ComCom announces 2018/19 priorities

The Commerce Commission (NZCC) has released its priorities for 2018/19, available herePriorities 2018/19 is important reading for all New Zealand businesses as it reveals the NZCC’s areas of focus for the next year.

What does it cover?

Some of the NZCC’s priorities for 2018/19 are ‘enduring priorities’ while others reflect a particular focus for the upcoming year.  The enduring priorities are important because of their significance for consumers, businesses or markets or due to the NZCC’s core statutory role.

Key enduring priorities are:

  • consumer cases with the potential to involve significant harm;
  • credit issues and issues affecting vulnerable consumers;
  • cartel and anti-competitive conduct with the potential to significantly impact consumers and markets;
  • mergers, both those that are notified and those that are not;
  • increased transparency of regulated businesses.

The focus areas for 2018/2019 address consumer harm, and include:

  • retail telecommunications;
  • responsible lending;
  • online retail;
  • motor vehicle sales;
  • electricity distributors’ quality of service;
  • electricity market;
  • investigating non-notified mergers

Which areas of focus are new?

The NZCC’s new focus on online retail, both consumer and business, will involve both educating businesses about their responsibilities and taking enforcement action where necessary.

The NZCC’s new focus on motor vehicle sales is a response to the range of complaints it receives about misleading representations, failure to redress serious faults and misrepresentation of consumers’ rights. It comes after the ACCC, Australia’s competition regulator, announced in February that new car retailing was one of its enforcement priorities.  The NZCC will use both education and enforcement to effect improvement.

The NZCC already has a role in both the pricing and quality of electricity distributors and its new focus may lead to considering whether communication during outages should be captured by ‘quality’.

The NZCC’s role in the electricity market will be to assist the expert panel currently reviewing whether the electricity market is delivering a fair and equitable price to consumers.

The NZCC’s new focus on non-notified mergers follows an increase in such mergers over the last year. Priorities 2018/19 confirms that the NZCC will continue to prioritise this work and will act quickly in these cases to prevent any significant consumer harm or adverse impact on competition in markets.

Our view

This is largely a business as usual approach.

However, in relation to mergers,  Priorities 2018/19 unequivocally signals that the NZCC will continue its aggressive approach to transactions for which clearance has not been sought.  During the last year the NZCC opened five investigations into non-notified mergers.

As a result, careful – and early – consideration of how merger parties should most effectively engage with the NZCC will be crucial to success.

A consistent theme across the NZCC’s areas of focus is an intention to improve its understanding of particular markets or industries while it also educates the relevant businesses about their obligations.  This is particularly relevant in industries undergoing rapid technological change, such as energy and telecommunications.  This process will provide a valuable opportunity for those businesses to engage with the NZCC and shape its understanding of their industry.

What next?

If you have any questions in relation to Priorities 2018/19 or want to understand more about how issues are relevant for your business, please contact one of our experts.

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