New Zealand Acts

COMMERCE ACT 1986 - SECT 54D

54D Definition of consumer-owned

1 In this subpart, unless the context otherwise requires, a supplier is
"consumer-owned" if it is a supplier that meets the following criteria:

a) all the control rights and all the equity return rights (within the meaning of clause 6 of Schedule 2 of the Electricity Industry Act 2010 ) in the supplier are held by 1 or more customer trusts, community trusts, or customer co-operatives; and

b) the trustees of each customer trust or community trust, or the committee of shareholders of each customer co-operative, as the case may be, that is referred to in paragraph (a) are elected by the persons who are consumers of the supplier in accordance with subsections (2A) to (2C); and

c) at least 90% of the persons who are consumers of the supplier as at an income distribution resolution date benefit from that income distribution; and

d) the supplier has fewer than 150 000 ICPs.

2 In this section, unless the context otherwise requires,—  
"community trust" , in relation to a supplier, is a trust in respect of which—  

a) at least 90% of the income beneficiaries comprise persons who are a class or classes identified by reference to their domicile or location or operation within the geographic area or areas of operation of the supplier; and

b) at least 90% of its income distributions are paid to those beneficiaries or for purposes related to that geographic area or areas

"consumer" has the same meaning as in section 2(1) of the Electricity Act 1992 , and includes, for the purposes of references to the election of trustees in this section and section 54H , any person who is listed on an electoral roll as a resident of an address that consumes the electricity in question  
"customer co-operative" , in relation to a supplier, means a co-operative company (as defined in section 2(1) of the Co-operative Companies Act 1996 ) that has the characteristics described in the definition of customer trust in this subsection, applied as if references to trusts were to co-operatives, references to income beneficiaries were to shareholders, and all other necessary modifications were made    
"customer trust" , in relation to a supplier, means a trust in respect of which—  

a) at least 90% of the income beneficiaries comprise persons who are a class or classes identified by reference to any of—

i) the person's connection to the lines of the supplier:

ii) the person's receipt of electricity from the supplier:

iii) the person's liability for payment for supply of electricity from the supplier:

iv) the person's liability for payment for the connection to the lines of the supplier:

v) the person's liability for payment for line services supplied by the supplier; and

b) at least 90% of its income distributions are paid to those beneficiaries

"ICP" means a point of connection on a local or an embedded network at which a retailer supplies electricity to a consumer  
"income distribution resolution date" means the date that a supplier, or the trust or co-operative that owns a supplier, as the case may be, resolves to make an income distribution to beneficiaries.  

2A The requirements in respect of elections for the purposes of subsection (1)(b) are as follows:

a) every trustee of the customer trust or community trust, or every member of the committee of shareholders of each customer co-operative, as the case may be, must have been elected solely by the persons who are consumers of the supplier; and

b) either—

i) at least 90% of the persons who are consumers of the supplier at the time of the election are eligible to vote in those elections; or

ii) in the case of a customer trust or community trust, there is ward-based voting that complies with the requirements of subsection (2B); and

c) each consumer must have an equal vote.

2B The requirements for ward-based voting are as follows:

a) at least 90% of the persons in a ward who are consumers of the supplier at the time of the election are eligible to vote in the election of all of the trustees of that ward; and

b) ward boundaries must provide for effective and fair representation of all consumers of the supplier, and in particular,—

i) the proportion of consumers in relation to the number of trustees of the relevant trust must be approximately equal in each ward; and

ii) the wards must not be based on volume of electricity supplied; and

c) ward boundaries must be reviewed periodically (at intervals determined by the Commission) in consultation with all consumers of the supplier.

2C A trustee of a customer trust or community trust, or a member of the committee of shareholders of a customer co-operative, as the case may be, must be treated as having been elected solely by the persons who are consumers of the supplier if the person—

a) has been declared to be elected without an election in the case of a nominee at an election where the number of nominations was equal to or less than the number of vacancies; or

b) has been declared to be elected as the next-highest-polling candidate in the case where a higher-polling candidate at the election was unable to fill the elected position; or

c) has been declared to be elected by the remaining trustees or members following a casual vacancy that arose between elections, provided that—

i) the person is the first person to have been so elected since the last election at which consumers of the supplier voted; and

ii) the person is elected to hold office only until the next scheduled election at which consumers of the supplier will vote.

2D The Commerce Commission may require a supplier that claims to meet the criteria in this section to verify that claim by statutory declaration.

2E The declaration must be made by the persons and in the form required by the Commerce Commission.

3 As soon as practicable after this subsection comes into force, the Minister must publish a notice in the Gazette stating the names of the suppliers that are consumer-owned as at that date.

4 The notice in subsection (3) is only for information purposes and has no legal effect.

History: Section 54D: inserted, on 1 April 2009, by section 4 of the Commerce Amendment Act 2008 (2008 No 70).   Section 54D(1)(a): amended, on 1 November 2010, by section 151(1) of the Electricity Industry Act 2010 (2010 No 116).     Section 54D(1)(b): substituted, on 1 November 2010, by section 151(2) of the Electricity Industry Act 2010 (2010 No 116).     Section 54D(2A): inserted, on 1 November 2010, by section 151(3) of the Electricity Industry Act 2010 (2010 No 116).     Section 54D(2B): inserted, on 1 November 2010, by section 151(3) of the Electricity Industry Act 2010 (2010 No 116).     Section 54D(2C): inserted, on 1 November 2010, by section 151(3) of the Electricity Industry Act 2010 (2010 No 116).     Section 54D(2D): inserted, on 1 November 2010, by section 151(3) of the Electricity Industry Act 2010 (2010 No 116).     Section 54D(2E): inserted, on 1 November 2010, by section 151(3) of the Electricity Industry Act 2010 (2010 No 116).     Section 54D(3): brought into force, on 14 October 2008, by section 2(1)(b) of the Commerce Amendment Act 2008 (2008 No 70).