New Zealand Acts

COMMERCE (CARTELS AND OTHER MATTERS) AMENDMENT ACT 2017 - SECT 8

8 New heading and sections 30 to 33 substituted

The heading above section 30 , sections 30 to 34, and the heading below section 34 are repealed and the following heading and sections substituted:

30 Prohibition on entering into or giving effect to cartel provision

No person may—

a) enter into a contract or arrangement, or arrive at an understanding, that contains a cartel provision; or

b) give effect to a cartel provision.

30A Meaning of cartel provision and related terms

1 A
"cartel provision" is a provision, contained in a contract, arrangement, or understanding, that has the purpose, effect, or likely effect of 1 or more of the following in relation to the supply or acquisition of goods or services in New Zealand:

a) price fixing:

b) restricting output:

c) market allocating.

2 In this Act,
"price fixing" means, as between the parties to a contract, arrangement, or understanding, fixing, controlling, or maintaining, or providing for the fixing, controlling, or maintaining of,—

a) the price for goods or services that any 2 or more parties to the contract, arrangement, or understanding supply or acquire in competition with each other; or

b) any discount, allowance, rebate, or credit in relation to goods or services that any 2 or more parties to the contract, arrangement, or understanding supply or acquire in competition with each other.

3 In this Act,
"restricting output" means preventing, restricting, or limiting, or providing for the prevention, restriction, or limitation of,—

a) the production or likely production by any party to a contract, arrangement, or understanding of goods that any 2 or more of the parties to the contract, arrangement, or understanding supply or acquire in competition with each other; or

b) the capacity or likely capacity of any party to a contract, arrangement, or understanding to supply services that any 2 or more parties to the contract, arrangement, or understanding supply or acquire in competition with each other; or

c) the supply or likely supply of goods or services that any 2 or more parties to a contract, arrangement, or understanding supply in competition with each other; or

d) the acquisition or likely acquisition of goods or services that any 2 or more parties to a contract, arrangement, or understanding acquire in competition with each other.

4 In this Act,
"market allocating" means allocating between any 2 or more parties to a contract, arrangement, or understanding, or providing for such an allocation of, either or both of the following:

a) the persons or classes of persons to or from whom the parties supply or acquire goods or services in competition with each other:

b) the geographic areas in which the parties supply or acquire goods or services in competition with each other.

30B Additional interpretation relating to cartel provisions

In this Act, in relation to a cartel provision,—

a) if a person is a party to a contract, arrangement, or understanding, each of the person's interconnected bodies corporate is taken to be a party to the contract, arrangement, or understanding; and

b) if a person (
"person A" ) or any of person A's interconnected bodies corporate supplies or acquires goods or services in competition with another person (
"person B" ) or any of person B's interconnected bodies corporate, person A is taken to supply or acquire those goods or services in competition with person B; and

c) a reference to persons in competition with each other for the supply or acquisition of goods or services includes a reference to—

i) persons who are, or are likely to be, in competition with each other in relation to the supply or acquisition of those goods or services; and

ii) persons who, but for a cartel provision relating to those goods or services, would, or would be likely to, be in competition with each other in relation to the supply or acquisition of those goods or services.

30C Cartel provisions generally unenforceable

1 No cartel provision is enforceable.

2 However, nothing in subsection (1) affects the enforceability of a cartel provision in any contract to which section 31, 32, 33, 44A(4) and (5), or 44B applies.

31 Exception for collaborative activity

1 Nothing in section 30(a) applies to a person in relation to a cartel provision if, at the time of entering into or arriving at the contract, arrangement, or understanding that contains the provision,—

a) the person and 1 or more other parties to the contract, arrangement, or understanding are involved in a collaborative activity; and

b) the cartel provision is reasonably necessary for the purpose of the collaborative activity.

2 Nothing in section 30(b) applies to a person in relation to a cartel provision if, at the time of giving effect to the cartel provision,—

a) the person and 1 or more other parties to the contract, arrangement, or understanding that contains the provision are involved in a collaborative activity; and

b) the cartel provision is reasonably necessary for the purpose of the collaborative activity.

3 Nothing in section 30(b) applies to a person in relation to a cartel provision that constitutes a restraint of trade if—

a) the person and 1 or more other parties to the contract, arrangement, or understanding were involved in a collaborative activity that has ended; and

b) the cartel provision was reasonably necessary for the purpose of the collaborative activity; and

c) the collaborative activity did not end because the lessening of competition between any 2 or more parties became its dominant purpose.

4 In this Act,
"collaborative activity" means an enterprise, venture, or other activity, in trade, that—

a) is carried on in co-operation by 2 or more persons; and

b) is not carried on for the dominant purpose of lessening competition between any 2 or more of the parties.

5 The purpose referred to in subsection (4)(b) may be inferred from the conduct of any relevant person or from any other relevant circumstance.

32 Exception for vertical supply contracts

1 Nothing in section 30 applies to a person in relation to a cartel provision in a contract, if—

a) the contract is entered into between a supplier or likely supplier of goods or services and a customer or likely customer of that supplier; and

b) the cartel provision—

i) relates to the supply or likely supply of the goods or services to the customer or likely customer, including to the maximum price at which the customer or likely customer may resupply the goods or services; and

ii) does not have the dominant purpose of lessening competition between any 2 or more of the parties to the contract.

2 The purpose referred to in subsection (1)(b)(ii) may be inferred from the conduct of any relevant person or from any other relevant circumstance.

33 Exception for joint buying and promotion agreements

A provision in a contract, arrangement, or understanding does not have the purpose, effect, or likely effect of price fixing if the provision—

a) relates to the price for goods or services to be collectively acquired, whether directly or indirectly, by some or all of the parties to the contract, arrangement, or understanding; or

b) provides for joint advertising of the price for the resupply of goods or services acquired in accordance with paragraph (a) ; or

c) provides for a collective negotiation of the price for goods or services followed by individual purchasing at the collectively negotiated price; or

d) provides for an intermediary to take title to goods and resell or resupply them to another party to the contract, arrangement, or understanding.