Deterring and detecting serious cartel behaviour
Published: 08 April 2021
From today, cartel behaviour can result in up to seven years imprisonment.
The two-year transition period of the Commerce (Criminalisation of Cartels) Amendment Act 2019 came to an end on 8 April 2021. Any cartel agreement entered into, or given effect to, after this date is subject to the new law, including possible imprisonment.
A cartel is where two or more businesses agree not to compete with each other. This conduct can take many forms, including price fixing, allocating markets, rigging bids or restricting output of goods and services.
Cartel behaviour has impacts across the globe and the new approach allows New Zealand authorities to coordinate and cooperate more fully with other jurisdictions. Aligning New Zealand’s laws with major trading partners will allow the Commerce Commission to participate more fully in international investigations.
Previously, New Zealand had a civil penalty regime under the Commerce Act to address cartel behaviour. The two-year transitional period was intended to allow time for businesses to assess their conduct to ensure it was not captured by the criminal offence provisions.
- Any cartel agreement entered into after 8 April 2021 will be subject to the new law, including possible imprisonment.
- If a cartel agreement was entered into before 8 April 2021, conduct after that date will be subject to the criminal legislation.
- The Commerce (Criminalisation of Cartels) Amendment Act 2019 amended the Commerce Act 1986 to introduce a criminal offence for cartel conduct. Information on the background to the legislation.
- What is cartel criminalisation(external link) — Commerce Commission website
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