Commission Updates Authorisation Guidelines And Application Form

The Commission has revised its Authorisation Guidelines and application form following amendments to the Commerce Act and the release of its Business Collaboration in response to an emergency guidance.

The Commerce Act 1986 prohibits certain anticompetitive conduct and mergers that harm competition. However, the Commission has the power to authorise these where the public benefits outweigh the competitive harms.

In these cases, firms can apply to the Commission for authorisation. The Commission will grant an authorisation if it is satisfied that the agreement or merger is likely to benefit the New Zealand public.

Changes to the Commerce Act came into force in early April, expanding the Commission’s ability to authorise certain anticompetitive conduct on public benefits grounds. In particular, the Commission is now able to authorise unilateral conduct (misuse of market power) that lessens competition. The Commission can also grant authorisation on an interim basis for certain conduct. The power to grant provision authorisation – introduced during the COVID-19 pandemic period – has lapsed.

The revised Guidelines have been updated to explain how applications to authorise such conduct are assessed. The guidelines also set out how applications for interim authorisation are assessed, including the process and indicative timeframes for a decision.

The Commission recently published its Business collaboration in response to an emergency guidance, to help businesses understand how and when they can collaborate in response to an emergency.

The guidelines recognise that in an emergency there may be challenges in providing the Commission with the documents and information that it normally requires to consider an application for authorisation. The revised guidelines provide some guidance to those applying for authorisation in emergencies.

A copy of the updated Guidelines and application form are available on our website.

Background
Cartel provisions are prohibited under section 30 of the Act, unless an exception applies or they have been authorised by the Commission.

A cartel provision is any provision in an agreement between competitors that has the purpose, effect, or likely effect of:

• fixing prices – an agreement not to compete on price, or on an element of price;
• restricting output – an agreement to prevent, restrict, or limit output, production, capacity, supply, acquisition, etc; or
• allocating markets – an agreement not to sell to or buy from certain customers or suppliers, or in particular areas.

Section 36 of the Act prohibits a person that has a substantial degree of power in a market from engaging in conduct that has the purpose, or has or is likely to have the effect, of substantially lessening competition.

A copy of the

Business collaboration in response to an emergency

guidance is available

here

.

Click

here

for the Authorisation Guidelines.

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