Next step for considering criminalisation of cartels

Commerce Minister Simon Power today announced that the Government will release a draft exposure bill on the criminalisation of cartels.

The draft bill is being released for public consultation to help the Government make its final decision on whether cartel conduct should be criminalised.

It comes after public feedback on a discussion document, released in February, revealed that opinion is divided on the issue.

Mr Power said 25 submissions were received and a number of workshops have been held with competition law and economic specialists. 

"Many of the issues raised by stakeholders relate to how the legislation would be drafted and how criminal cartel conduct would be defined," Mr Power said.

"Given the degree of uncertainty expressed, it's important that businesses are given the opportunity to comment on how the law could look."

Mr Power said activities such as price fixing and bid rigging are the most harmful forms of anti-competitive business conduct, which ultimately result in consumers paying inflated prices.

"The Government is considering introducing criminal penalties, including imprisonment, to send a strong message because many cartels see the current fines as simply a cost of doing business.

"Other countries, including the United States, the United Kingdom, Canada, and Australia, have criminalised cartel behaviour and it's important New Zealand keeps in step with those countries - especially Australia."

The discussion document and submissions are available on the Ministry of Economic Development's website www.med.govt.nz.

The draft exposure bill will be released early next year.