The Government has initiated a comprehensive review of competition rules, aiming to address monopolies and enhance economic productivity.

The announcement was made by Commerce and Consumer Affairs Minister Andrew Bayly, who emphasised the importance of strong competition for improving living standards across the country.

“Improving competition is one of the most important ways to boost productivity and lift living standards,” Mr Bayly said.

“When competition is working well, businesses are incentivised to invest, grow, and innovate. This has wide-ranging advantages for Kiwi consumers who benefit from more choice and lower prices.”

The review comes as OECD research highlights New Zealand's lag in competition compared to international peers.

Key sectors such as groceries, banking, and building supplies have been identified as areas where limited choice and high prices persist.

Mr Bayly pointed to the 2022 plasterboard crisis, which underscored the consequences of competition failure.

He outlined a two-pronged approach for the review:

• Commerce Act Review: Updating competition settings with a focus on merger regulations.
• Commerce Commission Review: Assessing the governance and effectiveness of the regulator, including its decision-making and resource prioritisation capabilities.

The merger regime, which has not been updated in over 20 years, will be a key focus.

“Mergers can improve market efficiencies but can also entrench market power and create monopolies,” Mr Bayly noted.

The Commerce Commission review will examine its organisational structure, including whether sector-specific commissioners improve accountability and strategy.

The Government aims to ensure the Commission has the necessary tools to oversee and enforce competition laws effectively.

Respected economist Dame Paula Rebstock will lead the review, supported by Professor Allan Fels and David Hunt.

The findings are expected by May 2025.

Mr Bayly noted that similar reviews are underway in Australia, providing an opportunity for alignment with New Zealand’s close economic partner.

He added, “Improving competition to drive down the cost of living and increase productivity is one of the Government’s top priorities.”

The initiative is part of a broader effort to establish a robust competition framework designed to support the economy and benefit all New Zealanders.