Consumer Law Reform results in significant changes

April 8, 2014

in Corporate & Business

Corporate & BusinessThe Consumer Law Reform Bill was passed into law in early December 2013 and sees the implementation of the most significant modernisation of consumer law in New Zealand for decades.  The Bill has resulted in amendments to the Fair Trading Act 1986 and the Consumer Guarantees Act 1993.

The changes will be implemented on a staged basis.  The initial changes came into immediate effect as of December 2013 and others planned to take effect in June 2014.  Some of the immediate changes are;

  • Consumers who reject faulty goods, which have been purchased on credit arranged by the trader, can now apply to the Disputes Tribunal to hold the trader liable; and
  • The amended      Fair Trading Act gives the Commission new powers to compel interviews,      enforce undertakings and seek management bans for those individuals who      repeatedly breach the Fair Trading Act;

The delayed changes are many and if you or your business is likely to be affected by the amendments to consumer law then we strongly urge you to seek legal advice to ensure you are not at risk of breaches and possible significant penalties.   Some of the key delayed changes include;

  • The maximum fines for breaches under the Fair Trading Act have been increased to $200,000 for individuals and $600,000 for body corporates.  As these are strict liability offences there could be serious flow on effects for compliance and risk costs to your business;
  • The Commission will have the power to issue infringement notices of up to $2,000 for what they consider ‘clear cut’ offences;
  • In certain circumstances parties may be able to contract out of their obligations under the Fair Trading Act, provided certain criteria are met. Equally however, the Commission can seek a Court Declaration that a term in a standard form consumer contract is unfair and causes a party to be disadvantaged.

It is crucial as a business owner/employer that you and your staff are aware of the many significant consumer law reforms.  Farry and Co can provide you with the necessary legal advice and support in these matters.

If you require any advice or further information on the matters dealt with in this publication please contact the lawyer at Farry and Co who normally advises you, or alternatively contact:

Kirsten Maclean

(03) 477 8870 or (09) 379 0055


The information contained in this publication is intended as a guide only.  It does not constitute legal advice and should not be relied upon as such.  Professional advice should be sought before applying any of the information to particular circumstances.  While every reasonable care has been taken in the preparation of this publication, Farry and Co. does not accept liability for any errors it may contain.  

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