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Commerce Act 1986

Restrictive trade practices - Contracts, arrangements, understandings, or covenants substantially lessening competition

27: Contracts, arrangements, or understandings substantially lessening competition prohibited

You could also call this:

"No deals that stop others competing with you are allowed."

Illustration for Commerce Act 1986

You cannot make a deal that stops others from competing with you. If you make a deal, you cannot include rules that reduce competition. You also cannot follow rules in a deal that reduce competition, no matter when the deal was made.

You might have made a deal before this law started, or you might make one later. Either way, you cannot enforce rules in the deal that reduce competition. This means you cannot make someone do something that stops them from competing with you.

If a deal has rules that reduce competition, those rules are not enforceable. This applies to all deals, whether they were made before or after this law started. You should know what rules are in your deals to make sure they are fair.

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View the original legislation for this page at https://legislation.govt.nz/act/public/1986/0120/latest/link.aspx?id=DLM88263.

Topics:
Business > Fair tradingMoney and consumer rights > Consumer protection
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26: Commission to have regard to economic policies of Government, or

"The Commerce Commission must consider the Government's economic plans when making decisions."

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28: Covenants substantially lessening competition prohibited, or

"It's against the law to make someone promise to do something that reduces competition in a market."

Part 2Restrictive trade practices
Contracts, arrangements, understandings, or covenants substantially lessening competition

27Contracts, arrangements, or understandings substantially lessening competition prohibited

  1. No person shall enter into a contract or arrangement, or arrive at an understanding, containing a provision that has the purpose, or has or is likely to have the effect, of substantially lessening competition in a market.

  2. No person shall give effect to a provision of a contract, arrangement, or understanding that has the purpose, or has or is likely to have the effect, of substantially lessening competition in a market.

  3. Subsection (2) applies in respect of a contract or arrangement entered into, or an understanding arrived at, whether before or after the commencement of this Act.

  4. No provision of a contract, whether made before or after the commencement of this Act, that has the purpose, or has or is likely to have the effect, of substantially lessening competition in a market is enforceable.