A report out today will propose criminalising cartels, with jail and other penalties for offenders.Commerce Minister Simon Power said cartel activities like price fixing and bid rigging were the most harmful form of anti-competitive business conduct."
A report out today will propose criminalising cartels, with jail and other penalties for offenders.
Commerce Minister Simon Power said cartel activities like price fixing and bid rigging were the most harmful form of anti-competitive business conduct.
"Such activities cause significant harm by reducing economic output, undermining trust in markets, slowing productivity growth, and distorting investment signals by making cartels appear more profitable than they would be in an undistorted market," he said.
"Businesses suffer and so do consumers, who have to pay inflated prices. And ultimately the wider economy also suffers."
Penalties including jail time, could deter organisations from engaging in cartel behaviour, he said.
"Many cartels are so big that the current fines are seen as a cost of doing business, rather than a deterrent, so I believe it's time to look at further measures to deter potential cartels.
"Several countries, including the US, the UK, Canada and Australia, have criminalised cartel behaviour and it's important New Zealand keeps in step with those countries – and especially Australia."
Mr Power said he wanted to ensure businesses operating in both Australia and New Zealand faced the same consequences for the same anti-competitive conduct.
The public can submit on the document until March 31.
