The Government has confirmed changes to the Raw Milk Regulations, which allow independent milk processors to buy milk from Fonterra.
The regulations require Fonterra, which collects the bulk of the country's milk, to make up to 5% of it available to independent processors at either an agreed or regulated price.
The aim is to provide competition in the domestic market by ensuring smaller dairy companies can get access to raw milk when they are starting up.
The changes follow a lengthy consultation and review process.
Primary Industries Minister David Carter said the new regulations will take effect at the start of the new dairy season on 1 June next year.
Fonterra says the changes address most of its concerns about the rules around eligibility to regulated milk.
Chairman-elect John Wilson says Fonterra and its shareholders have consistently said the Raw Milk Regulations needed an overhaul for the good of the dairy sector and New Zealand.