10 Dec 2018

Govt to consult public on commercial sharp practice

2:20 pm on 10 December 2018

The government is keen to close any gaps that leave consumers and businesses exposed to unfair commercial practices.

Commerce and Consumer Affairs Minister Kris Faafoi and Minister for Small Business Stuart Nash have today released a discussion paper outlining options to protect consumers and businesses from unfair commercial practices.

Commerce and Consumer Affairs Minister Kris Faafoi released the discussion paper today along with Minister for Small Business Stuart Nash. Photo: RNZ / Rebekah Parsons-King

Commerce and Consumer Affairs Minister Kris Faafoi and Minister for Small Business Stuart Nash have released a discussion paper outlining options to protect consumers and businesses from unfair tactics.

Mr Faafoi said he had heard of traders using aggressive tactics to sell products to vulnerable consumers and businesses left powerless when contracts with suppliers have been changed, including price.

"Unfair commercial practices can cause significant stress for consumers, in some cases leading to financial difficulty, while the consequences for businesses include cash flow issues, increased costs and stress," he said.

There are existing provisions in the Fair Trading Act and Commerce Act to protect consumers and businesses, but the government is asking for submissions to make sure there isn't more that can be done.

"We went out and surveyed a whole lot of small businesses and about 40 percent of the respondents came back and said at some point in time they felt as if they'd been treated unfairly," Mr Nash said.

"This may be, for example, breaching contracts that are already in place."

Mr Nash said the government wanted to build a more productive, sustainable and inclusive economy but that wouldn't happen with these types of practices in the marketplace.

"We want honest businesses to continue to compete effectively, negotiate firmly, and freely enter into contracts."

Submissions close on 25 February.

Commerce and Consumer Affairs Minister Kris Faafoi and Minister for Small Business Stuart Nash have today released a discussion paper outlining options to protect consumers and businesses from unfair commercial practices. They made the announcement at the company Wellington Chocolate Factory.

Minister for Small Business Stuart Nash. Photo: RNZ / Rebekah Parsons-King