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WT/TPR/S/316
11 May 2015
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Trade Policy Review Body  
 
TRADE POLICY REVIEW 
REPORT BY THE SECRETARIAT 
NEW ZEALAND  
This report, prepared for the fifth Trade Policy Review of New Zealand, has been drawn up by the 
WTO Secretariat on its own responsibility. The Se cretariat has, as required by the Agreement 
establishing the Trade Policy Review Mech anism (Annex 3 of the Marrakesh Agreement 
Establishing the World Trade Organization), sought clarification from New Zealand on its trade 
policies and practices.  Any technical questions arising from this report may be addressed to Ms Martha Lara Fernandez 
(Tel: 022 739 6033) or Mr Michael Kolie (Tel: 022 739 5931). 
 Document WT/TPR/G/316 contains the policy statement submitted by New Zealand. 
 
 
Note: This report is subject to restricted circulation and press embargo until the end of the 
first session of the meeting of the Trade Policy Review Body on New Zealand. This report was 
drafted in English. WT/TPR/S/316 • New Zealand 
 
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  CONTENTS 
SUMMARY ....................................................................................................................... . 6 
1   ECONOMIC ENVIRONM ENT ........................................................................................... 10 
1.1   Introduction ............................................................................................................. 10 
1.2   Recent Econ omic Developments.................................................................................. 11 
1.3   Sectorial Structure .................................................................................................... 13 
1.4   Monetary and Ex change Rate  Policies .......................................................................... 15 
1.5   Fiscal Policy  and Tax Reform ...................................................................................... 16 
1.6   Balance of Payments ................................................................................................. 18 
1.7   Trade Performance ................................................................................................... 19 
1.7.1   Composition of merchandise trade ............................................................................ 20 
1.7.2   Direction of  merchandis e trade ................................................................................ 20 
1.7.3   Services trade ....................................................................................................... 22 
1.8   Foreign Dire ct Invest ment ......................................................................................... 24 
2   TRADE AND INVE STMENT RE GIME ................................................................................. 27 
2.1   Overview ................................................................................................................. 27 
2.2   Genera l Framework .................................................................................................. 27 
2.3   Trade Policy Form ulation and Ob jectives ...................................................................... 28 
2.4   Trade Agreements and Arrangements .......................................................................... 29 
2.4.1   WTO ................................................................................................................... . 29 
2.4.2   Regional trad e agreements  (RTAs) ........................................................................... 31 
2.4.2.1   RTAs in force since 2009 ...................................................................................... 32 
2.4.2.2   Other agreemen ts and arra ngements ..................................................................... 34 
2.5   Foreign Inve stment Regime ....................................................................................... 34 
3   TRADE POLICIES AND PRACTICES BY MEASURE .............................................................. 39 
3.1   Overview ................................................................................................................. 39 
3.2   Measures Direct ly Affectin g Imports ............................................................................ 40 
3.2.1   Registration, customs procedures and requirements ................................................... 40 
3.2.2   Rules of origin .......................................................................................................  42 
3.2.3   Tariffs ............................................................................................................... ... 43 
3.2.3.1   Applied M FN tariff st ructure .................................................................................. 43 
3.2.3.2   Bound tariff ........................................................................................................ 45 
3.2.3.3   Tariff preferences ................................................................................................ 46 
3.2.3.4   Tari ff Conce ssions ............................................................................................... 46 
3.2.4   Other charge s affecting imports ............................................................................... 47 
3.2.4.1   Other du ties and charges ..................................................................................... 47 
3.2.4.2   Internal taxes ..................................................................................................... 48 
3.2.4.2.1   Goods and Services Ta x (GST) ........................................................................... 48 
3.2.4.2.2   Excise duties ................................................................................................... 49 
3.2.5   Import prohibitions, restrictions, an d licensing ........................................................... 49 WT/TPR/S/316 • New Zealand 
 
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  3.2.6   Anti-dumping, countervai ling, and safegu ard measures ............................................... 50 
3.2.6.1   Anti-dumping and countervailing measures ............................................................. 50 
3.2.6.2   Safeguards ........................................................................................................ 51 
3.2.7   Standards and othe r technical requirements .............................................................. 52 
3.2.8   Sanitary and phyt osanitary requ irements .................................................................. 55 
3.3   Measures Directly Affecting Exports ............................................................................. 57 
3.3.1   Export procedur es and requirements ........................................................................ 57 
3.3.2   Export taxes, charges, an d levies ............................................................................. 57 
3.3.3   Export prohibitions, restrictions, and licensing ............................................................ 57 
3.3.4   Duty and tax concessions ........................................................................................ 57 
3.3.5   Export promotion and marketing assistance ............................................................... 58 
3.3.6   Export credit insurance and guarantees ..................................................................... 58 
3.4   Measures Affectin g Production and Trade ..................................................................... 59 
3.4.1   In centives ............................................................................................................  59 
3.4.2   Subsidies and othe r government assistan ce ............................................................... 59 
3.4.3   Competition policy ................................................................................................. 60 
3.4.4   State trading, state-owned en terprises ..................................................................... 63 
3.4.5   Governme nt procurement ....................................................................................... 64 
3.4.5.1   Policy and re gulatory fr amework ........................................................................... 64 
3.4.5.2   Procedures ......................................................................................................... 65 
3.4.5.3   Foreign participation ............................................................................................ 66 
3.4.6   Intellectual property rights ...................................................................................... 67 
4   TRADE POLICI ES BY SECTOR ........................................................................................ 72 
4.1   Overview ................................................................................................................. 72 
4.2   Agriculture, Fo restry, and Fisheries ............................................................................. 74 
4.2.1   Main features ........................................................................................................ 74 
4.2.2   Border  measures ................................................................................................... 75 
4.2.2.1   Impo rt measures ................................................................................................ 75 
4.2.2.2   Export measures ................................................................................................. 75 
4.2.3   Domestic support ................................................................................................... 76 
4.2.4   Dairy industry restructuring ..................................................................................... 76 
4.2.5   Sustainable mana gement of resour ces ...................................................................... 77 
4.2.6   Fisheries ............................................................................................................... 77 
4.3   Energy .................................................................................................................. .. 79 
4.3.1   Overview ..............................................................................................................  79 
4.3.2   El ectricity ........................................................................................................... .. 80 
4.3.3   Hydrocarbons ........................................................................................................ 81 
4.4   Manuf acturi ng .......................................................................................................... 82 
4.5   Services ................................................................................................................ .. 83 
4.5.1   Features and multilateral commitments ..................................................................... 83 WT/TPR/S/316 • New Zealand 
 
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  4.5.2   Financial services ................................................................................................... 84 
4.5.2.1   Banking .............................................................................................................  84 
4.5.2.1.1   General featur es and market  structure ................................................................ 84 
4.5.2.1.2   Regulatory framework ....................................................................................... 85 
4.5.2.2   Insura nce .......................................................................................................... 87 
4.5.2.2.1   General featur es and market  structure ................................................................ 87 
4.5.2.2.2   Regulatory framework ....................................................................................... 88 
4.5.2.3   Other financial services ........................................................................................ 89 
4.5.3   Telecommunications ............................................................................................... 90 
4.5.3.1   General features  and market struct ure ................................................................... 90 
4.5.3.2   Regulatory regime ............................................................................................... 91 
4.5.3.3   Prices .............................................................................................................. .. 92 
4.5.4   Transport .............................................................................................................  93 
4.5.4.1   Overview ........................................................................................................... 93 
4.5.4.2   Air transport services and airports ......................................................................... 94 
4.5.4.2.1   Air serv ices agreements .................................................................................... 95 
4.5.4.3   Maritime transport an d ports ................................................................................ 96 
4.5.5   Tourism ................................................................................................................ 98 
REFERENCES ................................................................................................................... 99 
5   APPENDIX TABLES ..................................................................................................... 101  
 
CHARTS 
 Chart 1.1 Exchange rates, January 2009-Octo ber 2014 ......................................................... 16
 
Chart 1.2 Product composition of merchandise trad e, 2009 an d 2014 ...................................... 21 
Chart 1.3 Direction of merchandise trade, 2009 and 2014 ...................................................... 22 
Chart 3.1 Distribution of MFN applied tariff rates, 2014 ......................................................... 44 
Chart 3.2 Average applied MFN and bound ta riff rates, by HS se ction, 2008 and 2014 ............... 45 
Chart 3.3 Tariff escalation by  2-digit ISIC industry , 2014  ....................................................... 45 
 
TABLES 
 
Table 1.1 Selected macroecono mic indicators, 2008/09-2013/ 14 ............................................ 12 
Table 1.2 Basic economic in dicators, 2008/ 09-2013 /14 ......................................................... 13 
Table 1.3 Tax reform: personal in come tax rates,  Budget 2010 .............................................. 17 
Table 1.4 Balance of pa yments, 2008/09 -2013/14 ................................................................ 18 
Table 1.5 Composition of trade in services, 2008/ 09-2013/ 14 ................................................ 23 
Table 1.6 Inward stock of foreign direct investment, 2008/09-2013/14 .................................... 24 
Table 1.7 Outward stock of foreign direct investment, 2008/09-2013/14 .................................. 25 
Table 2.1 Status of selected notifi cations to the WTO,  November  2014 .................................... 29 
Table 2.2 Overview of New Zealand's BITs, 2014 .................................................................. 37 WT/TPR/S/316 • New Zealand 
 
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  Table 2.3 Overview of New Zealand's RT As with investment  componen ts, 2014 ........................ 37 
Table 3.1 Customs Appeal Au thority Statis tics, 2009 -14 ........................................................ 42 
Table 3.2 New Zealand's MFN ta riff structure,  2008 and 2014 ................................................ 43 
Table 3.3 Summary analysis of New Zealand's preferential tariffs, 2014 ................................... 46 
Table 3.4 Summary of the HPA rates on alcohol products ....................................................... 47 
Table 3.5 Definitive anti-dumping measures, as of 31 December 2014 ..................................... 50 
Table 3.6 New Zealand standards, 2009-14 ......................................................................... 52 
Table 3.7 Standards and conformity assessment infrastructure ............................................... 53 
Table 3.8 Overview of MRAs involving New Ze aland, 2014 ..................................................... 53 
Table 3.9 Subsidy schemes, 2009-11 .................................................................................. 60 
Table 3.10 List of bilateral agreem ents on competit ion issues , 2014 ........................................ 62 
Table 3.11 Summary of regional trade agreemen ts with competition chapters in  force ............... 63 
Table 3.12 IPR registrations in New Zealand, 2009-13 ........................................................... 67 
Table 3.13 Summary of the protection of  intellectual prop erty righ ts, 2014 .............................. 68 
Table 4.1 Agriculture, fisheries an d forestry export  values, 2009-14  ........................................ 74 
Table 4.2 Banking sector indicators, December 2009 to June 2014 .......................................... 85 
 
BOXES 
 Box 2.1 Overseas investment: criteria considered by the relevant Minister or Ministers (or their de legate) ...........................................................................................................  35
 
Box 4.1 Commercial fishing: Qu ota Management System (QMS) ............................................. 78 
Box 4.2 New Zealand: retail prices for fixed-line phone and broadband services ........................ 93 
 
APPENDIX TABLES 
 Table A1. 1 Merchandise export s by product gr oups, 2009- 14 .............................................. 101
 
Table A1. 2 Merchandise import s by product gr oups, 2009- 14 .............................................. 102  
Table A1. 3 Merchandise export s by destinatio n, 2009-14  .................................................... 103  
Table A1. 4 Merchandise impo rts by origin , 2009-14  ........................................................... 104  
Table A3. 1 Overview of origin criteria for a pplication of preferential  tariff duti es, 2014 ............ 105 
Table A4. 1 New Zealand regist ered banks, June 2014  ........................................................ 111  
Table A4. 2 New Zealand's Air Transport Agreem ents, 2014  ................................................. 112  
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  SUMMARY 
1. Since its previous Review (2009), New Zealand has remained among the most open 
economies in the world. Between 2008/09 and 2013/14, real GDP grew at an average annual rate of 2.1% driven primarily by private consumption, although in the later years of the review period 
growth was mainly due to gross fixed capital formation (associated with the rebuild after the 
2010/2011 Canterbury earthquakes). High international prices for New Zealand's commodity exports also contributed to growth.  
2. Over most of the review period, an accommodative monetary policy supported economic 
recovery after the effects of the 2008 global financial crisis. CPI inflation was within the Reserve Bank of New Zealand (RBNZ)'s target band (1%-3%) for most of the review years. As domestic demand picked up and inflationary pressures started to build (owing in part to high housing 
prices), the RBNZ began tightening monetary po licy in March 2014. Limits on high-loan-to-value 
mortgage lending, in place since October 2013, have helped moderate housing prices. The Government is committed to fiscal consolidation; its operating balance deficit has been reduced 
(1.3% of GDP in 2013/14) and is expected to return to a surplus in 2015/16.  
3. New Zealand has traditionally run a current account deficit, reflecting a persistent shortfall in 
domestic savings that has been financed by overse as borrowing. Helped by strong terms of trade, 
the deficit narrowed down to 2.6% of GDP in 2013/14. Net foreign liabilities have decreased 
gradually but remained relatively high at 65.6% of GDP at end March 2014.  
4. While the New Zealand economy has gathered momentum over the last few years, it faces 
important challenges, including high private foreign liabilities, slowing demand from some trading 
partners, volatile international commodity prices, a strong exchange rate, and a highly-indebted 
farm sector. Moreover, New Zealand's labour productivity and income per capita continue to lag behind OECD averages.  
5. New Zealand's external trade of goods and services was equivalent to 56.7% of GDP in 
2013/14, reflecting a relatively low trade intensity given the small size of the economy, which might be partly explained by the country's geog raphical remoteness from world markets. Primary 
sector-based products continue to dominate merchandise exports, increasing their share to 76%, 
mainly on account of high international commodity prices; while imports concentrate in manufacture (mainly capital goods) and raw materials. The direction of New Zealand's merchandise trade changed during the review pe riod, with China becoming its largest single 
trading partner. Exports of services, mainly travel services, remain an important source of foreign 
exchange earnings.  
6. New Zealand's trade and investment frameworks have not changed significantly since its 
previous Review. The Multilateral Trading System remains New Zealand's main vehicle for 
providing trade opportunities to its exporters and ad dressing the challenges it faces as a small and 
remote country. Nonetheless, New Zealand has incr easingly engaged in regional trade agreements 
(RTAs) to complement its participation in the WTO. It now has 10 RTAs, of which four entered into 
force during the review period (i.e. with Chinese Taipei; Malaysia; Hong Kong, China; and the ASEAN-Australia-New Zealand Free Trade Area), and is continuing negotiations to conclude other RTAs. During the review period, new RTAs were concluded with the Gulf Cooperation Council and 
the Republic of Korea. New Zealand grants duty -free quota-free access to imports from LDCs and 
preferential tariffs for developing countries under the GSP. It is an active provider of Aid for Trade, with specific support measures provided to Pacific Is land Countries to build their capacity to trade.  
7. New Zealand regularly meets WTO notification requirements. During the review period, it 
was involved as a complainant in one WTO dispute settlement case.  
8. Foreign direct investment (FDI) is an important source of financing for New Zealand and a 
means to gain access to foreign technology, know -how and global markets. The stock of FDI in 
New Zealand amounted to NZ$97.4 billion at end March 2014 (42% of GDP), with over half of it invested in the financial and manufacturing sect ors. New Zealand's stock of FDI abroad totalled 
NZ$23.2 billion at end March 2014, most of it invested in manufacturing activities. Overall, New 
Zealand has an open foreign investment regime. However, by means of screening procedures, WT/TPR/S/316 • New Zealand 
 
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  restrictions apply in a few areas of critical interest, i.e. certain sensitive types of land, "significant 
business assets" other than land, and fishing quotas. 
9. New Zealand's average applied MFN tariff rate is 2.4% (2015) and over half of tariff lines are 
duty free, although higher tariffs continue to a pply to footwear and textile products. In October 
2013, the Government decided to hold MFN tariffs at current levels until at least 30 June 2017. A 
tariff review will take place in 2016 to consider whether any changes are needed after 2017.  
10. Since its 2009 TPR, New Zealand has implemented a trade facilitation project geared 
towards the establishment of a "Joint Border Management System". As part of it, a Trade Single 
Window and a revised import electronic declaration form have been put in place.  
11. During the review period, New Zealand continued to modernize its trade related legislation. 
For example, the antidumping and countervailing law underwent significant amendments, including 
a new provision to allow importers to apply for refund of anti-dumping duties paid in excess of the 
margin of dumping. In addition, to support rebuild ing activities after the Canterbury earthquakes, 
anti-dumping measures were suspended on resident ial building materials. A new Trade (Safeguard 
Measures) Act was adopted in 2014, allowing for a timely imposition of safeguard actions and the 
inclusion of "public interest" criteria when imposing a safeguard measure. Four anti-dumping investigations were initiated during the review period, of which two resulted in the imposition of 
final measures; no countervailing or safeguard measures were imposed. 
12. Technical regulations and sanitary and phytosanitary measures (SPS) are intended to reflect 
WTO provisions. When standards are developed, existing international standards are considered and stakeholder consultation is undertaken. Rela tively stringent SPS measures are applied to 
imports of plant and animal products for biosecurity reasons. In the WTO Committee on TBT, some 
Members have raised concerns about New Zealand's 2012 proposal to introduce plain packaging of tobacco products, while some other Members have supported it. New Zealand has Mutual 
Recognition Agreements with some of its main trading partners. The most comprehensive is the 
Trans-Tasman Mutual Recognition Arrangement with the federal government and state and territory governments of Australia.  
13. New Zealand maintains several business assistance and export promotion programmes. The 
main export promotion agency, New Zealand Trad e and Enterprise, provides strategic advice, 
research and market intelligence for new exporter s, as well as support for already established 
export companies. Export credit insurance is also available for exporting companies. Other 
incentive schemes are in place mainly to enco urage innovation and capacity building.   
14. New Zealand has a comprehensive legal and institutional framework for competition policy. 
The Commerce Commission is responsible for enforcing the generic provisions of the Commerce 
Act, as well as the competition components of industry-specific laws. The Commission is also 
engaged in international cooperation with overseas competition authorities. While New Zealand's competition regime is considered as generally performing well in international comparisons, some 
studies have found that the country's small market and remoteness have led to relatively low 
levels of competition in some services industries (i.e. retail, finance, insurance, real estate and professional services). This may have contributed to low productivity levels and high costs in some of these sectors to the detriment of New Zealan d firms and consumers. Proposed amendments to 
the competition law, including criminal sanctions for hard-core cartels and the application of the 
Commerce Act to the international freight transport sector, are currently before Parliament.  
15. There is only one state-trading enterprise in operation, with special authority to export 
kiwifruit. The Government maintains equity shares in several enterprises in key economic sectors 
such as energy and transport. The level of government participation in such enterprises has been falling in recent years. 
16. Government procurement in New Zealand amounted to some 20% of GDP in 2012. New 
rules for government sourcing came into force in 2013. The regime intends to promote open competitive procurement practices, with no preferences accorded to domestic suppliers. The terms of New Zealand's accession to the revised WTO Agreement on Government Procurement (GPA) 
were agreed on 29 October 2014. A Parliamentary treaty examination process is under way to 
ratify the country's accession. WT/TPR/S/316 • New Zealand 
 
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  17. New Zealand's intellectual property regime aims at ensuring a balance between the interests 
of rights owners and the society as a whole. Several legislative changes occurred during the review period. A new patent Act entered into force in 2013 to allow, inter alia , stricter examination of 
applications, and exclude "computer software as such" from patentability. The Copyright act was 
amended to facilitate enforcement action against infringing sharing file. The Trade Marks Act was 
amended several times to accommodate international standards. Protection for geographical indications continues to be provided throug h the Fair Trading Act 1986. The Geographical 
Indications (Wine and Spirits) Registration Act 2006, which establishes a registration system for 
wines and spirits geographical indications is yet to be brought into force. 
18. The primary sector plays a key role in New Zealand's economy. Benefitting from high 
commodity prices, agricultural products contributed to 70% of total merchandise exports in 2014. 
Agriculture is a highly-productive sector, with minimal Government intervention. Tariffs on 
agricultural products continued to decline and there are no import quotas or licensing. Domestic support is limited to biosecurity border control for pest and disease and relief against climate 
disasters. New Zealand's producer support estimate (PSE) was less than 1% in 2010-13 (the 
lowest among OECD countries). The former statutory marketing boards have all been replaced by producer organizations; a state-trading enterprise still has a quasi-monopoly on exports of 
kiwifruit to most markets. The dairy industry has seen further reforms to improve transparency 
and access to raw milk by market entrants. The ex clusive export licences held by the Fonterra 
Co-operative Group, New Zealand's major dairy exporter, were phased-out at end 2010. Commercial fishing is a thriving export subsector, with 90% of all catch being exported. However, 
restrictions to overseas investment in fishing quotas apply. Foreign-flagged charter fishing vessels 
will be prohibited from fishing in New Zealand waters from 1 May 2016. 
19. State participation remains strong in the electricity sector, although steps have been taken 
to open it up further to private investors. Three state-owned companies generate nearly two-thirds 
of all electricity, while transmission is in the hands of another state-owned enterprise. The State sold 49% of its stake in the three main generators in 2013 and 2014. Electricity is traded in a 
liberalized market, with no regulation on whol esale or retail prices, while the transmission 
company and the largest distribution firms are su bject to price quality controls. The Electricity 
Industry Act 2010 created an independent regulator and relaxed ownership restrictions between distribution, retail and generation companies. In 2013, changes to the petroleum regulatory 
regime were made to attract investments, including a streamlined exploration permit procedure.  
20. Manufacturing remains an important contributor to the economy, but its shares in GDP, 
employment and exports continued to decline in th e review period. Food and other resource-based 
industries account for most of manufacturing output. The simple average applied MFN tariff on 
manufactures is 2.5%. In recent years, the manufacturing industry has faced challenging conditions, including weak demand and shortages of skills and R&D. The Government has put in 
place several programmes to assist the business sector (not specifically targeted to industry), 
mainly in the form of financial support, technical advice and R&D funding. 
21. Services are the leading sector of the econ omy and account for 25% of total exports of 
goods and services. The services trade regime is relatively liberal, although there are a few 
restrictions on FDI in the telecommunications and transport sectors. New Zealand has 
commitments in 90 of the 155 sectors under the Ge neral Agreement on Trade in Services (GATS). 
22. Recent regulatory changes in New Zealand's financial sector included strengthening of the 
prudential framework for banks and other financial institutions (insurance companies and 
non-bank deposit takers). The banking sector, characterized by a high level of foreign ownership, is well capitalized and meets prudential requirements, including the Basel III capital adequacy 
thresholds. Nonetheless, highly indebted household and farm sectors and heavy reliance on 
foreign funding remain key challenges for the financial sector. Macro-prudential measures have been implemented to address such challenges and increase the system's resilience.  
23. The telecommunications sector has seen significant regulatory changes, including the 
incumbent operator's demerger in 2011. Internet broadband uptake has grown fast but prices 
remain relatively high by OECD standards. At present, the Government is implementing its initiative to roll-out the ultra-fast-broadband fibre network to 75% of the population by 2020. 
There are no licensing requirements for entry into  the market and control over retail prices is 
minimal. Foreign investment in telecommunication firms is subject to compliance with generic WT/TPR/S/316 • New Zealand 
 
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  overseas investment rules, and there is a 49.9% cap on any overseas investment in the former 
incumbent wholesale operator without prior written approval of the Crown.  
24. New Zealand has a liberal international air transport policy and maintains air services 
relationships with over 60 partners. The national carrier, Air New Zealand, is 52.3% owned by the 
Crown, and no overseas person may hold 10% or more of the voting shares without prior written 
consent by the Crown. The three main international airports have both private and public ownership and are subject to information disclosure requirements under the Commerce Act. A 
review of airport legislation, including competition issues, is currently being conducted.  
25. Virtually all New Zealand overseas trade, by volume, is moved by sea. Shipping policy aims 
to ensure that New Zealand exporters and shippers  have access to carriers on competitive terms. 
A bill currently before Parliament would, if adopted, remove an exemption that allows price-fixing 
in international shipping agreements. Foreign ships passing through New Zealand to unload 
imports or load exports and overseas-registered ships operated or controlled by a New Zealand entity are allowed to carry coastal cargo. Most of the 14 seaports are managed by port companies 
owned by local authorities. Increasing port prod uctivity would help reduce trading costs for New 
Zealand firms. Tourism is an important generator of foreign exchange earnings and jobs. The sector is supported by significant public investment. 
 WT/TPR/S/316 • New Zealand 
 
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  1  ECONOMIC ENVIRONMENT 
1.1  Introduction 1.1.  New Zealand maintains one of the most open economies worldwide, ranking consistently high 
in international indicators of economic freedom and ease of doing business.
1 New Zealand's annual 
economic growth averaged 2.1% between 2008/09 and 2013/14, albeit with some fluctuations. A 
significant share of growth in the later years of this period was due to gross fixed capital formation as construction work intensified to rebuild the city of Christchurch, following the destructive 
earthquakes of 2010 and 2011. In the year ending March 2014, real GDP expanded by 2.5%, 
supported also by high prices for New Zealand's commodity exports. More recent data estimates indicates that GDP grew by 3.8% in the year ending December 2014. 
1.2.  Between 2008/09 and 2013/14, GDP per capita rose from US$28,574 to US$42,520; while 
New Zealand's ranking in the UN Human Development Index climbed to the 7
th position (out of 
177 counties).2 The unemployment rate increased during th e review period to a peak of 6.8% in 
the year ending March 2013, but declined to 5.7% in December 2014, as economic activity 
picked-up. 
1.3.  Growth has been underpinned by a sound ma croeconomic framework. Fiscal policy is geared 
towards achieving fiscal consolidation, mainly via spending reductions; the Government's 
operating balance deficit fell to 1.3% of GDP in 2013/14. Monetary policy focuses on price stability. 
In 2013, macro-prudential policy was deployed to help moderate housing market pressures and increase the financial system's resilience. Annual CPI inflation averaged 2.3% over the review period, and was within the Reserve Bank of New Zealand's (RBNZ) target band for most of the 
review years. Helped by a strong New Zealand dollar, CPI inflation was 1.3% in 2013/14. The 
current account reported a deficit throughout the review period, but it narrowed to 2.6% of GDP in 2013/14 aided by record-high terms of trade. Net foreign liabilities have decreased gradually but 
remain relatively high at 65.6% of GDP at end-March 2014. 
1.4.  While economic expansion has been gathering momentum over the past few years, 
New Zealand continues to face a number of challenges to growth. These include high private 
foreign liabilities, sluggish demand from some trading partners, volatile terms of trade and a 
strong exchange rate.
3 In particular, a pronounced slowdown in the demand for imported soft 
commodities from China (New Zealand's largest goods trading partner) and a strong decline in commodity prices could have a significant impact on New Zealand's growth prospects. In addition, 
the highly-indebted housing and farm sectors, wh ich account for the largest share of the banking 
system's credit exposure, remain a potential risk to financial stability in the event of sharp price corrections or fluctuations.
4 Furthermore, New Zealand's labour productivity and income per capita 
continue to lag behind OECD averages. 
1.5.  New Zealand's external trade (exports and imports of goods and services) was equivalent to 
56.7% of GDP in 2013/14 (down from 65% in 2008/09). This reflects a relatively low trade 
intensity given the small size of the economy. Primary sector-based products (agriculture, forestry, 
fishing and mining) continue to dominate New Zealand's merchandise exports, accounting for almost 76% of export value; while imports concentrate in manufacturing (transport equipment and machinery) and raw materials. The direction of New Zealand's merchandise trade changed notably 
during the review period, with China overtaking Australia as New Zealand's largest single trading 
partner and several Asian emerging economies gaining more importance as commercial partners. Services exports, mainly travel services, are also a significant source of foreign exchange earnings. 
The stock of foreign direct investment (FDI) in New Zealand increased steadily during the review 
period to NZ$97.4 billion at 31 March 2014, with over half of it invested in the financial and 
                                               
1 In 2014, New Zealand ranked 5th in the Heritage Foundation Economic Freedom index, and 2nd in the 
World Bank's Doing Business 2015 Index. Viewed at: http://www.heritage.org/index/  and 
http://www.doingbusiness.org/rankings , respectively. 
2 UNDP online information, Human Development Index 2014. Viewed at: 
http://hdr.undp.org/en/content/human-development-index-hdi . 
3 Although it appreciated during most of the review period, the New Zealand dollar has depreciated 
since September 2014, partly in response to weakening export prices. 
4 The authorities have indicated that the risk to the banking system is tempered by the fact that over 
half of New Zealand's total banking sector debt is to rela ted parties, such as healthy Australian parent banks.  WT/TPR/S/316 • New Zealand 
 
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  manufacturing sectors. New Zealand's stock of FDI abroad was NZ$23.2 billion at 31 March 2014, 
with most of it invested in manufacturing activities.5  
1.2  Recent Economic Developments 1.6.  New Zealand's real GDP expanded at an average annual rate of 2.1% between 2008/09 and 
2013/14.
6 Growth was primarily driven by private cons umption and exports during the first part of 
the period, while in the later years it was mainly attributable to gross fixed capital formation. (Table 1.1). Growth performance was not steady during the review period as the New Zealand 
economy had to face some significant challenges. 
1.7.  A severe drought and the impact of the global financial crisis caused GDP to contract in 
2008/09. In order to mitigate the effects of the global slowdown, New Zealand implemented a 
number of monetary and fiscal measures. The RBNZ (central bank) reduced the Official Cash Rate 
(from 8.25% to 2.5%) in April 2009 and introduced  facilities to provide sufficient liquidity for 
banks. Short-term retail and wholesale bank guaran tees were put in place to facilitate banks' 
access to funding and restore confidence in the financial system. Personal income tax rates were 
reduced (October 2010), a temporary relief package was introduced to support SMEs, and 
infrastructure works were undertaken. 
1.8.  After a rebound in 2009/10, GDP growth was subdued in 2010/11 due to the disruption 
caused by two devastating earthquakes that hit the Canterbury region, in particular the city of 
Christchurch, in September 2010 and February 2011. Their material damage was estimated at about 20% of annual nominal GDP.
7 Additional temporary tax-relief measures for individuals and 
businesses were put in place to assist in the recovery.  
1.9.  From mid-2011 onwards, economic growth star ted to pick up momentum. In the year ending 
March 2014, real GDP grew by 2.4% fuelled by domestic demand, although with a high import 
content. Investment was particularly strong, reflecting a rebound in construction activity as the 
Christchurch rebuilt efforts intensified. In addition, New Zealand benefitted from high export 
commodity prices and rising terms of trade during most of the review period.  
1.10.  A significant challenge to New Zealand's growth potential remains its relatively low labour 
productivity and per capita income levels, which lag behind OECD averages, despite the country's 
otherwise conducive policy settings.8 A recent study has suggested that remote access to markets 
and suppliers and low investment in R&D woul d explain up to 26 percentage points of 
New Zealand's productivity gap vis-à-vis the average of 20 OECD countries.9  
1.11.  Distance from global markets is reflec ted in New Zealand's low trade intensity (unusual 
given its small size) and limited participation in global value chains (GVC), other than food and agriculture GVCs.
10 Improving the country's productivity would therefore entail actions to mitigate 
the impact of distance from global markets and foster greater integration in GVCs, in particular in 
innovation-intensive sectors. Further reducing tr ade transaction costs, updating the regulatory 
framework of international freight services so as to increase competition, and improving 
telecommunications infrastructure could contribute to minimizing the disadvantage of distance 
(Section 4).11 Moreover, a shift of production towards higher value, knowledge-intensive products 
and services, especially those that are less sensitive to geographical remoteness, would help foster participation in GVCs and enable New Zealand to reap the benefits of international trade in the 
form of technology diffusion, increased domestic competition and economies of scale.
12 
                                               
5 FDI data is presented on a directional basis. 
6 Data on GDP and other indicators refer to fiscal years ending in March, unless otherwise indicated. 
7 Treasury (2014a). 
8 OECD (2013b). 
9 De Serres, Naomitsu, and Boulhol (2014). 
10 Data on trade in value added (TiVA) and GVC indicators compiled by the WTO and the OECD can be 
found at: http://stats.oecd.org/Index.as px?DataSetCode =TIVA_OECD_WTO . 
11 The authorities indicated that barriers (mainly in  developed markets) for New Zealand's key exports 
and the generally small size of New Zealand firms we re impediments to tradin g and expanding offshore. 
12 OECD (2013b). WT/TPR/S/316 • New Zealand 
 
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  Table 1.1 Selected macroeconomic indicators, 2008/09-2013/14  
(Year end-March, unless 
otherwise indicated) 2008/09 2009/10 2010/11 2011/12 2012/13 2013/14
Real GDP, expenditure based, 
2009/10 prices (NZ$ billion) 188.5 192.9 194.2 198.6 204.4 209.3 
Real GDP, expenditure based, 
2009/10 prices (US$ billion) 122.6 130.9 142.4 160.2 166.5 171.8 
Current GDP, expenditure 
based (NZ$ billion) 187.7 192.9 201.6 210.3 215.4 230.0 
Current GDP, expenditure 
based (US$ billion) 122.0 130.9 147.8 169.7 175.4 188.8 
GDP per capita at current 
market price (NZ$) 43,948.0 44,664.0 46,216.0 47,877.0 48,739.0 51,798.0 
GDP per capita at current 
market price (US$) 28,573.9 30,306.0 33,885.2 38,625.2 39,704.8 42,520.1 
National accounts (%  change, unless otherwise indicated)  
Real GDP, expenditure based -2.1 2.3 0.7 2.3 2.9 2.5 
   Consumption -0.2 1.1 2.0 2.4 1.7 2.8 
      Private consumption -1.5 1.7 2.0 2.7 2.5 2.9 
      Government consumption 4.0 -0.5 1.9 1.6 -0.6 2.7 
   Gross fixed capital 
 formation -7.4 -9.3 3.3 5.5 7.2 10.4 
   Exports of goods and 
services -2.7 4.0 2.8 2.3 3.0 0.3 
   Imports of goods and 
services -3.5 -9.3 11.5 6.6 1.3 8.0  
      XGS/GDP (%) (at current 
market price) 32.4 28.9 30.5 30.8 29.1 29.2 
      MGS/GDP (%) (at current 
market price) 32.6 26.6 28.2 29.2 28.4 27.5 
Unemployment rate (%) 4.5 6.4 6.6 6.6 6.8 6.1 
Prices and interest rates  
Inflation (CPI, % change) 3.9 1.9 2.9 3.3 0.9 1.3 
Lending rate (%)a 8.53 6.37 6.28 6.02 5.76 5.50 
Deposit rate (%)a 6.46 4.19 4.60 4.20 4.03 3.79 
Exchange rate  
US$/NZ$ (period average) 0.650 0.679 0.733 0.807 0.815 0.821 
Nominal effective exchange 
rate (% change)b -13.2 2.7 5.3 4.6 3.6 4.1 
Real effective exchange rate 
(% change)b -12.7 4.1 6.0 4.9 2.6 3.6 
Fiscal balance (Year ended 30 June, % of GDP)  
Total Crown revenue 42.8 38.8 40.6 39.9 40.8 39.0 
      Tax revenue 29.4 26.4 25.7 26.3 27.6 26.8 
Total expenditure 44.9 42.1 49.8 44.3 42.8 40.2 
Operating balance before 
gains and losses -2.1 -3.3 -9.2 -4.4 -2.1 -1.3 
Gross debtc 23.3 27.8 36.0 38.1 36.7 35.8 
Net debtd  9.2 13.9 20.0 24.2 26.3 26.2 
Saving and investment (% of GDP)  
Gross national savings 15.6 18.5 17.5 17.5 17.7 20.0 
Gross domestic investment 22.8 19.9 20.3 20.7 21.6 23.0 
External sector (% of GDP, unless otherwise indicated)  
Current account balance  -7.2 -1.5 -2.8 -3.8 -3.7 -2.6 
Goods balance -1.1 1.1 1.5 0.9 0.2 1.2 
   Exports 23.5 20.7 22.5 22.8 21.6 21.9 
   Imports 24.6 19.6 21.0 21.9 21.4 20.8 
Services balance 0.9 1.2 0.9 0.6 0.5 0.6 
Capital account 0.6 0.0 9.4 0.4 -0.0 0.0  WT/TPR/S/316 • New Zealand 
 
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  (Year end-March, unless 
otherwise indicated) 2008/09 2009/10 2010/11 2011/12 2012/13 2013/14
Financial account 1.7 2.7 -5.6 5.7 1.9 -0.8 
      Direct investment 1.7 -1.9 1.9 0.2 1.8 -0.4 
Balance of payments 5.3 -3.4 -1.0 -0.1 -0.6 0.9 
Terms of trade (September 
2002=1,000, end-period) 1,185.0 1,186.0 1,266.0 1,240.0 1,205.0 1,414.0 
Merchandise exports 
(% change)e 13.9 -9.5 13.4 6.1 -3.2 8.3 
Merchandise imports 
(% change)e 11.9 -18.2 12.0 8.8 -0.1 3.7 
Service exports (% change)e 4.5 -4.5 2.4 2.7 -2.8 3.3 
Service imports (% change)e 14.6 -10.1 7.6 5.8 -1.0 1.8 
Net foreign liabilities  85.0 79.3 65.5 69.8 69.2 65.6 
Official reserve assets 
(NZ$ billion, end-March) 20.5 23.4 24.7 23.5 23.8 21.0 
      % of GDP 10.9 12.1 12.3 11.2 11.1 9.1 
Total external debt 
(NZ$ billion, end-March) 232.8 232.9 242.9 238.4 242.4 232.8 
      % of GDP 124.0 120.8 120.5 113.4 112.5 101.2 
a Calculations are based on monthly averages. 
b Consumer price index based (2010=100). Calculations are based on monthly averages. c Gross debt is defined as gross sovereign-issued debt excluding Reserve Bank settlement cash and 
Reserve Bank bills. 
d Net debt is defined as core Crown net debt excluding the NZS Fund and advances. 
e Growth rates based on trade figures taken from the Balance of Payment in NZ$. 
Source: Statistics New Zealand online information; New Zealand Treasury online information; New Zealand 
Reserve Bank online information; and data received by the authorities. 
1.3  Sectorial Structure  
1.12.  The structure of New Zealand's economy has not changed much over the past few years. 
Agriculture, forestry, and fishing continue to play a key role, accounting for 6.9% of current GDP in 
2011/1213 (up from 5.4% in 2008/09) and 6.8% of total employment in the same year 
(Table 1.2). Together with mining, these subsectors made up 9.0% of GDP in 2011/12 and 
three-quarters of merchandise exports, underlyin g New Zealand's high reliance on the primary 
sector.  
Table 1.2 Basic economic indicators, 2008/09-2013/14  
    2008/09 2009/10 2010/11 2011/12 2012/13 2013/14
GDP by economic activity at 2009/10 prices (% change)  
Agriculture, fore stry and fishing 9.2 0.2 -5.9 14.1 2.5 -3.0 
Mining -0.3 2.0 -3.8 -13.7 3.2 1.4 
Manufacturing -7.8 -4.9 1.9 -0.1 0.9 1.5 
Electricity, gas, water and waste 
management 0.7 4.9 2.8 -2.2 -0.5 0.1 
Construction -10.7 -0.3 -4.7 3.3 10.8 10.9 
Services -0.6 0.3 2.7 2.2 1.7 2.5 
 Wholesale trade -4.6 -6.1 6.7 2.9 2.1 2.2 
 Retail trade and 
accommodation -4.3 -0.1 1.9 3.9 2.8 4.2 
 Transport, postal and 
warehousing -1.0 -2.2 7.8 2.7 1.1 0.7 
 Information media and 
telecommunications 1.8 0.9 5.7 4.5 3.2 0.9 
 Finance and insurance 1.9 2.4 0.8 1.1 1.6 4.4 
 Rental, hiring and real estate 
services -1.4 0.5 1.2 4.1 1.1 1.2 
                                               
13 The year 2011/12 is the most recent year for which current GDP data by sectors is available. WT/TPR/S/316 • New Zealand 
 
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      2008/09 2009/10 2010/11 2011/12 2012/13 2013/14
 Professional, scientific and 
technical services; 
administrative and support 
services -4.0 0.2 6.0 1.6 2.1 3.4 
 Public administration and 
safety 6.8 0.4 1.6 0.3 -0.2 2.3 
 Education and training 2.7 1.0 0.0 0.3 0.2 0.6 
 Health care and social 
assistance 4.0 3.6 -0.5 -0.3 4.1 4.6 
 Arts and recreation and other 
services -0.5 1.6 -0.6 1.3 0.3 2.2 
Share of sectors in current GDP (%)  
Agriculture, fore stry and fishing 5.4 6.2 7.2 6.9 .. .. 
Mining 2.5 2.3 2.3 2.1 .. .. 
Manufacturing 13.8 12.6 12.1 12.1 .. .. 
 Food manufacturing 4.5 3.1 3.1 3.5 .. .. 
Electricity, gas, water and waste 
management 3.4 3.5 3.5 3.4 .. .. 
Construction 6.0 6.0 5.7 5.8 .. .. 
Services 68.9 69.4 69.1 69.7 .. .. 
 Wholesale trade 5.2 5.3 5.5 5.5 .. .. 
 Retail trade 4.9 4.6 4.5 4.4 .. .. 
 Accommodation and food 
services 2.1 2.2 2.2 2.2 .. .. 
 Transport, postal and 
warehousing 4.3 4.5 4.8 5.0 .. .. 
 Information media and 
telecommunications 3.3 3.3 3.2 3.2 .. .. 
 Finance and insurance 5.4 6.3 5.5 5.9 .. .. 
 Rental, hiring and real estate 
services 6.5 6.9 6.9 7.1 .. .. 
 Owner-occupied property 
operation 6.9 6.1 6.3 6.4 .. .. 
 Professional, scientific and 
technical services 8.0 7.7 7.8 7.7 .. .. 
 Administrative and support 
services 2.3 2.0 2.1 2.2 .. .. 
 Public administration and 
safety 4.8 4.9 4.7 4.7 .. .. 
 Education and training 5.0 5.2 5.2 5.2 .. .. 
 Health care and social 
assistance 6.5 6.7 6.6 6.4 .. .. 
 Arts and recreation services 1.6 1.6 1.6 1.6 .. .. 
 Other services 2.2 2.2 2.2 2.1 .. .. 
Share of sector in total employment (%)  
Agriculture, forestry and fishing 6.7 6.6 6.9 6.8 6.7 6.5 
Mining and quarrying 0.3 0.3 0.3 0.3 0.3 0.3 
Manufacturing 12.1 11.5 11.3 11.3 11.0 10.8 
Electricity, gas, water and waste 
management 0.8 0.7 0.8 0.8 0.8 0.8 
Construction 8.4 8.3 8.0 7.9 7.7 8.1 
Services 71.2 72.3 72.4 72.6 73.2 73.2 
 Wholesale trade 4.5 4.8 4.9 4.7 4.2 4.0 
 Retail trade and 
accommodation 15.9 15.4 15.4 14.9 15.2 15.7 
 Transport, postal and 
warehousing 4.5 4.3 4.2 4.4 4.8 4.7 
 Information media and 
telecommunication 1.8 1.9 2.0 2.0 2.0 1.9 
 Finance and insurance 
activities 3.0 3.2 2.9 3.1 3.2 3.1 
 Rental, hiring and real estate 
activities 1.9 1.7 1.7 1.7 1.6 1.7 WT/TPR/S/316 • New Zealand 
 
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      2008/09 2009/10 2010/11 2011/12 2012/13 2013/14
 Professional, scientific, 
technical, administrative and support services 10.9 11.0 10.9 11.0 11.3 11.7 
 Public administration and 
safety 5.1 5.6 5.6 5.6 5.5 5.2 
 Education and training 8.3 8.6 8.8 9.0 8.7 8.5 
 Health care and social 
assistance 9.5 10.2 10.3 10.4 10.5 10.7 
 Other services 5.8 5.5 5.6 5.9 6.0 6.0 
Not classified or provided 0.5 0.4 0.3 0.3 0.4 0.3 
.. Not available. 
Note: Figures are based on New Zeal and's fiscal year: April-March. 
Source: New Zealand Statistics online information and data provided by the authorities. 
1.13.  Manufacturing is also an important contribu tor to the economy, although its shares in GDP 
and employment have declined in recent years to 12.1% (2011/12) and around 11%, respectively. 
While there has been some diversification towards higher value-added and knowledge-intensive 
products, food processing and other resource-based  industries remain the largest components of 
manufacturing activity.  
1.14.  Services are by far the leading sector of  the economy, accounting for 69.7% of current GDP 
(2011/12) and about 73% of total employment, bu t their growth pace (averaging 1.9% annually 
between 2008/09 and 2013/14) has been more modera te than during the previous review period.  
1.4  Monetary and Exchange Rate Policies 
1.15.  The RBNZ is responsible for conducting monetary policy, whose main objective is to 
maintain price stability, while avoiding "unnecessary instability in output, interest rates and the exchange rate", and having regard to the so undness and efficiency of the financial system. 
Inflation targeting is used to control inflation th rough agreements signed between the Governor of 
the RBNZ and the Minister of Finance. The most recent Policy Targets Agreement 
(September 2012) kept the inflation target at 1%-3% on average over the medium term, but added a requirement to maintain average annual inflation close to the 2% midpoint.
14 It also 
required the RBNZ to monitor asset prices. The ma in instrument used by the RBNZ to implement 
monetary policy is the Official Cash Rate (OCR).  
1.16.  During most of the review period, moneta ry policy maintained an accommodative stance in 
order to support economic recovery, while maintaining price stability. After lowering the OCR to 
2.5% in April 2009, the RBNZ kept the policy rate at the same level up until early 2014, except for a short interval.
15 Annual CPI inflation averaged 2.3% over the review period16, and was within the 
target band for most of the review years, except in 2008/09 and 2011/12 (Table 1.1). Helped by a 
strong exchange rate that lowered prices for tradables, CPI inflation fell below the midpoint in the last two fiscal years and stood at 1.3% in 2013/14.  
1.17.  In March 2014, the RBNZ began tightening monetary policy as growth in domestic demand 
gathered momentum, excess capacity diminished, and inflationary pressures started to build up, 
owing in part to high housing prices. The OCR was first increased to 2.75%, and after several subsequent increases, stood at 3.5% in September 2014. The RBNZ has announced a period of 
monitoring and assessment before further adjustments, but expects that further policy tightening 
may be necessary to keep inflation near the target midpoint.
17   
                                               
14 The inflation target has remained unchanged since 2002. 
15 The RBNZ increased the OCR to 3.0% in July 2010, but cut it back to 2.5% following the 
February 2011 earthquakes. 
16 Excluding the direct impact of  the value-added tax (GST) increase in 2010, the average annual CPI 
inflation was 1.9%. 
17 RBNZ Monetary Policy Statement, September 2014. Viewed at: 
http://www.rbnz.govt.nz/monetary_policy/monetary_policy_statement/2014/mpssep14.pdf . WT/TPR/S/316 • New Zealand 
 
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  1.18.  In order to counter inflation in the housing market and strengthen the resilience of the 
financial system in general, the RBNZ introduced "speed limits" on high-loan-to-value (LVR) mortgage lending by banks in October 2013.
18 These restrictions led to a significant reduction in 
housing market turnover and a moderation in mo rtgage lending and house prices. The initiative 
also enabled the rise in the OCR to be deferred until March 2014 (Section 4.5.2.1).  
1.19.  The NZ dollar appreciated significantly during  the years under review, with the real effective 
exchange rate appreciating by 23% between 200 8/09 and 2013/14 (Chart 1.1). According to IMF 
estimates for 2013, the exchange rate was about 5-15% higher than would be consistent with 
medium-term fundamentals. A number of short-term factors explained this, including high terms of trade, interest rate differentials, New Zealand's bright growth prospects and increased portfolio and official flows into the country.
19  
Chart 1.1 Exchange rates, January 2009-October 2014  
0.500.550.600.650.700.750.800.850.90
80859095100105110115120125
01/01/2009
04/01/2009
07/01/200910/01/2009
01/01/2010
04/01/2010
07/01/2010
10/01/201001/01/2011
04/01/2011
07/01/2011
10/01/2011
01/01/201204/01/2012
07/01/2012
10/01/201201/01/2013
04/01/2013
07/01/2013
10/01/2013
01/01/201404/01/2014
07/01/2014
10/01/2014Nominal effective exchange rate (left-hand scale)
Real effective echange rate (left-hand scale)
US$/NZ$ (right-hand scale)Index 2010=100US$/NZ$
 
Source: IMF, International Financial Statistics online information. 
1.20.  In September 2014, the Governor of the RB NZ stated that the exchange rate was well 
above its sustainable level and the levels justified by short term business cycle factors, and that it 
was susceptible to a significant downward adjustment over the next months.20  
1.21.  Since July 2014, the RBNZ has intervened in the foreign exchange market to counter the 
appreciation of the N.Z. dollar. A persistently strong exchange rate could hamper New Zealand's 
international competitiveness and growth in the export sector.   
1.5  Fiscal Policy and Tax Reform 
1.22.  After many years of fiscal surpluses, th e domestic economic recession that started in 
early 2008 and the effects of the global financial crisis led to decreased revenues and rising expenditure thus weakening New Zealand's fiscal position. Throughout the review years, the Government's operating balance (before gains and losses) registered a deficit, reaching a peak of 
9.2% of GDP in the year ending in June 2011
21 (Table 1.1). Since then, the deficit has been 
                                               
18 In May 2013, the Governor of the RBNZ and the Minister of Finance signed a Memorandum of 
Understanding setting out a macro-prudential po licy framework and its operating guidelines. 
19 IMF (2014). 
20 RBNZ online information. Statement by the RBNZ Governor, Graeme Wheeler, 25 September 2014. 
Viewed at: http://www.rbnz.govt.nz/research_and_publications/speeches/2014/5882607.pdf . 
21 Fiscal data are based on years ending in June.  WT/TPR/S/316 • New Zealand 
 
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  gradually reduced to 1.3% of GDP in 2013/14, mainly on account of spending restraint. Total 
expenditure as a share of GDP declined during the review years (except in 2010/11) to 40.2% of GDP in 2013/14. Nevertheless, capital spending (including on transport infrastructure, ultrafast broadband, schools, and hospitals) has increased. Total revenue as a percentage of GDP fell from 
42.8% in 2008/09 to 39.0% in 2013/14, with tax revenue declining from 29.4% to 26.8% of GDP 
in the same period. As a result, net public debt rose significantly to 26.2% of GDP in 2013/14, from 9.2% in 2008/09. Although debt levels are low compared to other advanced economies, 
New Zealand faces relatively higher borrowing costs. 
1.23.  The Public Finance Act 1989 contains provisio ns to enhance transparency and predictability 
in the budget process and requires the Government to conduct fiscal policy in accordance with the principles of responsible fiscal management. The Act was amended in 2013 to revise existing 
principles and add three more. The existing principles include, inter alia , reducing debt to prudent 
levels and ensuring that on average total oper ating expenses do not exceed total operating 
revenues. The new principles require the Government to formulate fiscal strategy recognizing the 
interaction with monetary policy and its likely impact on present and future generations, and to 
ensure that the Crown's resources are managed effectively and efficiently.  
1.24.  The New Zealand Government is committed to fiscal consolidation. The 2014 Budget and 
the 2014 Fiscal Strategy Report set out short and long term fiscal objectives. These include 
returning the operating balance (before gains and losses) to a surplus no later than 2014/15, and 
reducing net public debt to below 20% of GDP by  2020 and maintaining it within a range of around 
10% to 20% of GDP over the economic cycle. Ba lancing the operating budget will be achieved 
mainly by restraining spending, with total expenses forecast to fall to 39.1% of GDP and total 
revenues forecast to be 40.1% of GDP by 2016/17. The priority for new spending will be given to health and education. Besides fiscal consolidation, the Government's plan involves building a more 
productive and competitive economy through a wide-ranging programme of microeconomic 
reforms set out in its Business Growth Agenda; de livering better public services; and supporting 
the rebuild of Christchurch. These objectives were reconfirmed in the 2015 Budget Policy 
Statement.
22 According to latest forecasts, the Government is expected to reach a surplus in its 
operating balance in 2015/16.23  
1.25.  The main tax reforms during the review period were introduced by the Budget 2010. Its 
overarching objectives were to: lift economic gr owth by improving incentives to work, save and 
invest; improve the fairness, coherence and integrity of the tax system; and support 
New Zealand's international competitiveness. The cornerstone of the 2010 tax reform was a significant reduction in income tax rates across-the-board (Table 1.3), funded by an increase in 
the Goods and Services Tax (GST) from 12.5% to 15%, and by tax base-broadening measures 
(including the removal of deprec iation on most buildings) and measures aimed at reducing tax 
avoidance. The company tax rate was also reduced (from 30% to 28%) as from 2011/12 to make 
it more attractive for business to locate in New Zealand. At the same time, the tax package 
included measures to compensate vulnerable individuals for the increase in the GST.
24  
Table 1.3 Tax reform: personal  income tax rates, Budget 2010  
Income range Tax rate before  
1 October 2010 (%) Tax rate from 
1 October 2010 (%) 
Up to NZ$14,000 12.5 10.5 
NZ$14,001-NZ$48,000 21.0 17.5 
NZ$48,001-NZ$70,000 33.0 30.0 
Over NZ$70,000 38.0 33.0 
Source: 2010 Budget, Minister's Executive Summary, Building the Recovery, 20 May 2010. Viewed at: 
http://www.treasury.govt.nz/budget/2010/execsumm/b10-execsumm.pdf . 
1.26.  New Zealand's rapidly ageing population poses a challenge to fiscal sustainability in the 
medium to long term, although less so than in other developed countries. According to 
New Zealand's Long term Fiscal Statement, published in July 2013, ageing-related pension and 
                                               
22 Treasury online information. Viewed at: http://www.treasury.govt.nz/budget/2015/bps/01.htm . 
23 Treasury (2014b). 
24 Treasury, 2010 Budget, Minister's Executive Summary, Building the Recovery, 20 May 2010. Viewed 
at: http://www.treasury.govt.nz/budget/2010/execsumm/b10-execsumm.pdf .  WT/TPR/S/316 • New Zealand 
 
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  health costs would exert significant pressures on public finances in the coming decades. 
Government spending on healthcare is projected to grow from 6.8% of GDP in 2010 to 10.8% in 
2060. Moreover, spending on New Zealand's Superannuation (the universal public pension system) is projected to rise from 4.3% of GDP in 2010 to 7.9% in 2060.
25  
1.27.  Taking into account tight financial constraints and given that welfare and social programmes 
are an important part of public spending, the Government is currently reforming its welfare system in order to reduce long-term welfare dependency an d focus on effective support services and social 
programmes that boost skills and employment. The Government is also intent in continuing to 
reprioritize public spending in infrastructure an d other sectors that are growth enhancing, and to 
deliver better value from money from public services. It is also important to note that the Government has recently sold part of its shares  in several Crown-owned enterprises, which has 
generated proceeds equivalent to almost 3% of GDP.  
1.6  Balance of Payments  1.28.  New Zealand has traditionally run a current account deficit, reflecting a persistent shortfall 
in domestic savings that has been financed by ov erseas borrowing (Table 1.4). During the review 
period, the current account deficit was mainly driven by a large deficit on the investment income account, which could not be offset by a generally positive goods and services balance.  
1.29.  After a large increase associated with the global financial crisis (2008/09), New Zealand's 
current account deficit decreased to 1.5% of GDP in the year ending March 2010, helped by a surplus in the goods balance (due to a sharp decline in imports) and a narrowing of the investment income deficit. In 2011/12 and 2012/13, the deficit widened again as the goods and investment 
income balances deteriorated. In 2013/14, strong  terms of trade helped narrow down the current 
account deficit to NZ$6 billion or 2.6% of GDP. Ho wever, the deficit is expected to widen again in 
the medium-term, partly due to increased import s associated with the post-earthquakes rebuild 
and to rising costs in servicing the foreign debt.
26  
Table 1.4 Balance of payments, 2008/09-2013/14  
(NZ$ million, year end-March) 
 2008/09 2009/10 2010/11 2011/12 2012/13 2013/14
Current account -13,459 -2,832 -5,625 -6,674 -7,966 -6,004 
Goods and services balance -475 4,511 4,668 3,298 1,527 3,948 
Trade balance -2,093 2,126 2,927 1,963 516 2,680 
    Exports 44,114 39,941 45,290 48,042 46,528 50,409 
    Imports 46,207 37,814 42,363 46,079 46,012 47,729 
Services balance 1,618 2,385 1,741 1,335 1,011 1,268 
    Credit 16,645 15,891 16,269 16,707 16,234 16,766 
    Debit 15,028 13,506 14,528 15,371 15,223 15,498 
Primary income -13,744 -7,964 -10,117 -9,667 -9,092 -9,517 
Credit 5,954 5,376 5,551 6,439 6,837 7,000 
    Investment income 5,954 5,376 5,551 6,439 6,837 7,000 
Debit 19,697 13,340 15,669 16,106 15,929 16,517 
    Investment income 19,550 13,227 15,536 15,966 15,759 16,337 
    Compensation of 
employees 148 113 133 140 170 180 
Current transfers 760 620 -176 -305 -401 -435 
Credit 2,361 2,022 1,173 1,263 1,275 1,265 
    General government 1,707 1,486 598 659 668 668 
    Other sector 654 536 575 604 607 597 
Debit 1,601 1,402 1,348 1,567 1,676 1,699 
    General government 603 538 543 582 544 636 
    Other sector 998 864 806 986 1,132 1,063 
                                               
25 Treasury (2013). 
26 Treasury (2014a). WT/TPR/S/316 • New Zealand 
 
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   2008/09 2009/10 2010/11 2011/12 2012/13 2013/14
Capital and financial 
account 4,302 5,230 7,630 12,980 4,098 -1,890 
Capital account 1,133 17 18,871 929 -1 0 
Financial account 3,169 5,213 -11,241 12,051 4,099 -1,890 
New Zealand investment 
abroad -18,643 6,464 25,592 -10,393 5,313 946 
    Direct investment -1,131 -2,998 1,171 -981 -80 -1,235 
    Portfolio investment -3,690 7,260 -8 3,437 8,006 7,693 
    Financial derivatives 2,082 -1,827 14 -312 692 -545 
    Other investment -5,906 -2,463 22,323 -12,752 -4,616 -2,890 
    Reserve assets -9,999 6,493 2,092 215 1,312 -2,078 
Foreign investment in 
New Zealand -15,474 11,677 14,351 1,658 9,412 -944 
    Direct investment 4,303 -587 2,738 1,476 4,055 318 
    Portfolio investment -18,717 12,724 10,578 3,918 12,448 2,139 
    Financial derivatives -269 -130 390 -79 -296 164 
    Other investment -790 -330 645 -3,658 -6,796 -3,564 
Net errors and omission 9,157 -2,397 -2,006 -6,306 3,868 7,894 
Memorandum       
Current account as % of 
GDP -7.2 -1.5 -2.8 -3.2 -3.7 -2.6 
Balance of payment as % of 
GDP 5.3 -3.4 -1.0 -0.1 -0.6 0.9 
Source: Statistics New Zealand online information. 
1.30.  New Zealand's net foreign liabilities as a percentage of GDP were reduced over the review 
years from a high of 85.0% in 2008/09 to 65.6% in the year ending March 2014, a level which is still relatively high. Initially, the decrease was mainly due to one-off reinsurance claims associated 
with the Canterbury earthquakes. However, the effect  of these claims on net international liabilities 
has been decreasing with time. By end September 2014, about three-fourths of the claims had been settled. Official external reserves fluctuat ed during the years under review, and stood at 
NZ$21.0 billion (or 9.1% of GDP) by end-March 2014 (Table 1.1).  
1.31.  Total external debt amounted to NZ$232. 8 billion at end March 2014 and its share in GDP 
was 101.2%, down from 124% at end March 2009. By end September 2014, total external debt 
was NZ$244.5 billion (103.3% of GDP). Most of external debt (79%) is held by the private sector. 
1.7  Trade Performance  
1.32.  New Zealand's external trade (exports and imports) of goods and services was equivalent to 
56.7% of real expenditure GDP in 2013/14 (compared to 65.0% in 2008/09) (Table 1.1). This 
reflects a relatively lower trade exposure than one would expect given the economy's small size 
and degree of openness. New Zealand ranked as the world's 43
th exporter and 42nd importer of 
goods, and as the 30th exporter and 38th importer of commercial services.27  
1.33.  Based on balance-of-payments figures, New Zealand's merchandise exports grew at an 
average annual rate of 2.7% between 2008/09 and 2013/14, while merchandise imports increased 
on average by 0.7% annually between the same years. During the review period, the performance of New Zealand's trade of goods and services was subject to important fluctuations in commodity 
prices and the exchange rate. Significant increa ses in global commodity prices in 2011, 2013 and 
the first part of 2014 led to near record high terms of trade for New Zealand (Table 1.1). Overall, the terms of trade increased by an annual aver age of 3.6% between 2008/09 and 2013/14. On the 
other hand, the appreciation of the exchange rate has had a restricting effect on non-agricultural 
exports.  
                                               
27 Counting the EU28 as one (WTO, International Trade Statistics 2014 . Viewed at: 
http://www.wto.org/english/res_e/statis_e/its2014_e/its14_toc_e.htm ). WT/TPR/S/316 • New Zealand 
 
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  1.7.1  Composition of merchandise trade 
1.34.  The primary sector continues to be the most important contributor to New Zealand's export 
earnings. According to United Nations Comtrade data, the share of primary products in total merchandise export value rose from 69.7% in 2009 to 75.7% in 2014, due mainly to increases in 
exports of agricultural products (Chart 1.2 and Ta ble A1.1). Dairy and meat products are the main 
agricultural exports, making up about 38% of to tal merchandise exports, and have benefitted from 
high global commodity prices during part of the review period; wood products have also been quite 
dynamic. By contrast, the share of manufactures in merchandise export value declined from 
25.6% in 2009 to 19.9% in 2014, with drops in the shares of machinery and transport equipment, 
chemicals and other semi-manufactures.  
1.35.  New Zealand's imports are dominated by manufactured products and raw materials. 
Manufactures accounted for 70.7% of the import bill in 2014, a slight decrease from their share in 
2009. Machinery and transport equipment (mainly automotive products) accounted for 37.9% and chemicals for 10.4% of all merchandise imports in  2014 (Chart 1.2 and Table A1.2). The share of 
primary products in total import value was 28.5% in 2014, with fuels accounting for 15% (down 
from almost 17% in 2013).  
1.7.2  Direction of merchandise trade 
1.36.  The direction of New Zealand's merchandise trade has changed significantly during the 
review period, with China beco ming New Zealand's largest single trading partner, ahead of 
Australia, and other Asian emerging economies gaining more importance as trading partners. In fact, China's strong and rapidly growing demand for New Zealand's agricultural commodities (in 
particular dairy and forestry products) has been the major driver of New Zealand's rising 
commodity export prices and terms of trade in recent years. 
1.37.  China has become New Zealand's largest export market, taking 19.9% of total exports in 
value terms (up from 9.1% in 2009) and overtaking Australia with 17.5% (Chart 1.3 and 
Table A1.3). Exports to Australia, in particular  manufactured products, se em to have benefitted 
from the Closer Economic Relations agreement with that country.
28 Other important export 
destinations in 2014 were the European Union-28 (9.6%), the United States (9.4%), and Japan 
(5.9%). However, since 2009, Japan's shares have gradually declined, while demand for New Zealand's exports from other economies in Asia, such as the Republic of Korea, Chinese Taipei, Malaysia, Thailand, and Viet Nam has been increasing. The Republic of Korea, with 
a share of 3.5% of exports, has now overtaken the United Kingdom (3.1%) as New Zealand's fifth 
largest export market. 
1.38.  The European Union as a group accounted for 17.5% of New Zealand's imports in 2014. 
However, China was New Zealand's main single source of merchandise imports, supplying 16.9% 
of total import value. Imports from China comprise mainly telecommunications equipment, computers, clothing and toys. Australia supplied 12.2% of total merchandise imports, followed by 
the United States (11.6%), and Japan (6.7%). Imports from other Asian economies are growing in 
importance too, with the Six East Asian Traders (Malaysia; Republic of Korea; Singapore; Thailand; Chinese Taipei; and Hong Kong, China) accounting for 18.2% of total import value in 2014 (Chart 1.3 and Table A1.4). 
                                               
28 Treasury (2014a).  WT/TPR/S/316 • New Zealand 
 
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  Chart 1.2 Product composition of merchandise trade, 2009 and 2014  
2009 2014
(a)    Exports (f.o.b.)
Other semi-
manuf.  5.8% Manufactures
25.6%
Total:   US$24.9 billion Total:  US$42.4 billion
(b)    Imports (c.i.f.)
Chemicals
11.8%Transport 
equipment
12.3%
Manufactures
71.4%
Electrical machines  
12.7%
Non-electrical machinery
9.2%Other mining
1.9%
Electrical machines
10.5%Agricultural
raw materials
11.1%
Other semi-manuf.  
8.2%Chemicals
10.4%Manufactures
70.7%
Total:   US$25.6 billio n Total:  US $43.3 b illionManuf.
19.9%
Fuels
3.2%Other mining
3.2%
Textiles & clothing
4.5%Other
0.7%Fuels
4.8%Machinery & transport 
equipment
9.0%Other consumer 
goods  4.3%
Other mining
2.9%Other semi-
manuf.  4.4%
Agricultural raw 
materials
9.4%
Other consumer 
goods  11.2%Other 
4.4%
Machinery & transport
equipment  6.2%
Other semi-manuf.
9.2%Other 
4.6%
Agriculture
11.6%Agriculture
11.4%
Transport 
equipment
17.9%Chemicals
5.5%Chemicals
5.0%Food
52.4%Food
58.5%Other consumer goods
5.3%
Fuels
15.0%Fuels
14.6%Other 
0.8%
Other mining
1.9%
Non-electrical machinery
9.6%Other consumer 
goods  9.7%
Textiles & clothing
5.0%
 
Source: UNSD, Comtrade database (SITC Rev.3). WT/TPR/S/316 • New Zealand 
 
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  Chart 1.3 Direction of merchandise trade, 2009 and 2014  
2009 2014
(a)    Exports (f.o.b.)
Asia-Pacific
62.5%
Total:   US$24.9 billion Total:  US$42.4 billion
(b)    Imports (c.i.f.)
EU28
17.3%
Singapore  4.0%United States
10.8%Other
3.1%
EU28
17.5%Other
2.8%
Thailand  2.6%United States
11.6%
Total:   US$25.6 billion Total:   US$43.3 billionJapan
7.1%
Thailand  3.4%
Korea, Rep. of
4.5%
Korea, Rep. of  
3.4%United States
10.0%United States
9.4%
China
19.9%
Japan
6.7%China
15.1%Other Asia
20.1%
EU28
9.6%
Australia
23.0%Other
2.8%
Japan
7.4%Other Asia
7.4%Middle East
4.7%Other America
4.4%
Middle East
3.9%
China
9.1%Africa
4.1%
Africa
3.3%
Japan
5.9%
Australia
12.2%Other Asia
18.6%
Malaysia  2.7%Other Asia   
7.2%Korea, Rep. of
3.1%Other
3.0%
Australia
17.5%
Australia
18.4%
Asia-Pacific
59.7%Asia-Pacific
60.8%Asia-Pacific
65.5%
Singapore  4.0%
Malaysia  4.6%Korea, Rep. of
3.5%
China
16.9%EU28
13.0%Other America
3.8%
Other America
2.6%Other America
2.7%
Middle East
5.3%Middle East
5.7%
 
Source: UNSD, Comtrade database. 
1.7.3  Services trade  
1.39.  Services exports are an important source of foreign exchange, accounting for about 25% of 
total export receipts (merchandise and services).  The services trade balance maintained a surplus 
throughout the period under review although expo rts of services hardly increased in real terms 
during the same period (real annual growth av eraged 0.1% between 2008/09 and 2013/14). The WT/TPR/S/316 • New Zealand 
 
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  high New Zealand dollar has weighed on the performance of services exports, in particular on 
tourism.  
1.40.  In the year ending in March 2014, New Zealand's exports of services amounted to 
NZ$16.7 billion, while imports of services totalled NZ$15.5 billion. Travel (tourism) services are by 
far the most important, accounting for 56.3% of total value of exports of services in 2013/14 
(Table 1.5). The largest source of inbound tourism is Australia, followed by China, the United States, and the UK, but a number of As ia markets have been growing in importance. 
Transportation, especially air transport, is the se cond largest export service with a share of 15%; 
followed by other business services (10.4%). Impo rts of services are also dominated by travel, 
which accounted for 30.8% of total value of services imports in 2013/14, followed by 
transportation (25%), with sea and air transport imports contributing each with similar shares, and 
other business services (19.8%).  
Table 1.5 Composition of trade in services, 2008/09-2013/14  
(NZ$ million, year end-March) 
  2008/09 2009/10 2010/11 2011/12 2012/13 2013/14
Total credit  16,645 15,891 16,269 16,707 16,234 16,766 
 % of total credit 
      Maintenance and repair 2.0 2.2 3.0 2.8 2.4 3.1 
      Transportation  16.2 14.8 15.5 15.6 15.9 15.0 
           Sea transport  3.0 2.6 3.0 3.3 3.2 3.0 
           Air transport  12.9 11.8 12.3 11.9 12.3 11.7 
      Travel  58.3 58.8 55.8 54.9 54.5 56.3 
           Business  4.9 4.4 4.4 4.1 4.2 4.4 
           Personal  53.3 54.4 51.4 50.8 50.2 51.9 
      Construction  0.2 0.1 0.1 0.1 0.1 0.1 
      Insurance and pension  0.3 0.3 0.3 0.3 0.3 0.3 
      Financial service  2.4 3.1 3.0 3.3 3.6 4.1 
      Telecommunication, 
computer and information  3.8 3.8 4.3 4.4 4.4 4.0 
      Royalties and licence fees  1.7 1.8 2.4 2.3 2.3 2.3 
      Other business services  10.5 10.2 11.4 11.4 11.1 10.4 
      Personal, cultural and 
recreational services  3.5 3.8 3.1 3.8 4.2 3.2 
      Government services  1.0 1.1 1.1 1.1 1.2 1.3 
Total debit  15,028 13,506 14,528 15,371 15,223 15,498 
 % of total debit 
      Maintenance and repair 2.1 1.6 1.9 1.9 1.3 1.0 
      Transportation  30.1 26.2 27.2 25.6 25.1 25.4 
           Sea transport  15.3 11.5 12.6 11.6 11.8 12.5 
           Air transport  14.3 14.0 14.0 13.5 12.8 12.2 
      Travel  27.9 29.8 29.2 28.9 30.0 30.8 
           Business  5.6 5.6 5.9 5.7 5.9 5.8 
           Personal  22.3 24.2 23.3 23.1 24.1 25.0 
      Construction  1.1 1.4 0.5 0.8 0.3 0.2 
      Insurance and pension  2.0 2.5 2.5 3.8 5.0 5.5 
      Financial service  2.3 3.2 3.0 2.7 3.0 2.9 
      Telecommunication, 
computer and information  5.3 5.5 5.2 5.5 6.0 4.8 
      Royalties and licence fees  5.9 6.7 7.0 8.3 8.1 7.5 
      Other business services  21.3 20.7 21.3 20.6 19.5 19.8 
      Personal, cultural and 
recreational services 0.9 1.0 1.0 0.9 0.9 0.9 
      Government services  1.1 1.2 1.1 1.0 0.9 1.2 
Source: Statistics New Zealand online information. 
 WT/TPR/S/316 • New Zealand 
 
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  1.8  Foreign Direct Investment 
1.41.  The stock of inward FDI increased from NZ$79.3 billion at 31 March 2009 to NZ$97.4 billion 
at 31 March 2014, equivalent to 42.3% of GDP (Table 1.6). Australia remains the largest overseas investor, accounting for 57.0% of total inward FDI stock as at end-March 2014 (up from 53.3% as 
at end-March 2009), followed by the United States (8.4%) and the United Kingdom (8.2%). The 
European Union, as a group, accounted for 9%. Singapore and Japan are the largest Asian sources of FDI stock in New Zealand. By economic activi ty, the main recipients of inward FDI are the 
financial sector (31.4%), manufacturing (13.1% ), and professional, scientific and technical 
services (6.0%). 
Table 1.6 Inward stock of foreig n direct investment, 2008/09-2013/14  
(NZ$ million and %,  year end-March) 
  2008/09 2009/10 2010/11 2011/12 2012/13 2013/14
Total inward FDI stock  79,346.0 81,068.0 80,449.0 87,479.0 89,622.0 97,373.0 
% of GDP 42.3 42.0 39.9 41.6 41.6 42.3 
By origin (% of total) 
Australia 53.3 56.1 57.1 59.5 58.7 57.0 
Belgium 0.0 0.5 ..a 0.2 0.1 0.0 
Canada 1.8 1.4 1.3 1.3 1.4 2.0 
Cayman Islands 1.5 1.3 0.9 1.2 1.4 1.0 
Channel Islands 2.5 2.7 2.4 1.9 ..a ..a 
China, People's Republic of ..a ..a ..a 0.2 0.4 0.7 
France 0.4 0.3 0.3 0.0 0.1 0.2 
Germany 0.8 1.0 1.0 0.8 -0.7 -0.4 
Hong Kong, China 1.4 1.6 1.3 1.2 1.8 3.1 
Ireland 0.4 0.3 0.1 0.1 0.1 0.2 
Japan 3.2 3.0 3.9 3.6 3.5 3.7 
Korea, Republic of  ..a ..a ..a ..a ..a 0.0 
Netherlands 5.1 4.2 3.5 3.9 3.2 2.9 
Singapore 2.9 1.2 2.5 2.8 4.5 4.1 
Switzerland 0.2 0.2 0.3 0.6 0.6 0.4 
United Kingdom 4.4 4.4 3.7 3.6 6.2 8.2 
United States of America 15.0 14.3 13.8 12.4 11.4 8.4 
Virgin Islands, British 3.4 ..a 3.1 2.8 2.7 2.8 
By economic activity (% of total) 
Agriculture, forestry, and 
fishing 5.9 5.9 5.2 5.1 5.3 5.7 
Mining 3.1 4.3 4.4 3.4 3.4 3.1 
Manufacturing 17.7 17.6 17.5 16.2 15.1 13.1 
Electricity, gas, water, and 
waste 3.1 3.6 4.5 4.1 4.3 4.4 
Construction 0.6 0.9 0.9 0.9 0.6 0.6 
Wholesale trade 6.6 6.6 5.7 4.4 3.9 4.1 
Retail trade 6.3 5.5 6.0 5.7 5.7 5.3 
Accommodation and food 
services 1.1 1.1 1.1 0.8 0.7 0.6 
Transport, postal, and 
warehousing 0.8 0.7 0.5 0.7 0.5 0.4 
Information media and 
telecommunications 5.2 4.9 4.6 4.7 2.6 1.8 
Financial and insurance 
services 23.4 25.2 25.8 28.6 30.3 31.4 
Rental, hiring, and real estate 
services 6.3 3.8 4.4 5.4 5.7 4.3 
Professional, scientific, and 
technical services 4.4 4.2 4.0 4.1 5.4 6.0 
Administrative and support 
services 0.4 0.3 0.3 0.2 0.3 0.4 
Public administration and 
safety ..a ..a ..a ..a ..a ..a WT/TPR/S/316 • New Zealand 
 
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    2008/09 2009/10 2010/11 2011/12 2012/13 2013/14
Education and training 0.0 0.0 ..a ..a ..a 0.0 
Health care and social 
assistance 1.4 1.2 1.1 1.7  1.4  1.3 
Arts and recreation services ..a ..a ..a ..a ..a ..a 
Other services ..a ..a ..a ..a ..a ..a 
Unallocated  ..a ..a ..a 13.3  14.3  17.3 
a Confidential. Other countries having  confidential data include, e.g. Argentina, Bermuda, Malaysia, 
Chinese Taipei, United Arab Emirates. 
Source: New Zealand Statistics online information. 
1.42.  Between 2009 and 2013, New Zealand' stock of FDI abroad averaged NZ$23 billion. The 
stock showed a small decrease from NZ$24.8 billion  as at end-March 2009 to NZ$23.2 billion as at 
end-March 2014 (Table 1.7). The main recipient of New Zealand's outward FDI stock is Australia (53.4% as at 31 March 2014); other important destinations are the United States and the 
United Kingdom. Most of New Zealand's outward FDI stock is invested in manufacturing activities. 
Table 1.7 Outward stock of foreign direct investment, 2008/09-2013/14  
(NZ$ million and %,  year end-March) 
  2008/09 2009/10 2010/11 2011/12 2012/13 2013/14
Total outward FDI stock  24,767 20,134 22,878 24,465 23,174 23,188 
% of GDP 13.2 10.4 11.3 11.6 10.8 10.1 
By origin (% of total)       
Australia 50.8 59.2 61.8 56.5 55.9 53.4 
Canada 0.4 0.2 0.3 0.2 0.2 0.7 
China, People's Republic of 0.7 0.6 0.5 0.6 0.3 0.4 
Germany ..a ..a ..a -0.1 -0.1 0.2 
Hong Kong, China 2.6 3.2 2.5 2.7 3.5 2.5 
Japan 0.3 ..a ..a ..a ..a ..a 
Malaysia 1.3 1.6 1.6 1.9 2.5 3.2 
Netherlands 1.2 ..a ..a 1.1 1.5 ..a 
Singapore ..a ..a ..a 7.3 7.0 ..a 
United Kingdom 4.9 5.2 4.8 4.5 4.8 6.3 
United States of America 23.5 18.5 18.7 17.1 16.2 15.8 
By economic activity (% of total) 
Agriculture, forestry, and 
fishing ..a ..a ..a ..a 0.0 ..a 
Mining ..a ..a ..a ..a ..a ..a 
Manufacturing 52.5 41.8 41.3 39.3 42.6 40.6 
Electricity, gas, water, and 
waste ..a ..a ..a 3.0 3.4 2.5 
Construction ..a ..a ..a ..a ..a ..a 
Wholesale trade ..a ..a ..a 15.5 11.8 14 
Retail trade 2.1 2.2 1.9 ..a ..a ..a 
Accommodation and food 
services ..a ..a ..a ..a ..a ..a 
Transport, postal, and 
warehousing 1.5 5.3 5.1 5.7 5.8 5.0 
Information media and 
telecommunications ..a ..a ..a ..a ..a ..a 
Financial and insurance 
services 7.7 4.1 7.2 6.0 5.6 4.0 
Rental, hiring, and real estate 
services ..a ..a ..a ..a ..a ..a 
Professional, scientific, and 
technical services ..a ..a 0.6 0.4 0.5 ..a 
Administrative and support 
services ..a ..a ..a 0.1 0.1 ..a 
Public administration and 
safety 0.0 0.0 0.0 0.0 0.0 0.0 WT/TPR/S/316 • New Zealand 
 
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    2008/09 2009/10 2010/11 2011/12 2012/13 2013/14
Education and training 0.0 0.0 0.0 0.0 0.0 0.0 
Health care and social 
assistance 0.0 0.0 0.0 ..a ..a ..a 
Arts and recreation services ..a ..a ..a ..a ..a ..a 
Unallocated ..a ..a ..a 6.1 4.4 6.5 
a Confidential. Other countries having confiden tial data include e.g. Argentina; Bermuda; 
Korea, Republic of; Chinese Taipei; United Arab Emirates. 
Source: New Zealand Statistics online information. 
 
 WT/TPR/S/316 • New Zealand 
 
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  2  TRADE AND INVESTMENT REGIME 
2.1  Overview  2.1.  New Zealand's general constitutional, legal and trade policy formulation frameworks have not 
significantly changed since its previous Review in  2009. The Ministry of Foreign Affairs and Trade 
(MFAT) in cooperation with relevant ministries and agencies formulates trade policy, including with 
respect to negotiations of Regional Trade Agreements (RTAs). The trade policy formulation process is usually conducted through wide stakeholder consultations. Since 2009, amendments have been 
made to trade and trade-related legislation in several areas, including customs procedures, tariff 
issues, sanitary and phytosanitary measures (SPS),  technical barriers to trade (TBT), competition 
policy, telecommunications, and intellectual property rights. Furthermore, new legislation was adopted on topics such as government procurement, food standards, and patents. 
2.2.  The multilateral trading system remains New Zealand's main vehicle for providing more 
trading opportunities to its exporters, as well as addressing the challenges it faces as a small and remote country. However, New Zealand has incr easingly engaged in RTAs to complement its 
participation in the WTO system. Ten RTAs are in place; of which, four entered into force during 
the review period (i.e. the Agreement between New Zealand and the Separate Customs Territory of Taiwan, Penghu, Kinmen and Matsu on Economic Cooperation; the New Zealand-Malaysia Free 
Trade Agreement; the Agreement Establishing th e ASEAN-Australia-New Zealand Free Trade Area 
(AANZFTA); and the New Zealand-Hong Kong, Chin a Closer Economic Partnership Agreement). 
2.3.  New Zealand maintains preferential treatment for imports from least developed countries 
(LDCs) and developing countries (under the GSP). It has also been an active provider of Aid for 
Trade. Specific support measures are provided to Pacific Island Countries to build their capacity to 
trade, including through the ongoing Pacific Agreem ent on Closer Economic Relations (PACER) Plus 
negotiations. Since its previous Review, New Zealand has been directly involved in one WTO 
dispute settlement case as a complainant. 
2.4.  In general, New Zealand has an open fo reign investment regime. However, by means of 
screening procedures, restrictions apply in a few areas of "critical interest", i.e. certain sensitive 
types of land, "significant business assets" other than land, and fishing quotas. 
2.2  General Framework 2.5.  New Zealand is a constitutional Mona rchy and a fully independent member of the 
Commonwealth. Its constitutional and legal framework has not undergone any significant change 
during the review period. 
2.6.  All legislation is passed by a single chambe r, the House of Representatives, which comprises 
triennially elected members. It holds the legislative power and is responsible for holding the 
Government accountable for its policies, including economic and trade related actions. The House 
has 120 seats, but extra seats may be added where there is an overhang. The last general election took place in September 2014 to determine the membership of the 51
st New Zealand Parliament; 
121 members were elected. New Zealand is a common law jurisdiction, with all law developed 
from case law and from statutes enacted by Parliament. New Zealand does not have a written constitution.  
2.7.  Based on the Westminster system of responsible government, executive power in 
New Zealand is based on the principle that "The Queen reigns, but the government rules, so long 
as it has the support of the House of Representa tives". The head of state is the Queen, who is 
represented in New Zealand by the Governor-Gen eral. The head of government is the Prime 
Minister. Prime ministers are not directly elected; by convention, the office is held by the party 
leader who commands a majority in the House. The Prime Minister is formally appointed by the Governor-General who also has the reserve power to dismiss him/her.  
2.8.  New Zealand's judiciary system has a pyramidal structure. At the top is the Supreme Court. 
Below it, in descending order, are the Court of Appeal, the High Court and the District Courts. These courts are all of general jurisdiction. There are several other specialized courts, including the Employment Court, the Environment Court and the M āori Land Court, which operate under the WT/TPR/S/316 • New Zealand 
 
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  District Courts. There are also a number of spec ialized tribunals which operate in a judicial or 
quasi-judicial capacity, such as the Disputes Tribunal, the Tenancy Tribunal and the Waitangi Tribunal.  
2.3  Trade Policy Formulation and Objectives 
2.9.  The Ministry of Foreign Affairs and Trad e (MFAT) is the principal government agency 
responsible for trade policy formulation in cooperation with technical ministries such as the Ministry of Business Innovation and Employment (MBIE). The MBIE was formed on 1 July 2012, 
bringing together four separate government agencies into one ministry. These agencies were: the 
Department of Building and Housing, the Ministry  of Economic Development, the Department of 
Labour, and the Ministry of Science and Innovation. Various other government agencies have trade policy-related functions (see sections 3 and 4). 
2.10.  When formulating trade policy, the MFAT actively shares information and consults with 
domestic interest groups including business people, unions, M āori and NGOs. A National Interest 
Analysis on the impact of any proposed prefer ential trade agreement is prepared prior to 
examination by Parliament of such agreement, and serves as a basis for public consultations.   
2.11.  Parliament has limited involvement in trade policy making. However, it has important 
responsibilities in ratifying treaties. The Executive cannot change New Zealand's domestic law by 
becoming party to a treaty. If the obligations contained in the treaty cannot be followed under 
existing law, the House of Representatives is required to pass the implementing measure prior to the ratification or accession to the treaty. 
2.12.  Parliament also holds oversight attributions on foreign policies, including trade policy. This is 
done through its committee on foreign affairs, defence and trade, especially by examining the 
MFAT's statement of intent and annual report which the ministry is required to produce every year. The statement of intent presented to Parliament  under the Minister's authority outlines policy 
priorities, looking ahead five years, as well as specific policy-implementation proposals for the year 
ahead. As highlighted under the MFAT's 2014-18 Statement of intent, New Zealand's overall trade policy objectives seek to make an important contri bution to the Government's goal of 'building a 
more competitive and productive economy' by pu rsuing improved market access and trade rules 
for New Zealand business, through high-quality trade agreements, including the eventual conclusion of the Doha Round, and opening d oors for New Zealand companies globally.   
2.13.  The MFAT contributes to achieving this goal by leading the 'Building Export Markets' 
component of the Business Growth Agenda. The Bu siness Growth Agenda is a programme of work 
that aims to support New Zealand businesses to grow, in order to create jobs and improve New Zealanders' standard of living. The Business Grow th Agenda is delivering  innovative initiatives 
and policy reforms that focus on six key "ingredi ents" businesses need to grow: export markets, 
innovation, infrastructure, skilled and safe workplaces, natural resources, and capital. Each of these has its own programme of work. Under the 'Building Export Markets' work stream, the 
Government has set an ambitious goal for New Zealand to increase the ratio of exports to GDP 
from the current 30% to 40% by 2025. 
2.14.  New Zealand introduced trade as a new sector priority in its Aid Programme in 2014. The 
purpose is to support Pacific Island Countries build their capacity to trade, including through 
implementation of the Pacific Agreement on Closer  Economic Relations (PACER) Plus, once this is 
concluded. 
2.15.  During the review period, amendments were made to trade and trade-related legislation in 
several areas, including customs procedures , tariff issues, SPS, TBT, competition, 
telecommunications, and intellectual property ri ghts. Furthermore, new laws were adopted on 
topics such as government procurement, food standards, and patents (Section 3). WT/TPR/S/316 • New Zealand 
 
- 29 - 
 
  2.4  Trade Agreements and Arrangements 
2.4.1  WTO 2.16.  New Zealand became a founding member of the GATT on 30 July 1948 and a member of the 
WTO when it was created on 1 January 1995.  
2.17.  New Zealand is committed to the multilateral trading system. The authorities are of the view 
that as a country dependant on international trade, New Zealand benefits from clear and transparent trade rules that are applicable to all Members. At the Bali Ministerial Conference in 
2013, New Zealand reiterated that the WTO remains its main focus in its efforts to address the 
challenges that it faces as a trading nation, and to promote broad-based and inclusive growth.
1 It 
has actively participated in WTO Trade Facilitation negotiations. However, it has not yet ratified the Agreement. 
2.18.  On 29 October 2014, the WTO Committee on Government Procurement adopted decisions 
inviting New Zealand to accede to the Governme nt Procurement Agreement (GPA) on the basis of 
final market access offers negotiated over the past two years. This move is set to assist businesses 
in New Zealand gain access to procurement markets currently valued at up to US$1.7 trillion 
annually (Section 3.4.5). 
2.19.  New Zealand sees the WTO's Trade Policy Re view Mechanism as an important transparency 
instrument, especially to keep its exporters info rmed of new trade regulations of each member 
country. 
2.20.  New Zealand is represented in multilateral negotiations at the WTO by the Trade 
Negotiations Division of the Ministry of Foreign Affairs and Trade, in conjunction with 
New Zealand's Permanent Mission to the WTO. Acco rding to the authorities, input from businesses 
and individuals is welcomed. 
2.21.  New Zealand continues to defend its trad e interests through the WTO's dispute settlement 
mechanism. Since 2009, New Zealand was directly involved in one dispute as a complainant. On 
30 August 2013, New Zealand requested consultations with Indonesia concerning certain measures Indonesia imposes on the importation of horticultural products, animals and animal products.
2 
New Zealand also participated as a third party in eight dispute settlement cases. 
2.22.  New Zealand continues to make regular notifications to the WTO (Table 2.1). In addition, it 
submits tariff and trade data annually to the WTO Integrated Data Base (IDB). However, as of February 2015, its latest bound schedule in HS12 had yet to be submitted to the WTO for 
verification. 
Table 2.1 Status of selected notifi cations to the WTO, November 2014  
Agreement Requirement/content Periodicity WTO document and date  
(latest document if recurrent) 
Agreement on Agriculture 
Articles 10 and 
18.2 Tables ES:1 and ES:2 – Export 
subsidies Annual G/AG/N/NZL/85, 19/05/2014 
Article 18.2 Table MA:2 – Imports under tariff 
quotas Annual G/AG/N/NZL/84, 19/05/2014 
Article 18.2 Table DS:1  – Domestic Support Annual G/AG/N/NZL/86, 19/05/2014 
Article 18.3 Table DS:2 – New or modified domestic 
support measures exempt from reduction Ad hoc G/AG/N/NZL/76, 05/07/2012 
                                               
1 WTO document WT/MIN(13)/ST/96, 9 January 2014. 
2 WTO documents WT/DS477/1, G/L/1068, G/AG/G EN/118, G/LIC/D/47, G/PSI/D/3, 15 May 2014. 
Australia, Canada, the European Union, Chinese Taipei, Thailand and the United States have joined in the consultations requested by New Zealand. WT/TPR/S/316 • New Zealand 
 
- 30 - 
 
  Agreement Requirement/content Periodicity WTO document and date  
(latest document if recurrent) 
Articles 5.7 and 
18.2 Table MA:5 – Special safeguards Ad hoc G/AG/N/NZL/83, 16/05/2014 
Articles 16.2 Measures concerning the possible 
negative effects of the reform 
programme on least developed and net food importing developing countries  G/AG/N/NZL/82, 07/10/2013 
Agreement on Implementation of Article VI of the GATT 1994 (Anti-dumping) 
Article 16.4 Reports concerning anti-dumping 
actions Ad hoc G/ADP/N/260 , 15/07/2014 
 Semi-annual reports of anti-dumping 
actions (taken within the preceding 
six months) Semi-annual G/ADP/N/259/NZL, 01/08/2014 
Article 18.5 Laws and regulations Once, then 
changes G/ADP/N/1/NZL/2/Suppl.5, 
13/06/2014 
Articles 16.5 Competent authority to initiate anti-
dumping investigations Once, then 
changes G/ADP/N/14/Add.35, 09/04/2013 
Agreement on Implementation of Article VII of the GATT 1994 (Customs valuation) 
Article 22.2 Changes in laws, regulations and 
administration Ad hoc G/VAL/N/1/NZL/1, 28/08/1995 
Understanding on the Interpretation of Article XVII:4(a) of the GATT 1994 (State trading) 
Article XVII:4(a) Notification on state-trading enterprises Ad hoc G/STR/N/15/NZL, 22/05/2014 
Understanding on the Interpretation of Article XXIV:7(a) of the GATT 1994 (Free-trade areas)  
Article XXIV:7(a) 
of the GATT 
1994 and 
Article V:7(a) of 
the GATS Free-trade area for trade in goods and 
trade in services Ad hoc NOTIFIED IN REVIEW PERIOD 
WT/REG348/N/1 and S/C/N/715, 
25/11/2013 
WT/REG284/N/2 and 
S/C/N/545/Add.1, 09/05/2012 
WT/REG306/N/1 and S/C/N/615, 
08/02/2010 
WT/REG291/N/1 and S/C/N/578, 
07/01/2011 
WT/REG266/N/1 and S/C/N/491, 
23/04/2009 
General Agreement on Trade in Services 
Article III:4 and 
IV:2 Contact and enquiry points Within two years 
from entry into 
force of WTO, 
then changes S/ENQ/78/Rev.13, 04/12/2012 
Agreement on Rules of Origin 
Annex II, Para. 4 Preferential rules of origin Ad hoc G/RO/N/113, 02/04/2014 
Agreement on Safeguards  
Article 12.5  Notification and consultations on 
safeguard measures Ad hoc G/SG/N/12/NZL/1, 17/05/2002 
Article 12.6 Laws and regulations Once, then 
changes G/SG/N/1/NZL/1, 07/04/1995  
Agreement on the Application of Sanitary and Phytosanitary Measures  
Article 7 and 
Annex B Laws, regulations and emergency 
measures Ad hoc G/SPS/N/NZL/509, 31/10/2014 
Agreement on Subsidies and Countervailing Measures  
Article 25.1 to 
25.6 Annual report on subsidies Annual G/SCM/N/253/NZL, 24/06/2013 
Article 25.11 Semi-annual report on countervailing 
duty actions Semi-annual G/SCM/N/203/NZL, 17/03/2010 
Article 25.12 Competent authority to initiate 
countervailing investigations Ad hoc G/SCM/N/18/Add.35, 09/04/2013 
Article 32.6 Laws and regulations Once, then 
changes G/SCM/N/1/NZL/2/Suppl.5, 
13/06/2014 WT/TPR/S/316 • New Zealand 
 
- 31 - 
 
  Agreement Requirement/content Periodicity WTO document and date  
(latest document if recurrent) 
Agreement on Technical Barrier s to Trade [Article 2.9] 
Articles 10.1 and 
10.3 Enquiry points  Once, then 
changes G/TBT/ENQ/25, 13/10/2004  
Article 10.6 Proposed and adopted technical 
regulations Ad hoc G/TBT/N/NZL/70, 31/07/2014 
Annex 3C Acceptance of code of good practice Ad hoc G/TBT/CS/N/86, 10/12/1997 
Agreement on Trade-Related Aspects of Intellectual Property Rights  
Article 63.2 Laws and regulations  Once, then 
changes IP/N/1/NZL/4,14/07/2004 (and 
series IP/N/1/NZL/C, D, I, L, P, T) 
Article 69 Contact points Once, then 
changes IP/N/3/Rev.2, 22/07/1996 
Agreement on Trade-Related Investment Measures  
Article 6.2 Publications Once, then 
changes G/TRIMS/N/2/Rev.6, 16/07/1999 
Source: WTO Secretariat. 
2.4.2  Regional trade agreements (RTAs) 
2.23.  New Zealand sees Regional Trade Agreements (RTAs) as a way to complement its 
participation in the multilateral trading system under the auspices of the WTO. The Ministry of Foreign Affairs and Trade coordinates RTAs trade negotiations, with negotiators drawn from other ministries and agencies, including the Ministry of Business, Innovation and Employment; the 
Ministry for Primary Industries; Treasury; New Zealand Customs Service; the Ministry for the 
Environment and the Ministry for Culture and Heritage. 
2.24.  New Zealand's approach is to negotiate comprehensive agreements covering a range of 
trade-related issues, including: trade in goods (m arket access, rules of origin, customs procedures, 
trade remedies, sanitary and phytosanitary meas ures, technical barriers to trade); trade in 
services (market access, movement of natural persons); investment; intellectual property; 
government procurement; competition and cons umer policy; trade and labour; and trade and 
environment. 
2.25.  As highlighted in the previous Review, New Zealand maintains RTAs under the following 
frameworks: (i) Australia-New Zealand Closer Economic Relations Trade Agreement (ANZCERTA) 
(in force since 1983); (ii) New Zealand-Singapore Closer Economic Partnership (in force since 
2001); (iii) New Zealand-Thailand Closer Economic Partnership (in force since 2005); (iv) Trans-Pacific Strategic Economic Partnership (P4 or TransPac) (in force since 2005); and 
(v) New Zealand-China Free Trade Agreement (in force since 2008).  
2.26.  The South Pacific Regional Trade and Economic Cooperation Agreement (SPARTECA), in 
force since 1980, is a non-reciprocal trade agreement that provides for preferential tariff treatment 
for the Forum Island Countries (FICs)
3 by New Zealand and Australia. Supplementing SPARTECA, 
the Pacific Agreement on Closer Economic Relations (PACER), in force since 2002, serves as a framework agreement for future trade liberalizati on between New Zealand, Australia and the FICs. 
Negotiations for a RTA amongst New Zealand, Australia and the FICs – termed PACER Plus – were 
launched in 2009. According to the authorities, New Zealand's overriding interest in these 
negotiations is to secure an outcome that advances the economic development of the FICs. Negotiation topics include: regional labour mobility; development and economic cooperation; rules 
of origin; customs procedures; sanitary and phytosanitary measures; technical regulations, 
standards and conformity assessment procedures; trade in goods; trade in services; and investment.  
2.27.  New Zealand is also engaged in the New Zealand-India Free Trade Agreement. RTA 
negotiations for a NZ-Russia-Belarus-Kazakhstan agreement have been recently suspended.  
                                               
3 Cook Islands, the Federated States of Micronesia , Fiji, Kiribati, Marshall Islands, Nauru, Niue, 
Papua New Guinea, Solomon Islands, Tonga, Tuvalu, Vanuatu, and Western Samoa. WT/TPR/S/316 • New Zealand 
 
- 32 - 
 
  2.28.  During the review period, New Zealand concluded negotiations on two RTAs, which are: the 
New Zealand-Gulf Cooperation Council Free Trad e Agreement; and the New Zealand-Korea Free 
Trade Agreement. These agreements are not yet in force. 
2.29.  New Zealand is a participant in the Trans-Pacific Partnership (TPP) negotiations. The TPP 
aims to create a high quality, comprehensive, 21st century regional trade agreement involving 
12 countries in the Asia Pacific region: Australia, Brunei Darussalam, Chile, Japan, Malaysia, Peru, Singapore, the United States, Viet Nam, Mexico, Canada, and New Zealand. The agreement would 
deepen economic ties between its members by further liberalizing trade in goods and services, 
investment flows, and promoting further convergence on regulatory issues. 
2.30.  New Zealand is also currently involved in the Regional Comprehensive Economic Partnership 
negotiations. The RCEP involves the 10 members of ASEAN (Brunei, Cambodia, Indonesia, 
Lao PDR, Malaysia, Myanmar, the Philippines, Singapore, Thailand, and Viet Nam) and the 
six countries with which ASEAN has existing Fr ee Trade Agreements (FTAs) – Australia, China, 
India, Japan, the Rep. of Korea, and New Zealan d. RCEP participating countries have a combined 
GDP of US$21 trillion
4, account for about 27% of global trade (WTO 2013 figures), are markets for 
60% of New Zealand's goods exports (in 2013), and include seven of New Zealand's top 10 export markets. Formal negotiations began in May 2013. Leaders agreed that the objective for RCEP 
should be to achieve a modern, comprehensive, high-quality and mutually beneficial economic 
partnership agreement. 
2.4.2.1  RTAs in force since 2009 2.31.  During the review period, New Zealand im plemented four RTAs, which are: the Agreement 
between New Zealand and the Separate Customs Territory of Taiwan, Penghu, Kinmen and Matsu 
on Economic Cooperation (ANZTEC) (entered into force in 2013); the New Zealand-Hong Kong, China Closer Economic Partnership (entered into force in 2011); the New Zealand-Malaysia Free 
Trade Agreement (entered into force in 2010), and the ASEAN-Australia-New Zealand Free Trade 
Agreement (AANZFTA) (entered into force between 2010 and 2012). These agreements have been notified to the WTO (see Table 2.1).  
The Agreement between New Zealand and the Separate Customs Territory of Taiwan, 
Penghu, Kinmen and Matsu on Economic Cooperation (ANZTEC) 
2.32.  The ANZTEC was signed on 10 July 2013 and entered into force on 1 December 2013.  2.33.  The ANZTEC provides for liberalization of trade in goods, services and investment between 
the two markets. It also contains provisions on government procurement, trade and labour, and 
trade and environment. 
2.34.  Certain provisions allow for the possibility of co-production between New Zealand and 
Chinese Taipei in film or television. Film and television co-productions are entitled to all the 
benefits accorded to domestic productions in the laws and regulations of each economy. Furthermore, the ANZTEC provides for more Flex ible Air Transport Services through the "open 
skies" provision, whereby airline operations from both sides are facilitated. 
2.35.  The ANZTEC also includes provisions on cooperation on indigenous issues. These provisions 
seek to enhance cultural and people-to-people contacts, and to expand and facilitate trade and economic relations between the indigenous peoples of Chinese Taipei and New Zealand's M āori. 
2.36.  Under the agreement, Chinese Taipei is set to liberalize 99.88% of its tariff lines (excluding 
rice), while New Zealand will liberalize 100% over 12 years. 
The New Zealand-Malaysia Free Trade Agreement 
2.37.  The New Zealand-Malaysia Free Trade Agreement was signed in Kuala Lumpur on 
26 October 2009 and entered into force on 1 August 2010. 
                                               
4 Online information. Viewed at: http://www.mfat.govt.nz/Trade-and-Economic-Relations/2-Trade-
Relationships-and-Agreements/RCEP/ . WT/TPR/S/316 • New Zealand 
 
- 33 - 
 
  2.38.  Malaysia is New Zealand's eighth largest export destination, accounting for almost 
NZ$1 billion of exports in 2013.  
2.39.  The agreement contains measures to improve business in various economic areas of mutual 
interest and is supported by agreements on trade and the environment and trade and labour 
matters. It liberalizes and facilitates trade in goods, services and investment between New Zealand 
and Malaysia, and goes beyond the commitments made in the ASEAN-Australia-New Zealand Free 
Trade Agreement (AANZFTA) signed in February 2009. 
2.40.  Upon entry into force of the agreement,  New Zealand provided duty-free access for 90.8% 
of tariff lines on imports from Malaysia, of which 72.1% were already duty-free on a unilateral basis. New Zealand shall liberalize all imports from Malaysia by 2016, whereas the latter shall provide duty-free access for 99.5% of Ne w Zealand's exports by the same date. 
The New Zealand-Hong Kong, China Closer Economic Partnership Agreement 
2.41.  The New Zealand-Hong Kong, China Closer Economic Partnership Agreement was signed in 
Hong Kong on 29 March 2010 and entered into force on 1 January 2011. 
2.42.  In 2013, Hong Kong, China was New Zealand's 11
th largest export destination. Overall, the 
value of New Zealand's total trade (goods and services) with Hong Kong, China in 2013 was NZ$1.5 billion. 
2.43.  New Zealand considers this RTA as an impo rtant way to boost trade with Hong Kong, China 
and take further advantage of growing opportunities in the region. The deal is also seen as a complement to New Zealand's Free Trade Agreement (FTA) with China. It contains measures to improve business flows and promote cooperation in a broad range of economic areas of mutual 
interest, and is supported by legally-binding side  agreements on labour and environment that are 
in line with New Zealand's broader objectives for sustainable development. A legally-binding side agreement was also secured to negotiate an Investment Protocol within two years of entry into 
force. Negotiations began in early May 2011 but have not yet been concluded. 
2.44.  Commitments under the agreement with Ho ng Kong, China cover the following trade and 
trade-related topics: goods, services, government  procurement, movement of business people, 
rules of origin, customs cooperation, trade remedies, sanitary and phytosanitary measures, 
technical barriers to trade, intellectual property, competition, electronic commerce, dispute settlement, and general exceptions.  
2.45.  The tariff reductions offered by New Zealand under this agreement are the same as those in 
the New Zealand-China FTA. Hong Kong, China bene fited from tariff elimination on 54% of tariff 
lines for its exports upon entry into force (53.1% of tariff lines were already duty free). The remaining 46% of Hong Kong, China's exports cove red by tariff duties will progressively become 
duty free by 2016. Hong Kong, China will maintain duty-free access to all imports into its territory 
on a permanent basis.  
The Agreement Establishing the ASEAN-Australia-New Zealand Free Trade Area 
(AANZFTA) 
2.46.  The Agreement Establishing the ASEAN-Australia-New Zealand Free Trade Area (AANZFTA) 
was signed by the Trade Ministers of New Zealand, Australia and ASEAN (Association of Southeast Asian Nations) on 27 February 2009 at the ASEAN Summit in Hua Hin (Thailand). It entered into 
force on 1 January 2010 for (and between) the following countries: Australia, Brunei, Myanmar, 
Malaysia, New Zealand, Singapore, the Philippines, and Viet Nam. The agreement entered into force for Thailand on 12 March 2010, for Lao PDR and Cambodia on 1 and 4 January 2011 
respectively, and for Indonesia on 10 January 2012. 
2.47.  The agreement provides for liberalization and facilitation of trade in goods, services and 
investment between New Zealand, Australia and the ASEAN economies. It also contains measures 
relating to customs procedures and cooperation, sanitary and phytosanitary measures, standards, 
technical regulations and conformity assessment procedures, electronic commerce, intellectual property and competition policy. WT/TPR/S/316 • New Zealand 
 
- 34 - 
 
  2.48.  Under the AANZFTA, 99% of tariff lines on exports from New Zealand will benefit from a 
progressive elimination of tariffs by 2020, whereas all tariffs on ASEAN exports will be eliminated during the same period. A key feature of AANZFTA's rules of origin is that they allow for cumulation between signatories.  
2.4.2.2  Other agreements and arrangements 
The Asia-Pacific Economic Cooperation 2.49.  New Zealand continues to attach importance to the Asia-Pacific Economic Cooperation 
(APEC). The APEC region accounted for 73.6% of New Zealand's exports, 72.3% of New Zealand's 
total imports and 83% of foreign direct investment into New Zealand in 2013.
5 New Zealand's 
priorities in APEC are to promote: support for th e multilateral trading system; regional economic 
integration including work towards realization of the Free Trade Area of the Asia Pacific (FTAAP); 
increased supply chain connectivity; lower transaction costs at the border including through 
improved customs and standards procedures; structural reform including a focus on good regulatory practice and cooperation; and trad e related measures to improve food security. 
Progress in these areas should continue to make it easier for New Zealand businesses to operate 
throughout the APEC region.  
2.50.  According to the authorities, New Zealan d remains committed to attainment of the Bogor 
Goals of free and open trade and investment in the Asia Pacific Region. In 2010, New Zealand, 
along with four other industrialized economies and eight volunteering developing economies, underwent a detailed assessment of progress towards the Bogor Goals.
6 Based on the analyses of 
these efforts and achievements made by these 13 economies, and taking into account the various 
developments of global circumstances, APEC Lead ers concluded that while more work remains to 
be done, significant progress has been made toward achieving the Bogor Goals at their meeting in Yokohama, Japan in 2010. Since then, two further progress reports have taken place in 2012 and 
2014.
7 
2.51.  At the end of 2012, APEC economies agreed to reduce tariffs on a list of 54 environmental 
goods to 5% or less by the end of 2015. The initiati ve built on a decade of work to open the sector 
within APEC and the World Trade Organization. New Zealand has fully implemented the outcome. 
Unilateral trade preferences 2.52.  A long-standing tariff preference is in place for certain goods from Canada and a few motor 
vehicle parts from Great Britain. The scheme has not changed during the review period. 
2.53.  Under the Generalized System of Prefer ences (GSP), New Zealand grants preferential 
treatment to less developed countries (or developing countries) with per capita incomes less than 70% of that in New Zealand, and least developed countries (LDCs). 91 less developed countries 
and 50 least developed countries are beneficiar ies of New Zealand's GSP scheme. New Zealand’s 
GSP has not been reviewed since its last Trade Policy Review. 
2.54.   All goods of LDC origin qualify for duty-free, quota-free entry into New Zealand since 
1 July 2001. 
2.5  Foreign Investment Regime  2.55.  Foreign Direct Investment (FDI) is gene rally seen by New Zealand as a means to help 
bridge the domestic investment-savings gap and promote connectivity to global markets. 
2.56.  The Overseas Investment Act 2005, the Overseas Investment Regulations 2005, and 
sections 56 to 58B of the Fisheries Act 1996 regulate foreign investment in New Zealand. Under 
                                               
5 APEC online information. Viewed at: http://statistics.apec.org.   
6 APEC online information. Viewed at: http://www.apec.org/About-Us/ About-APEC/Achievements-and-
Benefits/2010-Bogor-Goals.aspx . 
7 APEC online information. Viewed at: http://www.apec.org/About-Us/ About-APEC/Achievements-and-
Benefits/2012-Bogor-Goals.aspx  and http://www.apec.org/About-Us/ About-APEC/Achievements-and-
Benefits/2014-Bogor-Goals.aspx . WT/TPR/S/316 • New Zealand 
 
- 35 - 
 
  the legislation, an overseas person is an individual who is neither a New Zealand citizen nor 
ordinarily resident in New Zealand, and includes a company that is incorporated outside New Zealand and any entity that is 25% or more ow ned or controlled by an overseas person or 
persons. "Overseas person" also includes other incorporated or unincorporated bodies, such as 
partnerships or joint ventures, and trusts, as well as associated of overseas investors.  
2.57.  The Overseas Investment Office (OIO) admini sters the legislation. It reviews applications by 
overseas persons seeking to invest in New Zealand certain asset types, and advises the relevant 
Minister or Ministers on how the application should be decided.
8 Some of the powers and functions 
of the relevant Minister or Ministers (including the power to make consent decisions) have been delegated to the OIO.  
2.58.  The legislation prescribes the circumstances where an overseas person is required to obtain 
consent before investing in New Zealand, i.e. acquisitions by overseas persons of sensitive land or 
an interest in sensitive land
9; 25% or more ownership or control interest in fishing quota; and any 
foreign investment that would result in the acquisition of 25% or more ownership or control 
interest in "significant business assets" (i.e. assets valued at more than NZ$100 million). In its 
mode 3 horizontal commitments under the GATS, New Zealand is bound to a screening threshold of NZ$10 million.  
2.59.  For all investments, the relevant Minister or Ministers (or their delegate) must be satisfied 
that overseas investors, inter alia , have business experience and acumen relevant to the 
investment, are of "good character" and have demonstrated financial commitment to the investment. In addition, where the investment involves sensitive land, the relevant Ministers (or 
their delegate) must be satisfied that the investment will or is likely to benefit New Zealand. In 
relation to investments in fishing quota, the relevant Ministers must be satisfied that the investment will or is likely to be in the national interest (see also Section 4.2.6). Box 2.1 lists the 
different criteria considered in assessing investment applications.    
Box 2.1 Overseas investment: criteria consider ed by the relevant Minister or Ministers 
(or their delegate) 
Criteria for overseas investment in significant business assets 
When considering a non-sensitive land application, the relevant Minister (or his or her delegate) will grant 
consent if he or she is satisfied that the overseas person involved or (if that person is not an individual) all the 
individuals with control of th e relevant overseas person:  
•  collectively have business experience and acumen relevant to the investment;  
•  have demonstrated financial commitment to the investment;  
•  are of "good character"; and 
•  are not individuals of the kind listed in sectio ns 15 and 16 of the Immigration Act 2009, for example, 
a person who has been convicted of an offence for which that person has been sentenced to 
imprisonment for a term of five years or more. 
Criteria for investment in sensitive land 
When considering an application for an overseas investment in sensitive land (either a direct interest or 
securities giving an indirect interest in sensitive land), in addition to the criteria used for overseas investment 
in significant business assets, the relevant Minister or Ministers (or their delegate) must be satisfied that 
either:  
•  the overseas person is, or (if that person is not an individual) all the individuals with control over the 
overseas person are, New Zealand citizens, ordinarily resident in New Zealand or intending to reside 
in New Zealand indefinitely; or 
•  the overseas investment will, or is likely to, be nefit New Zealand (or any part of it or group of 
New Zealanders) (as discussed below) and, if the rele vant land includes non-urban land that in area 
(either alone or together with any associated land) exceeds five hectares, that the benefit will be, or 
is likely to be, substantial and identifiable. 
"Benefit to New Zealand" is assessed having regard to 21 factors that are listed in section 17 of the Overseas 
Investment Act 2005 and regulation 28 of th e Overseas Investment Regulations 2005. 
                                               
8 In the case of a significant business asset decision (not including sensitive land), the relevant Minister 
is the Minister of Finance. In the case of a fishing quota decision, the relevant Ministers are the Minister of Finance and the Minister for Primary Industries, and in the case of a sensitive land decision, the relevant 
Ministers are the Minister of Finance and the Minister for Land Information. 
9 Sensitive land is defined in Schedule 1 of the Overseas Investment Act 2005 and includes non-urban 
land over 5 hectares, certain specified islands, foreshore or seabed, and land over 0.4 hectares that includes or 
adjoins reserves or historic areas. WT/TPR/S/316 • New Zealand 
 
- 36 - 
 
  Factors relating to foreshore/seabed/riverbed/lakebed (Special land) 
Where the relevant land that is the subject of the overse as investment is or includes foreshore, seabed, river 
bed or a lake bed, it is deemed to be "special land" under the Overseas Investment Regulations 2005 (being a 
subset of sensitive land) and the land must first be  offered by the current owner back to the Crown in 
accordance with the procedures set out in the Overse as Investment Regulations. If the Crown accepts the 
offer, it can only acquire the part of the sensitive land that constitutes "special land". The Minister of Finance's 
Ministerial Directive Letter dated 8 December 2010, which is issued under section 34 of the Overseas 
Investment Act 2005, states that the Government's general policy approach to the acquisition of special land is 
that the special land should only be acquired if it is in  the public interest for the Crown to own the special land. 
In determining whether it is in the public interest for the Crown to acquire special land, any recognized 
attitude of New Zealanders (or a group of New Zealanders) towards the special land is one of the relevant 
matters to be considered. 
 
Criteria for farm land 
I n  a d d i t i o n  t o  t h e  c r i t e r i a  u s e d  f o r  a n  o v e r s e a s  i n v e s t m e n t  i n  s i g n i f i c a n t  b u s i n e s s  a s s e t s  a n d  a n  o v e r s e a s  
investment in sensitive land, any overseas investment that involves farm land must meet an additional 
requirement – the farm land or farm land securities must  be advertised on the open market in accordance with 
the rules set out in the Overseas Investment Regu lations 2005, unless a standing advertising exemption 
applies, or an specific exemption from the farm land ad vertising requirements is so ught and is granted.   
 
Criteria for overseas investment in fishing quota 
In addition to the criteria used for an overseas investme nt in significant business assets, the following criteria 
for an overseas investment in fi shing quota must be considered:  
•  whether the relevant overseas person is a body corporate;  
•  whether the interest in the fishing quota is capable of being registered in the Quota Register or the 
annual Catch Entitlement Register; and 
•  whether the granting of consent is in the "national interest" (as discussed below). 
 
National interest 
In assessing whether or not an overseas investment in fishing quota is in the national interest, consideration 
must be given to some of the section 17 "Benefit to New Zealand" factors listed under the heading "Criteria for 
investment in sensitive land" above, and also the following factors:  
•  the introduction into New Zealand of additional inve stment for purposes of si gnificant development, or 
whether the overseas investment will, or is likely to, result in increased processing of New Zealand 
fish, aquatic life or seaweed; or 
•  any other factors that are set out in regulations under the Overseas Investment Act 2005 or that the 
relevant Ministers, having regard to the circumst ances and nature of the a pplication, think fit.  
Source: Overseas Investment Act, 2005; and information provided by the authorities. 
2.60.  In the five years to June 2013, 755 investment applications were screened by the OIO, of 
which 655 were approved, 47 withdrawn, 33 lapsed, and 10 declined. All the 10 declined 
applications involved sensitive land cases. No applications regarding significant business assets 
alone were declined. During the same period, the OIO also undertook 2,196 monitoring exercises to assess post-transaction compliance with conditions; 2,096 were found to be complying, 78 did 
not require complete monitoring, 17 did not comply, and five partially complied. The OIO publishes 
average assessment times over a 12 month period on its website. This information is updated at the end of each month.
10  
2.61.  Following a review in 2009/2010, the Govern ment decided to not to change the Overseas 
Investment Act 2005. However, it agreed to make  several changes to the Overseas Investment 
Regulations 2005. Two additional factors were added (effective December 2010) – a new "economic interests" factor allowing consideration of whether New Zealand's economic interests 
are adequately safeguarded and promoted by the overseas investment, and a "mitigating" factor, 
allowing consideration of whether an overseas investment provides opportunities for New Zealand oversight and involvement. In addition, a new ministerial directive letter was published in 
December 2010, which provides more clarity about the Government's policy on overseas 
investment, and in particular what factors in the benefit test are likely to be more or less important in assessing particular types of invest ments. These changes, along with some others 
made in 2009 to simplify the overseas investment rules and speed up application processing 
times, were considered to strike the right balance. 
                                               
10 Viewed at: http://www.linz.govt.nz/regulatory/overseas-investment/making-application/application-
assessment-timeframes . WT/TPR/S/316 • New Zealand 
 
- 37 - 
 
  2.62.  There are also specific limitations on foreign investment in the air transport and 
telecommunications sectors (Section 4). As regards Air New Zealand Limited, no person who is not a New Zealand national may hold an interest in equity securities which confer 10% or more of the voting rights without the prior written consent of the Crown. In addition, the majority of 
Air New Zealand's board of directors must be New Zealand citizens. In the case of Chorus Limited, 
no person who is not a New Zealand national shall have a relevant interest in more than 49.9% of the total voting shares of the company, without the prior written approval of the Crown, and at 
least half of the board of directors must be New Zealand citizens (see also Section 4). 
2.63.  New Zealand's involvement in international investment agreements, and especially with 
regard to Bilateral Investment Treaties (BITs), se ems relatively modest (Table 2.2). New Zealand's 
approach has been to conclude investment chapters as part of comprehensive RTAs. To that end, 
most RTAs involving New Zealand have significant investment components (Table 2.3). The 
Investment Protocol to the New Zealand-Australia Closer Economic Relations Trade Agreement was signed on 16 February 2011 and entered into force on 1 March 2013. Under the Protocol, investors 
in both countries benefit from lower compliance costs, higher screening thresholds (New Zealand's 
significant business asset thresholds are NZ$496 million for an Australian non-government investor and NZ$104 million for an Australian government investor, as from 1 January 2015) and 
greater legal certainty.
11 
Table 2.2 Overview of New Zealand's BITs, 2014 
Partners Status Date of signature Date of entry into force 
Argentina Signed 27/08/1999 Not in force 
Chile Signed 22/07/1999 Not in force 
China In force 22/11/1988 25/03/1989 
Hong Kong, China In force 06/07/1995 05/08/1995 
Source: Online information. Viewed at: 
http://investmentpolicyhub.unctad.org/IIA/CountryOtherIias/150#iiaInnerMenu .  
Table 2.3 Overview of New Zealand's RTAs with investment components, 2014 
Short title Status Date of signature Date of entry into force 
ANZTEC In force 10/07/2013 01/12/2013 
Australia-New Zealand Closer 
Economic Relations Investment 
Protocol In force 16/02/2011 01/03/2013 
Malaysia-New Zealand FTA In force 26/10/2009 01/08/2010 
AANZFTA In force 27/02/2009 10/01/2012 (Australia, Brunei, 
Myanmar, Malaysia, 
New Zealand, Singapore, the 
Philippines, and Viet Nam) 
12/03/2010 (Thailand) 
01/01/2011 (Lao PDR) 
04/01/2011 (Cambodia) 
10/01/2012 (Indonesia) 
China-New Zealand FTA In force 07/04/2008 01/10/2008 
New Zealand-Thailand CEP In force 19/04/2005 01/07/2005 
New Zealand-Singapore CEP In force 14/11/2000 01/01/2001 
New Zealand-Korea FTA Concluded Not yet signed  
Source: Online information. Viewed at: 
http://investmentpolicyhub.unctad.org/IIA/CountryOtherIias/150#iiaInnerMenu .  
                                               
11 DFAT online information. Viewed at: http://www.dfat.gov.au/fta/anzcerta/ .  WT/TPR/S/316 • New Zealand 
 
- 38 - 
 
  2.64.  New Zealand has double taxation agreements  (DTAs) currently in force with 39 of its main 
economic partners, 4 DTAs or protocols that are signed but not yet in force with 3 countries, and it is currently negotiating DTAs or protocols with 10 others.
12 In general, DTAs are subject to a prior 
assessment by the Parliament; whereby a Select Committee considers a national interest analysis. 
The national interest analysis is published as part of the Committee's report back to the 
Parliament, and on each country's tax treaty web page. 
 
                                               
12 The list of countries participating in DTAs with New Zealand, including the texts of the DTAs, is 
available at: http://taxpolicy.ird.govt.nz/tax-treaties .  WT/TPR/S/316 • New Zealand 
 
- 39 - 
 
  3  TRADE POLICIES AND PRACTICES BY MEASURE 
3.1  Overview  3.1.  New Zealand maintains an open trade policy regime. The country is engaged in an ambitious 
trade facilitation initiative geared towards implementing a "Joint Border Management System 
(JBMS)". As of February 2015, the initiative was at an advanced stage: a Trade Single Window 
(TSW) and a revised import electronic declaration form had been made available.  
3.2.  The simple average applied MFN tariff rate is 2.4% and over half of tariff lines are duty free, 
reflecting a relative low level of tariff prot ection. Regular reviews are undertaken by the 
Government to ensure predictability of applied customs duties. 
3.3.  During the review period, New Zealand continued to modernize its trade and related 
legislation, either through amendments or comprehensive overhaul. The anti-dumping and 
countervailing law underwent significant amendments, including the introduction of a new 
provision to allow importers to apply for refund of anti-dumping duties paid in excess of the margin of dumping. In addition, as a support meas ure for rebuilding activities after the Canterbury 
earthquakes, anti-dumping measures were susp ended on residential building materials. The 
safeguard regime was modernized with the adoption of a new Act. The Trade (Safeguard Measures) Act 2014 allows for, inter alia , a timely imposition of safeguard actions, and the 
inclusion of "public interest" consideration when imposing a safeguard measure. Four anti-dumping 
investigations were initiated during the review period, of which two resulted in final measures being taken; no countervailing or safeguard measures were imposed. 
3.4.  Technical regulations and SPS-related measures are adopted following related WTO 
provisions. When standards are developed, existing international standards are considered and 
stakeholder consultation is included in the process. Some WTO Members have raised concerns regarding New Zealand's 2012 proposal to introduce plain packaging of tobacco products, while 
some other Members supported the proposal. In 2014, the Smoke-free Environments (Tobacco 
Plain Packaging) Amendment Bill passed its first reading in the New Zealand Parliament and is currently awaiting a second reading. Mutual Reco gnition Agreements (MRAs) are in place between 
New Zealand and some of its main trading partners. The most comprehensive is the Trans-Tasman 
Mutual Recognition Arrangement with the fede ral government and state and the territory 
governments of Australia. 
3.5.  New Zealand maintains several business a ssistance and export promotion programmes. The 
main export promotion agency, New Zealand Trade and Enterprise (NZTE), provides, inter alia , 
strategic advice, research and market intelligence for new exporters, as well as support for already 
established export companies. Export credit insurance is also available for exporting firms. 
Incentive schemes are in place mainly to en courage innovation and capacity building.  
3.6.  New Zealand has a sound legal and institutional framework for competition. The Commerce 
Commission is responsible for enforcing the generic provisions (anti-competitive practices and 
mergers) of the Commerce Act, as well as the competition components of industry-specific laws. 
The Commission is also engaged in international cooperation with overseas competition authorities. New Zealand's competition regime is considered as performing well in international comparisons. However, recent independent studies have found that the country's small market 
and remoteness have resulted in relatively low levels of competition in some services industries 
(e.g. retail, finance, real estate and professional services). This may have contributed to relatively low productivity levels and high costs in some of these sectors. Amendments to the competition 
law, including criminal sanctions for hard-core cartels and the application of the Commerce Act to 
the international freight transport sector, are currently before Parliament.  
3.7.  The Zespri Group, a company with special authority for export of kiwifruit, is the only 
state-trading enterprise currently in operatio n in New Zealand. However, the Government 
maintains equity shares in several enterprises in various key economic sectors such as energy and transport. According to the authorities, the level of government participation in such enterprises has been falling in recent years. WT/TPR/S/316 • New Zealand 
 
- 40 - 
 
  3.8.  New Zealand's spending on government procurement accounted for some 20% of GDP in 
2012. The government procurement regime seeks to support open competitive procurement practices. As such, no preferential treatment ex ists for domestic companies. The terms of New 
Zealand's accession to the revised WTO Agreement on Government Procurement (GPA) were 
agreed on 29 October 2014. A Parliamentary treaty examination process is under way to ratify 
New Zealand's accession. 
3.9.  New Zealand continues to enforce intellectual property rights with a view to ensuring a 
balance between the interests of rights owners and the society as a whole. Several legislative 
changes occurred during the review period. A new patent Act entered into force in 2013 to allow, inter alia , stricter examination of applications, and excluding "computer software as such" from 
patentability. The Copyright Act was amended to facilitate enforcement action against infringing 
sharing file. In addition, the Trade Marks Act was amended several times to accommodate 
international standards. Protection for geographical indications continues to be provided through the Fair Trading Act 1986. The Geographical Indica tions (Wine and Spirits) Registration Act 2006, 
which establishes a registration system for wines and spirits geographical indications is yet to be 
brought into force.  
3.2  Measures Directly Affecting Imports  
3.2.1  Registration, customs procedures and requirements 
3.10.  There are no specific requirements to become an importer in New Zealand. However, 
depending on the nature of goods, prior to importation, consents may be required from various government agencies such as the New Zealand Customs Service (NZCS), the Ministry for Primary 
Industries (MPI), the New Zealand Transport Agen cy, and the Ministry of Health. Food importers 
must register with the MPI. New Zealand has notified to the WTO a list of products for which an import licence is required, and the government agencies in charge of their issuance.
1  
3.11.  As indicated in New Zealand's previous Review, import procedures, including customs 
valuation regulations and appeal mechanisms against NZCS' decisions are regulated through the Customs and Excise Act 1996, and the Customs and Excise Regulations 1996.  
3.12.  The NZCS is responsible for customs procedures, security of the national border, as well as 
collection and administration of all duties and taxes collected at the border. It requires that customs procedures be undertaken electronically  for consignments valued at NZ$1,000 or more 
(import entry) for which full details of the goods to be imported, including the classification of the 
goods under "The Working Tariff Document of New Zealand", is required. Import entry clearance 
must be lodged no later than 20 days of the arrival of goods in New Zealand. In practice, most entries are lodged in advance of arrival. Some g oods are exempt from import entry requirements, 
including postal articles when no duty is payable. Goods valued at less than NZ$1,000 can be 
entered using a simplified entry procedure or can be cleared for entry based on electronic cargo information, which can include multiple consignments on a manifest. Duty is waived when the 
amount of duty payable is less than NZ$60. 
3.13.  During the review period, the NZCS and the MPI embarked in the development of a Joint 
Border Management System (JBMS) with a view to further streamlining customs procedures for goods passing in and out of New Zealand.
2 This modernization has been enshrined into law 
through the 2014 amendments to customs legislation.  The implementation of the JBMS includes a 
Trade Single Window (TSW), which is set to allow international trade stakeholders to send all shipment details electronically to one place, rather than separately to several government 
agencies. The revised electronic declaration form under the TSW is based on version 3 of the 
World Customs Organization's trade data model. The TSW and the revised electronic declaration form for imports went live in August 2013. The remaining development, planned for completion in 
December 2015, includes new electronic forms for cargo reporting and transhipments, and an 
enhanced risk management system. 
3.14.  Electronic declaration of commercial imports is mandatory. Customs procedures can be done 
either by the importer or on his behalf by a cu stoms broker. According to the authorities, 95% of 
                                               
1 WTO document  G/MA/QR/N/NZL/2, 7 October 2014. 
2 The MPI's responsibilities cover, inter alia , agriculture, livestock, forestry, and food safety. WT/TPR/S/316 • New Zealand 
 
- 41 - 
 
  imports are declared by agents acting on behalf of importers, via Electronic Data Interchange 
(EDI) using either a commercial freight forwarder software product, or their own company software. EDI users can connect to the TSW themselves; they must meet technical security requirements and have their own technical support.  As an alternative to EDI, importers and their 
agents can use TSW Online (www.tsw.govt.nz). As this involves entering data manually into 
screens on the website, it is more suitable for agents and importers with low declaration volumes. In order for imports to be cleared: 
• An importer must have a TSW client code; 
• The agent or importer submitting the declaration via EDI or TSW Online must have a 
trade single window declarant code and a unique user identifier. 
3.15.  The implementation of the TSW is at a transi tional phase, and it is being used concomitantly 
with the existing separate systems. For agents and importers whose software has been upgraded 
to the new electronic declaration form, or who use TSW Online, declaration and clearance of imports for both NZ Customs and MPI is now managed in the JBMS, operated by NZ Customs.  
3.16.  The new electronic declaration form will be  mandatory in 2016. Until then, the old version of 
the electronic customs declaration will be accepted. In this case, information about plants, animals, and food products required by the MPI to manage biosecurity and food safety risks and 
requirements (permits and certificates) is sent se parately by importers or their agents to MPI's 
Quantum and FoodNet systems. Simplified customs procedures are available for importers of goods valued at less than NZ$1,000. 
3.17.  New Zealand's risk management system is  based on a standardized methodology, jointly 
developed with Australia for identifying and assessing risk. This generic guide for establishing and 
implementing risk management is reinforced by  other trade facilitation measures such as:  
• Electronic clearance of customs declarations prior to the physical arrival of the goods, 
which has enabled NZCS to decouple border control from physical movement across the 
border, and enable risk assessment in advance of arrival; 
• Access to advance rulings and review and appeal mechanisms; 
• Deferred payment schemes, separation between  payment of duty or tax and physical 
clearance of the goods; 
• Penalties and sanctions for non-compliance, and support for voluntary disclosure; and 
• Post clearance audit mechanisms. 
3.18.  As a result, less than 5% of import transactions are subject to further compliance checks or 
inspection, and 99% of compliant transactions are processed by Customs within 30 minutes of 
completion of an import declaration.
3 NZCS does not maintain an Authorized Economic Operator 
(AEO) system, as the authorities seek to give simplified process to all importers. 
3.19.  New Zealand does not maintain any preshipment inspection regime.  3.20.  In 1995, New Zealand notified its legislation on customs valuation to the WTO. As indicated 
during the previous Review, it is based on the WTO Agreement on Customs Valuation.
4 Aggrieved 
importers or any other authorized person may appeal to the Customs Appeal Authority (CAA), an independent judicial body administered by the Minist ry of Justice. In general, the Notice of Appeal 
must be filed within 20 working days from noti fication of a decision, and a fee of NZ$410 is 
applicable. With respect to goods that have been  seized as forfeit, the Customs and Excise Act 
1996 allows an aggrieved person to appeal to the Chief Executive of Customs in the first instance, 
with a right of appeal to the CAA if not satisfied with the Chief Executive's decision. If dissatisfied 
                                               
3Investment Climate in Practice online information. Viewed at: 
https://www.wbginvestmen tclimate.org/uploads/Inpractic e%20Trade%20NewZealandnote12.pdf .  
4 WTO document WT/TPR/S/216/Rev.1, 12 June 2009. WT/TPR/S/316 • New Zealand 
 
- 42 - 
 
  with the decision of the CAA, a person may appeal to the High Court. During the review period, of 
the 69 customs appeals (Table 3.1), only 8 were taken to the High Court. 
Table 3.1 Customs Appeal Au thority Statistics, 2009-14 
 2009 2010 2011 2012 2013 2014 
Number of appeals 10 20 12 12 9 6 
Appeals heard 1 11 7 9 6 4 
Appeals withdrawn 9 9 5 3 3 2 
Note: Withdrawn covers appeals that were wi thdrawn, struck out, or were invalid.  
Source: WTO Secretariat, based on da ta provided by the authorities. 
3.2.2  Rules of origin 
3.21.  New Zealand applies MFN tariff rates to all goods that do not otherwise qualify for 
preferences under the rules of origin established under a preferential arrangement. Determinations 
of origin for non–preferential purposes can be made under section 65 of the Customs and Excise 
Act 1996. In general terms, this would include an assessment as to where the last substantial 
transformation had been carried out. 
3.22.  New Zealand's preferential rules of origin and other relevant requirements in respect of the 
Generalised System of Preferences (GSP) are se t out in part 6 of the Customs and Excise 
Regulations 1996, as well as in New Zealand legislation by reference (Table A3.1).5  
3.23.  Various origin categories apply in determining whether particular goods qualify as the 
produce or manufacture of a particular preferential country or countries group. 
3.24.  In the case of "Goods wholly obtained or produced in the preferential country", goods are 
basically natural resource-based obtained in the pr eferential country, and final products made from 
them without incorporating any other material (e.g. plants, animals, substances extracted from 
the country's soil or sea bed). This origin category is common to all of New Zealand's trade 
agreements. 
3.25.  Goods produced in a preferential country (or in the territory of one or more countries in the 
case of a regional trade agreement) entirely fr om materials that would themselves qualify as 
originating goods may be conferred origin for preferential treatment purposes. For the GSP, 
ANZSCEP, and for goods imported from Canada, the UK and Forum Island Countries (New Zealand's older agreements), the criteria is a specified value content threshold. For NZTCEPA, 
there is a schedule (Annex 2 of the agreement) that allows for a specified change in tariff 
classification to confer origin.  
3.26.  Origin may also be conferred to goods part ly manufactured in a preferential country, when 
two or more countries have taken part in the manufacture. This origin category uses a 
value-added approach whereby the value of specif ied types of production costs incurred in the 
preferential country must be a certain minimum pe rcentage of the factory cost of the goods (this 
percentage is generally 50%). In addition, the la st process in the manufacture of the goods must 
be performed in the preference receiving country.  
3.27.  Separate rules may be specified for each tariff line (chapter, heading, or subheading within 
the Harmonized System nomenclature) to allow goods containing non-originating materials to 
qualify for preferential treatment. In general, product-specific rules are based on three different 
approaches:  
• Change of tariff classification (CTC) whereb y a good produced in a preferential country 
qualifies as an originating good if the final good has a different HS classification from the 
HS classification of any non-originating materials used in the production; 
                                               
5 NZCS online information. Viewed at: 
http://www.customs.govt.nz/news/resources/factsheets/Documents/Fact%20Sheet%2008.pdf .  WT/TPR/S/316 • New Zealand 
 
- 43 - 
 
  • Regional value content (RVC) whereby a good gains the benefit of the preferential tariff 
treatment if the value added in the preferential country or in the country group to which it belongs amounts to a certain level; 
• A specified process rule whereby a good will qualify as an originating good if it has 
undergone a particular operation (such as finishing process) in the preferential country. 
3.28.  In most cases, for goods to qualify for preferential tariff treatment in New Zealand, they 
must be transported to New Zealand from the preferential country or country group without 
entering the commerce of another country. This requirement allows simple transit through a 
third-party country (under customs' control) provided the goods do not undergo further processing whilst in transit. 
3.2.3  Tariffs 
3.29.  New Zealand's Tariff implementation rules and procedures are contained in a consolidation 
of two legislative pieces, namely the Tariff Act 1988 and the Customs and Excise Act 1996 as 
amended. The Tariff of New Zealand is divided into two parts. Part I relates to the Standard Tariff 
and it sets out the classification of all international trade and import duty rates. Part II relates to 
concessions; it outlines the concession categories to reduce or waive a duty that would usually be applied under Part I. 
3.2.3.1  Applied MFN tariff structure 
3.30.  In October 2013, the Government decided to hold tariffs at current levels until at least 
30 June 2017, except where they are being reduced through trade agreements. This decision followed the Government's commitment in 2009 to make no changes in tariff levels until 
June 2015 at the earliest. The next review of tariff levels will take place in 2016 to consider 
whether there is any need to change overall tariff levels after 2017. 
3.31.  In October 2011, the Tariff (Harmo nised System) Amendment Order 2011 aligned 
New Zealand's tariff nomenclature on the 2012 version of Harmonised Commodity and Coding 
System (HS2012) effective 1 January 2012. The 2014 applied MFN tariff contains 7,510 lines at the HS eight-digit level, of which 99.9% carry ad valorem  duties. Tariffs are applied on the Value 
for Duty (VFD) of imports. 
3.32.  Six tariff lines bear specific rates (fou r on alcoholic beverages and two on clothing and 
footwear). With respect to tariff lines for which international transactions exist, average ad valorem  equivalents (AVEs) for the period 2011-13 were estimated at 1.63% and 1.34% (for 
the alcoholic beverages lines), 36.01% and 37.32% (for clothing and footwear lines). 
3.33.  New Zealand does not maintain tariff quotas.
6 58.3% of tariff lines are duty free (Table 3.2 
and Chart 3.1). 
Table 3.2 New Zealand's MFN ta riff structure, 2008 and 2014 
(%, unless otherwise indicated)  
 MFN applied rate  Final boundb 
  2008a 2014   
Bound tariff lines (% of all tariff lines) .. 100.0c  100.0c 
Simple average rate 2.5 2.4  11.2 
    WTO agricultural products 1.8 1.7  7.4 
    WTO non-agricultural products 2.6 2.5  11.8 
Duty-free tariff lines (% of a ll tariff lines) 57.7 58.3  40.8 
Simple average rate of dutiable lines only 6.0 5.7  19.0 
Tariff quotas (% of all tariff lines) 0.0 0.0  0.0 
Non-ad valorem  tariffs (% of all tariff lines) 0.1 0.1  3.1 
Domestic tariff "peaks" (% of all tariff lines)d 5.6 5.6  5.5 
International tariff "peaks" (% of all tariff lines)e 0.03 0.03  35.5 
                                               
6 WTO document G/AG/N/NZL/84, 19 May 2014. WT/TPR/S/316 • New Zealand 
 
- 44 - 
 
   MFN applied rate  Final boundb 
  2008a 2014   
Overall standard deviation of tariff rates 3.4 3.1  12.1 
Coefficient of variation of tariff rates 1.3 1.3  1.1 
Nuisance applied rates (% of all tariff lines)f 0.1 0.03  0.1 
Total number of tariff lines 7,288 7,510  7,508 
    Ad valorem  rates 3,045 3,091  4,212 
    Duty free 4,205 4,381  3,066 
    Specific rates 6 6  10 
    Alternate rates 0 0  188 
    Otherg 32 32  32 
.. Not available. 
a October 2008 to June 2009. 
b Final bound rates are based on the 2014 tariff schedule in HS2012 nomenclature. The transposition 
to HS2012 is based on WTO calculations. 
c In 2014, only 2 tariff lines are fully unbound (worn clothing). 24 tariff lines are only partially bound 
(used transport vehicles). Partially bound rates are included in the tariff calculations. 
d Domestic tariff peaks are defined as those exc eeding three times the overall average applied rate. 
e International tariff peaks are defined as those exceeding 15%. 
f Nuisance rates are those greater than zero, but less than or equal to 2%. 
g "Other" rates apply to parts and components, for whic h the tariffs varies subject to the rate applying 
to the machinery, appliance or equipmen t for which they have been designed. 
Note: 2008 tariff is based on HS07 nomenclature, 2014 tariff is based on HS12. Calculations for averages 
are based on national tariff line level (8-digit). In cluding AVEs for specific rates, provided by the 
authorities. 
Source: WTO Secretariat calculations, based on data provided by the authorities. 
Chart 3.1 Distribution of MF N applied tariff rates, 2014 
Number of tariff lines 
(58.3)
(35.6) 
(5.6)
05001,0001,5002,0002,5003,0003,5004,0004,5005,000
Duty free 5% 10% 
Note: Figures in parentheses denote the share of total lines. Figures do not add up to 100% due to the 
exclusion of 6 specific tariff lines and 32 "other" tariff lines (see Table 3.2). 
Source: WTO Secretariat calculations, based on data provided by the authorities. 
3.34.  Applied MFN tariffs remain relatively low in  New Zealand, with a simple average of 2.4% in 
2014 (2.5% in 2008). The slight decrease is due to a reduction of some tariffs in 2009 and the 
conversion to HS2012. Footwear and textiles are the most protected industries (Chart 3.2).  
3.35.  In aggregate, New Zealand's tariff shows a positive escalation (Chart 3.3). Further 
disaggregation at ISIC two-digit level shows positive  escalation in chemicals; wood and furniture; 
and food, beverages and tobacco industries. Textiles and leather industries show mixed escalation. WT/TPR/S/316 • New Zealand 
 
- 45 - 
 
  Chart 3.2 Average applied MFN and bound tariff rates, by HS section, 2008 and 2014 
0.0%2.5%5.0%7.5%10.0%12.5%15.0%17.5%20.0%
01 02 03 04 05 06 07 08 09 10 11 12 13 14 15 16 17 18 19 20 2101   Live animals & products        
02   Vegetable products03   Fats & oils      
04   Prepared food, etc.
05   Mineral products06   Chemicals & products07   Plastic & rubber
08   Hides & skins09   Wood & articles
10   Pulp, paper, etc.
11   Textiles & articles12   Footwear, headgear13   Articles of stones
14   Precious stones, etc.15   Base metals and products
16   Machinery
17   Transport equipment18   Precision instruments19   Arms & ammunition
20   Miscellaneous manuf.21   Works of art, etc.MFN 2008
MFN 2014 
Bound
Average applied rate
2008 (2.5%)
2014 (2.4%)Average bound rate
(11.2%)
 
Note: Calculations include AVEs for specific rates, provided by the authorities. 
Source: WTO Secretariat calculations, based on data provided by the authorities. 
Chart 3.3 Tariff escalation by 2-digit ISIC industry, 2014 
n.a.n.a.
0%1%2%3%4%5%6%7%8%
Food,
beverages &
tobaccoTextiles &
leatherWood &
furniturePaper
printing &
publishingChemicals Non-metallic
mineral
productsBasic metals Fabricated
metal
products &
machineryOther
manuf.TotalAverage applied rate in manufacturing
(2.5%)First stage of processing Semi-processed Fully processed
 
n.a. Not applicable. 
Source: WTO Secretariat calculations, based on data provided by the authorities. 
3.2.3.2  Bound tariff  
3.36.  As of March 2015, New Zealand's latest bound schedule in HS2012 had yet to be submitted 
to the WTO for verification. As a result, a matching of the bound and applied schedules in HS2012 was not available. According to the authorities work  was ongoing in order to complete the process.  
3.37.  For the purpose of this Review, based on WTO Secretariat's transposition to HS2012, it 
appears that in 2014, only two tariff lines were fully unbound (worn clothing) and 24 tariff lines 
were partially unbound (transport equipmen t). The average final bound rate was 11.2% 
(Table 3.2).  WT/TPR/S/316 • New Zealand 
 
- 46 - 
 
  3.38.  At the time of New Zealand's previous TP R, it was found that New Zealand bound 99.6% of 
its tariff lines, of which 96.7% were ad valorem  rates; 192 and 11 lines carried specific and 
compound rates of duty, respectively (usually as alternatives to ad valorem  rates), while 35 lines 
had other rates.7 Bindings were not made for some 20 tariff lines, 18 of which relate to transport 
equipment and two to worn clothing and footwear; there were no partially bound lines. The 
average final bound rate stood at 11.6%. 
3.2.3.3  Tariff preferences 
3.39.  During the period under review, New Zealand implemented four free trade and closer 
economic partnership agreements resulting in tariff elimination (Section 2.4.2). In addition, New Zealand continues to grant preferential tariff treatment under bilateral trade agreements (Table 3.3). 
Table 3.3 Summary analysis of New Ze aland's preferential tariffs, 2014 
(Number and %) 
 
Number of 
preferential 
linesa  Total WTO agriculture  WTO non-
agriculture 
  Average
(%) Duty-
free 
rates 
(%) Average 
(%) Duty-
free 
rates 
(%)  Average 
(%) Duty-
free 
rates 
(%) 
MFN   2.4 58.3 1.7 64.8  2.5 57.3
Closer Economic Partnership and 
FTAs:    
Australia 3,097  0.0 99.6 0.0 100.0  0.0 99.5
Canada 2,832  0.3 92.0 0.4 90.1  0.3 92.3
China  3,097  0.1 98.0 0.0 100.0  0.1 97.7
Hong Kong, China  3,097  0.1 98.0 0.0 100.0  0.1 97.7
Malaysia 2,486  0.7 90.2 0.1 98.7  0.8 88.8
Singapore 3,096  0.0 99.6 0.0 100.0  0.0 99.5
Chinese Taipei  3,127  0.0 99.6 0.0 100.0  0.0 99.5
Thailand 3,092  0.4 90.7 0.0 99.9  0.4 89.2
UK and Northern Ireland 9  2.4 58.4 1.7 64.8  2.5 57.4
ASEAN-Australia-New 
Zealand FTA 2,517  0.7 90.7 0.1 98.9  0.0 89.3
TPAb 3,097  0.2 0.1 0.0 0.0  0.2 0.1
SPARTECAc 3,097  0.0 99.6 0.0 100.0  0.0 99.5
GSP     
Less developed 
countries 471  2.2 60.1 1.6 66.3  37.3 59.1
Least developed 
countries 3,097  0.0 99.6 0.0 100.0  0.0 99.5
a The number of preferential lines includes only lines on which the rates are lower than the 
corresponding MFN applied rate. The 2014 MFN tariff consists of 7,510 tariff lines out of which 
4,381 lines bear a duty-free rate. 
b TPA: Transpacific Strategic Econ omic Partnership Agreement (Brune i Darussalam, Chile, Singapore). 
c SPARTECA: South Pacific Regional Trade and Economic Cooperation Agreement (Australia, 
Cook Islands, Micronesia, Fiji, Kiribati, Nauru, Niue, Palau, Papua New Guinea, Marshall Islands, Samoa, Solomon Islands, Tonga, Tuvalu, and Vanuatu). 
Source: WTO Secretariat calculations, based on information provided by the New Zealand authorities. 
 
3.2.3.4  Tariff Concessions 
3.40.  New Zealand applies tariff concessions for social/humanitarian, customs facilitation, trade 
policy and industry assistance purposes, or to comply with international commitments. Of the 17 categories of tariff concessions, the most frequently used is the duty exemption for goods for 
which suitable alternatives are not available from local producers/manufacturers. Locally produced 
"suitable alternative" goods are only recogniz ed when, the domestic content of the locally 
produced "suitable alternative" good is not less than 25% of its ex-factory cost. 
                                               
7 Other rates apply mainly to parts and compon ents for which the tari ff depends on the final 
manufactured product in which they are used. WT/TPR/S/316 • New Zealand 
 
- 47 - 
 
  3.41.  Additionally, there are specific concession s for shortfalls of manufacturing inputs; certain 
capital equipment; and woven fabrics containing wool for use in apparel manufacturing. These concessions are issued for limited periods and, in so me cases, are restricted to specific quantities 
or for the use of specified manufacturers. 
3.42.  Applications for concession are lodged with the New Zealand Customs Service (NZCS). 
Approved applications are published in the Customs Edition of the New Zealand Gazette. NZCS also maintains a consolidated list of approvals relating to tariff concessions issued under the 
general category.
8 
3.43.  Since July 2014, a tariff concessions scheme is implemented for a range of goods used in 
the construction of residential houses in order to support the rebuild effort in the aftermath of the 
Canterbury earthquakes and help address housing supply issues in other areas such as Auckland.  
This scheme will be reviewed in five years.   
3.44.  As indicated in the previous Review, tariff  remissions are also granted for exports under the 
drawback, temporary import, and export warehousing schemes (Section 3.3.4).   
3.2.4  Other charges affecting imports 
3.2.4.1  Other duties and charges 3.45.  In addition to tariffs, an import entry transaction fee (IETF) of NZ$29.26 is payable on every 
electronic import entry clearance, and on import declaration for goods when the sum of duty and 
Goods and Services Tax (GST) payable exceeds NZ$60. A MPI biosecurity system entry levy of NZ$17.63 (GST inclusive) is payable on every entry on which an IETF is payable and is collected 
by Customs at the same time as the IETF.  
3.46.  An inward cargo transaction fee of NZ$30.66 is payable on every inward cargo report for 
goods imported by air, and NZ$359.82 for goods imported by sea. 
3.47.  NZCS also collects: (i) a research levy on  imports of heavy steel and welding consumables 
at rates of NZ$10 per tonne of heavy steel, and NZ$0.05 per kilogram of welding consumables; 
(ii) a levy on alcohol products on behalf of the Health Promotion Agency (HPA) at various rates (Table 3.4); (iii) a synthetic greenhouse gas (good s) levy on goods containing hydrofluorocarbons 
(HFCs) and perfluorocarbons (PFCs) under the C limate Change Response Act 2002 and the Climate 
Change (SGG Levies) Regulations 2013 on behalf of  the Ministry for the Environment at various 
rates
9; (iv) a biosecurity risk screening levy collected by NZCS on behalf of MPI at rates that can 
vary between NZ$12.77 and NZ$18.40 (as per the Biosecurity (System Entry Levy) Order 2010).  
Table 3.4 Summary of the HPA rates on alcohol products  
Alcoholic beverage  Rate as of 1 July 2014 (NZ$) 
Beer Containing more than 1.15% vol. but not 
more than 2.5% vol. 
 
Containing more than 2.5% vol. 0.5658 cents per litre  
 
 
1.6553 cents per litre 
Wine of fresh grapes Containing more than 14% vol., fortified by 
the addition of spirits or any substance 
containing spirits 
 
Other 6.8297 cents per litre  
 
 
 
3.7721 cents per litre 
Vermouth and other wine 
of fresh grapes flavoured with plants or aromatic 
substances Containing more than 14% vol., fortified by 
the addition of spirits or any substance containing spirits  
Other 6.8297 cents per litre  
   
3.7721 cents per litre 
                                               
8 NZ Customs Service online  information. Viewed at: 
http://www.customs.govt.nz/news/resources/listsandguides/Documents/Approvals.pdf .  
9 Online information. Viewed at: 
http://www.legislation.govt.nz/regulation/public/2013/0046/latest/DLM5093414.html . WT/TPR/S/316 • New Zealand 
 
- 48 - 
 
  Alcoholic beverage  Rate as of 1 July 2014 (NZ$) 
Other fermented 
beverages (such as cider, 
perry, mead) Containing more than 1.15% vol. but not 
more than 2.5% vol.  
 
Containing more than 2.5% vol. but not more 
than 6% vol. 
 
Containing more than 6% vol. but not more 
than 9% vol. 
 
Containing more than 9% vol. but not more 
than 14% vol. 
 
Containing more than 14% vol. but not more 
than 23% vol. 
 
Containing more than 23% vol. 0.5658 cents per litre 
 
 
1.6553 cents per litre 
 
 
3.0177 cents per litre 
 
 
3.7721 cents per litre 
 
 
6.8297 cents per litre 
 
 
14.5258 cents per litre 
Spirits and spirituous 
beverages The strength of which can be ascertained by 
OIML hydrometer (brandy, whisky, rum and 
tafia, gin and geneva, vodka) other  Containing more than 1.15% vol. but not more than 2.5% vol.  Containing more than 2.5% vol. but not more than 6% vol.  Containing more than 6% vol. but not more than 9% vol.  Containing more than 9% vol. but not more than 14% vol.  Containing more than 14% vol. but not more than 23% vol.  
Containing more than 23% vol. 14.5258 cents per litre 
 
  0.5658 cents per litre   1.6553 cents per litre   3.0177 cents per litre   3.7721 cents per litre   6.8297 cents per litre   
14.5258 cents per litre 
Bitters Containing not more than 23% vol. 
 
Containing more than 23% vol. 6.8297 cents per litre 
 
14.5258 cents per litre 
Liqueurs and cordials Containing  more than 1.15% vol. but not 
more than 2.5% vol.  Containing more than 2.5% vol. but not more than 6% vol.  
Containing more than 6% vol. but not more 
than 9% vol.  Containing more than 9% vol. but not more than 14% vol.  Containing more than 14% vol. but not more than 23% vol.  
Containing more than 23% vol. 0.5658 cents per litre 
  1.6553 cents per litre   
3.0177 cents per litre 
  3.7721 cents per litre   6.8297 cents per litre   
14.5258 cents per litre 
Source: New Zealand Customs Service online information. Viewed at: 
http://www.customs.govt.nz/features/ charges/feetypes/Pages/default.aspx .  
3.2.4.2  Internal taxes 
3.2.4.2.1  Goods and Services Tax (GST) 
3.48.  GST in New Zealand is governed by the Goods and Services Tax Act 1985. It is a 
consumption tax, based on the "destination principle" which requires that goods and services are taxed in the country in which they are consumed. Consequently, GST is applied to most imported 
and locally produced and consumed, goods and services. The standard rate of 15% applies to most WT/TPR/S/316 • New Zealand 
 
- 49 - 
 
  goods and services. Zero-rated supplies include ex ports of goods and services, certain business-to-
business financial services, certain supplies of fine metal, and certain supplies of land. 
3.49.  Exemptions are regulated in Part 2 of the Act. These exemptions include financial services 
that are not zero-rated (for example, business-to -consumer financial services), most supplies of 
residential housing by lease or sale, and supplie s of donated goods and services by non-profit 
bodies.  
3.50.  The taxable value of GST for imported  goods is the sum of following amounts: 
• The customs value of the goods; 
• Any customs duty, anti-dumping and countervailing duties, HPA levy or Heavy 
Engineering Research Association levy payable; 
• The freight and insurance costs incurred in transporting the goods to New Zealand; and 
• The amount of levy paid or payable on g oods under the Climate Change Response Act 
2002. 
3.2.4.2.2  Excise duties 
3.51.  New Zealand applies excise taxes on impo rted and locally produced goods made of or 
containing: (i) alcohol and alcohol products; (ii) tobacco and tobacco products; (iii) fuels such as motor spirit, compressed natural gas (CNG), and liquefied petroleum gas (LPG). 
3.52.  The Excise and Excise-equivalent Duti es Table in the Working Tariff Document of 
New Zealand has a full listing and description of all the excisable goods and excise rates.
10 
3.53.  Annual adjustments to the excise and exci se-equivalent duty rates on alcohol and tobacco 
products are based on movements in the "Consumers Price Index All groups, excluding credit 
services" over the previous 12-month period to the date of adjustment. The latest adjustment took 
place on 1 July 2014 (alcohol) and 1 January 2015 (tobacco).  
3.2.5  Import prohibitions, restrictions, and licensing 
3.54.  Prohibitions and restrictions are regulated under Customs and Excise Act 1996, or legislation 
administered by the Government department responsible for particular controls. Some prohibitions/restrictions can be waived, subject to prior approval/exemption from relevant 
Government departments or agencies (e.g. MPI, Ministry of Health, Environmental Protection 
Authority, and Ministry of Foreign Affairs and Trade) prior to importation for the prohibition/restriction to be waived. Some import prohibitions and restrictions are covered by import alerts on the NZCS computerized entry pr ocessing system and are subject to electronic 
compliance checks. These relate to agricultural products, food, chemicals, controlled drugs, 
explosives, firearms, hazardous waste, etc. A comprehensive list of these products and a description of related procedures is found on the NZCS website. 
3.55.  In 2014, New Zealand notified all its quantitative restrictions to the WTO.
11 As indicated at 
the time of the previous TPR of New Zealand, no import prohibitions, restrictions, or licensing are operated on commercial grounds.  
3.56.  The current quantitative restrictions in force are implemented for various purposes, 
including: protection of public morals, compliance with domestic regulations and international conventions, or protection of public health. They include agricultural products, chemicals, 
endangered species, as well as a range of food products.  
                                               
10 NZ Customs Service online  information. Viewed at: 
http://www.customs.govt.nz/news/resources/tariff/th eworkingtariffdocument/Documents/Excise%20and%20e
xcise-equivalent%20duties%20table.pdf . 
11 WTO document G/MA/QR/N/NZL/2, 7 October 2014.  WT/TPR/S/316 • New Zealand 
 
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  3.2.6  Anti-dumping, counterva iling, and safeguard measures 
3.2.6.1  Anti-dumping and countervailing measures 3.57.  The Dumping and Countervailing Duties Act 1988 provides the legal basis for investigating 
dumping and subsidization, and for the imposition  of anti-dumping and countervailing duties in 
New Zealand. Its main provisions reflect the WTO's Anti-Dumping Agreement and Subsidies and 
Countervailing Measures Agreement. The Trade and Regulatory Co-operation team of the Ministry 
of Business Innovation and Employment is in charge of the investigation process (acceptance of a 
complaint by New Zealand producers, initiation of an investigation, and the core investigation 
process).  
3.58.  During the period under review, noticeable changes were made to New Zealand's legislation 
on anti-dumping and countervailing. 
3.59.  The Dumping and Countervailing Duties Act 1988 was amended in 2012 and 2014. The 
2012 amendment allows New Zealand importers to apply for a refund of anti-dumping duty paid in excess of the margin of dumping. The 2014 amen dment suspended existing anti-dumping duties 
on residential building materials and suspended th e application of any new anti-dumping duties on 
imports of residential construction materials for three years with effect from 1 June 2014. 
3.60.  New Zealand's RTAs also contain anti-dumping and countervailing provisions. Under the 
ANZCERTA protocol, Australia and New Zealand have agreed to dispense with anti-dumping action 
in relation to goods produced in either country. However, countervailing measures may be taken by either country. 
3.61.  Under the New Zealand-Singapore Closer Economic Partnership Agreement, New Zealand 
and Singapore may take anti-dumping and counterva iling action against each other. However, in 
the case of anti-dumping, this agreement provides for a higher de minimis  dumping margin and a 
higher "negligible imports" volume threshold. In  addition, anti-dumping and countervailing duties 
will cease after three years unless reviewed, rath er than five years as provided for under WTO 
rules. 
3.62.  Under the trade agreements with Pacific Forum Island Countries, and Canada, there are a 
number of notification and consultation requirements to be followed, prior to anti-dumping and 
countervailing actions.  
3.63.  Since 2009, New Zealand has initiated four anti-dumping investigations (wire nails from 
China, preserved tomatoes from Italy, diaries fr om the Republic of Korea, and preserved peaches 
from Spain) of which two (wire nails from China, and preserved peaches from Spain) resulted in 
final measures being taken. 
3.64.  As of end December 2014, New Zealand maintained definitive anti-dumping measures 
against China, Greece, Malaysia, South Af rica, Spain, and Thailand (Table 3.5). 
Table 3.5 Definitive anti-dumping measures, as of 31 December 2014 
Country/ 
Customs 
Territory Product  Date of original imposition Date(s) of extension 
China Peaches in preserving liquid 
 Diaries  Wire nails
a 21.08.2006  
 18.10.2007  02.06.2011; 13.06.2012 (exclusion of some types of nail)  18.07.2012 
 15.08.2013 
Greece Canned peaches 09.03.1998 18.12.2003; 18.11.2009 
Malaysia Diaries 
 Galvanized wire 18.10.2007  
 29.04.2004 15.08.2013 
 17.11.2009 
South Africa Canned peaches 02.08.1996 28.06.2002; 11.02.2008; 
05.06.2014; 15.01.2015 WT/TPR/S/316 • New Zealand 
 
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  Country/ 
Customs 
Territory Product  Date of original imposition Date(s) of extension 
Spain Preserved peaches 11.08.2011  
Thailand Plasterboard 
(8.75 - 10.25mm)a 
 
 
Plasterboard  
(6mm - less than 12mm)a 
 
Reinforcing steel bara 21.12.1989 
 
 
 
19.11.2000 
 
 
05.03.2004 26.02.1996; 27.03.2000; 
12.12.2002; 11.09.2006; 
18.07.2012 
 
11.09.2006; 18.07.2012 
 
 
17.11.2009 
a Anti-dumping duties suspended. 
Source: WTO document G/ADP/N/265/NZL, 6 March 2015. 
3.65.  As of 1 June 2014, New Zealand suspended anti-dumping duties on plasterboard from 
Thailand, wire nails from China, and reinforcing steel bar from Thailand for three years. The suspension of these anti-dumping duties on impo rts of building materials is a measure to support 
the construction sector in the aftermath of the Christchurch earthquake.  
3.66.  New Zealand has not imposed any countervailing duties or undertaken any countervailing 
investigations during the review period. In July  2009, the countervailing  duty on canned peaches 
from the European Union was terminated, following sunset review.   
3.2.6.2  Safeguards  3.67.  The Trade (Safeguard Measures) Act 2014 entered into force in November 2014 and put in 
place a new safeguards regime for New Zealand and repealed the previous law relating to 
safeguards contained in the Temporary Safeguard Authorities Act 1987. The Act requires 
New Zealand to apply safeguard measures following WTO rules. 
3.68.  The reform steps under the new Act include measures authorizing the Commerce and 
Consumer Affairs Minister to impose separate provisional and final safeguard duties to allow 
safeguard action to be taken quickly; the inclusion of criteria for determining whether the imposition of a safeguard measure is in the public interest; and extending the time-frame for 
completing a safeguard investigation from 30 to 75 working days. In addition, it allows safeguard 
duties to be refunded if the investigat ion finds the measures were not required. 
3.69.  New Zealand has not imposed any safeguard measures or undertaken any safeguard 
investigations during the review period.  
3.70.  The AANZFTA, the New Zealand–Thailand Closer Economic Partnership Agreement, the 
New Zealand–China FTA, and the New Zealand-Ma laysia FTA include a bilateral transitional 
safeguard mechanism which allows each Party to impose a bilateral transitional safeguard on 
imports  from the other Party during the period tariffs are being phased out for any particular good 
and for a limited period. Such a transitional safeguard mechanism can be imposed to address situations of serious injury or threats of serious injury to a domestic industry caused by increased 
imports as a result of tariff reductions under the FTA. In these situations, action can include 
suspending further tariff reductions or reverting to higher tariffs for a certain period. 
3.71.  The Closer Economic Partnership between New Zealand and Hong Kong, China and the 
Economic Cooperation Agreement between New Zealand and Chinese Taipei, both include a 
provision where, if either Party imposes a WTO safeguards measure, it shall exclude imports from 
the other party if such imports are not a cause of serious injury or threat thereof. The New Zealand–Thailand Closer Economic Partners hip Agreement, the New Zealand–China FTA and 
the New Zealand–Malaysia FTA provide that a Party applying a global safeguard measure may 
exclude imports from the other Parties where thos e imports are not cause of serious injury. Under 
the Australia-New Zealand Closer Economic Relations Agreement and the New Zealand–Singapore 
Closer Economic Partnership Agreement, a Party imposing a global safeguard measure must 
exclude imports originating from another Party from the measure. WT/TPR/S/316 • New Zealand 
 
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  3.2.7  Standards and other technical requirements 
3.72.  New Zealand's standards regime (including technical regulations and other technical 
requirements) did not undergo significant change s during the review period. The New Zealand 
Standards Council oversees the development and ad option of standards. Standards New Zealand, 
the national standards body, continues to operate under the Standards Act 1988 and the Crown 
Entities Act 2004. It represents New Zealand in the International Organization for Standardization 
(ISO) and the International Electrotechnical Commission (IEC). Standards New Zealand is also the 
national enquiry point under the WTO Agreement on Technical Barriers to Trade (TBT).  
3.73.  New Zealand's standards development process continues to involve wide consultation, as 
Standards New Zealand has accepted the Code of G ood Practice for the Preparation, Adoption and 
Application of Standards under Annex 3 of the TBT Agreement. When developing a standard, 
Standards New Zealand invites all interested stakeholders to nominate a representative to the 
standards development committee. The stakeholders may be regulators, professional bodies, research agencies, manufacturers, or end-users. A public consultation period of six to eight weeks 
is provided on a draft standard.  
3.74.  The majority of New Zealand's standards are voluntary (Table 3.6). However, they can be 
mandatory when cited in the relevant legislation or regulations. Since 2009, New Zealand has 
notified some 22 technical regulations (mandatory standards) to the WTO. They cover products in 
areas including environmental protection, human health, food standards, and products safety. 
Table 3.6 New Zealand standards, 2009-14 
 2009 2010 2011 2012 2013 2014 
Total number of standards 
3,036 3,050 3,103 3,118 3,193 3,205 
of which technical 
regulations n.a.  n.a. n.a. 1,271 1,210 1,214 
Per cent developed by 
New Zealand 19 19 19 19 18 18 
Per cent developed jointly by 
Australia & New Zealand 81 81 81 81 82 82 
Per cent of total equivalent to 
ISO standards 14 13 13 14 14 15 
Per cent of total equivalent to 
IEC standards 19 18 18 18 18 20 
Per cent of total equivalent to 
ISO and IEC (ISO/IEC) 11 11 11 11 11 8 
Per cent for which no 
internationally equivalent 
standard available 56 58 58 57 57 57 
n.a. Not available. 
Source: Information provided by the authorities. 
3.75.  Products (imported or produced locally) are tested or inspected by various laboratories or 
inspection bodies, and two accreditation bodi es assess them independently (Table 3.7). 
3.76.  New Zealand cooperates with several of its major trading partners under the framework of 
Mutual Recognition Agreements (MRAs) (Table 3.8). The Trans-Tasman MRA between New Zealand 
and Australia is the most comprehensive cooperat ion framework and provides for extensive mutual 
recognition as shown below. 
 WT/TPR/S/316 • New Zealand 
 
- 53 - 
 
  Table 3.7 Standards and conformi ty assessment infrastructure 
Activity  International 
organization  Regional 
organization  National authority  Relevant 
legislation 
Documentary 
standards  International 
Organisation for Standardisation (ISO)   International 
Electrotechnical 
Commission (IEC)  Pacific Area 
Standards Congress (PASC)  Standards 
New Zealand (SNZ)  Standards Act, 1988  
    Crown entities Act, 
2004 
Physical standards 
of measurement  International Bureau 
of Weights and 
Measures (BIPM)  Asia Pacific 
Metrology 
Programme (APMP)  Measurement 
Standards 
Laboratory (MSL)  Measurement 
Standards Act, 1992 
Legal 
measurement  International 
Organisation of Legal Metrology (OIML)  Asia Pacific Legal 
Metrology Forum (APLMF)  Trading Standards, 
Ministry of Business, Innovation and Employment Weight and Measures 
Act, 1987 
Accreditation of 
laboratories, 
inspection bodies 
and radiology 
services  International 
Laboratory 
Accreditation 
Co-operation (ILAC)  Asia Pacific 
Laboratory 
Accreditation Co-
operation (APLAC)  
 
European 
Co-operation for 
Accreditation (EA)  
 
Inter-American 
Accreditation 
Cooperation (IAAC) International 
Accreditation 
New Zealand (IANZ)  Testing Laboratory 
Registration Act, 
1972 
 
 
Crown entities Act, 
2004 
Accreditation of 
certification bodies (products, 
systems and 
personnel)  International 
Accreditation Forum (IAF) 
 
International Auditor and Training Certification Association (IATCA)  Pacific Accreditation 
Cooperation (PAC)  Joint Accreditation 
System for Australia and New Zealand 
(JAS-ANZ) The JAS-ANZ Treaty, 
1998 
Source: Information provided by the New Zealand authorities. 
Table 3.8 Overview of MRAs involving New Zealand, 2014 
Cooperation framework Areas covered 
Australia (Trans-Tasman MRA) A good that may be sold legally in Australia may be sold in New Zealand 
(and vice versa) withou t further technical regulation requirements. There 
are a limited number of exceptions wh ere mutual recognition would not be 
appropriate, such as Radio communications Regulations 
China Conformity assessment for electric and electronic equipment and 
components 
Chinese Taipei Conformity assessment for electric and electronic equipment and 
components, including electrical safety and Electromagnetic Compatibility (EMC) 
Singapore Conformity assessment for electric and electronic equipment and 
components 
European Union Conformity a ssessment for: medicinal products, medicinal devices, 
telecommunications terminal equipment, low voltage equipment, electromagnetic compatibility, machinery, and pressure equipment 
APEC countries Conformity assessment for electric and electronic equipment and food 
products 
 Source: WTO Secretariat and informat ion provided by the authorities. 
3.77.  New Zealand has two key product safety laws: the Consumer Guarantees Act 1993 and the 
Fair Trading Act 1986. Under the Ministry of Business, Innovation and Employment, Trading 
Standards (formally the Measurement and Prod uct Safety Service (MAPSS)) administers and 
provides advice on the product safety provisions  of these Acts. These regulations do not have a 
mandated review period.  WT/TPR/S/316 • New Zealand 
 
- 54 - 
 
  3.78.  Part Three of the Fair Trading Act affords the Minister of Consumer Affairs a range of 
statutory powers to place controls on unsafe consumer goods, i.e. to set mandatory standards for consumer goods, ban unsafe consumer goods (through unsafe goods notices), compel the recall of an unsafe good or issue a product safety policy statement. This last measure was introduced as 
part of the review of consumer protection legislation in 2013. A product safety policy statement is 
a statement from the Government in relation to a product safety issue, but it does not in itself carry a legal sanction. It can be used as possible precursor to regulatory intervention. An unsafe 
goods notice can be introduced without public consultation and it remains in force for 18 months 
(unless revoked). After the initial 18 months the Minister can make it permanent, following a consultation process. 
3.79.  The Minister makes decisions based on advice received from Trading Standards, and is 
provided with a range of options and recommendations in respect of possible legal measures to 
address the risks and issues identified. 
3.80.  The Consumer Guarantees Act is a general consumer protection law which sets minimum 
standards of quality for goods and services. It provides consumers with a series of civil law rights 
in relation to the purchase of goods. In cases where goods are not of "acceptable quality" (which 
includes the requirement for the goods to be safe) a consumer can seek civil redress.  
3.81.  There are currently six product safety standards made under the Fair Trading Act for: baby 
walkers; children's nightwear; children's toys; cigarette lighters; household cots and pedal cycles. Unsafe goods notices are currently in force for: lead in children's toys; chainsaws; multi-purpose ladders; hot water bottles; candles with lead in the wicks and candlewicks containing lead; and 
pistol crossbows.
12 
3.82.  The Commerce Commission enforces product safety standards and product bans made 
under the Fair Trading Act. The New Zealand Customs Service can also enforce the safety 
provisions. 
3.83.  During the review period, specific trade co ncerns were raised within the framework of the 
WTO Committee on Technical Barriers to Trade, wi th respect to New Zealand's Proposal in 2012 to 
introduce plain packaging of tobacco products.13 On 11 February 2014, the Smoke-free 
Environments (Tobacco Plain Packaging) Amen dment Bill (Plain Packaging Bill) passed its 
first reading in the New Zealand Parliament and was referred to a parliamentary select committee 
for further consideration. 
3.84.  The Plain Packaging Bill is set to enable  regulations to be made to set out the detailed 
requirements for the design and physical appearan ce of any packaging used or intended for use 
with tobacco products, and of the tobacco products themselves. However, according to the 
authorities, the Plain Packaging Bill and the re gulations to implement plain packaging might be 
delayed, if necessary. This is to enable the Bill to take into account the implications of ongoing WTO dispute settlement proceedings on similar matters. 
3.85.  In 2010, the Electricity (Safety) Regulations 2010 revoked the Electricity Regulations 1997. 
According to the authorities, the new Regulation s promote the health and safety of individuals 
involved in the supply and use of electricity in New Zealand, and promote the prevention of damage to property. The main changes brough t about by the 2010 Regulations include: the 
definition of requirements relating to safety management systems and the adoption of relevant 
international standards. In addition, the regulations deal with the importation and sale of fittings and appliances.  
3.86.  In July 2014, New Zealand introduced the Standards and Accreditation Bill 2014. The 
authorities stated that the purpose of this Bill is to ensure that the New Zealand Standards and accreditation system is viable and well-functioning, and meets the needs of business, regulators, 
and consumers into the foreseeable future. This is set to be done by means of new institutional 
arrangements for New Zealand standards development and approval, as well as for the Testing Laboratory Registration Council.   
                                               
12 Online information. Viewed at: http://www.consumeraffairs.govt.nz/legislation-policy/acts-
regulation/product-safety-standards/how- product-safety-laws-work-in-new-zealand .  
13 WTO document G/TBT/M/62, 5 May 2014. WT/TPR/S/316 • New Zealand 
 
- 55 - 
 
  3.2.8  Sanitary and phytosanitary requirements 
3.87.  New Zealand continues to attach high importance to the protection of human, animal, and 
plant life or health. As a consequence, it mainta ins a relatively strict SPS regime. "Risk goods" 
cannot be imported into New Zealand until a co mprehensive risk assessment has been completed 
through the adoption of an "Import Health Standards" (IHS). 
3.88.  New Zealand's main SPS legislation, i.e. the Biosecurity Act 1993 and the Animal Products 
Act 1999, has not been significantly amended during the review period.  
3.89.  The Food Act 2014 updates the Food Act 1981. It reforms provisions on trade in food in 
order to enhance safety and suitability. It also se ts guidelines for risk-based measures to improve 
public health protection. The Act is scheduled to be fully in force by mid-2016. 
3.90.  In 2012, the Ministry of Agriculture and Forestry (MAF) was merged with the Ministry of 
Fisheries and the New Zealand Food Safety Authority (NZFSA) to form the Ministry for Primary 
Industries (MPI).  
3.91.  The MPI is in charge of New Zealand biosecurity and food safety systems. MAF Biosecurity 
New Zealand became part of MPI in 2012. Its pre-border and post-border functions are now 
dispersed across several branches in the organisation. Functions relating to implementation of the Biosecurity Act 1993 are largely now the responsibili ty of the Regulation and Assurance Branch.   
3.92.  The Animal and Animal Products Directorate has responsibility for developing SPS measures 
relating to animal health and zoonoses, in accordance with relevant international standards. The Plants, Food and Environment Directorate has th e responsibility of developing SPS measures 
relating to plant health. SPS New Zealand, which is also part of the MPI, is the Notification 
Authority and National Enquiry Point for the purp oses of the WTO SPS Agreement. Food safety 
issues are regulated in various branches of the MPI, mainly in the Policy and Trade, and the Regulation and Assurance Branches, as well as the Compliance Branch. 
3.93.  Under section 24A of the Biosecurity Act 1993, New Zealand issues Import Health Standards 
(IHS), which are documents that state the requirements to be met before risk goods can be imported under the Biosecurity Act.  
3.94.  A risk good is any organism, organic material, or any other substance that, by reason of its 
nature, origin, or other relevant factors may: (a) cause unwanted harm to natural and physical resources or human health in New Zealand; or (b ) interfere with the diagnosis, management, or 
treatment, in New Zealand, of pests or unwanted organisms. In practice, the nature of the good 
(e.g. plant or animal material) and/or a history of regular interceptions of organisms on a 
particular product (e.g. inanimate objects) may be the basis for determining that the product is a risk good and therefore requires an import health standard to enable its importation.   
3.95.  Risk goods cannot be cleared for entry into New Zealand unless the risks posed by the 
goods have been assessed and can be effectively managed. Any risk good that does not meet the biosecurity requirements for import (set out in an import health standard), or which have not been 
assessed, will not be cleared for entry to New Zealand. Risk goods require a risk analysis to be 
undertaken before an import health standard can be issued and goods cleared under it.  
3.96.  Decisions on issuing import health standard s are the responsibility of the Director-General 
of MPI, on the recommendation of a Chief Techni cal Officer. To date, over 350 IHS have been 
issued (of which about 90 during the review peri od). The MPI maintains an online system which 
provides detailed information on specific IHS by commodity and by country.
14  
3.97.  An importer can apply for an IHS to be drafted if one does not exist. Applications are 
assessed and prioritized against specific criteria, including the importance of the product, its 
strategic nature, the net benefit, as well as the work required for the IHS. Risk analysis is the first stage in the development of IHS. It involves the identification of potential pests and diseases 
                                               
14 Biosecurity New Zealand onli ne information. Viewed at: 
http://www.biosecurity.govt.nz/ihs/search/0?page=9 .  WT/TPR/S/316 • New Zealand 
 
- 56 - 
 
  associated with a product, the likelihood of entry and establishment in New Zealand and the 
potential impacts on the economy, the environmen t and human health in New Zealand. Proposed 
IHSs go through a wide public consultation before their adoption. The timeframe for public comment varies depending on the nature of the amendment, the number of interested/affected 
parties, the urgency of the measures, as well as implementation factors.  
3.98.  SPS certification from the country of origin may be required for food products for which 
there are specific food safety provisions, in the pre-clearance arrangements. If there are no such 
requirements, no SPS certification is needed.  
3.99.  Food Standards are made under the Food Act 1981. They set general safety and production 
requirements that must be met by food producers. The Food (Importer Listing) Standard 2008 requires food importers to be listed as an impo rter with MPI, and the Food (Importer General 
Requirements) Standard 2008 set specific requirem ents for sourcing, storage and transport prior 
to import, and record keeping. 
3.100.  The Biosecurity Costs Regulations 2010 and the Biosecurity System Entry Levy Order 2010 
establish the structure of charges paid by importers to MPI for biosecurity clearance of imported 
goods and other related activities at the border. 
3.101.  For exporters to meet importing countries requirements, the MPI also maintains an export 
certification system for plant products whereby it  authorizes Independent Verification Agencies 
(IVAs) and approved organizations to carry out certification services and activities on its behalf. It has developed standards and technical requirements in this regard.  
3.102.  Under the Animal Products Act 1999 (APA), Animal Products Notices, Specifications, and 
Overseas Market Access Requirements are issued by  the MPI to: (a) minimise and manage risks to 
human or animal health arising from the production and processing of animal products, by instituting measures that ensure that all traded animal products are fit for their intended purpose; 
and (b) facilitate the entry of animal material and products into overseas markets. 
3.103.  Under the Wine Act 2003, Wine Standards, Notices, and Codes of Practice provide 
standards for identity, truthfulness in labelling, and safety of wine. They also facilitate the entry of 
wine into overseas markets by providing the necessary quality and safety controls. Since 2009, 
eight Wine Notices and Codes of Practice have been issued. 
3.104.  As mentioned in the previous Review, Food Standards Australia New Zealand (FSANZ) 
develops food standards for food available in New Zealand and Australia. These standards are 
described in the Australia New Zealand Food Standards Code which provides a common set of food 
composition and labelling rules agreed between New Zealand and Australia. Food composition includes ingredients (including novel foods and th ose produced using gene technology), processing 
aids, colourings, additives, vitamins and minera ls. Under the Trans-Tasman Mutual Recognition 
Agreement (TTMRA), goods produced in, or imported into, New Zealand and then legally sold, may be sold in Australia, and vice versa. However, "high-risk" foods (Bovine and bovine meat products, 
and Bivalve Molluscan Shellfish (BMS) are exempt fr om the TTMRA and subject to import clearance 
procedures. The MPI provides updated guidance for importers who want to import from Australia.
15 
3.105.  New Zealand makes annual updates to amend the Maximum Residue Limit of agricultural 
compounds, under its Food Standards 2014.16  
3.106.  Since 2009, New Zealand has notified to the WTO 96 new SPS measures (regular and 
emergency measures), of which 12 were emergency measures affecting either all its trading partners or geared towards specific Members including Brazil, Chinese Taipei, EU members, the 
United States, Paraguay, Switzerland and Turk ey. These regulations were imposed based on 
existing international standards. No trade concerns involving New Zealand were raised in the WTO SPS Committee during the review period.  
                                               
15 Ministry for Primary Industries online information. Viewed at: 
http://www.foodsafety.govt.nz/elibrary/ind ustry/Importing_Prescribed-Review_Food.pdf .  
16 WTO document G/SPS/N/NZL/508, 29 August 2014. WT/TPR/S/316 • New Zealand 
 
- 57 - 
 
  3.107.  New organisms, including GMOs, are regulated through the 1996 Hazardous Substances 
and New Organisms (HSNO) Act. Under HSNO, all new organisms are prohibited from importation, development, field testing or release without formal approval from the Environmental Protection Agency (EPA), which is required to take into account various factors related to the potential risks 
and benefits of the proposal. These include enviro nmental, economic, social, cultural, and public 
health considerations. The MPI ensures that the controls placed on new organism approvals by the EPA are complied with.  
3.108.  GMO foods and ingredients can only be sold  in New Zealand if they have been assessed for 
safety and consequently approved by Food Standards Australia New Zealand (FSANZ). The 
Australia and New Zealand Ministerial Forum on Food Regulation has the capacity to adopt, or seek a review of the approval. MPI is also responsible for ensuring foods containing GMOs are labelled in 
accordance with the appropriate standard in the Australia New Zealand Food Standards Code. 
3.3  Measures Directly Affecting Exports 3.3.1  Export procedures and requirements 
3.109.  All export declarations must be lodged and cleared electronically before goods are loaded 
for export. Goods valued at less than NZ$1,000 and passenger effects are exempt from this 
requirement. In 2006, NZCS established the "Secure Export Scheme", a voluntary arrangement 
between exporters and the NZCS to protect the exporters' international supply chain against 
tampering, sabotage, smuggling and other trans-national crime.
17 Under the scheme, several 
advantages such as NZCS advice, assistance fo r unexpected issues, and a reduced export entry 
transaction fee of NZ$12.01 (inclusive of GST) are offered to registered exporters. 
3.3.2  Export taxes, charges, and levies 
3.110.  New Zealand does not impose export taxes or duties on exports.  3.3.3  Export prohibitions, restrictions, and licensing 
3.111.  New Zealand imposes restrictions, licensing requirements, additional controls and 
prohibitions on a variety of exports, mostly for health and safety reasons, or to comply with 
international obligations. In the case of some agricultural products, export licences are maintained 
either to manage trading partners' import requirements (tariff-quotas) or for marketing reasons. 
NZCS maintains an updated list of goods subject to export prohibitions or control.
18 
3.3.4  Duty and tax concessions 3.112.  Exporters may be eligible for duty drawback  on import duties, excise taxes and, in certain 
cases GST, paid on imported goods.
19 There have been no amendments to the drawback regime 
since the last Review. Exporters can claim a refund of duties for: goods imported into New Zealand 
that are later exported; goods manufactured and exported from New Zealand; imported parts used 
for goods manufactured in New Zealand and subs equently exported; and imported materials, 
except fuel or plant equipment, used in the ma nufacture of goods in New Zealand and exported.20 
Re-import of goods exported under drawback provisions is allowed (subject to payment of 
corresponding customs duty).  
3.113.  The minimum amount of drawback that can be claimed for commercial goods is NZ$50. 
There is no minimum amount for private exporters. 
3.114.  The amount of duties refunded under the drawback scheme stood at NZ$44 million in 
2013/2014, up from NZ$37 million in 2008/2009. 
                                               
17 NZ Customs Service online  information. Viewed at: 
http://www.customs.govt.nz/news/resources/factsheets/Documents/Fact%20Sheet%2034.pdf .  
18 NZ Customs Service online  information. Viewed at: 
http://www.customs.govt.nz/news/resources/factsheets/Documents/Fact%20Sheet%2004.pdf .  
19 Section 117 of the Customs and Excise Act 1996. 
20 NZ customs Service online  information. Viewed at: 
http://www.customs.govt.nz/news/resources/factsheets/Documents/Fact%20Sheet%2001.pdf .  WT/TPR/S/316 • New Zealand 
 
- 58 - 
 
  3.115.  Duties may be waived for temporary import s, if the goods are re-exported or packed for 
export in a customs controlled area, or destroyed within 12 months from the date of importation. In addition, duty remissions are available for goods held in Customs controlled areas (export warehouses and duty-free shops) duly licensed by the NZCS. 
3.3.5  Export promotion and marketing assistance  
3.116.  Since the previous Review, no substantial change has occurred in New Zealand's export 
promotion framework. New Zealand Trade and Enterp rise (NZTE) remains the key agency involved 
in export promotion. Its activities include strategic advice, facilitating access to networks, research 
and market intelligence for new export companies and support for enterprises that already export.  
3.117.  NZTE's Industry Capability Network (ICN) is a service working across New Zealand and 
Australia to give suppliers and purchasers access to a wide range of supply-chain and project 
opportunities.  
3.118.  The International Growth Fund (IGF) of NZ$30 million aims at supporting export 
businesses with high growth potential. In additi on, the IGF seeks to increase the number and size 
of New Zealand businesses embedded in the global economy. 
3.119.  The New Zealand Story Advisory Board and New Zealand Story team (NZ Story) are 
building a resource to promote good reputation of  export products by sharing success stories on 
some New Zealand products and services. The NZ Story Secretariat is housed within NZTE.   
3.120.  Through the Business Growth Agenda (BGA ), NZTE has the responsibility to extend 
companies' international reach by focusing assistance on them and mobilising capital to support business growth. 
3.3.6  Export credit insurance and guarantees 
3.121.  Since the previous Review, the New Zealand Export Credit Office (NZECO) continues to 
provide trade credit insurance and financial guarantee products that complement those available in 
the private sector for exporters and banks, includ ing against the risk of non-payment arising from 
defined political or commercial risks (up to 95% cover).  
3.122.  NZECO is currently located in the Treasury, and its obligations to third parties are 
guaranteed by the New Zealand Government. The Government's maximum liability under the 
scheme is NZ$740 million. To be eligible for NZEC O's guarantees, an exporter must be either a 
New Zealand registered company, or a subsidiary  of a New Zealand registered company located 
abroad; and an economic benefit to New Zealand must exist from the transaction.  
3.123.  Traditionally, the NZECO products relate to medium and long-term financing (between 
one and 14 years). However, in response to the global financial crisis, NZECO's mandate was extended in 2009 to cover short-term trade credit insurance, which covers the risk of a foreign 
buyer defaulting on their short-term repayments (less than 360 days), due to specific commercial 
or political events. NZECO is not mandated to compete with the private insurers and can only provide this product for non-marketable risks and/ or where the insurers lack the capacity. During 
the 2013/2014 financial year, NZECO guaranteed NZ $306 million worth of export transactions in 
support of 36 exporting companies, of which 74%  had annual turnovers of less than NZ$50 million 
and 62% had annual turnovers of less than NZ$25 million.  
3.124.  According to the authorities, NZECO foll ows the OECD Arrangement on export credits and 
pricing, as well as its own Crown mandated criteria and prudential limits.
21  
3.125.  NZECO also provides co-insurance (top-up cover) policies to support the private insurers' 
capacity.  
                                               
21 NZ Export Credit office online information. Viewed at: 
http://www.nzeco.govt.nz/about/annualreport/ar-nzeco-13-14.pdf .  WT/TPR/S/316 • New Zealand 
 
- 59 - 
 
  3.4  Measures Affecting Production and Trade 
3.4.1  Incentives 3.126.  New Zealand's business climate is considered as one of the most attractive in the world. It 
highly encourages private entrepreneurship and competition. According to the World Bank 2014 
Doing Business Report, New Zealand ranks third among 189 economies on the ease of doing 
business index; it takes one day and one procedure to register a private company in New Zealand.
22  
3.127.  During the period under review, New Zealan d maintained its efforts of creating a proactive 
regulatory environment, with strong emphas is on innovation and capacity building.  
3.128.  Under Callaghan Innovation, the High Performance Working Initiative (HPWI) helps 
medium-sized firms to use high performance workin g practices to achieve higher productivity and 
improve business performance. Callaghan Innovation delivers HPWI via contracted partners to 
engage specialist business improvement consultant s to design and coordinate the delivery of 
programmes of groups of participating enterpri ses. HPWI has annual funding of NZ$1 million.  
3.129.  Callaghan Innovation, a stand-alone Crown Entity established in 2013, administers most of 
the incentive programmes for innovation. 
3.130.  Under the Callaghan Innovation's Business R&D Funding programme, over NZ$160 million 
is spent yearly to provide an incentive for in creasing business investment in research and 
development (R&D) with a view to accelerating innovation by firms in New Zealand. The programme is implemented through three schemes:  
• The R&D Growth Grants for businesses with a strong track record for R&D spending in 
New Zealand. It provides 20% public co-funding for qualifying firms' eligible R&D 
expenditure, capped at NZ$5 million per annum . After two years of funding, businesses 
can be granted a two-year extension of funding; 
• The R&D Project Grants supports companies with new or weak R&D programmes; and 
• Callaghan Innovation's Research and Technical Services provides a range of services to 
industries engaged in various forms of high-tech manufacturing. These services include 
product development/prototyping, open laboratories, workshops and pilot plants, testing 
and failure analysis, near market research and contracting R&D services. 
3.131.  Under the Better by Lean programme, Callaghan Innovation assists companies achieve the 
objective of improving performance, eliminating inefficient processes and activities, and increasing 
customer satisfaction. The programme includes a two-day course at the University of Auckland and 
co-funding of 50% or up to NZ$20,000 towards cons ultant costs for lean planning, training and 
implementation in the first 12 months. 
3.4.2  Subsidies and other government assistance 
3.132.  As at the time of the previous Review, subsidies schemes in New Zealand seek to promote 
business capabilities, growth, investment, regional  development and R&D; and they are provided 
mainly in the form of grants. Eleven subsidy schemes that were in place over 2009-10 were 
notified to the WTO in 2011 (Table 3.9).
23 
3.133.  A refund of excise duties is available for vehicles, such as agricultural vehicles and some 
commercial vehicles that do not travel on the road. Refunds are also available for commercial 
vessels that operate exclusively or principally for commercial purposes. 
 
                                               
22 World Bank Group (2013). 
23 WTO documents G/SCM/N/220/NZL, 15 July 2011; and G/SCM/N/253/NZL, 24 June 2013. WT/TPR/S/316 • New Zealand 
 
- 60 - 
 
  Table 3.9 Subsidy schemes, 2009-11 
Subsidy scheme Purpose Form of assistance Duration  Annual budget 
(2009/10) in 
NZ$ 
Enterprising Auckland 
Fund Regional 
development Grant for up to 80% 
of the costs of the project No fixed duration/ 
the programme ended in 2010 1 million allocated, 
with nil actual expenditure 
Enterprising Partnership 
Fund Regional 
development Grants for up to 70% 
of the costs of the 
project No fixed duration/ 
the programme 
ended in 2011 9.25 million 
New Zealand Export Credit Office Programme Trade finance Credit guarantees No fixed duration, 
but subject to regular review 2.094 million 
(operating costs 
Australia New Zealand 
Biotechnology Fund Industry 
co-development in 
Australia and 
New Zealand Grants for up to 25% 
of the costs of 
eligible activities Formerly closed in 
November 2010 4 million 
International Growth Fund Firms capabilities 
development Grants for up to 50% 
of the costs of approved activities No fixed duration 9.6 million 
Research Consortia Research contracts 
between Government 
and businesses Grant. Consortia 
must invest a 
minimum of 
NZ$500,000 No fixed duration for 
the programme 19.561 million 
Beachheads Development of 
international connections for businesses Various services, 
including advice, business connections No fixed duration for 
the programme 4.718 million 
Primary Growth 
Partnership Research and 
innovation Grants for up to 50% 
of eligible costs No fixed duration No expenditure in 
2009/10 
Food Innovation Network Food development 
and commercialization Grant Ongoing No expenditure in 
2009/2010 
Environmental 
Certification Fund Assist seafood 
industry to get 
independent 
environmental 
certification Grants for up to 75% 
of the costs Ongoing 1.937 million 
Aquaculture Sector Market Development  Market development 
and implementation of national priority Grants for up to 50% 
of eligible costs Terminated in 2014  550,000 
Source: WTO Secretariat, based on WTO documents G/SCM/N/220/NZL, 15 July 2011.  
3.134.  In 2013, New Zealand notified its Primary Growth Programme (PGP) initiative to the WTO. 
The PGP initiative invests in significant programmes of research and innovation to boost economic 
growth and the sustainability of agriculture and food sectors. Its annual budget stood at 
NZ$40 million in 2010/11 and NZ$50 million in 2011/12. There is no fixed duration for the programme.
24 
3.4.3  Competition policy  
3.135.  New Zealand's competition regime cont inues to be governed mainly through the 
Commerce Act 1986 (the Commerce Act) as amended. It applies broadly across the economy, 
including the public sector. The New Zealand Commerce Commission (the Commerce Commission) 
is an independent statutory body with responsibility for enforcing the Commerce Act. 
3.136.  The Commerce Act aims to promote competition in New Zealand markets for the long-term 
benefit of consumers. It prohibits conduct that restricts competition (anti-competitive coordinated 
behaviour and unilateral conduct), as well as acquisition of assets of a business or shares if the 
acquisition leads to a substantial lessening of competition in a market.  
3.137.  The Pharmaceutical Management Agency (PHARMAC) decides on behalf of District Health 
Boards which medicines and related products are subsidized for use in the community and public 
hospitals. It has a partial exclusion from the restrictive trade practices provisions of the Commerce 
                                               
24 WTO document G/SCM/N/253/NZL, 24 June 2013. WT/TPR/S/316 • New Zealand 
 
- 61 - 
 
  Act, as regards its pharmaceutical management ac tivities. According to th e authorities, PHARMAC 
generally does not take advantage of this exemption.  
3.138.  In addition, the Commerce Act does not cover a list of specified services that are subject to 
other specific regulatory regimes. This includes international shipping, under the Shipping Act 
1987; authorized international civil aviation arra ngements, under the Civil Aviation Act 1990; and 
employment relations, under the Employment Relations Act 2000.  
3.139.  The Commerce Commission maintains Memoranda of Understanding (MoU) with 
three domestic regulators, i.e. the Financial Markets Authority, the Gas Industry Company, and the 
Electricity Authority. Each MoU clarifies the interface between the Commerce Commission's role and that of the sectoral regulator. The Commerce Commission's responsibility covers generic competition enforcement issues, while the sectoral regulator deals with technical oversight of the 
sector.
25 
3.140.  The Commerce Act may apply to certain conducts outside New Zealand by a person 
resident or carrying on business in New Zealand that affect a market in New Zealand. 
3.141.  There is no compulsory requirement to notify the Commerce Commission of mergers and 
acquisitions in New Zealand. However, businesses may seek clearance or authorization from the Commerce Commission if they believe a proposed acquisition may have the effect of substantially 
lessening competition. The effect of clearance by the Commerce Commission is to offer companies 
protection from legal action under the Commerce Act. 
3.142.  In order to maintain stakeholders' awareness, the Commerce Commission provides 
guidelines about the main provisions of the Commerce Act, whereby it sets out factors that it takes 
into account when dealing with restrictive trade practices and business mergers and acquisitions. 
In general, to determine if a merger/acquisition may result in lessening competition in a market, the Commerce Commission follows formal guidelines detailing how it will conduct its assessment. 
First, the market must be defined by accounting for factors such as products substitutability, 
geographical extent, functional level (manufacture, wholesale, retail), consumer dimension, and demand-side and supply-side substitutions. Following the definition of relevant market, the impact 
of the merger/acquisition on competition in the market must be assessed.  
3.143.  During the review period, the Commerce Commission updated its mergers and acquisitions 
guidelines, as well as its authorization guidelines to reflect new developments. In the new guidelines, released in July 2013, the Commerce Commission indicated that its focus is on 
conditions of entry and expansion by existing and new competitors; it also expressed the view that 
a merger that relies on efficiencies is better dealt with under the authorization regime.
26   
3.144.  Authorization guidelines provide factors taken into account by the Commerce Commission 
when considering applications to authorize arrangements or business acquisitions that lessen 
competition but may be in the public interest. Under the revised guidelines, the Commerce Commission assesses whether an anti-competitive transaction will be likely to lead to any losses in 
productive and dynamic efficiency on a case-by-case basis.  
3.145.  The Commerce Commission also enforces consumer legislation (through the Fair Trading 
Act 1986 and the Credit Contracts and Consumer Finance Act), as well as competition components of industry-specific regulations, i.e. under Part 4 of the Commerce Act (in respect of electricity 
transmission and distribution lines, gas transm ission and distribution pipelines, and specified 
airfield activities of the major international airports), the Telecommunications Act 2001 (for telecommunications); the Dairy Industry Restru cturing Act 2001 (as amended in 2012 in respect 
of raw milks). 
3.146.  In October 2011, the Minister of Commer ce introduced the Commerce (Cartels and Other 
Matters) Amendment Bill 2011 into Parliament. As of February 2015, the Bill was at its 
                                               
25 Commerce Commission online information. Viewed at: http://www.comcom.govt.nz/the-
commission/about-us/relationships-with-other-agencies/ . 
26 OECD online information. Viewed at: 
http://www.oecd.org/officialdocuments/publicdisplaydocumentpdf/?cote=DAF/COMP/AR(2013)33&docLanguag
e=En .  WT/TPR/S/316 • New Zealand 
 
- 62 - 
 
  second assessment by Parliament. The Bill pursues various objectives, such as introducing criminal 
sanctions for hard-core cartels, i.e. those formed when rival firms agree to not compete with each 
other by fixing prices, restricting output, allocating markets or rigging bids. Another objective of the Amendment Bill is to provid e for an exemption regime for legitimate, pro-competitive and 
efficient arrangements between firms, provided that their main purpose is not anti-competitive and 
the cartel provisions are reasonably necessary to  achieve that purpose. The proposed Amendment 
also removes the exemptions for international shipping currently contained in the Commerce Act 
1986 and Shipping Act 1987 (Section 4). In addition, it extends the statutory timeframes for 
clearances from 10 to 40 working days.  
3.147.  Under the Commerce (International Cooperation, and fees) Amendment Act 2012, the 
Commerce Commission is allowed to provide compulsory acquired information and investigative 
assistance to a recognized overseas regulator wh ere an appropriate cooperation agreement is in 
place. In addition, the fee provisions were am ended to allow the Commerce Commission to refund 
any overpayment or exempt certain categories fr om fees levied for clearance and authorization 
applications.  
3.148.  The Search and Surveillance Act 2012 amends the Commerce Act by aligning the 
Commerce Commission's powers with those of the main regulatory enforcement agencies. These 
provisions largely deal with procedural matters su ch as securing the 'scene', computer searches, 
and clarifying protection for legal privilege.  
3.149.  In July 2012, the Dairy Industry Restru cturing Act 2001 (DIRA) was amended to further 
promote contestability of the market through greater transparency of Fonterra's farm-gate milk 
price setting process.
27 Under the amended provisions, the Commerce Commission is responsible 
for undertaking two statutory reviews, each season, of Fonterra's farm-gate milk price calculation, 
as well as the methodology used (Section 4.2). 
3.150.  New Zealand continues to be involved in bilateral cooperation with overseas competition 
authorities (Table 3.10), as well as in international frameworks such as the International Competition Network (ICN) and the Competition Committee of the OECD. According to the 
authorities, as an example of bilateral cooperation, in 2013/14, the Commission obtained 
permission from the Australian Competition and Consumer Commission (ACCC) to inspect 
protected information under the Australian Competition and Consumer Act, regarding a cartel investigation into potential breaches of th e Commerce Act. The ACCC undertook a similar 
investigation, which resulted in legal proceedings. 
Table 3.10 List of bilateral agreements on competition issues, 2014 
Agreement type Parties 
Memorandum of Understanding Australian Co mpetition Commission, The Commissioner of 
Competition (Canada) and New Zealand Commerce 
Commission 
Memorandum of Understanding Australian Competition Commission, the New Zealand 
Commerce Commission and the Fair Trade Commission of 
Chinese Taipei 
Cooperation Agreement Australian Competition Commission and New Zealand 
Commerce Commission 
Cooperation Agreement (Mergers) Australian Competition Commission and New Zealand 
Commerce Commission 
Source: Information provided by the authorities. 
3.151.  Competition chapters are also included in most of RTAs involving New Zealand 
(Table 3.11). According to the authorities, this is to ensure that the benefits of an agreement are 
not undermined by anti-competitive practices, and give greater certainty and transparency for New Zealand businesses operating in member states . In general, competition chapters recognize 
                                               
27 DIRA allowed Fonterra, a dairy cooperative, to be established in 2001 following an authorization 
under the Commerce Act. Due to Fonterra's dominant position at the time (96% of New Zealand' milk 
production), the DIRA set up a regu latory regime to promote the efficient operation of New Zealand's dairy 
markets, i.e. Fonterra must accept  all milk supply from dairy farmers in New Zealand and allow relatively 
costless exit from the cooperative. WT/TPR/S/316 • New Zealand 
 
- 63 - 
 
  the importance of promoting and maintaining competition that enhances economic efficiency and 
consumer welfare. As such, they may include prov isions for cooperation, and capacity building. 
Table 3.11 Summary of regional trade agreem ents with competition chapters in force 
Regional trade agreement Competition chapter: brief overview 
ASEAN-Australia-NZ FTA (2010) Covers basic competition principles and cooperation 
NZ-Hong Kong, China Closer 
Economic Partnership (2011) Covers promotion of competition, exemptions, cooperation, 
exchange of information and consultations 
NZ-Malaysia FTA (2009) Covers general competition principles, cooperation, 
discussions on anti-competitive practices 
Trans-Pacific Strategic Economic 
Partnership (2005) Covers general competition objectives, competition law and 
enforcement, cooperation, notifications, consultations, 
exchange of information, excl usive rights and exemptions  
NZ-Thailand Closer Economic 
Partnership (2005) Covers general competition objectives and principles, 
promotion of competition, application of competition laws, 
exemptions, cooperation, exchange of information, technical cooperation, consultation and transparency 
NZ-Singapore Closer Economic 
Partnership (2001) Covers general competition principles and their application, 
non-discrimination, compliance cost reduction, coordination, 
consultation, resourcing, cooperation and information 
exchange 
Agreement between NZ and the Separate Customs Territory of Taiwan, Penghu, Kinmen and 
Matsu on Economic Cooperation Covers endorsement of APEC competition principles, 
promotion of competition, transparency, implementation, cooperation, competition laws and authorities, exemptions, 
private rights of action, consumer protection, cooperation 
and exchange of information, and consultations 
Source: Information provided by the authorities. 
3.152.  Despite the relatively good international standing of New Zealand's competition regime, as supported, for instance, by the Global Merger Control Index
28, questions remain in terms of the 
appropriate level of competition in some economic sectors, mainly services.  
3.153.  In 2014, a study by New Zealand's Productivity Commission identified relatively low 
competition in the services sector (i.e. in the retail, insurance, finance, real estate, and professional, scientific and technical services) as one of the main reasons for the low 
productivity/high costs in the sector.
29 While factors such as foreign investment screening, 
professional licensing requirements, and the smallness and remoteness of New Zealand's market were pointed out as significant barriers to international competition in services, New Zealand's competition legislation was also described as offering room for improvement. In that regard, the 
Commerce (Cartel and Other Matters) Amendment Bill is expected to bring further clarification to 
the competition framework. The Government recently announced that a review of the Commerce Act in response to the matters raised by the Productivity Commission would be undertaken. 
3.154.  Findings of the Productivity Commission's study also showed that given the importance of 
services inputs in New Zealand's domestic production (40% more than salary costs in 2010-11), the weaker competition in the services sector may have contributed to higher prices in the 
economy.  
3.4.4  State trading, state-owned enterprises 3.155.  According to New Zealand's latest notification pursuant to the provisions of Article XVII: 
4(a) of the GATT 1994 and Paragraph 1 of the Unders tanding on the Interpretation of Article XVII, 
submitted to the WTO in 2014, Zespri Group Limited is the only state-trading enterprise (STE) in 
operation in New Zealand.
30 Zespri has special authority to export kiwifruit so as to obtain the best 
commercial return from world markets for producers in New Zealand. 
                                               
28 Online information. Viewed at: http://www.mergerdata.net/doc/gmci2014/GMCI2014.pdf . 
29 New Zealand Productivity Commission (2014). 
30 WTO document G/STR/N/15/NZL, 22 May 2014. WT/TPR/S/316 • New Zealand 
 
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  3.156.  Under the Kiwifruit Export Regulations 1999, private traders can engage in exporting 
kiwifruit to markets other than Australia in collaboration with Zespri, subject to authorization by Kiwifruit New Zealand, an independent regulatory body. There is no need for private traders to 
seek for such authorization to export kiwifruit to Australia. 
3.157.  The Government maintains equity shares in some 49 enterprises in different economic 
sectors. According to the authorities, govern ment-owned enterprises generally operate in 
competitive markets. The Treasury reviews the performance of these government-owned 
enterprises that may have full or partial commerc ial objectives. Collectively, these enterprises 
employ over 40,000 people and, as at 30 June 2013, held assets of around NZ$125 billion.
31 
3.4.5  Government procurement 3.4.5.1  Policy and regulatory framework 
3.158.  Spending on New Zealand's government procurement contracts amounted to some 19% of 
GDP in 2012. Government spending on goods and services was estimated at some NZ$39 billion in 2014.
32  
3.159.  The conduct of government procuremen t is based on a three-tier policy framework 
including the overarching Principles of Govern ment Procurement, the Government Rules of 
Sourcing and relevant good practice guidance. The current version of the Principles of Government 
Procurement (the Principles), which was approved by the Cabinet in July 2012, sets out 
five fundamental principles that all government agencies are expected to follow in organizing their procurements: (i) plan and manage for greater result s; (ii) be fair to all suppliers; (iii) get the 
right supplier; (iv) get the best deal for everyone; and (v) play by the rules. 
3.160.  The Government Rules of Sourcing (the Ru les), which came into e ffect on 1 October 2013 
and replaced the 2006 Mandatory Rules for Procurement by Departments, represent the Government's minimum standards of good practice for procurement planning, approaching the 
market and contracting. They were amended in May 2014 to implement the Cabinet's decision to 
rescind Rule 67, which required agencies to sour ce cleaning services only from members of the 
Building Services Contractors Association.   
3.161.  The Rules focus mainly on the 'sourcing' pa rt of the procurement life cycle. This covers 
procurement planning, market research, appr oaching the market, evaluating responses, 
negotiating and awarding the contract.  
3.162.  The application of the Rules is mandatory for Public Service departments, as well as for 
New Zealand Police and New Zealand Defence Forces; and these entities may be audited for 
compliance with the Rules (e.g. by the Auditor-General under the Public Audit Act 2001).
33 On 
1 February 2015, under a government directive i ssued by the Ministers of State Services and 
Finance, the Rules became mandatory for all Crow n entities excluding school boards of trustees. 
Crown Research Institutes covered by this directive must have regard to the Rules but cannot be bound by them.
34  
3.163.  The Rules intend to support agencies to get the best value for money from the 
procurement process. They encourage early market  engagement and provide a flexible framework 
which allows for innovative approaches such as competitive dialogue and e-procurement.  
3.164.  In addition to the Principles and the Ru les, there are various guidelines published to 
support good procurement. The most important one is the Procurement Guidance for Public 
                                               
31 Treasury online information. Viewed at: 
http://www.treasury.govt.nz/commercial/publications/annual-portfolio-report/2013/ . 
32 According to the authorities, given the decentrali zed nature of the govern ment procurement system, 
it may be challenging to provide ac curate figures on related spending. 
33 Public Service department s are the core departments and ministries listed in the State Sector Act 
1988, Schedule 1. 
34 The following entities are covered by the dire ctive: Crown agents, independent Crown entities, 
autonomous Crown entities, Crown entity companies, Pu blic Finance Act Schedule 4A Companies, and Crown 
Research Institutes.  WT/TPR/S/316 • New Zealand 
 
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  Entities (2008 Guidance) which was issued by the Auditor-General and applies to all public sector 
entities. Non-obligatory in nature, the 2008 Guidance outlines the principles, considerations, and processes that should help public entities to meet ethical standards and act with integrity when procuring goods or services. Some sectors have also published their guidelines regarding their 
specific types of procurement. 
3.165.  New Zealand's government procurement policy is administered by the Ministry of Business, 
Innovation and Employment (MBIE) to lift the ca pability and performance of agencies undertaking 
procurement, create an environment where New Zealand businesses can succeed; and unlock cost 
savings. Except where collaborative procurement has been undertaken, each individual government entity is responsible and accountable for its own procurement. 
3.166.  The policy promotes open competitive procurement practices, and no preferential 
treatment is accorded to domestic suppliers. Ho wever, according to the authorities, the MBIE 
works alongside NZTE to support New Zealand businesses to become more competitive in international markets and improve their ability to tender for government work.   
3.167.  All information pertaining to government procurement policy in New Zealand is 
comprehensively published and regularly updated online ( www.procurement.govt.nz ) by the MBIE. 
3.4.5.2  Procedures 
3.168.  The procedures of government procurement are set out in the Rules, which, in general, 
apply to:  
• Procurement of goods or services or refurbis hment works, or a combination of goods or 
services or refurbishment works, when the maximum total estimated value of the 
procurement equals or exceeds the value threshold of NZ$100,000 (excluding GST).  
• Procurement of goods or services or works for new construction works, when the 
maximum total estimated value of the procurement equals or exceeds the value 
threshold of NZ$10 million (excluding GST).  
3.169.  Above these thresholds the Rules require open competitive procurement processes, which 
may be one-step (requests for quote or requests fo r tender) or multi-step (registration of interest 
followed by a shortlisting, and then a Request for Proposal or Request for Tender). An agency must 
openly advertise on the Government Electronic Tenders Service (GETS) if the maximum total estimated value of the procurement meets or exceed s the relevant value threshold, and if there is 
no exemption from open advertising.  
3.170.  GETS is a free website-based service oper ated by the MBIE to publish information about 
the New Zealand Government contract opportunities. It is accessible to all interested suppliers, both domestic and international. Under the Rules, procuring entities must publish Annual 
Procurement Plans (APP); these plans provide suppl iers with forecast procurement opportunities. 
3.171.  In some limited circumstances agencies may be exempt from the requirement to openly 
advertise. A closed competitive (a Request for Qu ote, Request for Tender or Request for Proposal 
restricted to a limited number of known suppliers) and/or direct source (a closed Request for 
Proposal or Request for Tender restricted to a known supplier) procurement may be followed. 
3.172.  Under Rule 15 ( Exemptions from Open Advertising), an agency may opt to use a closed 
competitive process or direct source in cases of, inter alia : emergency; procurement following an 
unsuccessful open tender; if the goods, services or works can only be supplied by one supplier and 
there is no reasonable alternative or substitute because of objective reasons, including intellectual property, work of art; or where an agency has established a panel of suppliers through an open, 
competitive process.  
3.173.  The Rules prohibit exempting procurement fr om open advertising to: (i) avoid competition, 
(ii) protect domestic suppliers, or (iii) discriminate against any domestic or international supplier. WT/TPR/S/316 • New Zealand 
 
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  3.174.  Agencies may define preconditions to eliminate suppliers who do not have the minimum 
capacity or capability to meet the contract requirements. Under the Rules, these conditions must be published in the notice of procurement; and the screening criteria must be limited to legal, financial, commercial/operational and technical capacity and not make any de jure  discrimination 
between domestic and foreign suppliers. 
3.175.  The final decision by procuring agencies must be based on the best value for money, which 
is not necessarily the cheapest price, at the time of the purchase. Procuring agencies are 
mandated to publish all evaluation criteria they  will use to assess responses in the Notice of 
Procurement. Furthermore, when listing the evaluation criteria it is mandatory, unless price is the only criterion, to indicate the relative importance of each criterion. 
3.176.  Aggrieved suppliers can take their protes ts to the procuring agency; the agency must 
consider and respond promptly and impartially to complaints and resolve the conflict. If still 
dissatisfied, the supplier can consider having recourse to mediation; asking for an independent audit review; requesting investigation by the Audi tor-General, by an Ombudsman, or by the State 
Services Commission; or seeking a resolution in court. MBIE also manages a supplier complaints 
process. While it cannot overturn a procurement de cision it can review whether or not the agency 
has followed government procurement policy in making its decision. According to the authorities, 
19 complaints have been received by MBIE during the review period and two complaints have 
resulted in modifications to procurement processes or outcomes.   
3.4.5.3  Foreign participation  3.177.  An important development, during the review period, was agreement to New Zealand's 
terms of accession to the revised WTO Agreement on Government Procurement (GPA) on 
29 October 2014, following the submission of its fina l offer. Upon ratification by New Zealand, the 
GPA is set to apply to procurement of goods, servic es, and construction works by a list of entities 
from central and sub-central government agencies, as well as other entities such as state-owned 
enterprises (SOEs). Ratification of New Zealand’s accession to the GPA entails a Parliamentary treaty examination process that is currently under way. The Agreement will enter into force for 
New Zealand on the thirtieth day following the deposit of New Zealand’s instrument of accession to 
the Director-General of the WTO. 
3.178.  Upon completion of its accession, New Zealand's initiative in joining the GPA will provide its 
suppliers with access to markets that have been valued at US$1.7 trillion annually.
35   
3.179.  New Zealand's other international commitments with respect to government procurement 
include: the Australia-New Zealand Government Procurement Agreement (ANZGPA), which is a comprehensive agreement on government procurement; the Closer Economic Partnership 
Agreement with Singapore (Singapore CEP); the Trans-Pacific Strategic Economic Partnership 
Agreement (Trans-Pacific Strategic EPA), the New Zealand-Hong Kong China Closer Economic Partnership Agreement, and the Economic Cooperation Agreement with Chinese Taipei. The 
Government Rules of Sourcing regulate New Ze aland's obligations under these agreements.  
3.180.  Thresholds for the application of these agreements are set in Special Drawing Rights (SDR) 
and are subject to periodic conversion into domestic currencies; revision of the thresholds can take place only by renegotiation by the parties to each respective agreement.  
3.181.  The ANZGPA and the Singapore CEP aim to establish a single procurement market between 
the parties. There is no threshold for application of the ANZGPA. A single threshold of SDR 50,000 is established for the application of the Singapore CEP. A threshold of SDR 130,000 applies for 
supply and service contracts, and SDR 5,000,000 for construction contract in the case of 
New Zealand-Hong Kong, China Closer Economic Partnership Agreement; and in the case of the Trans-Pacific Strategic EPA, a threshold of SDR 50,000 applies for supply and service contracts, 
and SDR 5,000,000 for construction contracts. 
                                               
35 The total market access commitments under the GPA 1994 were US$1.6 trillion. The revised GPA has 
expanded the market access opport unities under the Agreement by US$8 0-100 billion annually, bringing the 
total coverage of the Agreement to US$1.7 trillion annually (WTO, 2014). WT/TPR/S/316 • New Zealand 
 
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  3.4.6  Intellectual property rights  
3.182.  The general objective of New Zealand's policy on intellectual property rights (IPRs) is to 
strike a careful balance between the interests of IPR owners and the interests of society as a whole.
36  
3.183.  The Ministry of Business, Innovation an d Employment (MBIE) is responsible for policy 
relating to the protection of intellectual property in New Zealand, while the Intellectual Property Office of New Zealand (IPONZ) is the government agency responsible for the granting of patents 
and the registration of trademarks and designs.
37 The Plant Variety Rights Office, which is part of 
IPONZ, is in charge of applications for plant variety protection. There is no system for copyright registration in New Zealand; copyright comes into existence every time an original work is created, published and performed. 
3.184.  Intellectual property rights are of considerable economic importance to New Zealand. 
Trade in IPR-intensive goods (IT products
38, pharmaceuticals39, beverages40 and copyright-based 
products41) grew by 36% from 2009 to 2013, with  exports growing by 43%. Imports of 
IPR-intensive goods made up 13% of all goods impo rts over the review period, and 6% of exports. 
Wine exports accounted for 44% of total IPR-intensive products exports. Registrations of IPRs remain significant in New Zealand (Table 3.12). 
Table 3.12 IPR registrations in New Zealand, 2009-13 
IPR types  2009  2010  2011  2012  2013  
Designs  1,083  1,047  990  1,151  1,042  
Patents  3,413  4,350  4,709  6,153  4,902  
Trademarks by class  32,791  27,914  26,345  27,586  29,794  
Plant variety rights  105  112  104  119  101  
Source: Information provided by the authorities. 
3.185.  Intellectual property rights in New Zealand are protected by a range of laws (Table 3.13). 
However, there is no stand-alone legislation for protection of geographic indications and undisclosed information, which are protected by other existing legislation.  
3.186.  A new Patents Act 2013 came into force in September 2014 and replaced the Patents Act 
1953. The new Act brings the New Zealand patent law into closer alignment with New Zealand's trading partners. Several changes were made within the scope of patents registration, including stricter examination of applications and subject matter exclusions. It excludes from patentability 
certain inventions such as: inventions that are contrary to public order or morality, and 'computer 
software as such', still allowing for patenting of embedded software. 
3.187.  Moreover, since 2009 amendments have been made to the main existing intellectual 
property laws. In 2011, the Copyright (infringing sharing file) Amendment Act brought a significant 
change to the Copyright Act 1994 by providing rights owners with a special regime for taking enforcement action against people who infringe  copyright through file sharing. The Designs 
Amendment Act 2010 provides procedures for restorat ion of lapsed copyright in registered designs 
and lapsed design applications.   
3.188.  The Trade Marks Act 2002 was amended several times during the review period. The most 
significant amendment was made in 2011. It prescr ibed that all trademarks must be classified 
according to the most recent edition of the Nice classification system; enabled New Zealand to 
                                               
36 MBIE online information. Viewed at: http://www.med.govt.nz/ business/intellectual-
property/intellectual-property-rights . 
37 IPONZ online information. Viewed at: http://www.iponz.govt.nz/cms/iponz . 
38 Items in Attachment A of the Ministerial Declaratio n on Trade in IT Products, with no adjustment for 
partial coverage of sub-headings, HS 8524.31 and 8524.91 excluded. 
39 HS 30 (pharmaceutical products); these fi gures include trade in generic products. 
40 HS 22 (beverages, spirits and vinegar) excluding 2209 (vinegar). 
41 HS 49 (books and other printed products); 3706 (motion-picture films); 3705 (other developed 
films); and 8524 (records, CDs, software, and other recorded media). WT/TPR/S/316 • New Zealand 
 
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  accede to the Nice Agreement and the Madrid Prot ocol and ratified the Singapore Treaty on the 
Law of Trademarks. It also established the Intelle ctual Property Office of New Zealand (IPONZ) as 
New Zealand's office of origin and provided for regulations to be made in regards to international registrations. The amendment also revised provisio ns regarding parallel importing, suspension of 
border protection notices, and removal of  licensees on the Trade Marks Register.  
3.189.  The Haka Ka Mate Attribution Act 2014 came into force in April 2014. The Act provides a 
right of attribution to M āori tribe Ng āti Toa in relation to the haka Ka Mate.
42 Any person who uses 
the words or associated actions and choreography of the Ka Mate  in any publication for commercial 
purposes, any communication to the public, or in any film that is shown or issued to the public must make an attribution statement. The statement must say that Te Rauparaha was the composer of Ka Mate  and a chief of Ng āti Toa Rangatira. 
3.190.  Protection for geographical indications is provided through the tort of passing off, the Fair 
Trading Act 1986, and the Trade Marks Act 2002. The Geographical Indications (Wine and Spirits) Registration Act 2006 establishes a registration system for wine and spirit geographical indications 
but this Act is not yet in force. According to th e authorities, the Government has taken action in 
order to bring the Act into force in 2016. 
Table 3.13 Summary of the protection of intellectual property rights, 2014 
Main 
legislation Coverage Duration Selected exclusions and limitations 
Patents    
Patents Act 
2013 Any invention that 
compared with the 
prior art base is 
novel, involves an 
inventive step, and 
has a specific, 
credible, and 
substantial utility 20 years from patent 
date An invention is not a patentable invention if 
its commercial exploitation is contrary to 
public order or morality. 
The following are not patentable inventions: 
scientific theories or mathematical formulae; 
art works and literature; business schemes or 
ways of presenting information; computer 
programs as such; methods of human 
medical treatment; diagnostic methods 
practised on humans; human beings and 
processes for their generation; processes for 
cloning humans; using human embryos for 
industrial or commercial purposes; plant 
varieties as provided in the Plant Variety 
Rights Act 1987. 
New plant varieties 
Plant Variety 
Rights Act 
1987 Any plant 
varieties that are 
new, distinct, 
stable, and 
homogeneous 20 years from the date 
of grant of plant variety 
right (23 years - woody 
plants and their 
woodstock) Non-commercial purposes, human 
consumption or other non-reproductive 
purposes, and plant-breeding purposes. 
Trademarks    
Trade Marks 
Act 2002 Any sign capable 
of being 
represented 
graphically, and 
distinguishing the 
goods or services 
of one person 
from those of 
another person 10 years from date of 
registration, renewable 
in 10-year intervals Non-distinctive trademarks are not 
registrable: signs that  are not trademarks; 
trademarks that have no distinctive 
character; trademarks that consist only of 
signs or indications that may serve, in trade, 
to designate the kind, quality, quantity, 
intended purpose, value, geographical origin, 
time of production of goods or of rendering of 
services, or other characteristics of goods or 
services; trademarks that consist only of 
signs or indications that have become 
customary in the current  language or in the 
bona fide and established practices of trade 
                                               
42 A haka is an ancient M āori war dance traditionally used on the battlefield and during ceremonies.   WT/TPR/S/316 • New Zealand 
 
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  Main 
legislation Coverage Duration Selected exclusions and limitations 
Industrial design 
Designs Act 
1953 Any new or original 
design that has not 
been published in 
New Zealand 
before the filing 
date; consists of 
features of shape, 
configuration, 
pattern or 
ornament applied 
to an article by any 
industrial process 
or means, being 
features that 
appeal to and are 
judged solely by 
the eye 5 years from date of 
registration, extendable 
for two further periods 
of 5 years Non-registrable designs: methods or 
principles of construction; designs that are 
purely functional; articl es which are primarily 
literary or artistic in  character; designs the 
use of which would be contrary to law or 
morality. 
Copyrights and related rights 
Copyright 
Act 1994 Original literary, 
dramatic, musical, 
or artistic works; 
sound recordings; 
films; 
communication 
works; 
typographical 
arrangements of 
published editions Literary, dramatic, 
musical, or artistic 
work: author's life and 
50 years from end of 
calendar year in which 
the author dies. 
Computer-generated 
works: 50 years from 
end of calendar year in 
which work is made. 
Sound recording or film: 
50 years from end of 
calendar year in which 
work is made or made 
available to public by 
authorized act, 
whichever is later. 
Communication work: 
50 years from end of 
calendar year in which is 
first communicated to 
public. 
Typographical 
arrangement of a 
published edition – 
25 years from end of 
calendar year in which 
edition is first published. 
Crown copyright – 
100 years from end of 
calendar year in which 
work is made. 
Artistic works 
industrially applied: 
16 years from when 
work is applied. 
Artistic craftsmanship 
industrially applied: 
25 years from when 
work is applied. 
Performance: 50 years 
from end of calendar 
year in which 
performance takes 
place. 
Moral rights are not 
assignable. Copyright in a work is not infringed by, 
inter alia : incidental copying of the work in 
artistic work, sound recording, film or 
communication work; fair dealing with a work 
for the purposes of criticism, review, and 
news reporting; fair dealing with a work for 
the purposes of research or private study; 
transient reproduction of work; copying for 
educational purposes; copying by librarians of 
parts of published wo rks and articles in 
periodicals; communication of an archived 
work in accordance with section 29C of the 
Television New Zealand Act 2003; anything 
done for the purposes of parliamentary or 
judicial proceedings or reporting them. WT/TPR/S/316 • New Zealand 
 
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  Main 
legislation Coverage Duration Selected exclusions and limitations 
Geographical indications  
Fair 
Trading Act 
1986, 
Common 
law tort of 
"passing 
off", and 
Trade 
Marks Act 
2002     
Layout-designs (topographies)  of integrated circuits  
Layout 
Designs Act 
1994 Any original three-
dimensional 
disposition, 
however 
expressed, of the 
elements, at least 
one of which is an 
active element, 
and of some or all 
of the 
interconnections, 
of an integrated 
circuit; and 
includes such a 
three-dimensional 
disposition 
prepared for an 
integrated circuit 
intended for 
manufacture 10 years after the 
calendar year in which 
first commercially 
exploited if it happened 
within 5 calendar years 
of being made. 
Other cases - 15 years 
after calendar year in 
which was made. Not considered infringements, inter alia : 
innocent commercial exploitation; copying for 
private use, copying for research or teaching 
purposes, copying for evaluation or analysis. 
Undisclosed information 
Crimes Act 
1961 Any information 
that is, or has the 
potential to be, 
used industrially or 
commercially; and 
is not generally 
available in 
industrial or 
commercial use; 
and has economic 
value or potential 
economic value to 
the possessor of 
the information; 
and is the subject 
of all reasonable 
efforts to preserve 
its secrecy.   
Medicines 
Act 1981 
and the 
Agricultural 
Chemicals 
and 
Veterinary 
Medicines 
Act 1997 These Acts provide 
for protection for 
data submitted in 
support of an 
application for 
approval of a new 
pharmaceutical or 
agricultural 
chemical. 5 Years  
Source: Information provided by the authorities. 
3.191.  The Copyright Act allows for parallel importing of non-infringing copies of a work into 
New Zealand, subject to certain exceptions in relation to films produced for cinematic release, for 
nine months from the date that the film is first made available to the public (subject to a private WT/TPR/S/316 • New Zealand 
 
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  use exemption). Since October 2013, the Copyrigh t (Parallel Importing of Films) Amendment Act 
has reduced the ban to five months from the date that the film is first made available to the public and provides that the ban will remain in effect  for three years until 31 October 2016. No import 
permit is required for parallel imports. 
3.192.  Regarding compulsory licensing, at any time after the expiration of 3 years from the date 
of the grant of a patent or 4 years from the date of filing a patent, whichever is later, any interested person may apply to the High Court for the grant of a licence under the patent, provided 
that a market for the patented invention is not being supplied, or is not being supplied on 
reasonable terms in New Zealand. There have be en no compulsory licences granted for patents 
since 2009. The issue of compulsory licensing for patents has not been the subject of significant 
debate in New Zealand. 
3.193.  New Zealand has been a WIPO member since 1984 and is signatory to 
ten WIPO-administered treaties.
43 Since its previous Review, New Zealand has ratified three of 
them, i.e. the Protocol Relating to the Madrid Agreement Concerning the International Registration 
of Marks and the Singapore Treaty on the Law of  Trademarks in 2012, and the Nice Agreement 
Concerning the International Classification of Goods and Services for the Purposes of the Registration of Marks in 2013. New Zealand is not party to the WIPO Copyright Treaty and the 
WIPO Performances and Phonograms Treaty.  
3.194.  IPRs provisions are included in most of the FTAs New Zealand participates in. These 
include the New Zealand-Hong Kong, China Closer Economic Partnership; the New Zealand-Malaysia Free Trade Agreement; the ASEAN, Australia and New Zealand Free Trade 
Agreement; the New Zealand-China Free Trade Agr eement; the Trans-Pacific Strategic Economic 
Partnership Agreement (P4); the New Zealand-Thailand Closer Economic Partnership Agreement; and the Agreement between New Zealand and Singapor e on a Closer Economic Partnership. It has 
also concluded and signed, but not yet ratified the Anti-Counterfeiting Trade Agreement (ACTA), 
which is aimed at establishing a comprehensive international framework that will assist Parties to the agreement in their efforts to effectively combat the infringement of intellectual property rights.  
3.195.  New Zealand notified to the WTO its Checklist of Issues on Enforcement in 1997. Various 
courts have jurisdiction over IPR infringement case s. These include District Courts, the High Court, 
the Court of Appeal, and the Supreme Court. 
3.196.  Civil or administrative or judicial action again IPRs infringement may be initiated by 
persons with a direct interest, such as the registered proprietor or licensee in the case of patents, 
trademarks and designs, or as the IPRs owner in the case of copyright. 
3.197.  Aggrieved IPRs holders may lodge notices with the chief executive of the NZCS under the 
Trade Marks Act 2002 and the Copyright Act 1994. The NZCS is responsible for intercepting 
imported goods subject to those notices, identifying whether a notice applies and, if so, initiating an investigation that involves liaison with importers and the owners or rights holders - generally 
through their legal representatives. To avoid civil litigation at the investigative stage, an importer 
may forfeit the infringing goods to the Crown for disposal. The NZCS may also criminally prosecute 
importers of IPR goods where it can be shown the importer had knowledge that infringing signs had been applied to the goods. According to the au thorities, to date, the NZCS has not started any 
criminal legal proceedings, as civil proceedings by the rights holders have proved effective.  
3.198.  Civil remedies for infringement include in junctions, and damages or account of profits. 
Criminal penalties apply for copyright piracy and tr ademark counterfeiting and include a fine of up 
to NZ$150,000 or up to five years imprisonment. The courts may also order the disposal of 
infringing goods, implements and materials. 
 
                                               
43 WIPO online information. Viewed at: 
http://www.wipo.int/treaties/en/ShowResults.jsp?country_id=134C . WT/TPR/S/316 • New Zealand 
 
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  4  TRADE POLICIES BY SECTOR 
4.1  Overview 4.1.  The primary sector plays a key role in Ne w Zealand's economy. Agriculture, forestry and 
fishing accounted for 6.9% of GDP and 6.8% of total employment in 2011/12. Benefitting from 
high commodity prices during most of the review  period, New Zealand's agricultural exports (in 
particular, dairy, meat, and wool) performed stro ngly and contributed to almost 70% of total 
merchandise exports in 2014.  
4.2.  New Zealand's agriculture is a highly-productive, market-oriented sector, with minimal 
government intervention. Tariffs on agricultural products are among the lowest worldwide and no imports are subject to quotas or licensing. Do mestic support is limited to expenditure for 
biosecurity border controls for pest and disease and relief against climate disasters. New Zealand's 
producer support estimate (PSE) was less than 1% in 2010-13 (the lowest among OECD 
members) and its Aggregate Measure of Support (AMS) was zero during the review years. The former statutory marketing boards have been replaced by producer-levy-funded industry 
organizations. Nevertheless, a state-trading enterprise still maintains a quasi-monopoly on exports 
of kiwifruit to markets other than Australia. The dairy industry has been the object of further reforms aimed at ensuring transparency, effici ency and access to raw milk by new market 
entrants. The exclusive export licences held by the Fonterra Co-operative Group, New Zealand's 
major dairy exporter, were phased-out at end-2010. Exports of some agricultural products are subject to tariff-rate quotas imposed by some of New Zealand's trading partners. 
4.3.  Commercial fishing is a thriving export su bsector, with 90% of all catch being exported. 
However, there are restrictions on foreign participation in the sector. Under the Fisheries Act 1996, 
consent is required for any overseas investments in fishing quota; relevant criteria include that the granting of consent is in the national interest. Overseas persons may not have a 25% or more 
ownership or control interest in fishing quota without prior Ministerial consent. The Fisheries 
(Foreign Charter Vessels and other matters) Amendment Act 2014 prohibits foreign-flagged charter fishing vessels from fishing in  New Zealand waters from 1 May 2016. 
4.4.  In the energy sector, state participation remains strong, although measures have been 
introduced to open it up further to private investors. Three partially state-owned companies account for nearly two-thirds of all electricity generated, while transmission is in the hands of another state-owned enterprise. Distribution companies have different ownership structures 
ranging from publicly listed companies to community trusts. Electricity is traded in a liberalized 
market, with no regulation on wholesale or retail prices. The transmission company and the non-community owned distribution firms are subj ect to price-quality control. The Electricity 
Industry Act 2010 created an independent regulator and relaxed ownership and corporate 
restrictions between distribution, retail and generation companies. In 2013 and 2014, the Government sold 49% of its stake in the three largest generators. Changes to the petroleum 
regulatory regime were made in 2013 to attract investments, including a streamlined exploration 
permit procedure; a new approach to allocate permits based on competitive tenders; and changes to the royalty regime. 
4.5.  Manufacturing remains an important contribu tor to the economy, although its shares in GDP 
and employment declined over the review period (to 12.1% and 11.3% in 2011/12, respectively). 
While there has been some diversification towards higher value-added, knowledge-intensive subsectors (e.g. niche electronic goods, new ma terials and software), food manufacturing and 
other resource-based industries remain the la rgest components of manufacturing output. The 
share of manufactures (excluding food) in total merchandise exports fell from 25.6% in 2009 to 
19.9% in 2014. The sector receives little import protection; the average applied MFN tariff is 2.5% 
(2014), but tariffs are higher (some reaching 8.9%) in the textiles, clothing and leather industries. 
Over the last few years, the manufacturing industry has faced challenging conditions, including weak domestic and global demand, volatility in world food prices, an appreciated exchange rate, 
shortage of skills and insufficient investment in R&D. The Government has put in place several 
programmes to assist the business sector (although not specifically targeted to industry), mainly in 
the form of financial support, technical advice and R&D funding. WT/TPR/S/316 • New Zealand 
 
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  4.6.  Services are the leading sector of New Zeal and's economy. The share of services in current 
GDP increased slightly since the last Review to 69.7% in 2011/12, and their contribution to total employment rose to around 73%. The services trade balance showed a surplus over the review 
period, with services exports (mainly travel services and air transport) accounting for about 25% 
of total exports of goods and services. By intern ational standards, New Zealand's services regime 
has low barriers to trade and investment, although there are a few restrictions on FDI in the telecommunications and transport sectors, and competition levels are less intense in certain 
subsectors. New Zealand has undertaken commitments in 90 of the 155 sectors under the General 
Agreement on Trade in Services (GATS). 
4.7.  New Zealand's financial system weathered the 2008-09 global financial crisis relatively well 
and remains sound. Over the review years, regu latory changes strengthened the prudential 
framework for banks and other financial institutions. However, highly indebted household and farm 
sectors and heavy reliance on foreign funding remain key challenges for the financial sector. Macro-prudential measures, including limits on high loan-to-value residential mortgage lending, 
have been implemented to address such challenges and increase the system's resilience. Banks 
are well capitalized and comfortably meet their regulatory requirements, including the Basel III capital adequacy thresholds that took effect in 2013. The banking sector is characterized by a high 
level of foreign ownership. The regulatory powers  of the Reserve Bank of New Zealand have been 
extended to cover non-bank deposit-takers and insurance companies and new legislation has been passed to regulate both types of institutions. The Insurance (Prudential Supervision) Act 2010 
required all insurers conducting business in New Zealand to be fully licensed by September 2013. 
The insurance sector was hard hit by the Canterbury earthquakes (2010 and 2011), but has 
managed to meet claims through reinsurance and capital provided by foreign parent companies. 
4.8.  The telecommunications sector has seen co nsiderable regulatory changes following the 2008 
operational separation of the incumbent operator and its structural demerger in 2011. These 
changes have allowed the market to expand rapidly and investment in the sector has increased. Internet broadband uptake has grown fast but certain prices remain relatively high by OECD 
standards. The Government is implementing its initiative to roll-out the ultra-fast-broadband fibre 
network to 75% of the population by 2020. The regulatory framework for telecommunications is 
under review, including with respect to wholesale pricing mechanisms for access to copper and fibre networks. There are no licensing requiremen ts for entry into the market and control over 
retail prices is minimal. Foreign investment in private telecommunication firms is subject to the 
generic provisions of the Overseas Investment Act 2005. A cap of 49.9% of total voting shares applies to any overseas investment in the former incumbent wholesale operator (Chorus) without 
prior written approval of the Crown.  
4.9.  New Zealand has a liberal international air transport policy as it seeks to improve its 
connectivity to the rest of the world. It has air services relationships with over 60 partners, many 
of which under open skies agreements. There are over 40 international airlines (nearly half of 
which provide services on a code-share basis) providing cargo and passenger services to and from New Zealand. The national carrier, Air New Zealand, is 52.3% owned by the Central Government. No overseas person may hold 10% or more of the voting rights in Air New Zealand without prior 
written consent of the Crown. Five airports receiv e scheduled international air services; the largest 
are Auckland, Wellington, and Christchurch which are managed by autonomous companies with both private and public ownership and subject to  information disclosure requirements under the 
Commerce Act. Regional airports are managed by either companies owned by local authorities or 
joint ventures between local authorities and the Crown. A review of relevant legislation, including competition issues, is being conducted and may lead to changes in the regulation of airports.  
4.10.  Virtually all New Zealand overseas trade, by  volume, is moved by sea, with some 30 foreign 
shipping companies calling at the country's ports. Shipping policy aims to ensure that New Zealand exporters and shippers have access to carriers on competitive terms. The Shipping Act 1987 contains provisions for monitoring carriers who incur in unfair practices, but it also provides for an 
exemption allowing price-fixing in international shipping agreements. Legislation currently before 
Parliament seeks to apply the Commerce Act to international shipping (thereby eliminating such exemption). Foreign ships passing through New Zealand to unload imports or load exports are 
permitted to carry costal cargo, as are overseas -registered ships operated or controlled by a 
New Zealand entity, provided the crew is subjec t to New Zealand law. Most of the 14 commercial 
seaports are managed by port companies owned by local authorities. Increasing port productivity 
so as to reduce trading costs for New Zealand companies is an ongoing interest. Tourism is an WT/TPR/S/316 • New Zealand 
 
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  important generator of foreign exchange earnings and jobs. There is no tourism legislation, but the 
sector is supported by a robust institutional framework and significant public investment. 
4.2  Agriculture, Forestry, and Fisheries 4.2.1  Main features 
4.11.  Agriculture remains a key sector of the Ne w Zealand economy. Together with forestry and 
fishing, it contributed 6.9% to GDP and  6.8% to total employment in 2011/12 (Table 1.2). 
New Zealand is a net-exporter of agro-food products and a leading player in global markets for 
dairy, meat, and wool. New Zealand's agricultural exports benefitted from high international 
commodity prices during most of the review period
1, and accounted for 69.6% of total 
merchandise exports in 2014 (compared to 61.8% in  2009). The share of agricultural products in 
total imports was 11.6% in 2014 (Tables A1.1 and A1.2). 
4.12.  New Zealand's agricultural and other primary exports have seen strong performance in 
recent years (Table 4.1), driven mostly by growing demand from China. In the year ending in June 2014, export prices for New Zealand products increased in virtually all sectors, while 
generally good weather conditions helped boost production, particularly in the dairy and forestry 
industries.
2 Dairy makes up 47% of primary exports value, followed by meat, wool, logs and 
horticultural products. Higher export prices have also meant that New Zealand's terms of trade 
have risen to almost historic levels in recent years.3  
Table 4.1 Agriculture, fisheries and forestry export values, 2009-14 
(NZ$ million) 
Year to 30 June 2009 2010 2011 2012 2013 2014 
Agriculture 23,868 22,230 25,868 26,535 26,491 31,734 
   Dairy 11,435 10,565 13,198 13,659 13,441 18,068 
   Meat and wool 7,757 7,053 7,773 7,716 7,725 8,093 
   Horticulture 3,261 3,208 3,369 3,547 3,536 3,786 
   Othera 1,415 1,405 1,528 1,614 1,789 1,787 
Fisheries 1,452 1,398 1,547 1,500 1,466 1,427 
Forestry 3,566 3,863 4,527 4,273 4,479 5,144 
Total 28,886 27,490 31,942 32,308 32,436 38,305 
a Including live animals, arab le, other food products and other agricultural products. 
Source: Ministry for Primary In dustries online information. 
4.13.  New Zealand's agriculture is a market-oriented, highly-productive sector, with minimal 
government intervention. Following the liberaliz ation of agriculture in the 1980s and 1990s, 
virtually all subsectors are now deregulated and the old statutory marketing boards have been 
dismantled and replaced by industry organiza tions established under the Commodity Levy Act 
1990. The reforms have contributed to making agriculture one of the most productive sectors of the economy. According to estimates of the Mini stry for Primary Industries, overall agriculture 
productivity grew by an annual compound rate of 3.3% from 1984 to 2007, more than the rest of 
the economy's annual compound productivity rate of 1%.
4  
4.14.  Since the last Review, agriculture has undergone some further reforms. Among the main 
developments is the restructuring of the dairy industry. Institutionally, the main change was the 
merger of the Ministry of Agriculture and Forestry  (MAF) and the Ministry of Fisheries into the new 
                                               
1 It should be noted that commodit y prices were volatile over the re view period and be gan declining in 
mid-2014. The authorities have indicated that prices for New Zealand's primary exports are set by global markets, which are often negatively affected by protectionis t policies applied to pr oduction and trade in 
primary products in many markets.  
2 Ministry for Primary Industries (2014). 
3 In the first quarter of 2014, the merchandise terms of trade rose 1.8%, the fifth consecutive quarterly 
rise, which lifted the terms of trade to their highest level since September 1973. Statistics New Zealand online 
information. Viewed at: http://www.stats.govt.nz . 
4 Ministry for Primary Industries online information. Viewed at: http://www.mpi.govt.nz/agriculture . WT/TPR/S/316 • New Zealand 
 
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  Ministry for Primary Industries (MPI), as of April 2012.5 MPI's functions include advising the 
Government on: domestic and international agricultural and fisheries policy; the performance of the sectors; the sustainable use of natural resources; international trade; innovation and science policy issues relevant to the sector; and food safety and biosecurity. Moreover, MPI maintains the 
regulatory systems around biosecurity, animal an d plant health, and food safety. The Ministry is 
also responsible for the implementation of the Emissions Trading Scheme for agriculture, and 
administers the Primary Growth Partnership, a government-industry initiative to invest in research 
and innovation to foster growth and sustainabili ty of the primary, forestry and food sectors. 
4.2.2  Border measures 4.2.2.1  Import measures 4.15.  New Zealand has some of the lowest tariffs on agricultural products worldwide. In 2014, the 
average applied MFN tariff on agriculture (WTO definition) was 1.7%, lower than the 2.5% average 
for non-agricultural goods and also lower than the overall applied MFN tariff averaging 2.3%. Under its WTO Schedule of Commitments (Section I-B), New Zealand may apply tariff rate quotas 
on imports of certain agricultural products (apples, pears, and hop cones), it does not, however, 
administer these quotas because the applied MFN tariff on these products is zero.
6  
4.16.  Import health standards (IHS), drafted under the Biosecurity Act 1993, are required for all 
risk goods before they can be brought into New Zealand. Certain products such as poultry table 
eggs and uncooked chicken are currently not being imported because they do not meet the required sanitary standards. Risk analysis is being undertaken in order to develop import conditions for honey from requesting countries (see Section 3.2.8). 
4.17.  Under the Commodity Levies Act 1990, industry organizations can collect producer levies on 
commodities to fund market research, quality assurance and plant and animal health protection. There are currently 30 commodity levy orders in force. With a very few exceptions, levies may not 
be spent on commercial and trading activities.
7 Levies on imports are permitted provided that the 
rate is equal or less than that charged on the domestic product and that the levy order is not contrary to New Zealand's international obligations. Industry organizations must obtain a new 
mandate to collect levies every six years through a referendum among producers. 
4.2.2.2  Export measures 4.18.  New Zealand administers exports licences for some agricultural products such as beef and 
dairy in order to accommodate tariff-quotas imposed by some trading partners. Export licences are 
required to export certain dairy products to the United States, the European Union, Japan and the 
Dominican Republic. In the case of meat, the New Zealand Meat Board is responsible for allocating export quotas for high quality beef, sheep, and goat  meat for the EU market, and for beef and veal 
for the U.S. market. Exporters of meat products to any market, including quota markets, must be 
registered under the Meat Board Act 2004. The Meat Board keeps this registry and issues quota certificates for relevant quota markets.   
4.19.  Until recently, the Fonterra Co-operative Group, New Zealand's main exporter of dairy 
products, had exclusive licences to export to designated restricted markets (i.e. where countries impose import restrictions). By March 2010, after a two-year phase-out period, all Fonterra's exclusive licences expired, meaning that since 2011 there are no restrictions on who can export 
dairy products to designated markets. The MPI allocates licences for the export of certain volumes 
of dairy products to designated markets; allocati on is based on the proportion of milk solids 
collected by each company in relation to the total import volume of the preferential tariff quota. 
4.20.  The kiwifruit industry is the only sector where export management measures remain. Under 
the Kiwifruit Industry Restructuring Act (KIRA) 1999 and the Kiwifruit Export Regulations 1999, the regulator, Kiwifruit New Zealand (KNZ), has gi ven the Zespri Group Ltd. an automatic but not 
                                               
5 Previously, in July 2010, the New Zealand Food Safety Authority had been amalgamated with the 
Ministry of Agriculture and Forestry. 
6 WTO document G/AG/N/NZL/84, 19 May 2014. 
7 During the review period, the Commodity Levies Act was amended to allow for funding for a wheat 
producers' mutual insurance scheme. WT/TPR/S/316 • New Zealand 
 
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  sole right to export kiwifruit to all markets except Australia.8 All other traders wishing to export 
kiwifruit to markets other than Australia must get prior approval from KNZ in order to export the fruit. This gives Zespri a quasi-monopoly on exports to markets other than Australia. Traders can export kiwifruit to Australia without prior approval from KNZ and independently from Zespri. No 
significant changes were made to the KIRA or th e Regulations during the review period. Between 
2009/10 and 2012/13, Zespri accounted for more than 97% of total exports of kiwifruit each year. 
4.21.  The Horticulture Export Authority Act 1987 (HEA Act) provides a framework for cooperation 
between growers and exporters of horticultura l produce through the development of export 
marketing strategies. Participation in the framework is voluntary, but participants must comply with the qualitative requirements set by the Hortic ulture Export Authority (HEA). A review of the 
HEA Act was carried out in early 2012; the amendm ents included: enabling industries to adopt 
more flexible and focused export marketing strategies by allowing multi-tier export licences with 
different fees; clarifying requirements and proc esses for industries to enter and exit the HEA 
framework; updating enforcement powers and penalties under the HEA Act; allowing the HEA to 
collect levies from producers groups; and modernizin g and clarifying the provisions of the HEA Act.  
4.22.  New Zealand does not apply export subsidies for agricultural products.
9 
4.2.3  Domestic support 
4.23.  The level of domestic support for New Zealand's agricultural sector has remained 
consistently low since the liberalization reforms of the mid-1980s. The producer support estimate (PSE) was less than 1% in 2010-12, the lowest among OECD countries. Total support for agriculture was about 0.3% of GDP during the same period.
10 Domestic prices of virtually all 
agricultural products are aligned with international prices, except for poultry table eggs and 
uncooked chicken, where stringent sanitary measures  have led to an absence of imports, resulting 
in domestic prices above world prices.11 Support measures mostly consist of general services 
applying to all products, and producer specific budgetary support is only granted for pest and 
animal disease control and relief in the event of large-scale natural disasters. During the review years, New Zealand's total Aggregate Measure of Support (AMS) was zero.
12   
4.24.  In June 2012, New Zealand notified the WTO Committee on Agriculture about official 
financial support granted to kiwifruit growers to contain the spread of the fruit disease Psa (pseudomonas syringae pv actinidi ae) and help the industry recover.
13 In December 2012, Psa was 
declared a medium-scale biosecurity event, meanin g that kiwifruit growers severely impacted by 
Psa would be eligible for Rural Assistance payments under the Primary Sector Recovery Policy. The 
payment covered essential living expenses for maximum of 12 months (excluding loss of income, livestock, land or other production factors). The eligibility period ended in December 2013 and 
given strict eligibility criteria only a very limited number of kiwifruit growers received payments.  
4.2.4  Dairy industry restructuring  4.25.  The dairy industry has continued to undergo  reforms with the aim of ensuring transparency, 
efficiency and access of new entrants into the ma rket, in particular given Fonterra Co-operative 
Group's still dominant role in the sector.
14 In 2009, Fonterra's shareholders voted to modify the 
Co-operative's capital structure to allow farmers to directly trade their shares among each other. Under the Trading Among Farmers (TAF) Order 2012, Fonterra no longer issues and redeems 
shares but rather shareholders buy and sell shares on the Fonterra Shareholders' Market (FSM). 
The FSM is a private market where only Fonterra Farmer Shareholders, Fonterra and a specially 
                                               
8 The Zespri Group Ltd. has been notified by New Ze aland to the WTO as a state-trading enterprise. See 
WTO document G/STR/N/15/NZL, 22 May 2014. 
9 WTO document G/AG/N/NZL/85, 19 May 2014 (latest notification).  
10 OECD (2013a). 
11 For the period 2010-12, single commodity transfers, which reflect the difference between world and 
domestic prices, were 22% for poultry, 10% for egg, and zero for all other agricultural products (OECD, 
2013a). 
12 WTO documents G/AG/N/NZL/69, 19 May 2011; G/AG/N/NZL/75/Rev.1, 28 September 2012; 
G/AG/N/NZL/81, 2 May 2013; and G/AG/NZL/86, 19 May 2014.  
13 WTO document G/AG/N/NZL/76, 5 July 2012. 
14 Fonterra Co-operative Group collects 87% of the milk produced in New Zealand. It is the world's 
largest diversified milk processing compan y and the top exporter of dairy products. WT/TPR/S/316 • New Zealand 
 
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  appointed market maker can trade. Outside investors who are not allowed to hold shares in 
Fonterra can, however, invest in the Fonterra Shareholders' Fund (FSF). The FSF gives investors 
access to the economic rights that they would have received if they were allowed to own a Fonterra share.
15 Fonterra launched its share trading scheme in November 2012.  
4.26.  The Dairy Industry Restructuring Act 2001 (DIRA)16 was amended in 2010 to allow the 
Minister for Primary Industries to conduct auctions for determining the price and allocation of raw milk when demand exceeds supply. The auction mechanism has not been used to date. The Dairy 
Industry Restructuring Amendment Act 2012 introduc ed a milk price monitoring regime aimed at 
improving transparency in Fonterra's farm-gate milk price setting process and controlling whether Fonterra's farm-gate milk price is consistent with a price that would otherwise emerge in a competitive market for farmers' milk. The Commerc e Commission is in charge of monitoring and 
reporting every year on Fonterra's milk price.  
4.27.  The Dairy Industry Restructuring (Raw Milk) Regulations 2001 were reviewed in 2011. A 
number of significant amendments were made resulting in the Dairy Industry Restructuring (Raw 
Milk) Regulations 2012. The Regulations' objectives are to facilitate entry of independent dairy 
processors into the farm-gate milk market (ensuring processors have access to raw milk) and support competition in the dairy product market. The Dairy Restructuring (New Sunset Provisions) 
Amendment Act 2011 raised the market share threshol ds for independent processors that must be 
met.
17 If the thresholds are not met by June 2015, the Minister for Primary Industries must, in 
consultation with the Minister of Commerce, request a report on the state of competition in the dairy industry, which may result in a review of the DIRA. The share of milk collected by Fonterra 
declined gradually from 94% of total milk production in 2007/08 to about 87% in 2013/14.
18  
4.2.5  Sustainable mana gement of resources 
4.28.  New Zealand has continued implementing schemes to improve sustainable management of 
resources, in particular water and land. The Community Irrigation Fund created in 2007 was 
superseded by the Irrigation Acceleration Fund (IAF) in 2011. The IAF also builds on the grants for irrigation-projects provided under the existing Sustainable Farming Fund.
19 IAF is targeted at 
supporting up to 50% of the costs of strategic water management studies and the feasibility, 
design and uptake stages of major irrigation and water storage projects up to the "investment-ready" stage. It has a budget of NZ$35 million  to be used over a period of five years.
20 
4.29.  Under New Zealand's Emissions Trading Scheme (NZETS) emitters of greenhouse gases 
must either reduce their emissions or buy New Zealand Units to pay for those emissions. Since 
2012, the agricultural sector is required to report  biological emissions (methane and nitrous oxide) 
that are produced on-farm. However, agriculture will have to surrender obligations in the ETS only 
if there are technologies available to reduce such emissions and international competitors take 
sufficient action on their own emissions.21 The agricultural sector is responsible for almost half of 
New Zealand's greenhouse gas emissions.22  
4.2.6  Fisheries 
4.30.  Commercial fishing and aquaculture are today one of New Zealand's leading export 
industries. Seafood exports (including wild capture and aquaculture) usually rank fifth in terms of export earnings. In 2013, the total value of seaf ood exports was US$1.46 billion, of which wild 
capture fisheries accounted for US$1.21 bi llion and aquaculture for US$252 million.
23 More than 
                                               
15 The FSF Units are listed on the New Zealand Stock Exchange Main Board. 
16 Passed in 2001 to foster competition in the dairy market, DIRA obliges Fonterra Co-operative Group 
to ensure farmers' open entry and exit to the co-opera tive, collect milk from a requ esting farmer and to make 
up to 79,500 million litres of raw milk available to independent processors at a regulated price.  
17 The thresholds are defined as a pe rcentage of milk solids  collected by independ ent processors from all 
New Zealand dairy farms in a given season. They were raised from 12.5% to 20% in 2011. 
18 Information provided by the authorities.  
19 WTO (2009). 
20 WTO document G/AG/N/NZL/70, 23 September 2011. 
21 Climate Change Response (Emissions Trad ing and Other Matters) Amendment Act 2012. 
22 Ministry of the Environment, New Ze aland's Greenhouse Gas Inventory 1990-2010.  
23 Ministry for Primary Industries (2014). WT/TPR/S/316 • New Zealand 
 
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  90% of all catch is exported. Eight large fishin g companies account for some 80% of production, 
but there are also medium and smaller companies, mainly dedicated to inshore fishing.24 
4.31.  The fisheries sector is principally govern ed by the Fisheries Act 1996 and its amendments.25 
Following the merger of the Ministries of Fisherie s and Agriculture, as of April 2012 the Ministry for 
Primary Industries is the Government's principal adviser on fisheries and aquaculture 
management. 
4.32.  In order to ensure the sustainable utilizati on of fisheries resources, commercial fishing in 
New Zealand has been regulated by a Quota Management System (QMS) since 1986. 
Box 4.1 describes the main features of the QMS.26 Currently, there are about 100 commercial 
species subject to the QMS. Commercial fishing of any non-QMS species not included on a specified list of the Fisheries Act 1996 is allowed. 
Box 4.1 Commercial fishing: Quota Management System (QMS)  
• The QMS regulates commercial fishing in New Zealand in order to ensure sustainable 
utilization of fisheries resources.  
 
• 100 species are subject to the QMS, divided into 638 separate stocks defined by 
geographical areas. Each stock is divided into 100 million transferable quota shares.  
 
• In the past, quota was allocated on the basis of catch history. Since 2010, quota shares for 
new stocks under the QMS are allocated through tender. Under the Maori Fisheries Act 
2004, 20% of any new QMS stock is allocated to Maori.  
 
• Total allowable catch (TAC) limits are set for each fish stock at the level that allows 
maximum sustainable yield (i.e. the greatest yield while maintaining a stock's productive 
capacity over time). After allowing for non-commercial fishing and fishing-induced mortality 
of each stock, a total allowable commercial catch (TACC) is determined.  
 
• Each quota share generates an annual catch entitlement (ACE), expressed in weight, within 
the TACC available for each stock. ACE ca n be traded during the fishing year.  
 
• Fishers must balance their catches with their ACE at the end of each fishing year. If the 
catches exceed their annual ACE holdings, fishers must pay to the Crown a monetary 
amount (deemed value) determined by the Mini ster for Primary Industries. Deemed values 
are higher than the ACE price of the stock plus the costs of obtaining the ACE. 
 
• A catch balancing mechanism and reporting requirements are in place to enforce the QMS. 
 
Source: Information provided by the authorities. See also http://fs.fish.govt.nz/Page.aspx?pk=81&tk=248 . 
 
4.33.  The MPI is responsible for the implementati on of the Fisheries Act and the QMS. A private 
entity, FishServe, operates some of the services required by the Act and relevant regulations (as 
either devolved or contracted services), such as maintaining the registers of all fishing quotas and 
ACE trades, vessel registration, high seas permits, and issuing commercial fishing permits that are required for undertaking fishing in New Zealand. 
4.34.  Currently, there are about 2,200 individu als and companies holding fishing quotas. The 
Fisheries Act 1996 provides for the setting of ca ps on the total number of quota shares of a 
particular stock that may be held by any single person or company (these caps do not apply to ownership of ACE so as to ensure the operational ef ficiency of fisheries). Nevertheless, the Minister 
for Primary Industries may consent to a higher limit for any entity that requests the extension 
                                               
24 MPI online information. Viewed at: http://www.fish.govt.nz/en-nz/Commercial/ . 
25 Other laws governing the sector include the Aquaculture Reform (Repeals and Transitional provisions) 
Act 2004, the Treaty of Waitangi (Fisheries Claims) Settlement Act 1992, the Maori Commercial Aquaculture 
Claims Settlement Act 2004, the Maori Fisheries Act 2004, an d a significant number of regulations relating to 
the management of fisheries within and outside New Zealand's Exclusive Economic Zone.  
26 For more details on the QMS see also: http://fs.fish.govt.nz/Page.aspx?pk=81&tk=248 . WT/TPR/S/316 • New Zealand 
 
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  prior to acquiring the quota shares that would be in excess of the prescribed limit. A number of 
companies have been granted such consent. 
4.35.  Under the overseas investment fishing provisions of the Fisheries Act 1996 (Sections 56 to 
58), consent is required for any overseas investment in fishing quota.27 The criteria for consent 
that all overseas investments in fishing quota must meet is established in Section 57G of the Act 
and includes that the granting of consent is in the national interest.28 
4.36.  Overseas persons may not have a 25% or more ownership or control interest in fishing 
quotas, without consent first being obtained from the relevant Ministers (i.e. the Minister for 
Primary Industries and the Minister of Finance). Under the Overseas Investment Act (2005), all overseas investments in fishing quota are defined as sensitive (see Section 2). 
4.37.  The recently passed Fisheries (Foreign Charter Vessels and other matters) Amendment 
Act 2014 will prohibit foreign-flagged charter fishing vessels (FCVs) from fishing in New Zealand 
waters (within the 200 mile limit) from 1 May 2016. At present, FCVs registered as New Zealand fishing vessels are allowed to fish in New Zealand waters, and there are a number of vessels 
operating under such provisions, which will need to be reflagged as New Zealand vessels if they 
are to continue their operations. Fish landed from such vessels is managed according to the charter arrangements between the New Zealan d company and the foreign vessel owner.   
4.3  Energy 
4.3.1  Overview 4.38.  In 2013, oil made up 33% of New Zealand' s total energy supply, followed by gas (22%), 
geothermal energy (20%), hydro (10%), other renewable sources (8%) and coal (7%). The 
overall contribution of renewable sources to total energy supply was 38%. Local production was 
responsible for 83% of the country's total energy  supply. New Zealand is self-sufficient in all 
primary energy sources, except oil, of which it is a net-importer. On the other hand, it is a 
net-exporter of coal and liquid petroleum gas (LPG). In 2013, the transport and industrial sectors 
accounted for 37% and 36% of energy demand, respectively.
29 
4.39.  The direction of energy policy is set ou t in the New Zealand Energy Strategy 2011-2021 and 
the New Zealand Energy Efficiency and Conservati on Strategy 2011-2016 (NZEECS), both released 
in August 2011. The strategy focusses on four ob jectives: developing greater energy resources, 
including renewable and non-renewable; ensuring secure and affordable en ergy; making efficient 
use of energy; and maintaining an environmentall y responsible approach to energy. New Zealand 
aims to generate 90% of its electricity from re newable energy sources by 2025, and to achieve a 
50% reduction in its greenhouse gas emissions (from 1990 levels) by 2050.30 The NZEECS sets 
out specific policies and targets in six sectors to achieve the above objectives.31 The Energy 
Efficiency and Conservation Authority (EECA) is  the government body responsible for improving 
energy efficiency by businesses and homes an d fostering greater use of renewable energy.32  
4.40.  New Zealand Emissions Trading Scheme (NZETS), in place since 2008, is part of the overall 
energy strategy. After a first review in 2011, amendments to the NZETS were passed in 2012 with 
the purpose of reducing its cost impact on businesses and households, improving its operation and making it more flexible. Some transitional provis ions were extended until the next review in 2015. 
                                               
27 For the purposes of the overseas investment fishing provisions of the Fisheries Act 1996, fishing 
quota means an interest in provisional catch history, quota or annual catch entitl ement (ACE) (section 57A). 
28 Factors to determine whether or not overseas investment in fishing quotas is in the national interest 
are spelled out in Section 57H of the Fisheries Act 1996, and include, inter alia , the creation of new jobs, the 
introduction of new technology or business skills, incr eased export receipts and a dded market competition.  
29 Figures in this paragraph are taken from Ministry of Business, Innovation and Employment (2014). 
30 Ministry of Business, Innovation and Em ployment online information. Viewed at: 
http://www.med.govt.nz/sectors-industries/ener gy/pdf-docs-library/ener gy-strategies/nzes.pdf . 
31 Ministry of Business, Innovation and Em ployment online information. Viewed at: 
http://www.med.govt.nz/sectors-industries/energy /pdf-docs-library/energy -strategies/nzeecs.pdf . 
32 For more details see EEC A online information at: http://www.eeca.govt.nz/ . WT/TPR/S/316 • New Zealand 
 
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  4.3.2  Electricity 
4.41.  In 2013, just over 75% of the electricity generated in New Zealand came from renewable 
sources, mainly hydropower (54.5% of all generation).33 Gas contributed with 19.4% and coal with 
5.3%. The industrial sector remained the largest consumer of electricity (38%), followed by the 
residential (32%), commercial (24%) and agricultural (6%) sectors.34  
4.42.  The generation sector is formally unrestric ted, but only five companies produce 92% of the 
country's electricity (2013).35 Three of these companies (Meridian Energy, Genesis Energy and 
Mighty River Power) are 51% state-owned and acco unt for almost two-thirds of all electricity 
generation. Transpower, another state-owned enterprise, owns, operates and maintains the national grid. It supplies electricity to 29 distribution companies, which tend to serve each a specific geographic area, although they have no exclusive territorial franchises. The ownership of 
distribution companies is a mix of publicly listed companies, shareholder trusts, community trusts 
and local bodies. 20 retailers buy electricity from the wholesale market and sell it to consumers, but 95% of the retail sector is dominated by five companies (which are also generators).
36 Certain 
restrictions apply on joint ownership and corpor ation between distributors, on the one hand, and 
generators and retailers, on the other.  
4.43.  Electricity is traded at a wholesale market, which is coordinated by the Electricity Authority 
(the government regulator) and other organizations undertaking various roles (e.g. market 
administrator, pricing manager, clearing manager). Wholesale electricity prices are set for every 30-minute trading period (i.e. 48 trading periods per day) and are based on the offers submitted by the generators for that period. The System  Operator (Transpower) generally chooses the 
lowest-cost offers to satisfy demand, whereas the wholesale market prices (paid by all market 
participants) are set at the highest-priced bid accepted for that period. New Zealand has locational pricing for electricity, i.e. there are about 248 wholesale market locations across the country, each 
of which can have a different wholesale price,  based on supply, demand and transmission 
constraints. While the System Operator operates the market to minimize the total cost of generation, it does so in a way that ensures that enough generation/transmission capacity is held 
in reserve so that unexpected events can be managed without interrupting supply to consumers.  
4.44.  Wholesale and retail electricity prices are unregulated for all classes of consumers, except 
that retailers must offer households with below-average consumption a tariff with a fixed charge tariff component not exceeding 30 cents per day (variable tariff components are not regulated). 
Local electricity distribution is a monopoly business. Some of the largest distribution enterprises 
are subject to price-quality regulation by the Commerce Commission.  
4.45.  There were important changes to the regulato ry regime of the electricity sector during the 
review period. The Electricity Industry Act 2010 (EIA ) came into force in November 2010, together 
with the Electricity Industry Participation Code 2010 (the Code) and a set of new regulations.
37 The 
EIA replaced parts of the Electricity Act 1992 and repealed the Electricity Industry Reform 
Act 1998 (EIRA 1998).38 The Code sets out the duties and resp onsibilities of industry participants 
and the new regulator. The Commerce Act 1986 (Part 4) provides for price-quality regulation for 
Transpower and large distribution companies (i .e. 17 non-community owned distributors). Under 
the same Act, Transpower and all distributors are subject to information disclosure requirements.  
4.46.  The main purpose of the EIA is to improv e competition, reliability and efficiency in the 
electricity market. One of the main changes introduced by the EIA was the establishment of the Electricity Authority as an independent regulator (replacing the Electricity Commission) with 
regulatory and monitoring functions aimed at enhancing market performance.
39 The EIA also 
                                               
33 Other renewable sources were  geothermal (14.5%), wind (4.8%), and bioenergy (1.4%). 
34 Figures are rounded, taken from Ministry of Business, Innovation and Employment (2014). 
35 These companies are Meridian Energy (32.7%), Contact Energy (24.3%), Genesis Energy (14.5%), 
Mighty River Power (15.1%),  and Trustpower (5.2%).  
36 These are Contact Energy, Genesis Energy, Mercury Energy (the retail division of Mighty River 
Power), Meridian Energy, and Trustpower.  
37 The Electricity Industry (Enforcement) Regulation s 2010, the Electricity Industry (Levy of Industry 
Participants) Regulations 2010, and the Electricity Industry (Participants and Roles) Regulations 2012. 
Electricity Authority online information at: http://www.ea.govt.nz/code-and-compliance/act-and-regulations/ . 
38 The EIA also provided for changes to the Commerce Act 1986, the Gas Act 1992 and other Acts. 
39 Information about the Electricity Authority can be found at: http://www.ea.govt.nz/about-us/ . WT/TPR/S/316 • New Zealand 
 
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  allowed distributors to increase their cross-ownership with retail businesses, and raised the 
thresholds for ownership and corporate separation  between distribution and generation. At the 
same time, it set out provisions to prevent discrimination by distribution companies against competing generators and retailers. The Electricity Authority is responsible for enforcing these 
provisions and has the power to set reporting requirements. It has been noted that while the EIA 
provides opportunities for distribution companies to invest in generation and retail, it could lead to vertical integration (from generation to retail) in some cases.
40 This makes the enforcement of 
pro-competition provisions and market monitoring all the more relevant. The Electricity Authority 
promotes competition in the electricity sector and the Commerce Commission is responsible for enforcement of competition rules in the electricity distribution and transmission markets.   
4.47.  The Public Finance (Mixed Ownership Mode l) Amendment Act 2012 provided for the partial 
privatization of the three state-owned generators/retailers. Accordingly, the Government sold 49% 
of its stake in Mighty River Power (May 2013) , Meridian Energy (October 2013), and Genesis 
Energy (April 2014). The electricity sector is subjec t to the provisions of the Overseas Investment 
Act 2005. 
4.48.  Under the Electricity Industry (Levy of Industry Participants) Regulations 2010 a levy is 
collected from all participants in the electricity industry. The levy is directly charged to industry 
participants, who may pass its cost on to consumers. 
4.3.3  Hydrocarbons 4.49.  New Zealand has several producing oil fields, but it is a net oil importer. Most domestically 
produced oil is sold on the international market where its good quality attracts a premium price, 
while cheaper oil is imported to be refined locally. The Middle East and Australia are the main 
sources of imports of crude oil. The only oil refinery, operated by Refining NZ, meets around 60% of domestic demand. In 2013, some three-quarters of imports of refined oil products came from 
Singapore and the Rep. of Korea. Diesel and petrol make up 85% of oil products domestic 
demand.
41 Prices and taxes on vehicle fuels are relatively low. New Zealand is a net exporter of 
LPG. 
4.50.  The Crown owns all petroleum resources and associated hydrocarbons. A permit is required 
in order to prospect, explore or mine petroleum whether in-ground, in the Exclusive Economic Zone or in the continental shelf. New Zealand Petroleum and Minerals (NZP&M) is the government agency responsible for administering the permit  regime under the Crown Minerals Act 1991. It 
reports to the Minister of Energy and Resources. The sector is open to foreign investment. Consent 
under the Overseas Investment Act 2005 is not normally required for prospecting, exploration or mining permits. However, consent is required for acquisition of "significant business assets" worth 
more than NZ$100 million.   
4.51.   The Petroleum Action Plan (2009) provided for a more proactive role of the Government in 
supporting exploration and development of petroleum resources and a review of the regulatory 
regime in order to attract investment. Amen dments to the Crown Minerals Act 1991 and the 
Minerals Programme for Petroleum and associated regulations came into force on 24 May 2013. A new streamlined permit regime was introduced to reduce the time required to obtain exploration 
permits for less complex and lower-risks projects, and improvements were made in the 
coordination between NZP&M and the health, safety and environmental regulators in the allocation 
of permits.  
4.52.  Prior to 2012, petroleum permits were allocated either via "priority in time" (PIT) or 
competitive tender. PIT permit allocation was removed in 2012 and since then all petroleum 
exploration permits have been allocated via the so-called Competitive Block Offer method. NZP&M publishes annual block offers, making available a number of blocks for competitive tender on the 
                                               
40 Nightingale and Odlin, at Buddle Findlay Lawyers (2010). 
41 Ministry of Business, Innovation and Employment (2014). WT/TPR/S/316 • New Zealand 
 
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  international market. In December 2012, the Gove rnment awarded ten new oil and gas exploration 
permits, and an additional ten in 2013.42 Most of the permits were granted to foreign investors.  
4.53.  A competitive tax and royalty regime is in place to attract investment to the petroleum 
sector. Exploration-related expenditures are deducted for royalty purposes in the year they are 
incurred. Non-resident offshore rig operators and seismic vessels are exempted from paying tax on 
their profits. This exemption was introduced as a temporary measure in 2005 but has since been extended twice; it is now due to expire on 31 December 2019.  
4.54.  The Crown Minerals (Royalties for Petroleum) Regulations 2013 set royalty rates on 
petroleum production from permits granted after 24 May 2013. Companies pay either an ad valorem  royalty or an accounting profits royalty, whichever is higher in any given year. In 
May 2014, the Government announced a partial review of the fees charged for petroleum 
prospecting permits and offshore minerals permits,  c o n s i d e r e d  t o  b e  t o o  h i g h  r e l a t i v e  t o  t h e i r  
administration cost. A full review of the fees regi me for petroleum and minerals will be conducted 
in 2015-16. 
4.4  Manufacturing 
4.55.  The manufacturing sector remains an important contributor to the New Zealand economy, 
although its shares in GDP and total employment continued to fall over the years under review. 
Manufacturing activity contracted sharply duri ng 2008/09 due to weak foreign and domestic 
demand, and has achieved only a modest recovery  since then. The sector accounted for 12.1% of 
GDP (at current prices) in 2011/12 and 11.3% of total employment (the latter fell to 10.8% in 2013/14) (Table 1.2).  
4.56.  There has been some diversification towards higher value-added, knowledge-intensive 
subsectors (e.g. niche electronic goods, new mate rials and software) in recent years, however, 
primary food manufacturing (mainly dairy and meat  products) and other resource-based industries 
remain the largest components of manufacturing activity. Food, beverage and tobacco is the most 
important subsector accounting for 38.9% of total manufacturing output (2011/12)
43 and around 
35% of the manufacturing workforce (2013). Other important subsectors are machinery and 
transport equipment, petroleum and chemical products, metal products, and wood and paper 
manufacturing.   
4.57.  Manufactured products accounted for 19.9% of New Zealand's total merchandise exports in 
2014 (down from 25.6% in 2009). However, this does not take into account exports of food 
products, which are registered under "agriculture" and made up 58.5% of goods exports in 2014. 
On the import side, manufactures represented 70.7% of New Zealand's total merchandise imports in 2014, compared to 71.4% in 2009. (Tables A1.1 and A1.2). Australia is the main export market 
for New Zealand's manufactures and Asia is the largest supplier of New Zealand's manufactured 
imports.
44  
4.58.  The manufacturing sector is generally open to foreign investment and receives little import 
protection. In 2014, the average MFN tariff for manufacturing (ISIC 3) was 2.5%, slightly lower 
than the 2.7% reported in the previous Review (2009). However, tariff rates in the textiles, clothing and leather industries (ISIC 32) remain higher than in other sectors, with an average applied MFN tariff of 4.4% in 2014. Tariffs for clothing (ISIC 3220) and footwear (ISIC 3240) are 
even higher at 8.9% and 6.8%, respectively, alth ough they are somewhat lower than at the time 
of the previous Review.  
4.59.  During the years under review, New Zealand's manufacturing industry faced a number of 
challenging conditions, including weak domestic and international demand, volatility in world food 
prices, and the appreciation of the New Zealand dollar against the currencies of some major trading partners. Other factors affecting the sector are the shortage of skills, in areas such as 
                                               
42 Ministry of Business, Innovation and Em ployment online information. Viewed at: 
http://www.med.govt.nz/sectors-industries/energy/pdf -docs-library/energy-strategies/nzpm-block-offer-
strategy.pdf . 
43 Information provided by the New Zealand authorities. 
44 RBNZ (2012). WT/TPR/S/316 • New Zealand 
 
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  engineering and management, weak linkages be tween the education system and the labour 
market, and insufficient investment in R&D.45 
4.60.  There is no overarching official policy sp ecifically targeted at the manufacturing industry. 
Instead, the New Zealand Government has put in place several programmes to assist businesses 
in the sector, mainly in the form of financial support, technical advice and R&D funding. The 
Business Growth Agenda (BGA) outlines Government initiatives to support New Zealand businesses to grow and help create a more productive and competitive economy, while specific programmes 
are implemented through government agencies. Fo r example, New Zealand Trade and Enterprise 
(NZTE) has programmes such as "Better By Design" (which assists companies to improve international competitiveness by integrating design principles across their businesses); "Better By Lean" (helps firms to improve performance by elim inating inefficient processes and activities); and 
"Better By Strategy" (previously called Manufacturing Plus) assists companies to develop business 
models, action plans and practical tools to enhance business performance.
46  
4.61.  The Ministry of Business, Innovati on and Employment manages approximately 
NZ$60 million annually in funding for research targeted at industry issues in the high value 
manufacturing and services sectors. Grants are al located to research providers via a contestable 
process and are usually for a period of several years. In 2013, the Government established 
"Callaghan Innovation", a Crown entity, which promotes the commercialization of innovation by 
firms. It funds business R&D (some NZ$160 million a year), advises firms on innovation, and can provide some research and technical services (Section 3.4.1). 
4.5  Services 
4.5.1  Features and multilateral commitments 
4.62.  Services remain the leading sector of New Zealand's economy, although their average 
annual growth rate at 1.9% in real terms between 2008/09 and 2013/14 has been more moderate 
than that reported in the previous Review. The sh are of services in GDP increased slightly during 
the review period to 69.7% (2011/12), while its share in total employment rose from 71.2% in 2008/09 to 73.2% in 2013/14. The largest subsectors are "professional, scientific and technical 
services" and "rental, hiring and real estate serv ices", which contributed 7.7% and 7.1% to GDP in 
2011/12, respectively. Other important subsectors are health care and social services, owner-occupied property operation, and finance and insurance (Table 1.2). The subsectors with the highest annual average growth rates during the re view period were professional, scientific and 
technical services and information media and telecommunications. The latter's dynamism is, in 
part, due to significant investments made for the roll-out of the ultra-fast broadband fibre network (Section 4.5.3).  
4.63.  New Zealand's services trade balance rema ined positive throughout the review period. 
Services exports amounted to NZ$16,766 million for the year ending in March 2014 (about 25% of 
total exports of goods and services), while impo rts totalled NZ$15,498 million. The major services 
exports continue to be travel, transport (mainly air transport) and business services; while the 
areas that have seen strong growth are financial services, computer and information services and audio-visual services. The main import categories are also travel, transport and business services (Table 1.5). 
4.64.  New Zealand has commitments in 90 of the 155 sectors covered in the classification 
normally used to make commitments under GATS.
47 The cross-border supply of most services 
(mode 1) has been bound without market access limitations. Except for financial services48, some 
transport services and one type of business service49, there are no market access limitations for 
the supply of services through commercial presence (mode 3) in New Zealand. Investments by 
                                               
45 Castalia (2014). 
46 MBIE carried out an evaluation of the Manufactur ing Plus programme in 2010. The report is available 
at: http://www.med.govt.nz/about-us/publications/pub lications-by-topic/evaluation-of-government-
programmes/nzte-output-class-2-sector-activities-evaluation-report-august-2010.pdf . 
47 WTO document S/DCS/W/NZL/, 24 January 2003. 
48 New Zealand undertook specific commitments on fi nancial services in accordance with the GATS' 
Understanding on Commitment s in Financial Services. 
49 Services incidental to animal husbandry. WT/TPR/S/316 • New Zealand 
 
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  "overseas persons" over a specified threshold re quire consent under the Overseas Investment Act 
2005 (this was scheduled as a general national treatment limitation on mode 3 based on the 
Overseas Investment Act 1973 in force at the time of scheduling). New Zealand has adopted the pro-competitive principles contained in the Reference Paper for Basic Telecommunications. MFN 
exemptions have been listed for audio-visual services, interpretation services, and maritime 
services (the latter relate to the nationality of officers servicing on New Zealand ships).  
4.65.  According to the World Bank's service trade restrictiveness index, New Zealand is one of the 
most open countries to services trade, taking into account all modes of supply.
50 There are, 
however, certain restrictions on FDI in the telecommunications and transport sectors (Sections 4.5.3 and 4.5.4). Competition in certain services sectors (i.e. retail, finance, insurance, real estate and professional services) is relative ly weaker than in other sectors (Section 3.4.3). 
4.5.2  Financial services 
4.66.  New Zealand has a developed, well-functioning financial system. The sector represents 
about 6% of GDP (2011/12) and contributes around  3% to total employment. It grew at an 
average annual rate of 2% in real terms be tween 2008/09 and 2013/14. Banks dominate the 
financial sector, accounting for most of the lending and deposit taking activity. Overall, New Zealand's financial system weathered the 2008-09 global financial crisis relatively well and 
remains sound. During the review years, regu latory changes strengthened the prudential 
framework for all types of financial institutions. The system faces some challenges such as high levels of debt in the household and agricultural  sectors, and banks' heavy reliance on foreign 
funding, which exposes them to foreign liquidity risks. Macro-prudential instruments have been 
used to address those challenges and increase the resilience of the domestic financial system. 
4.67.  The financial sector is subject to the general provisions of the Overseas Investment Act 
2005 (Section 2). There are no sector-specific restrictions on foreign investment, with local and 
foreign financial institutions competing on the same conditions in the domestic market. All 
companies, domestic and foreign, have access to a range of financing options in the local market. New Zealand does not apply a capital gains tax. 
4.68.  The financial services market is  generally open to trade. Foreign-owned suppliers deliver 
93% of all banking services in New Zealand and underwrite around 51% of all insurance contracts. Many other financial services can be supplied cross-border, including: insurance relating to transport and transit of goods; reinsurance and re trocession and services auxiliary to insurance; 
provision and transfer of financial information and financial data processing and related software; 
advisory, intermediation and other auxiliary financial services; and certain electronic payment and portfolio management services. 
4.5.2.1  Banking 
4.5.2.1.1  General featur es and market structure 
4.69.  New Zealand's banking system is characterized by a high level of foreign ownership, with 
more than 90% of all financial system assets owned by foreign banks. As at end-November 2014, 
there were 25 registered banks in New Zealand, of which ten were branches of foreign banks and 
one a state-owned bank (Kiwibank). Of the 14 New Zealand incorporated banks, nine are foreign-owned. The banking sector's total assets amounted to NZ$431.4 billion at June 2014. 
Concentration in the sector remains high, with the four largest banks (locally incorporated but 
predominantly Australian-owned) holding 81.5% of total assets (Table A4.1). 
4.70.  Following the global financial crisis, New Zealand's banking sector has performed well. All 
banks are now well capitalized and exceed thei r regulatory requirements, including the new 
Basel III capital requirements. Overall Tier 1 capital ratio is 11.4% of risk-weighted assets (Table 4.2), compared to the minimum requirement of 6%. All locally incorporated banks meet the 
capital conservation buffer of 2.5% of common equity (in place since January 2013) and their 
quantitative and qualitativ e liquidity requirements.
51 The non-performing loans ratio has fallen 
                                               
50 World Bank online information. Viewed at: http://iresearch.worldbank.org/servicetrade/default.htm . 
51 RBNZ (2014). WT/TPR/S/316 • New Zealand 
 
- 85 - 
 
  since 2011, and is now at 0.9%. Return on equity (ROE) was 13.7% (January-June 2014), making 
New Zealand's banking sector highly profitable by international standards.52 
Table 4.2 Banking sector indicators, December 2009 to June 2014 
  Dec. 09 Dec. 10 Dec. 11 Dec. 12 Dec. 13 Jun 14 
Number of registered banks 19 19 21 22 23 23a  
Total assets (NZ$ million) 376,740 379,635 393,132 406,359 412,932 431,421  
Total income (NZ$ million) 9,530 9,365 10,716 10,182 11,089 11,256  
Net interest income 
(NZ$  million) 6,929 7,313 7,792 8,183 8,375 8,618  
Operating expenses as a % 
of total income  44.3 47.0 41.8 46.0 43.0 40.9  
Net profit after tax 
(NZ$ million) 295 2,700 3,742 3,369 4,307 4,604  
Return on assets (ROA) (%) 0.1 0.7 1.0 0.8 1.1 1.1  
Return on equity (ROE)b (%) 2.9 9.9 13.1 11.2 12.9 13.7  
Total capital (as a % of 
risk-weighted assets)b 12.6 12.8 13.3 13.1 12.5 12.6  
Tier 1 capital (as a % of 
risk-weighted assets)b 9.5 9.8 1.6 11.5 11.4 11.4  
Tier 2 capital (as a % of 
risk-weighted assets)b 3.1 3.0 2.7 1.5 1.1 1.1  
Impaired assets/gross 
lending (%) 1.2 1.6 1.4 1.1 0.8 0.6  
Non-performing loans/gross 
lending (%) 1.7 2.1 1.7 1.4 1.0 0.9  
Specific provisions/impaired 
assets (%) 31.1 30.3 31.5 36.9 31.6 33.3  
a As at end-November 2014, there were 25 registered banks. 
b For locally incorporated banks only. Overseas inco rporated banks are required to calculate capital 
and risk weighted credit exposures in accordance with the requirements in their home jurisdiction, 
therefore they are no t directly comparable . 
Source: Information provided by the New Zealand authorities. 
4.71.  Banks' funding conditions are gradually improving, with more stable core funding (retail 
deposits, long-term wholesale borrowing and bank capital) making up 85.5% of total funding 
(September 2014), while reliance on offshore borrowing has been reduced. Credit has expanded at around 5% annually in recent years (from 1.3% in late 2009), but it has started to outpace retail 
deposits growth. Credit expansion has been primar ily due to an increase in mortgage lending, 
reflecting a buoyant housing market, particularly in 2012 and 2013, although restrictions on new mortgage loans introduced in October 2013 have helped cool off the property market (see paragraph 4.82). 
4.72.  Non-banking deposit-taking institutions (NBD Ts), i.e. finance companies, building societies 
and credit unions, represented about 1.1% of intermediated credit in New Zealand in May 2014 (down from 5.5% in December 2007).
53 NBDTs were hard hit during the 2008-09 global financial 
crisis due to risky lending practices and the slow-down in economic activity. Severely constrained 
by the lack of available funding, many of them  experienced failure or were merged with other 
institutions. This prompted the Government to expe dite its proposals for the prudential supervision 
of these institutions by the RBNZ (see paragraph 4.83). 
4.5.2.1.2  Regulatory framework 4.73.  The banking sector is regulated by the Reserve Bank of New Zealand (RBNZ) under the 
Reserve Bank of New Zealand Act 1989. The Act empowers the RBNZ to register and supervise 
banks for the purposes of promoting a sound and efficient financial system, and avoiding 
                                               
52 New Zealand's banking sector ranks sixth out of 25 OECD countries in terms of ROE (RBNZ, 2014b). 
53 Figures provided by the New Zealand authorities (RBNZ). WT/TPR/S/316 • New Zealand 
 
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  significant damage to the system in the event of distress or bank failure. The RBNZ is also 
responsible for overseeing non-bank deposit takers, insurance companies and the payment system. In addition, banks are subject to the Credit Contracts and Consumer Finance Act 2003, 
administered by the Commerce Commission, which requires creditors to disclose all aspects of 
credit contracts (e.g. fees, charges, and interest). 
4.74.  Both locally incorporated entities and br anches of banks incorporated overseas may apply 
for registration. There is no upper limit on the num ber of registered banks and no restrictions on 
the scope of financial services that a bank may provide. However, a banking group is not 
permitted to conduct material non-financial activities and insurance businesses in excess of 1% of total consolidated group assets.  
4.75.  Only entities whose business substantially consists of borrowing and lending money or 
providing other financial services may be registered as banks. They must have a proven ability to 
conduct their business in a prudent manner and an appropriate standing in financial markets. The RBNZ takes into account both qualitative and quantitative criteria in the registration process.
54 
New Zealand-incorporated banks must have a total capital of not less than NZ$30 million and meet 
Basel III capital ratio requirements and buffers: i.e.  a minimum ratio of 6% of Tier 1 capital to 
risk-weighted assets (increased from 4% in Ja nuary 2013), a minimum 8% total capital ratio; a 
common equity Tier 1 capital ratio of not less than 4.5%, and a conservation buffer of 2.5%. 
Banks can operate within this buffer but incur restrictions in their profit distribution if they do so. The RBNZ has the power to apply an additional counter-cyclical capital buffer in periods of excessive credit growth. Minimum capital requirements for the four largest banks are based on an 
internal-model-approach, which must be approved by the RBNZ for each bank. 
4.76.  Since April 2010, locally incorporated banks must hold liquidity buffers that satisfy the 
one-week and one-month mismatch ratios. Additi onally, registered banks must comply with a 
minimum "core funding ratio" (CFR) introduced in 2010. The CFR requires that at least 75% of 
total funding must come from liabilities other than short-term debt, such as retail deposits, long-term wholesale borrowing and bank capital.
55 Banks must make quarterly public disclosures 
of their financial and prudential state, maintain credit ratings for their long-term unsecured 
obligations payable in New Zealand in local currency, and comply with limits on the level of exposure to related parties.  
4.77.  An overseas incorporated entity wishing to  register as a branch in New Zealand must have 
bank status in its home jurisdiction and the appr oval of its home supervisor to carry out banking 
activities in New Zealand. Branches of overseas banks are not subject to minimum capital requirements, but the parent bank must demonstr ate that it meets the prudential requirements, 
including minimum capital standards, imposed on it by its home supervisor. However, the RBNZ 
may require a foreign bank to operate through a locally incorporated entity rather than a branch in certain circumstances, i.e. when the bank is systemically important
56; when the bank intends to 
take retail deposits in New Zealand and there is depositor protection in the bank's home 
jurisdiction; or when supervisory arrangements (including disclosure requirements) and market disciplines in the home jurisdiction are deemed inadequate.
57  
4.78.  The RBNZ closely monitors banks complianc e with the prudential supervision regime, but 
does not guarantee banks against failures. Currently, there is no formal deposit guarantee 
scheme.58 In the event that a registered bank fails, th e RBNZ will seek to avoid significant damage 
to the financial system. It may act as the lender of last resort and also use its crisis management 
powers, which include giving directions to a registered bank that is in difficulties, and 
recommending that a bank in financial distress be placed under statutory management.  
                                               
54 The RBNZ published an updated set of principles that it follows in  deciding over applications for 
registration (RBNZ, 2014b). 
55 Initially the CFR was set at 65%, then increa sed to 70% in 2011 and to 75% in January 2013. 
56 Systemically important banks are those whose New Zealand liabilities (net of amounts due to related 
parties) exceed NZ$15 billion. 
57 RBNZ (2014b). 
58 The wholesale bank guarantee facility and the retail guarantee scheme introduced in response to the 
2008-09 global financial crisis were terminated on 30 April 2010 and 31 December 2011, respectively. WT/TPR/S/316 • New Zealand 
 
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  4.79.  During the review years, a number of regu latory changes were made to improve prudential 
standards and the overall functioning of the financ ial system. In the banking sector, these included 
the implementation of the Basel III minimum capital requirements and buffers, effective January 2013; the introduction of quantitative li quidity requirements in 2010; adjustments to the 
core funding ratio (2011 and 2013); and the implem entation of a new policy for Open Bank 
Resolution (OBR) to help address the "too-big-to-fail" issue and reduce the net cost of banking crises, placing it primarily on the bank shareh olders and creditors (2012). Other regulatory 
developments were the creation of the Financial Markets Authority (FMA) as the regulator for the 
securities sector
59; the establishment of a Council of Financial Regulators to facilitate cooperation 
between the RBNZ, the FMA and other government departments involved in financial regulation; 
legislation against money laundering and financing of terrorism60; legislation to provide greater 
certainty and transparency for covered bonds issued by banks61; as well as the introduction of new 
regulatory frameworks for non-bank deposit takers  and the insurance sector (Section 4.5.2.3).  
4.80.  The RBNZ may impose macro prudential requirements at particular times to address 
potential system-wide risks and build its resilience. A 2013 Memorandum of Understanding 
between the Governor of the RBNZ  and the Minister of Finance provided for the RBNZ's temporary 
use of four macro-prudential tools, namely core funding requirements, a counter-cyclical capital 
buffer, changes in sectoral capital requirements to  address credit imbalances in some sectors, and 
loan-to-value caps on residential mortgages.  
4.81.  In October 2013, in order to minimize potential risks to the financial system posed by rapid 
price increases in the housing market, the RBNZ requ ired registered banks to hold higher levels of 
capital against their high loan-to-value exposure  and imposed limits on the proportion of new 
mortgage loans with high loan-to-value ratios (L VRs). Loans with LVRs over 80% must not exceed 
10% of a bank's new mortgage loans. The measure has helped bring the housing market back to a 
more sustainable level, with prices and credit growth moderating in 2014.  
4.82.  The Reserve Bank of New Zealand Amen dment Act passed in September 2008 designated 
the RBNZ as the prudential regu lator of non-bank deposit-take r institutions. Since 2010, these 
institutions are subject to regulatory requirements including capital adequacy, liquidity, 
related-party lending, governance, risk management, and credit rating obligations. The Non-bank Deposit Takers Act 2013, which came into force in May 2014, provides a stand-alone framework for the prudential regulation of the NBDT sector. The new Act incorporates the prudential 
requirements that were already in place and adds new provisions on licensing, fit and proper 
requirements for directors and senior officers , changes of ownership, and investigation and 
enforcement.
62 
4.5.2.2  Insurance 
4.5.2.2.1  General featur es and market structure 
4.83.  New Zealand's insurance sector comprises life insurance, health insurance and general 
insurance. At end-June 2014, total insurance premiums were estimated at NZ$14 billion (including 
government-owned insurers).63  
4.84.  As at end-September 2014, there were 99 licensed insurers carrying on business in the 
New Zealand market, of which 96 were fully licensed and 3 had provisional licences. Of the total, 
55 licensed insurers were foreign-owned, with insurance premiums of NZ$7 billion.  
4.85.  Three government-owned entities, i.e. th e Accident Compensation Corporation (ACC), the 
Earthquake Commission (EQC) and Southern Response participate in the insurance sector but are 
exempt from general prudential regulation. ACC is the Government provider of personal injury 
                                               
59 Financial Markets Authority Act 2011. The FMA acts also as a joint regulator of settlement systems 
with the RBNZ. 
60 Anti-Money Laundering and Countering Financing of  Terrorism Act 2009 and its regulations issued on 
30 June 2011. The AML/CFT regime came fully into force at 30 June 2013. 
61 Reserve Bank of New Zealand (Covered Bonds) Amendment Act 2013.  
62 Non-Bank Deposit Takers Act 2013 and Non-bank De posit Takers (Debt Securities and Suitability 
Concern) Regulations 2014. 
63 Information provided by the New Zealand authorities.  WT/TPR/S/316 • New Zealand 
 
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  insurance; it is a statutory monopoly (although some large employers can contract out and cover 
their employees for work related accidents), with  its own legislation and is overseen by the 
Ministry of Business, Innovation and Employment and the Treasury. EQC is a monopoly provider of nationwide residential insurance for land and dwellings
64; it has its own legislation and is overseen 
by the Treasury. ACC and EQC insurance premiums amount to NZ$5 billion. Southern Response is 
a run-off insurer for covered insurance claims arising from the Canterbury earthquake events between 2010 and 2012; it is overseen by the Treasury.  
4.86.  Over the three-year licensing transition period that ended in September 2013 
(Section 4.5.2.2.2), the insurance sector underwent significant restructuring: some insurers changed their business to fall outside the prudential regime, some exited the market by way of run-off or transfer of their whole portfolio to other insurers, and others restructured between 
related corporate entities; there have also been new entrants to the market.
65 In May 2014, the 
New Zealand Commerce Commission approved the pu rchase of Lumley General Insurance (N.Z.) 
by the Australian IAG Group; this acquisition increased IAG's market share to some 50% of the 
general insurance sector in New Zealand. In June 2014, after completing its assessment under the 
Insurance (Prudential Supervision) Act 2010, the RB NZ announced that it remained satisfied that 
Lumley General Insurance (N.Z.) Limited would continue to meet the licensing criteria set out in 
the Act. The Australian approvals required to co mplete the transaction (including the approval 
from the Australian Competition and Consumer Commission) were received by 20 June 2014 and the transaction was completed on 30 June 2014.
66 
4.87.  The general insurance sector was hard hi t by the massive Canterbury earthquakes in 2010 
and 2011, which resulted in a high level of claims and general increases in property insurance 
premiums. The industry is still grappling with th e substantial costs of the earthquakes. As at 
30 September 2014, total claim payments for the earthquakes were NZ$22 billion, of which the 
state-owned EQC paid NZ$7 billion and private insurers the rest.67 In 2012, the Government also 
established a new agency, the Southern Response, to assume the earthquake claims liabilities of a major insurer, AMI Insurance, which failed because of the earthquakes.
68 New Zealand insurers 
have managed to meet their claims liabilities through reinsurance and with additional capital 
provided by parent companies or through Crown support in the case of EQC and Southern Response. The life-insurance sector is relatively small: at end-March 2014, it had assets of approximately NZ$12 billion.
69 The RBNZ expects an improvement in the sector's outlook in the 
longer term thanks to greater affordability through rising incomes and anticipated higher 
investment returns.70 Overall, the insurance sector is facing increasing competition from banks, 
which benefit from size advantages and are selling insurance to their customers through their 
distribution-channels. 
4.5.2.2.2  Regulatory framework 4.88.  During the review period, the legal fram ework for the insurance sector was subject to a 
major overhaul to bring it in line with international standards. The Insurance (Prudential 
Supervision) Act 2010 and its Regulations came into force in 2010.
71 The Act brought the 
insurance sector under the supervision of the RBNZ. It required all insurers conducting business in New Zealand (life, health and general insurance) to be fully licensed by the RBNZ within a period 
of three years (i.e. by 7 September 2013).
72 The Act also empowered the RBNZ to take 
appropriate action in the event that an insurer was not able to comply with the law or was otherwise in financial or other difficulties. In 2011, the RBNZ issued fit and proper standards for 
                                               
64 EQC's dwelling cover is capped at NZ$100,000, after which private insurers' cover is needed. 
65 RBNZ (2013). 
66 The purchase of Lumley General Insurance (N.Z.)  formed part of a wider transaction whereby IAG 
Group in Australia also bought all the shares in Wesf armers Insurance Pty Limited from Wesfarmers Limited. 
67 The RBNZ estimates the final cost of in surance claims to be NZ$31-38 billion. 
68 The IAG Group purchased AMI Insurance from the Government, except for the earthquake claims 
liabilities that were assumed by Southern Response. AMI insurance continues as a licensed insurer. 
69 Information provided by the New Zealand authorities.  
70 RBNZ (2014a). 
71 The Insurance (Prudential Supervision) Regulations 2010 were amended in 2012 and 2013. 
72 Existing insurers at the time of enactment of the new law were given a three-year transition period to 
obtain full licences, until then they continued to operate under provisional licences.  WT/TPR/S/316 • New Zealand 
 
- 89 - 
 
  licensed insurers, solvency standards for different  categories of insurance (since revised), and 
governance guidelines for licenced insurers.73 
4.89.  The Insurance (Prudential Supervision) Amendment Act 2013, which came into force in 
September 2013, required the RBNZ to publish and maintain a register of licensed insurers74; and 
financial strength ratings; it also allowed overseas insurers to submit financial statements based 
on their home country requirements in lieu of  financial statements prepared according to 
New Zealand's requirements, subject to approval by the RBNZ.  
4.90.  The RBNZ has the power to set the conditions for licensing and is required to publish its 
policies on how it will determine applications for licences.75 Generally, an applicant (domestic or 
foreign-owned) must: hold a current financial streng th rating by a rating agency approved by the 
RBNZ76; have the ability to carry on its business in a prudent manner; comply with solvency 
standards, including a minimum amount of capital (NZ$5 million for life insurance and 
NZ$3 million for non-life insurance); comply with statutory funds (for life insurance) and any conditions of licence; have a satisfactory fit and proper policy for directors and senior officers; 
have a proper risk management programme; be registered or qualify to be registered as a 
financial services provider; and comply with anti-money laundering legislation and any other prescribed requirements.  
4.91.  Overseas insurers may operate as branches in New Zealand, provided they meet all 
licensing, reporting and other prudential requirem ents. Nevertheless, the RBNZ has discretion to 
exempt foreign insurers from certain New Zealand requirements, if they are fully compliant with 
their home-country's regulation and the law, and regulatory requirements and prudential 
supervision in their home jurisdiction are at least as satisfactory as those applied to New Zealand 
insurers.  
4.92.  Licenced insurers may provide life and general insurance through the same entity. However, 
life insurers are required to establish a statutory fund to legally separate and better protect life 
insurance policyholders. Licensed insurers can have dealings with related parties (with higher risk charges for solvency calculations); they can conduct any non-insurance business within the insurer 
and can provide insurance in New Zealand and in other countries from within the same entity.  
4.93.  The RBNZ is currently focussing on prudenti al supervision, following a risk-based approach. 
Insurers are required to give prompt notice to the RBNZ of any breaches of regulatory requirements. In 2014, the RBNZ started a review of  risk governance and plans to undertake other 
thematic reviews in the near future. It is also working on the development of a data collection and 
reporting system for the insurance sector, which is expected to assist its monitoring and supervisory functions.  
4.5.2.3  Other financial services 
4.94.  The Financial Markets Conduct Act 2013 (FMCA) comprehensively overhauls New Zealand's 
regulatory framework for financial services. Part of the FMCA came into effect on 1 April 2014, and 
the remainder became effective on 1 December 2014 , subject to certain transitional arrangements 
over a maximum two-year peri od. The FMCA established, inter alia , a licensing regime for fund 
managers, independent trustees, derivatives issuers,  and providers of crowd funding, peer to peer 
lending and discretionary investment management services. Subject to transitional arrangements, 
it is not possible to perform any of these services without a licensed granted by the Financial 
Markets Authority as from 1 December 2014.   
4.95.  The Financial Advisers Act 2008 (FAA) requires providers of finance advice or broking 
services to retail clients in New Zealand to comply with disclosure, competency and conduct 
obligations. This is regardless of where the adviser or broker is resident, incorporated, or carries on business. The FAA also requires all financial advisers to be registered; those who advise on 
more complex financial products must generally be authorised by the Financial Markets Authority. 
                                               
73 Insurance legislation is available at http://www.rnbz.govt.nz/regulat ion_and_supervision/insurers . 
74 The Register is available at: http://www.rbnz.govt.nz/regulation _and_supervision/insurers/register . 
75 For further detail see Conditions of licence and licensing policies, pu blished on the RBNZ's website at: 
http://www.rbnz.govt.nz/regulation_and_supervision/insurers/licensing/5246234.pdf . 
76 All ratings are published on the RBNZ's website. WT/TPR/S/316 • New Zealand 
 
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  4.96.  The Financial Service Providers (Regis tration and Dispute Resolution) Act 2008 (FSPA) 
requires any person or entity that provides financial services in New Zealand to register on a public register of financial service providers. Those supplying services to retail clients must also join an approved dispute resolution scheme. In addi tion, the Securities Trustees and Statutory 
Supervisors Act 2011 (STSS), which came into effect on 1 October 2011, requires securities 
trustees and statutory supervisors to be licensed. 
4.5.3  Telecommunications 
4.5.3.1  General features and market structure 
4.97.  During the review period, the number of fixed-line telephone connections declined slightly, 
as mobile services became cheaper and more attrac tive. At end June 2013, there were 1.85 million 
fixed-line connections, giving a penetration rate of around 41% (42% in 2007, as reported in the 
previous Review).
77 At the same date, there were about 4.7 million mobile connections, equivalent 
to a penetration rate of 107% (104% in 2007 ); with approximately two-thirds of mobile 
subscribers having pre-paid connections. Broadband services are delivered over both fixed-line and 
wireless connections. Fixed broadband connections have grown fast in recent years to reach 
1.32 million at end June 2013 (up from 0.68 million in June 2007), giving a penetration rate of 29.5%.
78 The uptake of mobile broadband has also been growing fast in the last few years, 
supported by the use of new 4G mobile technologies and the Government's Rural Broadband 
Initiative. However, certain Internet access prices remain relatively high by international standards. Investment in the telecommunications sector has increased in recent years, mainly driven by the roll-out of the Ultra-Fast Broadband (UFB) fibre network, also a major government-
backed initiative currently being implemented.  
4.98.  There have been important changes in the sector's market structure in recent years. In 
2008, the incumbent operator, Telecom New Zealand was separated by law into three business 
units: Telecom Retail; Telecom Wholesale; and Chorus, which owns the copper-wire network. 
Telecom was also required to unbundle the local loop, ending any remnants of monopoly that Telecom once had in the retail market. In 2011, Telecom and Chorus demerged, each becoming a 
separate listed company. Telecom, which changed its name to Spark New Zealand in 2014, now 
owns the retail and mobile network, while Chorus owns the copper and fiber networks. The demerger enabled Chorus to successfully bid for about 70% of the government subsidised roll-out of the UFB network.  
4.99.  Spark New Zealand is still the major player in the fixed-line market, providing nationwide 
voice and broadband services over the copper-wir e network. TelstraClear was the second-largest 
fixed-line operator until it was acquired by Vodafone New Zealand in October 2012. Vodafone now 
owns the cable broadband network covering much of Wellington and Christchurch and also uses 
unbundled copper-wire local loops (UCLL) and resale services to offer fixed-line retail services in other parts of the country. Other telecommunications retailers also access Chorus's copper lines 
and electronic equipment to provide broadband services. As at end-June 2013, the estimated 
shares of the retail fixed-line broadband market by connection were: Telecom (49%); Vodafone (32%); CallPlus (8%); Orcon (5%); and others (6%).
79 
4.100.  In the mobile market, there are three network operators: Spark, Vodafone and 2degrees. 
The latter started operations in 2009. All three operators have 3G networks, providing voice, SMS 
and broadband services. In addition, Vodafone and Spark rolled out 4G networks in 2013. The three mobile network operators are also the major mobile retailers, and although there are some 
mobile virtual network operators, which resell services purchased from the mobile network 
operators, their market share is insignificant. At  end June 2013, Vodafone had 42% of total mobile 
connections, followed by Telecom (33%), and 2degrees (25%).
80 
                                               
77 2013 data in this paragraph are based on Commerce Commission (2014). 
78 The OECD average broadband penetration is 26.7%. New Zealand ranks 15 out of 34 OECD countries. 
79 Commerce Commission (2014). 
80 Commerce Commission (2014). WT/TPR/S/316 • New Zealand 
 
- 91 - 
 
  4.5.3.2  Regulatory regime 
4.101.  The telecommunications sector is governed by the Telecommunications Act 2001 and 
associated regulations. The Act regulates the supply of certain telecommunication services with the purpose of promoting competition in telecommunications markets for the long-term benefit of 
end-users. Important amendments were made to the regulatory regime with the passage of the 
Telecommunications Amendment Act 2006, which included the operational separation of the incumbent Telecom; the introduction of new regulated services (e.g. unbundled local loops
81), and 
the requirement that Telecom upgrade its network. Further amendments were made through the 
Telecommunications (TSO, Broadband, and Other Matters) Amendment Act 2011, which facilitated the structural separation of Telecom and Chorus, allowing the latter to participate in the UFB roll-out. As part of structural separation, Chorus was prohibited from providing retail services 
and required to enter into undertakings to provide wholesale services on a non-discriminatory 
basis.  
4.102.  There are no restrictions on foreign investment in private telecommunications firms, other 
than the provisions of the Overseas Investment Act 2005 (Section 2). However, the Constitution of 
Chorus provides that no person who is not a New Zealand national shall have more than 49.9% of the total voting shares of Chorus without the prior written approval of the Crown, and at least half 
of the board of directors must be New Zealand citi zens. There are no-company specific restrictions 
on investment in Spark New Zealand. 
4.103.  New Zealand does not impose licensing requirements for entry into the 
telecommunications business market and control over retail prices is minimal. On the other hand, 
there is a comprehensive regime regulating conditions for access to networks (although the 
conditions are less intrusive for new technologies like the UFB network) and Chorus and other UFB network providers are prohibited from providing retail services. 
4.104.  The Commerce Commission is responsible for overseeing competition in the 
telecommunications market and regulating certain telecommunication services. It has a range of 
regulatory tools, as provided for under the Act. It can recommend that services be regulated or 
deregulated. The Commission may also set the terms and conditions (including prices) for 
regulated services through Standard Terms Determinations. It also has powers to: request that industry-wide services (e.g. number portability) be made available; impose information disclosure requirements; and enforce structural remedies such as separation. 
4.105.  Some regulatory functions are shared between the Commerce Commission, other 
government departments and the industry. The Minister for Communications can accept or reject the Commission's recommendations as to whether a service should be regulated or deregulated, 
and transmit a "statement of economic policy" to which the Commission must have regard. The 
Ministry of Business, Innovation and Employment also provides policy advice on the regulatory 
environment for the telecommunications sector. The industry, acting through the New Zealand 
Telecommunications Forum (TCF), has the statutory function to develop telecommunications 
access codes for regulated services, which once approved by the Commerce Commission become binding on all industry (regulated codes). TCF is also involved in developing industry standards and voluntary codes of practices, and facilitates dialogue on industry issues of common interest.  
4.106.  Upgrading the telecommunications infrastructure is crucial for realizing the services trade 
opportunities that Internet offers and for mitigating the costs of New Zealand's remoteness from world markets. Hence, a cornerstone of the New Zealand Government telecommunications policy 
over the past few years is the UFB initiative, aimed at rolling out ultra-fast-broadband network to 
75% of the population by 2020, giving priority  to businesses, schools and health services.
82 The 
project is in large part funded by the Governme nt (NZ$1.35 billion), with the participation of 
Chorus and three other local fibre companies, which have been selected through a tender 
procedure. By the end of 2014, over 570,000 end us ers were able to connect to the fibre network. 
                                               
81 Other regulated services are Un bundled Copper Low Frequency; Unbu ndled Bitstream Access; Mobile 
termination Access; and Mobile Co-location. 
82 The Government is now considering options for extending the UFB to cover 80% of the population. WT/TPR/S/316 • New Zealand 
 
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  This is expected to increase to 1.34 million by  2020, while access to data should be ten times 
faster than with current technology.83  
4.107.  The transition from the traditional copper-wire network to a new fibre-optic network raises 
a number of regulatory issues. Therefore, the regulatory framework for telecommunications, 
including the Telecommunications Act 2001, is being reviewed.84 The review will focus on the 
optimal framework for regulation after the comp letion of the fibre network in 2020, and will 
consider how best to set access prices under the framework.  
4.108.  The Rural Broadband Initiative (RBI) is another key Government initiative aimed at 
delivering improved broadband access to 86% of rural communities by June 2016. RBI is being implemented by Chorus and Vodafone. Chorus is laying the fiber-optic network to rural schools, 
hospitals and libraries and installing infrastructure equipment in exchange areas so that retail 
service providers can connect the end-users; while Vodafone is providing a wireless broadband 
service to rural communities using the backbone fiber-optic network. At 30 June 2014, about 3,100 km of fiber-optic had been laid in rural areas. The rollout has brought new or upgraded 
broadband coverage within reach of 230,000 users.
85  
4.109.  The Telecommunications Development Levy (TDL) was introduced in 2011, through an 
Amendment to the Telecommunications Act 2001. The levy is applied to some telecommunications 
companies to provide funding for telecommunications services that are in the public interest but 
would otherwise be unaffordable. Currently, the TDL is set at NZ$50 million per year until 2016/17 when it will be reduced to NZ$10 million. The Commerce Commission determines the amount of levy paid by individual telecommunications companies, on the basis of their market shares.   
4.5.3.3  Prices 
4.110.  Average retail prices for telecommunicati ons services have showed only small decreases 
over the review years, and some of them remain  higher than OECD averages (Box 4.2). In the 
fixed-line segment, there has been a drop in the average price of national calls (from 10 NZ cents 
per minute in 2008/09 to about 7.5 cents per minute in 2012/13), apparently on the back of various free national calling offers included in monthly bundle prices.
86 In fixed-to-mobile calling 
the average price dropped from about 32 cents to 23 cents per minute over the same period. This 
may be partly explained by the August 2010 deci sion of the Minister for Communications to 
regulate mobile termination rates in order to improve market competition and lower the prices for mobile phone users. However, according to the Commerce Commission, the operators' margin on 
fixed-to-mobile calls remains high, because th e regulated mobile termination rate (which 
represents the main cost input) fell to 3.72 cents per minute in April 2013, while the average price on calls remains at 23 cents per minute.  
4.111.  In the mobile sector, there is a convergi ng trend in the average price of calls between 
users on different networks (off-net calling) and users on the same network (on-net calling), with the price of off-net mobile calls dropping faster than the price of on-net calls.
87 There is even a 
clearer convergence in the average price of on-net  and off-net text messaging (SMS). Competition 
in the delivery of mobile broadband has pushed do wn the average retail price of mobile data from 
more than 20 cents per MB in 2008/09 to 7 cents per MB in 2012/13, but the rate of the decrease has slowed in the last three years.  
4.112.  In March 2013, the Prime Ministers of New Zealand and Australia announced an agreement 
on a joint regulatory approach in response to historically high costs of trans-Tasman mobile roaming. It is proposed that the New Zealand Commerce Commission and the Australian 
Competition and Consumer Commission will collect data and report regularly on wholesale and 
retail trans-Tasman mobile roaming services. Both Commissions would also gain new powers to intervene in the market if necessary, and legislat ion to enable these changes is being prepared. 
                                               
83 Downloading speed will be at least 100 Mbps (megabits per second). 
84 Under the Telecommunications Act, the Minister of Communication and Information Technology is 
required to commence a review of the regulatory framework no later than 30 September 2016. 
85 Information provided by the New Zealand authorities.  
86 Commerce Commission (2014). 
87 Commerce Commission (2014). WT/TPR/S/316 • New Zealand 
 
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  Box 4.2 New Zealand: retail prices for fi xed-line phone and broadband services 
The Commerce Commission released its third report benchmarking New Zealand retail prices for 
fixed-line phone and broadband services against international prices. The Report showed that:  
 
• Most customers buy broadband together with phone services in a bundle; 
• Prices for a bundle with 60GB of data had dropped 14% over two years; 
• However, these bundles were still priced 30% higher than the OECD average; 
• Prices for a 60GB naked broadband plan had dropped 41% in two years and were 4% less 
than the OECD average. However, these prices were available only to subscribers with an 
on-account mobile plan with the same provider; 
• Prices for fixed-line voice services purchased without broadband continued to be 
considerably higher than the OECD average for an average customer, but lower than 
average for heavy users of voice services.  
Source: New Zealand Commerce Commission (2014), Annual Telecommunications Monitoring Report 2013 , 
May.  
4.5.4  Transport 
4.5.4.1  Overview 
4.113.  Given New Zealand's distance from world markets, the transport sector is crucial for the 
country's participation in international merchandise trade, and is an important enabler of economic 
growth. The "transport, postal and warehousing" sector accounts for 5% of GDP and employs more 
than 85,000 people (end-2013).88 Almost all New Zealand's overseas trade, by volume, is carried 
by sea; while airfreight accounts for 13.3% of exports and 20.5% of imports, in value terms.89 
4.114.  The Ministry of Transport is the main agen cy providing expert advice to the Government in 
all transport-related matters, including legislative, regulatory, policy and funding issues. The Ministry represents the Government's transport interests in international fora, and oversees the performance of four Crown entities with transport functions: the Civil Aviation Authority, Maritime 
New Zealand, NZ Transport Agency (land transport)
90, and the Transport Accident Investigation 
Commission. In addition, three state-owned enterprises have transport-related functions91, while 
local authorities are primarily responsible for road networks and public transport services, and 
some of them own seaports and airports, or share ownership with the Crown.  
4.115.  In 2011, the Government issued "Connecting New Zealand", a document that summarizes 
the broad policy direction for the transport sector.92 The overall objective is to achieve an 
effective, efficient, safe, secure, accessible and resilient transport system that supports 
New Zealand's growth and delivers prosperity to its citizens. Three key themes set the direction for the development of the transport system fo r the years 2011-21: economic growth and 
productivity; value for money; and road safety.
93 Connecting New Zealand refers to all transport 
modes, but makes emphasis on land transport, recognizing its essential role both in the domestic 
context and in enabling connectivity with air and sea ports, crucial for the country's international trade.
94 Freight transport costs account for a sizeable proportion of international trading costs for 
New Zealand companies. In 2012, the Productivity Commission produced a report on the 
                                               
88 Ministry of Transport (2013). 
89 Ministry of Transport (2014c). 
90 In August 2008, Transit New Zealand and land  transport New Zealand merged to form the 
New Zealand Transport Agency. 
91 Airways Corporation of New Zeal and Limited, New Zealand Railways  Corporation and Meteorological 
Services of New Zealand Limited. 
92 The New Zealand Transport Strategy 2008, released  by the previous Government, has been largely 
superseded by Connecting Ne w Zealand. The latter draws from a numb er of policy decisions, including the 
National Infrastructure Plan, the Go vernment Policy Statement on Land Transport Funding, and the Safer 
Journeys: New Zealand's Road Safety Strategy.  
93 New Zealand Government (2011). 
94 A total of NZ$36 billion are expected to be invested in land transport over the years 2011-21. WT/TPR/S/316 • New Zealand 
 
- 94 - 
 
  performance of international freight transport services in New Zealand and made a number of 
recommendations.95   
4.5.4.2  Air transport services and airports 4.116.  New Zealand has five airports receiving scheduled international air services and 
28 regional airports. Auckland International Airport is New Zealand's busiest airport, with total 
passenger movements totalling 14.8 million in 2013,  followed by the international airports of 
Christchurch and Wellington (with over 5 million each). New Zealand airports moved NZ$6.5 billion 
of exports or 13% of the total value of merchandise exports in 2013, and carried 2.8 million 
international visitors.
96  
4.117.  New Zealand's international airports are autonomous companies with both private and 
public ownership; while regional airports are either companies owned by local authorities or joint 
ventures between local authorities and the Crown (central government). The Crown has minority 
shareholdings in Christchurch International Airport (25%)97 and other international and regional 
airports.98 There are no full-privately owned international airports.  
4.118.  The air transport sector is subject to the provisions of the Overseas Investment Act 2005. 
No specific restrictions apply on foreigners providing airport services and airport auxiliary services, or computer reservation system services. 
4.119.  Under the Airport Authorities Act 1966, local authorities and companies may be conferred 
airport authority status and powers for establishing and operating airports. As amended in 1997, the Airport Authorities Act requires all airport companies to consult with their airline customers on charges and major capital expenditures, and disclose certain financial information.
99 To prevent 
potential abuse of monopoly power at the three major airports, the Commerce Amendment 
Act 2008 subjected specified airport services100 at the Auckland, Wellington and Christchurch 
airports to additional information disclosure requirements (including on prices) under the 
Commerce Act (Part 4).101 The Commerce Commission was required to report to the Ministers of 
Commerce and Transport as to how effectively information disclosure regulation is promoting the purposes of the Commerce Act in respect of spec ified airport services. The Commission completed 
its reports on the above three airports in 2014. The next step is for the Minister of Transport and 
the Minister of Business, Innovation and Employment to respond to the Commission's reports.
102  
4.120.  The Civil Aviation Act 1990 sets out provisions governing the airports jointly owned by the 
local authorities and the Crown. No major changes have been introduced to airport legislation 
since 2009. However, both the Civil Aviation Act 1990 and the Airport Authorities Act 1966 are 
currently being reviewed with the purpose of clarifying and updating their provisions. The results of this review and the responses of the relevant Ministers to the Commerce Commission's reports 
on the three major airports may lead to changes to the legal framework for the economic 
regulation of airports. Another key aspect of th e review is to determine whether the competition 
regime for international air services should remain under the Civil Aviation Act or be moved to the 
Commerce Act. Any changes arising from the review are likely to come into effect in 2017. 
                                               
95 The New Zealand Productivity Commis sion is an independent Crown enti ty that provides advice to the 
Government on productivity matters. Its report on International Freight Transport Services is available at: 
http://www.productivity.govt.nz/site s/default/files/FINAL%20Internation al%20Freight%20Transport%20Servic
es%20PDF%20with%20covers_1_0.pdf . 
96 Civil Aviation Authority of New Zealand (2014). 
97 Ministry of Transport online information. Viewed at: http://www.transport.govt.nz/air/ . 
98 National Infrastructure Unit on line information. Viewed at: 
http://www.infrastructure.govt.nz/plan/mar2010/39.htm . 
99 Airport Authorities (Airport Companies Information Disclosure) Regulations 1999. 
100 These are aircraft and freight acti vities, airfield activities, and certai n passenger terminal activities.  
101 Airports must disclose informat ion annually on their financial pe rformance and quality of airport 
services. They also must disclose information on their price setting fra mework, pricing methodology, and an 
explanation of the extent to which the applicatio n of their pricing leads to efficient prices.  
102 Reports can be consulted at: http://www.med.govt.nz/business/competition-policy/part-4-
commerce-act/airport-regulation/effectiveness-information-disclosure-regulation/effectiveness-of-information-
disclosure-regulation-for-major-international-airports-discussion-document.pdf-1 . WT/TPR/S/316 • New Zealand 
 
- 95 - 
 
  4.121.  There are two New Zealand-based international airlines: Air New Zealand, the national flag 
carrier; and Virgin Australia Airlines, a subsidiary of Virgin Australia (NZ) Ltd.103 At 
end-January 2015, there were 24 foreign airlines operating aircraft to and from New Zealand, and an additional 21 airlines serving New Zealand on a code-sharing basis.
104 The Crown holds a 
52.3% stake (reduced from 73% in November 2013) in Air New Zealand. It also holds a 
preferential "Kiwi share", which enables the Go vernment to impose a 10% cap on individual 
foreign shareholdings in the national airline, in order to maintain substantial ownership and 
effective control of Air New Zealand. At present, government policy is that the New Zealand 
Government will continue to own at least 51% of the shares in Air New Zealand. The Crown also holds 100% ownership of Airways Corporation of Ne w Zealand Limited, which is the sole provider 
of air navigation and air traffic ma nagement services in the country. 
4.122.  Under the Civil Aviation Act 1990, an airline wishing to operate a scheduled international 
air service to or from New Zealand is required to hold a scheduled international air service licence or an open aviation market licence. The latter is applicable only for scheduled services between 
New Zealand and countries/territories specifical ly designated by the Minister of Transport.
105 
No economic licences are required for domestic air services. 
4.123.  An application for a scheduled international air services licence must be submitted to the 
Secretary of Transport.106 To qualify for a licence, an applicant airline must have been designated 
by its Government according to the provisions of the ASA between that Government and the Government of New Zealand. In addition, an applic ant may be required to provide evidence of the 
nationality of the control of the airline, and either evidence of the nationality of its ownership or its 
principal place of business and place of incorpor ation. To comply with safety and security 
requirements, an applicant must also obtain a foreign air operator certificate (FAOC) from the Director of the Civil Aviation Authority. Under a mutual recognition agreement with Australia, 
New Zealand and Australian airlines do not need to hold safety certifications from both countries' 
civil aviation authorities.   
4.5.4.2.1  Air services agreements 
4.124.  New Zealand has one of the world's most li beral international air transport policies as it 
seeks to improve its connectivity to the rest of the world. During the review period, New Zealand's Ministry of Transport renegotiated existing ai r services agreements (ASAs) and negotiated new 
ones in order to reduce barriers to competition on international air routes to and from 
New Zealand. 
4.125.  As at 30 June 2014, New Zealand had ASAs  with 62 partners across all continents (46 in 
March 2008) (Table A4.2).
107 Over 30 of these are open skies agreements, with no restrictions on 
routes, traffic rights, or capacity, and no requirem ent to seek authorisation of tariffs. New Zealand 
is also a signatory of the Multilateral Agreement for Liberalization of International Air Transportation (MALIAT), a multilateral open skie s air services agreement, which came into force 
in December 2001 and, unlike other ASAs, is open to accession by other parties.
108 In general, 
New Zealand's ASAs seem to have succeeded in increasing the number of foreign airlines operating international services to and from New Zealand, although competition on domestic routes is still limited.
109   
                                               
103 In January 2015, Virgin Australia commenced the integration of its New Zealand operations with its 
international division. Throughout the early part of 2015, the airline will transfer all of its aircraft onto the 
Australian registry, where they will be  operated under Virgin Australia Intern ational's Air Operators Certificate.  
104 Ministry of Transport online information. Viewed at: http://www.transport.govt.nz/air/international 
airservices/internationalairlinelicensing/internationalairlinesservingnewzealand/ . 
105 Currently, these are Australia, Brunei, Chile, th e Cook Islands, Luxembourg, Malaysia, Samoa, 
Singapore, Tonga, the United Arab  Emirates, and th e United States. 
106 The requirements for a licence can be found at Ministry of Transport online information at: 
http://www.transport.govt.nz/air/inter nationalairservices/internationalairlinelicensing/foreigninternationalairlin
es-scheduledinternationalairservicelicences/ . 
107 ASAs with 12 partners had been negotiated but we re not yet formally in place as at 30 June 2014. 
108 Currently, the parties to the MA LIAT are Brunei, Cook Islands, Chile, New Zealand, Singapore, 
Samoa, Tonga and the United States. Mo ngolia participates for cargo only. 
109 COVEC (2013). WT/TPR/S/316 • New Zealand 
 
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  4.126.  As stated in its international air transport policy (2012-17), New Zealand will continue to 
negotiate new ASAs to improve its connectivity and facilitate increased trade in goods and services (including tourism). Its preferred option is to conclude reciprocal open skies agreements
110, and 
when this is not feasible, to put in place the mo st open agreements possible, while ensuring that 
New Zealand-based airlines have equal opportunities to offer services in other Parties' home 
markets. The current policy removed foreign ownership limits for designation of a New Zealand airline (other than Air New Zealand), which were set at 25% by a single foreign airline and 35% by 
foreign airlines in total. The Government will also consider, on a case-by-case basis, designating 
New Zealand-based airlines whose ownership and control structure is consistent with relevant bilateral arrangements, or where the risk of operating authorizations not being accepted by the other Party is small. A more liberal designation policy for cargo-only airlines is also considered.
111  
4.5.4.3  Maritime transport and ports 
4.127.  Virtually all New Zealand foreign trade, by volume, is moved by maritime transport. In the 
twelve-month period ending June 2014, exports carried by sea amounted to 38.3 million tonnes, 
of which 70.5% was bulk cargo and the rest containerized cargo.112 Sea imports and exports 
combined were worth NZ$85.2 billion.113 
4.128.  New Zealand has 14 commercial sea ports, most of which are managed by companies 
owned by local authorities. The Port of Tauranga (North Island) is by far the largest port for 
exports of bulk and containerized cargo. Ports of Auckland (North Island) is the leader in containerized imports, while North Port (North Island) mainly handles bulk oil imports for the adjacent Marsden Point oil refinery. Some 30 international and regional shipping lines call at 
New Zealand's ports.  
4.129.  Coastal shipping accounts for approximately 14% of New Zealand's freight task, and is 
operated by both local and international shipping companies.
114 Under the Maritime Transport Act 
1994, three categories of ships are allowed to carry coastal cargo: (i) New Zealand ships; 
(ii) foreign ships passing through New Zealand to unload import cargo or load export cargo, and (iii) overseas-registered ships operated or contro lled by a New Zealand entity, provided that the 
crew is subject to national law.
115 Any other foreign ships are not allowed to carry coastal cargo 
unless they receive authorization to do so, provided that no New Zealand ship or foreign ship in an international voyage is available. 
4.130.  Port access is subject to the provisions of the Commerce Act 1986 (the general 
competition law). Any discrimination in port services that could lead to a distortion reducing 
competition may be investigated  by the Commerce Commission.  
4.131.  International shipping is currently exempt from the Commerce Act. The Shipping Act 1987 
seeks to promote fair competition in international shipping and contains provisions for monitoring 
carriers who incur in unfair practices, but it also provides for an exemption allowing price-fixing and capacity-limiting in international shipping agreements.
116 The Shipping Act is considered as 
ineffective in regulating competition in this sector. Therefore, the Commerce (Cartels and Other 
Matters) Bill currently before Parliament seeks to apply the Commerce Act to international shipping, thereby removing the exemption for pr ice-fixing and capacity-limiting agreements.
117  
                                               
110 New Zealand seeks open skies agreements that prov ide for: no restrictions on routes, capacity or 
traffic rights, including 7th freedom and cabotage rights (8th and 9th freedom); no regulation of tariffs (except to 
prevent anti-competitive behaviour); liberal arrangements for granting au thorisations following receipt of 
designation); and provisions for regulatory cooperation by civil aviation authorities. 
111 Ministry of Transpor t online information, International air transport policy statement . Viewed at: 
http://www.transport.govt.nz/air/iatrpolicystatement . 
112 In terms of value, exports carried by sea added up to NZ$39 billion; of which containerized cargo 
represented 80.1%. 
113 Ministry of Transport (2014a).  
114 Ministry of Transport (2014b).  
115 Maritime Transport Act, Section 198(1). 
116 The original rationale for this exemption was to pr event price instability and destructive competition. 
117 This is in fact one of the recommendations made in the report of the Prod uctivity Commission on 
International Freight Transport Services. WT/TPR/S/316 • New Zealand 
 
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  4.132.  New Zealand-owned ships (i.e. ships that are majority or entirely owned by New Zealand 
nationals118) must be registered under the Ship Registration Act 1992. Foreign persons are only 
allowed to register a ship under the country's flag in co-ownership with  a majority of New Zealand 
nationals. When the ship is subject to shareholding , more than half of the shares in the ship must 
be owned by one or more New Zealand nationals.119 At end 2014, 14 merchant ships were 
registered under New Zealand's flag: 4 oil tankers, 4 bulk carriers, 2 containerships, and 4 passenger/freight ferries). 
4.133.  Maritime New Zealand, a Crown entity, is responsible for developing and monitoring rules 
and standards for safety, security and environmental matters in maritime transport, under the Maritime Transport Act 1994. The entity is also re sponsible for implementing the Maritime Security 
Act 2004, administering the New Zealand Register of Ships and ensuring compliance with 
international maritime and marine environment protection conventions.
120  
4.134.  Safety services are funded through the maritime levy applied to all commercial ships and 
collected by Maritime New Zealand. Levy rates vary  according to vessel type and service category. 
Ships operating in domestic trade are charged on an annual basis (due to high port calls); ships 
operating in international services are levied by voyage.121 In 2013, the rates were reduced for all 
ship categories: those for ships operating in international services will be reduced gradually by 
24% over the period 2014-20.  
4.135.  The Port Companies Act 1988 established the port companies that operate 12 of 
New Zealand's 14 seaports. It specifies governance, reporting and directorship requirements for these port companies. The Act does not impose any limitation on the acquisition or holding of port 
company shares by private national or foreign persons; but acquisitions by overseas persons 
above the specified threshold would need prior consent under the Overseas Investment Act. Private companies may also undertake auxiliary services activities in sea port areas. So far, 
however, private shareholding in seaports companies remains limited: 8 of the 12 port companies 
are entirely owned by local authorities and in the remaining four private ownership accounts for less than 50%. Indeed, the absence of major international port operators reflects this ownership 
and management structure, whereby port companies majority or entirely-owned by local 
governments typically follow an owner/operator model.
122 
4.136.  Port productivity is crucial to compensate for New Zealand's geographical disadvantage of 
being far away from major economic hubs. In 2010, an independent study found that 
New Zealand's port ownership structure might have hindered productivity as well as the entry of 
experienced international port operators.123  
4.137.  In 2012, the New Zealand Productivity Co mmission undertook an inquiry about the factors 
influencing the accessibility and efficiency of  international freight transport services for 
New Zealand firms. In its final report, the Comm ission recommended improved reporting on port 
productivity and on competition between port companies. The Government accepted the 
Commission's advice to expand the measures of port productivity that are regularly published by 
the Ministry of Transport.124 In terms of ownership, the Commission recommended that local 
authorities (Councils) should choose the minimum level of council ownership that offered them the required control rights to achieve the objectives they wish to pursue through port ownership, and 
that Councils should consider landlord port models.
125 The Commission also recommended 
strengthening the competition framework for international freight services.  
                                               
118 Permanent residents as well as citizens  are considered New Zealand nationals. 
119 Maritime New Zealand online information. Viewed at: http://www.maritimenz.govt.nz/Publications-
and-forms/Commercial-o perations/Ship-registration/A- guide-to-Ship-Registration.pdf . 
120 Maritime New Zealand online information. Viewed at: http://www.maritimenz.govt.nz/Publications-
and-forms/Maritime-NZ-corporate-public ations/MNZ-statement-of-intent-2014-2020.pdf . 
121 The levy rates are available online at: http://www.maritimenz.govt.n z/About-us/Fees-levies/MSC/ . 
122 A bid by Hutchison Whampoa of Hong Kong, China to acquire Lyttleton Port failed in 2006.  
123 New Zealand Institute for Economic Research (2010). 
124 New Zealand Productivity Commission (2012). 
125 The Government noted that this was a recommendation for local authorities to consider. In the 
Government's view, if the fundamenta ls of good governance were in pl ace, and port companies focused on 
their commercial objectives, then the issue of ownership was less relevant.  WT/TPR/S/316 • New Zealand 
 
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  4.5.5  Tourism 
4.138.  Tourism is an important service industry in New Zealand and often seen as a role model 
for tourism sectors worldwide. In the year ending March 2014, tourism directly contributed NZ$8.3 billion, or 4% to GDP. The indirect value added of industries supporting tourism generated 
an additional NZ$6.5 billion fo r tourism, or 3.1% of GDP.
126 The sector created 94,100 full-time 
equivalent jobs or 4.7% of total employment. International tourism expenditure amounted to NZ$10.3 billion in the year ended March 2014, acco unting for 15.3% of total exports of goods and 
services, second only to dairy products. Significant tax revenues come from the GST on tourism, 
with tourist generating NZ$1.8 billion in GST revenue in 2014.
127 International visitor arrivals to 
New Zealand in the year ended March 2014 reac hed 2.75 million people (a compound annual 
growth rate of 2.8% between 2009 and 2014). The largest inbound tourism markets are Australia, 
China, the United States, and the United Kingdom.  
4.139.  There are no specific restrictions on foreigners supplying tour guide services, travel 
agencies and tour operator services, apart from normal immigration requirements. Foreign 
investment in tourism is subject to the provisions of the Overseas Investment Act 2005. 
4.140.  New Zealand has no tourism-specific legislation128; however the industry is supported by a 
robust institutional framework and important public investment. Total public funding for tourism 
for fiscal year 2013/2014 was NZ$129 million.129 The Tourism Policy Team, within the Ministry of 
Business, Innovation and Employment, is responsible for advising the Government on the appropriate settings to foster productivity, growth and the contribution of tourism to the economy. Other government initiatives are the creation of the Tourism Growth Partnership to invest in 
projects that boost innovation and productivity in the tourism sector; the Canterbury Tourism 
Partnership to support tourism recovery in the aftermath of the 2010 and 2011 earthquakes; and measures to facilitate visas and travel arrangements for visitors from China, a fast growing 
inbound tourism market. 
4.141.  Tourism New Zealand (a Crown entity) is in charge of promoting New Zealand abroad as a 
high-value tourist destination. A major aspect of its tourism marketing strategy, "100% Pure 
New Zealand", is to rely upon "leveraged events" in order to capitalize promotion of the country 
via global attention-drawing events. Events under this strategy have included the 2011 Rugby World Cup, the 2015 ICC Cricket World Cup and the 2015 FIFA U-20 World Cup, as well as the promotion related to the making of the Lord of the Rings and Hobbit movies in the 2000s. Since 
then, film-making has become an emerging indust ry, with more than 50 feature films located in 
the country between 2010 and 2013. 
4.142.  Local governments are actively involved in tourism development through regional tourism 
organizations (RTOs). The private sector supports RTOs and is extensively organized in lodging, 
restaurant and tour-guide associations. 
                                               
126 Statistics New Zealand  online information. Viewed at: 
http://www.stats.govt.nz/browse_for_stats/industry _sectors/Tourism/tourism-satellite-account-2014.aspx . 
127 Statistics New Zealand  online information. Viewed at: 
http://www.stats.govt.nz/browse_for_stats/industry_sectors/tourism/tourism-satellite-account-
2014/Tourism_value_added.aspx .  
128 Some regulatory arrangements are in place to manage safety in the adventure tourism sector. 
129 OECD (2014). WT/TPR/S/316 • New Zealand 
 
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ownership-an-assessment-of-the-evidence . 
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 WT/TPR/S/316 • New Zealand 
 
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  5  APPENDIX TABLES 
Table A1. 1 Merchandise exports by product groups, 2009-14 
  2009 2010 2011 2012 2013 2014 
Total exports (US$ billion) 24.9  30.9  37.6  37.3  39.4  42.4  
 (% of total) 
Total primary products 69.7  72.0  73.0  72.8  74.9  75.7  
   Agriculture 61.8  63.3  64.0  64.6  68.2  69.6  
      Food 52.4  53.0  53.5  53.9  56.2  58.5  
         0222 Milk concentrated or sweetened 10.8  13.2  14.6  14.9  18.1  18.4  
         0121 Meat of sheep or goats 7.3  6.3  6.3  5.7  5.7  6.0  
         0230 Butter and other fats and oils 
derived from milk 3.8  5.0  5.2  4.3  4.6  5.2  
         0112 Bovine meat, frozen 3.9  3.8  3.8  3.9  3.8  4.4  
         1121 Wine of fresh grapes (including 
fortified wine) 2.6  2.5  2.4  2.6  2.6  2.7  
         0249 Other cheese; curd 2.8  2.6  2.3  2.6  2.4  2.5  
         0579 Fruit, fresh, dried, n.e.s. 2.9  2.5  2.5  2.6  2.0  2.4  
         0989 Food preparations, n.e.s. 3.0  2.5  2.4  2.4  2.6  2.4  
         0224 Whey, milk products n.e.s. 1.4  1.4  1.5  1.6  1.3  1.4  
         0574 Apples, fresh 1.0  0.8  0.8  0.8  1.0  1.0  
         0342 Fish, frozen (excluding fillets 
and minced fish) 1.0  0.8  0.8  1.0  0.8  0.8  
      Agricultural raw material 9.4  10.3  10.5  10.7  12.0  11.1  
         2474 Wood, of coniferous, in the 
rough or roughly squared 2.4  3.1  3.4  3.4  4.9  4.5  
         2482 Wood of coniferous, sawn of a 
thickness > 6 mm 1.8  1.9  1.6  1.7  1.7  1.5  
         2682 Other wool, unprocessed 0.8  0.9  1.1  1.0  0.9  1.0  
         2919 Other animal materials, n.e.s. 0.8  0.6  0.7  0.8  0.8  0.7  
   Mining 8.0  8.7  9.0  8.2  6.8  6.1  
      Ores and other minerals 0.9  1.0  1.0  1.1  0.9  0.7  
      Non-ferrous metals 2.3  3.0  2.9  2.4  2.3  2.3  
         6841 Aluminium and aluminium 
alloys, unwrought 1.7  2.2  2.2  1.8  1.7  1.7  
      Fuels 4.8  4.7  5.2  4.8  3.6  3.2  
         3330 Crude oils of petroleum and 
bituminous minerals 4.4  4.5  4.6  4.0  3.0  2.7  
Manufactures 25.6  22.9  22.0  22.3  20.5  19.9  
   Iron and steel 1.1  1.0  1.0  1.0  0.9  0.7  
   Chemicals 5.5  4.4  4.4  5.0  4.9  5.0  
         5922 Albuminoidal substances, 
modified starches and glues 2.7  2.1  2.2  2.6  2.6  2.9  
   Other semi -manufactures 4.7  4.5  4.3  4.2  3.9  3.8  
   Machinery and transport equipment 9.0  8.0  7.9  7.5  6.4  6.2  
      Power generating machines 0.3  0.3  0.3  0.3  0.3  0.3  
      Other non-electrical machinery 3.1  3.0  2.9  2.9  2.5  2.6  
         Agricultural machinery and tractors 0.5  0.5  0.5  0.6  0.5  0.5  
      Office machines & telecommunication 
equipment 1.4  1.2  1.2  1.1  1.0  0.9  
      Other electrical machines 1.6  1.6  1.6  1.6  1.5  1.2  
      Automotive products 0.6  0.5  0.5  0.5  0.5  0.4  
      Other transport equipment 2.0  1.5  1.4  1.0  0.7  0.8  
   Textiles 0.9  0.9  0.8  0.7  0.6  0.6  
   Clothing 0.6  0.6  0.5  0.5  0.6  0.6  
   Other consumer goods 3.8  3.5  3.1  3.4  3.2  3.0  
Other 4.6  5.1  5.0  5.0  4.5  4.4  
   Gold 1.6  1.4  1.3  1.3  1.1  0.8  
 
Source: UNSD, Comtrade database (SITC Rev.3). WT/TPR/S/316 • New Zealand 
 
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  Table A1. 2 Merchandise imports by product groups, 2009-14 
  2009 2010 2011 2012 2013 2014 
Total imports (US$ billion) 25.6  30.2  36.1  38.2  39.6  43.3  
 (% of total) 
Total primary products 27.8  29.0  31.2  31.1  30.2  28.5  
   Agriculture 11.4  11.2  11.4  11.3  11.4  11.6  
      Food 10.7  10.6  10.8  10.6  10.7  10.9  
         0813 Oil-cake, oilseed residues 0.4  0.8  0.9  0.8  1.0  1.3  
         0989 Food preparations, n.e.s. 1.0  1.0  1.0  1.1  1.2  1.1  
         0819 Food waste, animal feeds n.e.s. 0.5  0.5  0.5  0.5  0.5  0.5  
      Agricultural raw material 0.7  0.6  0.6  0.6  0.7  0.7  
   Mining 16.4  17.8  19.7  19.8  18.9  16.9  
      Ores and other minerals 1.0  1.5  1.5  1.3  1.2  1.1  
      Non-ferrous metals 0.9  1.0  1.0  0.9  0.8  0.8  
      Fuels 14.6  15.3  17.3  17.7  16.9  15.0  
         3330 Crude oils of petroleum and bituminous 
minerals 7.3  9.5  11.6  12.1  11.1  9.3  
Manufactures 71.4  69.9  67.8  68.0  68.8  70.7  
   Iron and steel 1.5  1.5  1.5  1.4  1.4  1.3  
   Chemicals 11.8  11.7  11.5  11.1  10.8  10.4  
         5429 Medicaments, n.e.s. 1.9  1.7  1.6  1.5  1.3  1.3  
         5621 Mineral or chemical fertilizers, nitrogenous 0.5  0.6  1.0  0.8  0.7  0.6  
         5711 Polyethylene 0.5  0.6  0.5  0.5  0.5  0.6  
         5822 Other plastics, flat shapes, non-cellular 
and not reinforced, etc. 0.5  0.6  0.5  0.5  0.5  0.5  
   Other semi-manufactures 7.7  7.6  7.3  7.0  7.0  6.8  
   Machinery and transport equipment 34.2  33.3  32.8  33.7  35.0  37.9  
      Power generating machines 2.0  1.2  1.6  1.7  1.3  1.5  
         7149 Parts of engines and motors of 714.41 
and 714.8 0.4  0.2  0.7  0.6  0.8  0.9  
      Other non-electrical machinery 7.2  6.9  7.1  7.7  7.7  8.1  
         7232 Mechanical shovels, etc., self-propelled 0.2  0.4  0.5  0.6  0.6  0.7  
         Agricultural machinery and tractors 1.1  0.9  1.0  1.3  1.2  1.4  
         7224 Wheeled tractors (other than of 744.14 
and 744.15) 0.5  0.4  0.4  0.6  0.5  0.7  
      Office machines & telecommunication equipment 8.7  8.5  8.3  7.8  7.7  7.0  
         7522 Data processing machines, with at least 
processing, imput and output units 1.1  1.4  1.4  1.5  1.5  1.4  
         7643 Radio or television transmission apparatus 1.0  0.8  1.1  1.2  1.3  1.2  
      Other electrical machines 3.9  3.7  3.7  3.6  3.6  3.4  
      Automotive products 7.0  9.2  7.8  9.9  11.0  11.9  
         7812 Motor vehicles for the transport of 
persons, n.e.s. 4.9  6.7  5.5  7.0  7.7  8.0  
         7821 Goods vehicles 1.1  1.5  1.4  1.8  2.1  2.8  
         7843 Other motor vehicle parts and accessories 
of 722, 781 to 783 0.7  0.7  0.6  0.7  0.7  0.7  
      Other transport equipment 5.3  3.8  4.3  2.9  3.8  6.0  
         7924 Aeroplanes, etc. (excl. helicopters), 
>15,000 kg unladen 2.3  0.8  1.1  0.5  0.5  2.6  
         7929 Parts, n.e.s., (excl. tyres, engines, 
electrical parts) of 792 1.1  0.7  1.1  0.6  0.6  0.6  
   Textiles 1.7  1.7  1.6  1.6  1.6  1.6  
   Clothing 3.2  3.2  3.1  3.0  3.0  2.9  
   Other consumer goods 11.2  10.7  9.9  10.1  10.0  9.7  
         8722 Instruments used in medical, surgical or 
veterinary sciences 0.9  0.8  0.7  0.7  0.7  0.7  
Other 0.7  1.1  1.0  0.9  0.9  0.8  
   Gold 0.2  0.2  0.2  0.1  0.1  0.1  
Source: UNSD, Comtrade database (SITC Rev.3). 
 WT/TPR/S/316 • New Zealand 
 
- 103 - 
 
  Table A1. 3 Merchandise expo rts by destination, 2009-14 
  2009 2010 2011 2012 2013 2014 
Total exports (US$ billion) 24.9  30.9  37.6  37. 3  39.4  42.4  
 (% of total) 
  America 14.4  13.1  12.9  13.5  12.8  13.2  
    United States 10.0  8.6  8.4  9.2  8.5  9.4  
    Other America 4.4  4.5  4.5  4.3  4.3  3.8  
      Canada 1.3  1.1  1.3  1.2  1.1  1.2  
  Europe 14.4  12.0  11.7  10.4  10.3  10.6  
    EU(28) 13.0  11.0  10.7  9.5  9.3  9.6  
      United Kingdom 4.3  3.5  3.2  3.0  2.9  3.1  
      The Netherlands 1.2  1.1  1.3  1.2  1.3  1.7  
      Germany 1.9  1.5  1.6  1.6  1.5  1.3  
    EFTA 0.3  0.3  0.3  0.2  0.3  0.3  
    Other Europe 1.0  0.8  0.7  0.7  0.7  0.8  
  Commonwealth of 
Independent States (CIS) 0.7  1.0  0.9  0.9  0.9  0.8  
  Africa 3.3  3.2  3.9  3.9  3.6  4.1  
      Algeria 0.7  0.5  1.0  0.9  0.6  1.2  
      Egypt 0.6  0.6  0.7  0.8  0.7  1.0  
  Middle East 3.9  4.1  4.2  4.3  3.7  4.7  
      United Arab Emirates 1.0  1.0  1.2  1.3  1.4  1.8  
      Saudi Arabia 1.2  1.4  1.4  1.5  1.1  1.5  
  Asia 62.5  65.5  65.3  65.8  67.7  65.5  
    China 9.1  11.1  12.4  14.9  20.7  19.9  
    Japan 7.1  7.8  7.2  7.0  5.9  5.9  
    Six East Asian Traders 12.7  12.4  12.2  12.2  12.3  12.6  
      Korea, Rep. of 3.1  3.3  3.5  3.4  3.4  3.5  
      Chinese Taipei 1.9  1.9  1.9  1.8  1.8  2.0  
      Singapore 2.8  1.9  1.7  1.8  2.1  2.0  
      Malaysia 1.8  1.8  1.8  1.9  1.9  2.0  
      Thailand 1.1  1.6  1.5  1.4  1.5  1.6  
      Hong Kong, China 2.0  2.0  1.7  1.9  1.6  1.5  
    Other Asia 33.5  34.2  33.5  31.7  28.8  27.1  
      Australia 23.0  23.0  22.7  21.5  19.0  17.5  
      Indonesia 2.4  2.1  1.8  1.8  1.8  1.9  
      Philippines 1.4  1.7  1.6  1.5  1.6  1.5  
      India 1.6  2.1  2.0  1.7  1.4  1.2  
      Viet Nam 0.8  1.0  0.9  1.0  1.0  1.1  
  Other 0.9  1.1  1.2  1.1  1.1  1.0  
Source: UNSD, Comtrade database. 
 
 
 WT/TPR/S/316 • New Zealand 
 
- 104 - 
 
  Table A1. 4 Merchandise imports by origin, 2009-14 
  2009 2010 2011 2012 2013 2014 
Total imports (US$ billion) 25.6  30.2  36.1  38. 2  39.6  43.3  
 (% of total) 
  America 13.4  13.0  13.2  12.1  12.1  14.3  
    United States 10.8  10.4  10.3  9.3  9.4  11.6  
    Other America 2.6  2.6  2.9  2.8  2.7  2.7  
      Canada 1.3  1.2  1.4  1.2  1.2  1.0  
  Europe 18.5  15.8  16.7  16.5  17.8  18.5  
    EU(28) 17.3  14.7  15.6  15.5  16.7  17.5  
      Germany 4.2  4.1  4.2  4.4  4.6  4.8  
      United Kingdom 2.3  2.3  2.7  2.7  2.5  2.6  
      France 3.3  1.4  1.9  1.9  2.5  2.3  
      Italy 1.8  1.7  1.8  1.7  1.8  1.8  
      Spain 0.5  0.6  0.6  0.5  0.7  1.1  
    EFTA 1.0  0.8  0.9  0.8  0.8  0.7  
    Other Europe 0.3  0.3  0.2  0.3  0.3  0.3  
  Commonwealth of 
Independent States (CIS) 0.5  1.0  2.6  0.6  1.3  1.1  
      Russian Federation 0.5  1.0  2.5  0.6  1.2  1.0  
  Africa 0.9  0.9  0.7  1.0  0.9  0.7  
  Middle East 5.3  6.2  7.8  7.6  7.3  5.7  
      United Arab Emirates 1.2  2.1  1.6  0.7  2.1  1.7  
      Saudi Arabia 0.7  0.7  2.0  2.2  1.9  1.6  
      Qatar 2.3  1.9  2.2  1.1  1.2  1.1  
      Kuwait 0.4  0.5  1.2  0.5  0.9  1.0  
  Asia 60.8  62.8  59.1  62.2  60.7  59.7  
    China 15.1  16.0  16.0  16.3  17.1  16.9  
    Japan 7.4  7.3  6.1  6.5  6.4  6.7  
    Six East Asian Traders 14.7  16.0  15.7  17.4  17.8  18.2  
      Malaysia 2.7  3.6  3.2  3.9  4.2  4.6  
      Korea, Rep. of 3.4  3.3  3.1  3.8  4.1  4.5  
      Singapore 4.0  3.8  4.7  4.5  4.2  4.0  
      Thailand 2.6  3.2  2.9  3.2  3.4  3.4  
      Chinese Taipei 1.5  1.7  1.5  1.7  1.6  1.5  
    Other Asia 23.6  23.5  21.3  22.0  19.5  17.9  
      Australia 18.4  18.2  16.0  15.2  13.3  12.2  
      Indonesia 1.8  1.5  1.6  1.4  1.8  1.7  
      India 0.9  0.9  0.8  0.9  0.9  1.0  
      Viet Nam 0.4  0.5  0.6  0.7  1.0  1.0  
  Other 0.4  0.3  0.0  0.0  0.0  0.0  
Source: UNSD, Comtrade database. 
  
  WT/TPR/S/316 • New Zealand
 
- 105 - Table A3. 1 Overview of origin criteria for application of preferen tial tariff duties, 2014 
 Wholly 
obtained or 
produced Partly manufactured Meet the 
requirements of a 
product specific 
rule Direct shipment Documentary 
evidence of origin Cumulation 
Australia New Zealand 
Closer Economic Relations Trade Agreement (ANZCERTA) Applies n.a.  
(since 1 January 2012) a) CTC;  
b) de minimis 10% of adjusted value;  c) RVC (build-down, build-up or factory cost methods), additional or alternative to CTC; d) specific process rules, alternative to CTC Applies 
(Repacking and relabelling in third country allowed) Declaration of 
exporter of goods Applies 
Agreement on Trade and 
Economic Cooperation 
between New Zealand and 
Canada Applies Qualifying expenditure 
not less than 50% of 
factory or works cost 
of goods in finished 
state, may be varied 
by Chief Executive for 
specific goods n.a. Applies 
(Can apply to Chief 
Executive for 
exemption if 
exceptional 
circumstance) a) Certificate of 
origin; 
b) Declaration of 
origin; or 
c) Other evidence 
sufficient to prove 
that the goods satisfy 
the relevant rules Applies as to 
calculating qualifying 
expenditure 
Malaysia-New Zealand 
Free Trade Agreement (MNZFTA)  Applies n.a. a) CTC; 
b) de minimis 10% of f.o.b. value, Ch. 50-69 - 10% of total weight of good; c) qualifying value content (build-down method), alternative to CTC; d) specified process rules, (additional to CTC or QVC, or) alternative to CTC Applies 
(Transit must be justified for geographical, economic or logistical reasons) a) Declaration of 
origin from exporter or producer; or b) Certificate of origin (not required for exports to Malaysia) Applies  
  WT/TPR/S/316 • New Zealand
 
- 106 -  Wholly 
obtained or 
produced Partly manufactured Meet the 
requirements of a 
product specific 
rule Direct shipment Documentary 
evidence of origin Cumulation 
United Kingdom of Great 
Britain and Northern 
Island, the Isle of Man, 
and the Channel Islands 
(Group 1) Applies Qualifying expenditure 
not less than 50% of 
factory or works cost 
of goods in finished 
state n.a. Applies 
(Allowed to enter 
commerce of other 
Group 1 countries)  
(No operations like 
unloading allowed) 
(Can apply to Chief 
Executive for 
exemption) a) Certificate of 
origin; 
b) Declaration of 
origin; or 
c) Other evidence 
sufficient to prove 
that the goods satisfy 
the relevant rules Applies as to 
calculating qualifying 
expenditure, only 
Group 1 
Generalized System of 
Preferences (Less Developed Countries – Group 2) Applies Qualifying expenditure 
not less than 50% of factory or works cost of goods in finished state n.a. Applies 
(Allowed to enter commerce of other Group 2 countries) (No operations like unloading allowed) (Can apply to Chief Executive for exemption) a) Certificate of 
origin; b) Declaration of origin; or c) Other evidence sufficient to prove that the goods satisfy the relevant rules Applies as to 
calculating qualifying expenditure 
Generalized System of 
Preferences (Least 
Developed Countries - 
Group 3) Applies Qualifying expenditure 
not less than 50% of 
factory or works cost 
of goods in finished 
state n.a. Applies 
(Allowed to enter 
commerce of other 
Group 3 countries) 
(No operations like 
unloading allowed) 
(Can apply to Chief 
Executive for 
exemption) a) Certificate of 
origin; 
b) Declaration of 
origin; or 
c) Other evidence 
sufficient to prove 
that the goods satisfy 
the relevant rules Applies as to 
calculating qualifying 
expenditure 
South Pacific Regional Trade and Economic Co-operation Agreement (SPARTECA) - Forum Island Countries Applies Qualifying expenditure 
not less than 50% of factory or works cost of goods in their finished state; 48% possible pending specific approval from Chief Executive; 45% for specified items of clothing n.a. n.a. a) Certificate of 
origin; b) Declaration of origin; or c) Other evidence sufficient to prove that the goods satisfy the relevant rules Applies as to 
calculating qualifying expenditure, only Forum Island Countries and NZ. Australian qualifying materials can be used (Forum Island Countries content must be at least 25% of factory and works cost of goods in finished state)  
  WT/TPR/S/316 • New Zealand
 
- 107 -  Wholly 
obtained or 
produced Partly manufactured Meet the 
requirements of a 
product specific 
rule Direct shipment Documentary 
evidence of origin Cumulation 
Agreement Between 
New Zealand and 
Singapore on a Closer 
Economic Partnership 
(ANZSCEP) Applies Qualifying area 
content (QAC): 
1) No less than 40% 
of factory or works 
cost of goods in 
finished state; 
2) None. Last process 
of manufacture is 
quality control 
checking and testing 
procedures (QCT), 
expenditure on QCT is 
not less than 50% of 
factory or works cost 
of goods calculated 
after completion of 
process of 
manufacture (does not 
apply to certain 
textiles or textile 
articles, clothing, 
headwear, or 
footwear); 
3) Some. And QCT 
performed in SG is last 
process of 
manufacture, QCT 
expenditure (not less 
than 8% of factory or 
works cost of goods 
calculated after 
completion of process 
of manufacture) is 
counted in QAC, and 
the QAC is not less 
than 40% of factory or 
works cost of goods in 
finished state n.a. Applies 
(Permitted (before 
importation into 
New Zealand) to enter 
into the commerce of 
Australia only for the 
purpose of unloading 
and reloading) Declaration of origin 
on the export invoice Applies as to 
calculating qualifying 
expenditure  
  WT/TPR/S/316 • New Zealand
 
- 108 -  Wholly 
obtained or 
produced Partly manufactured Meet the 
requirements of a 
product specific 
rule Direct shipment Documentary 
evidence of origin Cumulation 
New Zealand-Thailand 
Closer Economic Partnership Agreement (NZTCEPA) Applies n.a. a) CTC; 
b) de minimis 10% of f.o.b. value; c) RVC (build-down method) not less than 50% of the export f.o.b. value, additional to CTC (Ch. 50-64); d) specific process rule (chemical reaction), alternative to CTC (Ch. 27-40) Applies, unless Chief 
Executive otherwise permits either generally or in a particular case Declaration of origin 
from exporter, producer or any other competent person, or public or private body, in relation to goods Applies 
Trans-Pacific Strategic 
Economic Partnership 
Agreement (TPA) Applies 
(+ recovered 
from used 
goods and 
utilized for 
producing 
remanufactu
red goods) n.a. a) CTC; 
b) de minimis 10% 
of transaction 
value;  
c) RVC (build-down 
method), additional 
or alternative to 
CTC; 
d) specific process 
rules, (additional to 
CTC and RVC) or 
alternative to CTC  Applies, unless Chief 
Executive otherwise 
permits either 
generally or in a 
particular case. 
Outward processing is 
permitted subject to 
meeting requirements Declaration of origin 
on the export invoice 
or certificate of origin Applies 
New Zealand-China Free 
Trade Agreement (NZCFTA) Applies n.a. a) CTC; 
b) de minimis 10% of f.o.b. value; c) RVC (build-down method), on its own, alternative or additional to CTC; d) specified process rule, additional or alternative to CTC Applies 
Temporary storage for up to 6 months is allowed. (Repacking is allowed) a) Certificate of 
origin issued by China’s Administration of Quality Supervision, Inspection & Quarantine (AQSIQ) or designated certifying body in NZ; or b) Declaration (on invoice or any other commercial document) provided by exporter; or Applies  
  WT/TPR/S/316 • New Zealand
 
- 109 -  Wholly 
obtained or 
produced Partly manufactured Meet the 
requirements of a 
product specific 
rule Direct shipment Documentary 
evidence of origin Cumulation 
c) Declaration 
submitted by exporter, providing reasons why goods in question qualify as of China origin 
Agreement Establishing 
the ASEAN-Australia-
New Zealand Free Trade 
Area (AANZFTA) Applies n.a. a) CTC; 
b) de minimis 10% 
of f.o.b. value, 
alternative for 
Ch.50-63 - 10% of 
total weight; 
c) RVC (build-up or 
build-down 
method), on its own 
or alternative to 
CTC; 
d) specified process 
rules, alternative to 
CTC or RVC Applies a) Certificate of 
origin issued by 
issuing 
authority/body in a 
party to the 
AANZFTA 
Agreement; or 
b) Declaration (on 
invoice or any other 
commercial 
document) provided 
by exporter in a 
party to AANZFTA Applies 
New Zealand-Hong Kong, China Closer Economic Partnership Agreement 
(NZ-HKC CEP) Applies n.a. a) CTC; 
b) de minimis 10% of f.o.b. value; 
c) RVC (build-up or 
build-down method), on its own, additional or alternative to CTC; d) specified process rules, alternative to CTC or RVC; [e) Ch.61-62 - part-processing in PRC allowed, additional to CTC] Applies 
Temporary storage for up to 6 months is 
allowed. (Repacking is 
allowed) Goods Ch.61-62:  
Certificate of origin issued by  Trade and 
Industry Department 
of Hong Kong, China or by a Government Approved Certification Organisation of Hong Kong, China (GACO) Applies  
  WT/TPR/S/316 • New Zealand
 
- 110 -  Wholly 
obtained or 
produced Partly manufactured Meet the 
requirements of a 
product specific 
rule Direct shipment Documentary 
evidence of origin Cumulation 
Agreement Between 
New Zealand and the 
Separate Customs 
Territory of Taiwan, 
Penghu, Kinmen, and 
Matsu on Economic 
Cooperation (ANZTEC) Applies n.a. a) CTC; 
b) de minimis 10% 
of f.o.b. value; 
c) RVC (build-down 
method), 
alternative to CTC; 
d) specified process 
rules, alternative or 
additional to CTC or 
RVC Applies 
Temporary storage for 
up to 6 months is 
allowed. (Repacking is 
allowed) a) Written 
declaration of origin 
(presented in print or 
electronic format); 
b) Written certificate 
of origin (presented 
in print or electronic 
format); or 
c) Other evidence to 
substantiate tariff 
preference claimed 
for goods Applies 
 
n.a. Not applicable.  
Source: NZCS online information. Viewed at: http://www.customs.govt.nz/news/resources/f actsheets/Documents/Fact%20Sheet%2008.pdf . 
 
 WT/TPR/S/316 • New Zealand 
 
- 111 - 
 
  Table A4. 1 New Zealand registered banks, June 2014 
Bank Market 
share 
(%)a Ultimate parent Country of 
parent 
Australia and New Zealand Banking 
Group Limited 2.4 Branch Australia 
ANZ Bank Limited 29.8 Australia and New Zealand 
Banking Group Limited Australia 
Commonwealth Bank of Australia 1.0 Branch Australia 
ASB Bank Limited 16.2 Commonwealth Bank of 
Australia Australia 
Bank of New Zealand 18.0 National Australia Bank Australia 
Bank of Baroda (New Zealand) 
Limited 0.0 Bank of Baroda India 
Bank of China (New Zealand) 
Limitedb 0.0 Bank of China China 
Bank of India (New Zealand) 
Limited 0.0 Bank of India India 
Citibank N.A. 0.6 Branch United States 
China Construction Bank 
(New Zealand) Limitedc 0.0 China Construction Bank China 
Deutsche Bank Aktiengesellschaft 0.6 Branch Germany 
Heartland Bank Limited 0.6 Hearthland New Zealand 
Limited New Zealand 
Industrial and Commercial bank of China (New Zealand) Limited 0.0 Industrial and Commercial 
Bank of China China 
JPMorgan Chase Bank, N.A. 0.1 Branch United States 
Kiwibank Limited 4.0 New Zealand Post Limited New Zealand 
Kookmin Bank 0.1 Branch Korea, Rep. of  
Rabobank Nederland 0.6 Branch Netherlands 
Rabobank New Zealand Limited 2.3 Rabobank Nederland Netherlands 
Southland Building Society 0.7  New Zealand 
The Bank of Tokyo-Mitsubishi 
Limited 0.9 Branch Japan 
The Co-operative Bank Limited 0.4   
The Hong Kong and Shanghai 
Banking Corporation Limited 1.2 Branch United Kingdom
TSB Bank Limited 1.3 TSB Co mmunity Trust New Zealand 
Westpac Banking Corporation 1.7 Branch Australia 
Westpac New Zealand Limited 17.5 Westpac Banking 
Corporation Australia 
 
a Registered banks' assets as a percentage of the total assets of the banking system, as at 
30 June 2014. 
b Registered on 21 November 2014. c Registered on 15 July 2014. 
 
Source:  RBNZ (2014), Financial Stability Report , November . Viewed at: 
http://www.rbnz.govt.nz/financial_stability_/financial_stability_report/ . 
 
 
   
  WT/TPR/S/316 • New Zealand
 
- 112 - Table A4. 2 New Zealand's Air Transport Agreementsa, 2014 
Partner Date Entry into 
force 
5th1 
7th2 
Cabotage3 
Coop4 
Designation5 
Withholding6 
Pricing7 
Capacity8 
Stat9 
ALI10 
Argentina 04.06.1998  TBAbY N N N M SOEC DA B1 Y 14 
Australia 08.08.2002 25.08.2003 Y N Y Y M PPoB FP FD Y 43 
Austria 14.03.2002 01.11.2002 Y N N Y M PPoB FP FD Y 37 
Belgium 04.06.1999 01.05.2003 N N N Y M PPoB DA B1 Y 19 
Brazil 11.06.2013 TBA Y N N Y M PPoB FP FD Y 37 
Brunei Darussalam  04.03.1999 04.03.1999 Y Y Y Y M PPoB FP FD N 50 
Canada 21.07.2009 TBA N Y N Y M SOEC DD FD N 28 
Chile  01.12.1992 28.06.1995 Y N N N M SOEC FP FD N 27 
China 11.04.2012 TBA Y N N Y M SOEC DA B1 Y 17 
Cook Islands  06.01.2000 06.01.2000 Y Y N Y M PPoB FP FD Y 43 
Denmark 07.02.2001 07.02.2001 Y N N Y M PPoB FP FD N 38 
Fiji 03.05.1998 03.05.1998 Y N N N M SOEC DA B1 Y 14 
France 12.10.1998 12.10.1998 Y N N N M SOEC DA B1 Y 14.0 
French Polynesia 04.03.2013 TBA Y N N Y .. SOEC .. FD .. .. 
Finland 21.05.2014 TBA Y Y Y Y M PPoB/CoI FP FD N 50 
Germany 23.03.2001 TBA Y N N N M SOEC DA PD Y 10 
Hong Kong, China 04.04.2014 04.04.2014 N N N N M PPoB DA PD Y 12 
India 31.01,2008 31.01.2008 Y N N Y M SOEC FP PD Y 21 
Indonesia 08.11.2012 06.10.2013 Y N N N M SOEC DA PD Y 10 
Ireland 20.05.1999 10.01.2001 Y N Y Y M PPoB FP FD N 44  
  WT/TPR/S/316 • New Zealand
 
- 113 - Partner Date Entry into 
force 
5th1 
7th2 
Cabotage3 
Coop4 
Designation5 
Withholding6 
Pricing7 
Capacity8 
Stat9 
ALI10 
Italy 12.09.2001 TBA Y N N Y M SOEC FP FD Y 29 
Japan 16.02.2012 11.09.2012 Y N N N M SOEC DA B1 Y 14 
Korea, Republic of 11.03.2004 11.03.2004 Y N N N M SOEC DA B1 Y 14 
Luxembourg 13.12.2013 TBA Y N N N M SOEC DA B1 Y 14 
Macao, China 09.03.1995 01.07.1996 Y N N N M PPoB DA FD Y 26 
Malaysia 16.06.1998 16.06.1998 Y N N Y M PPoB FP FD N 38 
Mexico 14.05.1999 03.03.2000 Y N N Y M PPoB DA FD Y 29 
Mongolia (Code-share-
only) 12.12.2013 TBA Y N N Y M PPoB FP FD N 38 
Nauru 28.11.1986 28.11.1986 Y N N N S SOEC DA B1 Y 10 
Niue 02.12.2010 02.12.2010 Y N N N M SOEC DA PD Y 10 
Norway 11.12.2013 TBA Y N N Y M PPoB FP FD N 38 
Papua New Guinea 31.05.2013 TBA Y N N N S SOEC DA B1 Y 10 
Philippines 06.03.2014 12.09.2014 Y N N Y M PPoB DA PD Y 21 
Russian Federation 16.05.2006 21.07.2006 Y N N N M SOEC DD B1 N 21 
Samoa 14.04.2000 14.04.2000 Y N N Y M PPoB FP FD N 38 
Singapore 27.11.1997 27.11.1997 Y N N Y M PPoB FP FD N 38 
Solomon Islands 30.05.1990 30.05.1990 Y N N N M SOEC DA B1 Y 14 
South Africa 12.12.2013 TBA Y N N N M SOEC DD B1 Y 20 
Spain 06.05.2002 16.09.2003 Y N N Y M PPoB FP FD Y 37 
Sri Lanka 08.05.2014 22.07.2014 Y N N Y M PPoB FP FD N 38 
Sweden 11.12.2013 TBA Y N N Y M PPoB FP FD N 38  
  WT/TPR/S/316 • New Zealand
 
- 114 - Partner Date Entry into 
force 
5th1 
7th2 
Cabotage3 
Coop4 
Designation5 
Withholding6 
Pricing7 
Capacity8 
Stat9 
ALI10 
Switzerland 11.12.2013 TBA Y N N Y M PPoB DD FD Y 35 
Chinese Taipei 10.07.2013 01.12.3013 Y N N Y M PPoB FP FD N 38 
Thailand 11.02.1999 04.08.1999 Y N N N M SOEC DA B1 Y 14 
Tonga 12.02.2002 12.02.2002 Y N N Y M PPoB FP FD Y 37 
Turkey 04.03.2010 TBA Y N N Y M SOEC/PPoB FP FD Y 37 
United Arab Emirates 11.12.2012 TBA Y N N N M SOEC DA B1 Y 14 
United Kingdom 02.09.2013 02.09.2013 Y N Y Y M PPoB FP FD N 44 
United States of America 18.06.1997 18.06.1997 Y N N Y M SOEC DD FD N 28 
Vanuatu 21.04.2006 13.06.2006 Y N N N M SOEC DA PD Y 10 
Viet Nam 16.08.2013 TBA Y N N N M PPoB DA PD Y 18 
.. Not available. 
a "Air Transport Agreements" refers to Air Services Agreements, Memoranda of Understand ing, Exchange of Notes, and other such r elevant instruments. Only 
agreements that have been formal ly signed are included. Agreements with Cambodia, Ethiopia, Iceland, Jamaica, Kuwait, the Nethe rlands, Paraguay, Peru, 
Qatar, Saudi Arabia, Togo, Uruguay, and Za mbia had been negotiated but were not formally signed as at 30 June 2014.  
b To be announced. 
1 "Y": Fifth freedom rights (even limited on es) are granted and do not require approval  by the aeronautical authorities. "N" no t granted. 
2 "Y": Seventh freedom rights (even limited ones) are granted and do not require approval by the aeronautical authorities. "N" not granted. 
3 "Y": Cabotage rights (e ven limited ones) are granted and do not require appr oval by the aeronautical authorities. "N" not gra nted. 
4 "Y": Clauses allowing cooperation betwee n airlines (e.g. code-sharing) are included  in the agreement. "N" not included.  
5 "S": single designation; "M": multiple designation. 6 "SOEC": Substantial Ownership and Effect ive Control, "PPoB": Principal Place of Business; "COI": Community of Interest. 
7 "DA": Double Approval; "DD": Double Disapproval; "CoO": Co untry of Origin; "ZP": Zone Pricing; "FP": Free Pricing. 
8 "PD": Pre Determination; "BI": Bermuda I;  "FD": Free determination; "O": Other. 
9 "Y": Exchange of statistics is forese en by the agreement. "N" not foreseen. 
10 "ALI": Air Liberalisation Index is a synthetic measure of the openness of a given Air Services Agreement (ASA), devised by t he WTO Secretariat. It has been 
constructed by attributing weights to the different variants of  the key market access features of ASAs (e.g. freedoms of the ai r, capacity, etc.). The value of 
the ALI ranges between 0, for very rest rictive ASAs, and 50, for very open ones. 
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