Franks Stephen: Fair Trading Amendment Bill (No 3) — Third Reading 
Franks Stephen: Fair Trading Amendment Bill (No 3) — Third Reading 
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STEPHEN FRANKS (ACT NZ) 
: The Fair Trading Amendment Bill (No 3) was introduced to the House more than a year ago as a bill to deal with pyramid selling. The New Zealand First member who has just resumed his seat—I do not think that the brief interruption since then counts as a speech—was obviously taken in by the spin that accompanied the introduction of this bill. There is nothing in this bill that deals with pyramid selling in any way that the existing law does not. 
This bill as a bill dealing with pyramid selling is simply misleading and deceptive conduct. Indeed if the politicians in charge of introducing this bill were judged by the same standards that were applied to the commercial people it purports to regulate they should be in prison although I do not think that imprisonment is used in these matters. The misleading part of the bill is that the only change to pyramid selling is to insert the words “whether personally or through an agent” into paragraph (ii) of section 24(2)(a) of the principal Act which is amended by clause 5. That I suggest to members and to New Zealanders will catch almost no pyramid selling if any is still occurring. What it may do is end up catching the people who run Lotto or perhaps the people running bingo or housie or the people who are running the pokies. The definition states: “that to many participants in the scheme constitutes primarily an opportunity to buy or sell an investment opportunity”. 
Even the TAB describes what it does as “investment”. The TAB has a guaranteed loss ratio over long-term “investment” which would probably be worse than a number of these pyramid schemes that we are supposed to get to. But of course Mr Mallard who is trying to intervene is part of a Government and sits alongside Ministers who told us what this bill was going to do. Does Mr Mallard know what they told us? They told us that they were going to get to the bottom of scams. Let me tell Mr Mallard what his colleagues said. Mr John Tamihere of course was chosen as the appropriate representative to deal with this. He came in here with some ringing words about misleading and deceptive conduct. He gave us a good definition of it and told us that any person of standing in our community involved in a scam unwittingly or otherwise should have the integrity credibility and ethics to stand up come back to the country and publicise the scam so that others would not be unwittingly misled into that type of investment. Of course it was a little different when Mr Tamihere had to try to hide behind a personal explanation so that members of this House could not go any further. There is no comment from Mr Mallard. Does he give up on interjections when Mr Tamihere’s name comes up? I ask him whether interjections are quite unacceptable now. 
But there is more. It got a lot better. Here is another Minister of the Labour Cabinet on what this bill was going to do. He said: “I want to see a very rigorous investigation of those issues.” that is the pyramid trading issues. “I am absolutely confident that the Labour members on the committee will dig deep on that investigation. They will drill all over the place and many things will be flushed out for the benefit of the whole community. I look forward to the rigorous debate and investigation by the select committee. I expect it will be better than a Senate committee investigation in the US. It will be deep investigation and the public will be better off for it and for this bill.” 
Now let us look at what the committee did. Let us look at what this House got from this tawdry little piece of deception introduced by this Government. What we got was a hearing of evidence that took 30 minutes and consideration which presumably included getting rid of Mr Peck’s typos of 55 minutes. So there is the Fair Trading Amendment Bill (No 3)—the pinnacle of the Minister’s career; the pinnacle of the honourable Judith Tizard’s time in this House to date no doubt. She satisfied Mr Rick Barker and Mr John Tamihere and no doubt that is exactly what Mr Mallard was expecting. 
What do we have instead? It is not simply that this bill does not do anything. It is not that it is just empty deception. It actually on the way returns to “soak the rich”. It takes a swing at business. Give a good thump on the way because they will not complain. Sadly it managed to drag in National Party members. I believe they have been improving I believe that they are getting better but sadly they too went along with “have a thump at business” because no doubt they thought it would not look good if they voted against increasing the sentences. 
What we got of course is the new power for the Commerce Commission to decide that it does not matter what the courts do about justice “we will do justice ourselves”. All it needs now for the Commerce Commission to stuff someone’s business completely to send out a signal that “you don’t monkey with us” irrespective of the bona fides that “you do not challenge the commissars from the Commerce Commission” is to apply for an injunction. We are told by Labour’s little gift here that the court must not as a condition of granting an interim injunction require the commission to give an undertaking as to damages. A protection carefully developed by the courts over generations is swept away in five short lines. Until now if we get a court order without a proper opportunity to investigate without full argument without giving an opportunity to mount the defence if we get an interim injunction which means immediately then we have to undertake that if we are wrong we will meet the costs of the person who has been wronged. 
So what did the Government do? It abolished it. That is not enough when we want to thump business. So we got new subsection (6) in section 41 inserted by clause 10 which states that the court faced with this injunction application knowing that it is not going to have the full story knowing that there is not time must not take into account that the commission is not required to give an undertaking as to damages. So we see the true measure of the malice in this bill. It is that the court when deciding whether to grant the injunction cannot even consider that it may be an engine of gross injustice—completely uncompensated injustice—with no remedy for the wronged person. 
There was another provision in the bill that excited a bit of attention. In fact it had the Greens United Future ACT and National voting for it. It was an amendment by Mr Brent Catchpole that tried to bring the power of search within normal parameters. It tried to say that at least when a warrant is issued there must be a suspicion that an offence is being committed. Instead this Government—the “Minister for Auckland Transport”—has brought in a search provision saying that warrants should be issued if an offence may be being committed. In other words officers can say that the evidence even if they find it does not need to amount to an offence. All it needs to amount to is an argument that it could constitute an offence. That is way beyond the powers of search that have been the product of careful protection of the liberties of the subject against the overweening power of the State for generations. This is not just an embarrassing bill; this is not just a tawdry piece of political malice; this is actually viciousness against the business sector.