Mooney JosephJOSEPH MOONEY (National—Southland): I rise on behalf of the National Party to speak in respect of the Commerce Amendment Bill. This bill will amend the Commerce Act 1986 to ensure that it better fulfils its purpose of promoting competition. In particular the bill strengthens the prohibition against the misuse of market power in section 36 of the Act.It also aligns the rules for trans-Tasman markets it prohibits the misuse of market power in New Zealand markets and it strengthens and clarifies prohibitions in that respect. It has similar prohibitions against Australian or trans-Tasman firms with substantial market power taking advantage of that power in a New Zealand market. For example it can result in a firm based in Australia being treated more leniently in the way section 36A currently sits than for firms based in New Zealand for identical conduct—that would affect New Zealand markets.The bill changes the Commerce Commission's authorisation powers as well. In some instances anti-competitive conduct might be in the public interest. For example it might be where competing businesses work together to aid in dealing with the effects of COVID-19. In these instances it may be desirable to allow that behaviour even though it might otherwise contravene the Act.There are a number of changes which are in here. The National Party does have concerns about some parts of it. The National Party remains concerned about the effect on pro-competitive behaviour of the changes to an effects-based test under section 36 and the repeal of intellectual property safe harbours. National is concerned about the effect on pro-competitive behaviour that those changes could have and the potential for resulting detrimental outcomes for consumers.In terms of section 36 the bill changes competition rules for dominant market players from the intention to be anti-competitive to business decisions that have the unintended consequence of altering competition in the market. The National Party believes that this test should be amended from intent (purpose) effect or likely effect" to be anti-competitive to "intent (purpose) or likely effect". The removal of the "effect" condition limits the restrictions to foreseeable consequences of commercial actions. As drafted firms with market power risk liability for unforeseeable future consequences leading to overly conservative decision-making on their part. This is likely to deter competitive conduct to the detriment of consumers in the long term. We note that the regulatory impact assessment prepared by the Ministry of Business Innovation and Employment supports this view.It's really important in bills of this nature to get the balance right so that we don't have firms taking overly conservative decision-making because we live in a dynamic world as COVID-19 has made all too apparent. We have seen our borders closed for a very considerable period of time and we need people to take risks in business to actually take advantage of the opportunities to look for new ways of doing things and to create new business opportunities for themselves which is ultimately good for the country.I just note that there is another concern that the National Party has in terms of the legitimate business justification. A legitimate business justification defence in our view should be included in section 36 of the Act consistent with international precedent. While the Commerce Commission has assured us that they'll not pursue proceedings against standard commercial conduct this should be specified in the bill. The commission may not bring proceedings against legitimate businesses but it does not preclude third parties from doing so.The National Party opposes the repeal of the intellectual property safe harbours which are proposed in this bill. Businesses require confidence to invest in and license their intellectual property. So intellectual property rights have no intrinsic value; rather the value lies in their statutory rights that allow for the enforcement of intellectual property. Repealing certain safe harbours in this bill will make New Zealand an outlier internationally discouraging investment in intellectual property and research and development and will have a chilling effect on pro-competitive licensing of intellectual property to competitors and other third parties.I'll just make the comment here that this is an incredibly important area for New Zealand to compete in with the weightless export potential for this market. It's something where we should really be carefully ensuring that we create the relevant statutory regime that will support the development of intellectual property and that will encourage research and development. Increasingly we see for example with matters around climate change and how to respond to that that we need some intelligent thinking and we need some people who are taking a chance. I saw recently a speech by Mr Callaghan from about 10 years ago where he noted that New Zealand is incredibly good at doing odd things. We have businesses where New Zealanders come up with ideas which are outliers that no one else has thought of and this is the classic number eight wire thinking that is hardwired into our DNA. New Zealanders will look at something and find an opportunity that no one else has noticed and they will do it very very well and sell it to the world markets. We don't want to see a chilling effect on that innovation—that number eight wire spirit—but rather we want to encourage it and unfortunately this bill undermines that.So there are a number of concerns that we have in respect of this bill but I think I'll leave my comments there. Thank you for the opportunity."