GRC Professional - February 2015 Edition | Page 28

IN DEPTH

UNFAIR CONTRACT TERMS
RULES HIT NEW ZEALAND

Tough new laws to control unfair contract terms in consumer product or
service arrangements are set to come into force in New Zealand in March.
And, the regulator is keen to test-drive its new powers. Gary Hughes.

The New Zealand
Commerce
Commission
(NZCC) is itching
to flex its new
consumer
law muscle.

THE NEW ZEALAND COMMERCE Commission
(NZCC) is itching to flex its new consumer law muscle,
which it will be able to do with unfair terms contained in
any standard form consumer contracts entered into, or
renewed, or varied, after 17 March 2015.
The NZCC released draft guidelines for consultation in 2014, to steer businesses on how it might apply
the new provisions regarding unfair contract terms,
which were added to the Fair Trading Act during major
pro-consumer law reforms. The Guidelines are partly
an effort to explore where the lines of unfairness might
be drawn (although the courts will ultimately determine
that) and also to provide warning to at-risk industries.
Finalised NZCC Guidelines were expected in
November 2014, but were delayed and are yet to be published. Although imminent, at time of going to print we
must rely upon the draft Guidelines. However, major
changes to the regime are not expected.
Which sectors and terms are at risk?
The NZCC has publicly identified 13 key industries
where standard form contracts are common, and clearly
suggests these industries will be early targets under the
new UCT provisions:
• telecommunications,
• finance,
• energy and utilities
providers,
• gym an