Navigating Regulatory Compliance: A Guide for NZ Business Owners

18 August, 2023 | Bret Gower

Regulatory compliance is an essential aspect of running a business in New Zealand, but it can be hard to keep up with all the requirements and to understand how to ensure your business complies – and it’s not the most fun aspect of running a business either!

Falling foul of Government regulations can cause unnecessary stress and time away from working on the growth aspects of your business. We want to help you as a business owner make your business compliant, and to help if something goes wrong and you are subject to an investigation.

So what are some of the regulatory compliance issues you need to think about?

Commerce Commission Investigations

You might think that the Commerce Commission only goes after large corporates, but they do investigate and prosecute small to medium businesses for infringements. Any business that engages in anti-competitive practices, makes false or misleading claims, has unfair contract terms, or doesn’t meet product safety or consumer information requirements can face investigation by the Commission.

The Commerce Commission is the Government Regulatory authority that investigates and prosecutes businesses in relation to laws designed to promote competition, protect consumers and ensure fair trade practices in the market.

The main laws that small to medium businesses need to be concerned with are:

• The Consumer Guarantees Act
• The Commerce Act,
• Fair Trading Act, and
• Credit Contracts & Consumer Finance Act.

So what happens if you receive notice of investigation from  the Commerce Commission? The most important thing it to seek advice early. Preparing a response takes time, and an understanding of what the Commerce Commission needs from you to respond properly and ideally to prove that you haven’t breached the rules.

By getting expert advice early, we can help minimise the risk of legal action and fines – as well as the damage to your reputation. Investigations usually commence with a request for voluntary provision of certain information, which can then lead to request for compulsory information and/or interview(s). Ultimately these investigations can result in prosecution. Commerce Commission prosecutions are open to the public, and often reported in the media.

We’re here to provide expert legal advice using our specialist  knowledge in competition and consumer protection matters, along with significant experience assisting clients to respond to Commerce Commission investigations. We will help gather the right information and present it in a way to protect your business. We can also assist with negotiations with the Commerce Commission.

Anti Money Laundering (AML/CFT) Risk Assessment and Policy Writing

In addition to competition and consumer protection, certain businesses must also comply with New Zealand’s AML/CFT laws. The purpose of these laws is to prevent money laundering and terrorism financing. That may sound like something that only happens overseas, but the Financial Action Task Force estimates that between $100 billion and $250 billion is laundered each year in New Zealand. And in the first half of 2023, the New Zealand police reported that they had investigated 93 money laundering cases, resulting in 63 prosecutions and $8.7 million in fines and forfeitures.

Is your business affected? There are many industries and small to medium businesses that must comply with AML/CFT Legislation in New Zealand. (Learn more here). You may be surprised to learn that your business is one of them.

If your business is captured by the AML/CFT laws, conducting a risk assessment and then developing and implementing an AML/CFT policy are critical to ensuring compliance with New Zealand law. Smith and Partners can help you conduct a risk assessment and develop an AML/CFT policy that meets your specific needs, taking into account the size and complexity of your business, the types of products and services you sell, and the risks posed by who your customers are and where they live.

Why Smith and Partners?

We understand that regulatory compliance can be a complex and challenging issue, which is why we offer a range of services to help you manage the process effectively. Our team of experts can provide practical and strategic advice to help you — including responding to Commerce Commission investigations, conducting AML/CFT risk assessments, and developing effective AML/CFT policies.

Regulatory compliance is a critical aspect of running a business in New Zealand, and it is essential to have professional legal support to manage the process effectively. By partnering with us, you’ll gain a trusted legal ally dedicated to your compliance success, allowing you to focus on what matters most – your business . Talk to expert business lawyer, Bret Gower today by phoning 09 837 6893 or email him at bret.gower@smithpartners.co.nz.