The construction sector is a major driver in New Zealand's economy. Overseas experience indicates this sector can be susceptible to cartel or price fixing conduct due to the structure of many construction markets. Below are some tips to help you to understand and comply with competition and consumer laws.

Tips for complying with competition law

  • Make independent pricing decisions.
  • Do not agree prices, discounts or any matters relating to price with your competitors (unless it is a specific sub-contract you are discussing).
  • Think carefully about who you are, or may be, in competition with, especially if sub-contracting is involved.
  • Do not exchange pricing information with your competitors.
  • If you are approached by another business to discuss pricing, allocating customers, bids for contracts, or restricting outputs, raise an objection straight away. Leave the discussion immediately.
  • Avoid agreements that could result in a substantial lessening of competition in a market, for example, agreements that significantly reduce others’ ability to compete effectively in the market.
  • If you are considering entering a joint bid with a competitor, seek legal advice.
  • Familiarise yourself with the key provisions of the Commerce Act
  • Review your internal documents, policies and procedures for compliance with the Commerce Act.
  • If you become aware of anti-competitive conduct, contact us straight away.

Read more about avoiding anti-competitive behaviour.

Four things you need to know about consumer law

Misleading your customers is illegal

The main purpose of the Fair Trading Act is to protect consumers. You must not mislead your customers or give them false information. But remember, businesses buy goods and services too, so businesses are also protected.

Customers must be able to rely on your quotes and estimates

Providing quotes or estimates to your potential customers is a key part of doing business. A quote is an offer to do a job for a certain price. It's likely to be misleading if you charge more than your quote, unless you have explicitly agreed a variation with your customer beforehand.

Misleading consumers about their rights is illegal

You must not mislead your customers about their contractual or legal rights. For example, if an insurance company advises a customer “you’re only entitled to a second-hand hot water cylinder” in a situation where the customer’s insurance policy entitles them to a new hot water cylinder, this would likely be misleading.

Unfair contract terms

If you offer standard form consumer contracts to your customers, terms in that contract must be fair. Standard form consumer contracts are typically contracts with standard terms and conditions that are offered on a “take it or leave it basis” where the consumer does not have an opportunity to effectively negotiate the terms and conditions in the contract.

Read more about your obligations as a business