THE

CAPITAL
LETTER
A weekly review of administration, legislation & law
TOURISM GROWTH AND Thirty years ago a burgeoning environmental protection movement focused
THE ENVIRONMENT on protecting native forests from logging in South Westland where for
REPORT many people this was their economic livelihood. Tourism was put forward
as an alternative. Today, that tourism risks becoming an extractive
- 21 January 2020 industry endangering the natural environment. This is the example given
by Parliamentary Commissioner for the Environment, Simon Upton, in his
report released late last year, Pristine, popular ... imperilled? The
environmental consequences of projected tourism growth (December 2019,
150 pp, www.pce.parliament.nz.

International tourism is now New Zealand's biggest export earner (20.6

percent of total earnings, having overtaken the dairy sector in 2017)
and international visitor numbers have grown from one million in 1993 to
almost 3.9 million in 2019, with some projections that it could rise to
10-13 million annually by 2050. But, as the Commissioner points out,
"the lion's share of tourist activity actually involves New Zealanders
taking a break." After a chapter recounting the history of tourism in NZ
(with heavy Government involvement from the outset in the 1840s, leading
to dispossession of Maori land, increased pressure on biodiversity as
rail, roads and other infrastructure was created, and the deliberate
introduction of destructive exotic plants and animals) the report is
arranged around six pressures on the environment from increasing tourism
activity. These are visitor density and loss of solitude (keenly sought
by many overseas visitors from overcrowded countries); water quality
degradation, solid waste generation and management; infrastructure
development and landscape modification; biodiversity loss and
biosecurity risk; and greenhouse gas emissions (particularly those
associated with international air travel). The report notes that
currently, we have no systematic way of quantifying the environmental
and cultural impacts of tourism. Tourism "is so much the part of the
fabric of the entire economy that pressures exerted in many locations
are virtually indistinguishable from the functioning of society itself".

Discussing the response to growing environmental pressure and changing

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perceptions of recent tourism growth, the report suggests that "most
policies have limited capacity to decouple tourism activity from the
environment and in some cases, such as geographic dispersal, may
actually exacerbate environmental pressures." Policies supporting
value-led growth are unlikely to work unless accompanied by policies
aimed at reducing the volume of visitors. The report then analyses how
tourism-related environmental pressures could evolve in a
business-as-usual future (if all else remains the same). This does not
make for comfortable reading. The report comments that some far-sighted
choices are needed to ensure sustainability in the sector but notes
"none of those interviewed in the course of this investigation saw any
limits to growth. At most, a variety of ways to deflect those pressures
were offered." The Commissioner is now seeking feedback on this report
before following up with a second report to elaborate on policy options
that should be debated.
The report follows the refreshing established pattern of reports from
Commissioners for the Environment not engaging in hyperbole to make a
point. It is all the more powerful for it. Sleep walking along the
business-as-usual approach will have disastrous consequences for our way
of life.
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THE COURTS LETTER

ACCIDENT COMPENSATION In ROCHE PRODUCTS (NZ) LTD v AUSTIN [2019] NZCA 660 per Kós P, Brown and
- COVER Goddard JJ (18/12/2019) the CA allowed an application to strike out A's
- TREATMENT INJURY claim for compensatory damages which had been refused by an AJ in the HC
- MEDICATION judgment, [2018] NZHC 208, 41 TCL 7/3, on the ground that there was
- LIMITATION inadequate evidence to decide whether the claim should be struck out
- BODILY INJURY (the application had been removed into the CA). A's claim arose from
- MEDICATION TAKEN taking a RPL medication (Ruaccutane) for his acne condition which had
- APPRECIATION OF resulted in A suffering major spinal problems requiring surgeries over a
EFFECT number of years. The CA first addressed the question whether the claim
for both compensatory and exemplary damages was barred by Limitation Act
1950, s 4(7), and held that it was arguable that the limitation period
did not start to run until A was aware of the role of Ruaccutane in his
spinal problems (consideration of whether this would satisfy the rule in
Searle required full evidence). The submission that the CA should
overturn Searle & Co [1996] 2 NZLR 129 (CA), 19 TCL 15/8, was rejected:
(1) the SC had had the opportunity to do so in Murray v Morel [2007]
NZSC 27, 30 TCL 17/9, but had refused that invitation, and (2)
Parliament did not change the relevant law applying to the transitional
period before the 2010 Act becomes fully operational when it enacted the
Limitation Act 2010 (acknowledging there were limits - specified - on
those reasons). On the issue of whether A's claim for compensatory
damages was barred by the AC Act 2001, s 317, the CA noted that A had in
fact been paid weekly compensation for two years after he filed an ACC
claim in 2015. The social contract established by the ACC regime was
that the s 317 bar was coextensive with cover granted (McGougan [2018]
NZCA 91, 41 TCL 15/2; Davies [2009] NZSC 47, 321 TCL 21/7, also noted).
The AJ refused to strike out A's compensatory damages claim because he
considered that A was entitled to pursue an arguable issue that his
spinal damage was an "ordinary consequence" of taking Ruaccutane. The CA
held that A's case did not raise any arguable issue on the boundary of
ordinary consequence, unlike ACC v Ng [2018] NZHC 2848, 41 TCL 46/1, due
for CA hearing in 2020 (arguments were rejected that (a), based on the
exclusion of clinical trials for manufacturers' profit in s
32(6)(a)(ii), that "treatment injury" did not extend to actions by drug
manufacturers distributing defective drugs - "extravagant", (b) supply
of pharmaceuticals on prescription gave cover for prescribing doctors
but not manufacturers - inconsistent with the policy of the act and
lacking any support in the act's provisions, (c) supply of Ruaccutane
was a "service" not a "treatment" - s 32 intended to cover provision of
medication by an appropriately qualified health practitioner including a
pharmacist howsoever delivered (Accident Compensation (Definitions) Regs
2019, reg 7, noted). The CA struck out A's claim for compensatory
damages while reserving leave for A to file an amended statement of
claim covering his taking Ruaccutane prescribed for his son not for him.
Costs ordered to lie where they fell. (56 paras)

CONTRACT In LING v NORTHWEST DEVELOPMENTS LIMITED [2019] NZCA 630 per Courtney,
- SALE AND PURCHASE Duffy and Wylie JJ (10/12/2019) L appealed unsuccessfully from the HC
OF LAND IN PROPOSED decision, [2019] NZHC 1023, 42 TCL 21/2, granting NDL specific
SUBDIVISION performance of a contract for the sale and purchase of land that was
- CANCELLATION part of a proposed subdivision by NDL. The contract contained a sunset
- RESOURCE MANAGEMENT clause permitting either party to cancel if title was not issued by a
- REVISED SURVEY PLAN certain date. NDL had submitted a revised survey plan (Resource
- SPECIFIC Management Act 1991, ss 223 and 224) after difficulties in obtaining
PERFORMANCE OF consent from neighbours and L cancelled claiming the extension of time
PURCHASER UPHELD obtained by NDL was invalid and the resulting revised survey plan was
not the same. The CA held that in "the context of the sale and purchase
agreement as a whole and the known process for the issuing of titles, a
reasonable person would unquestionably treat a revised "Plan of
Subdivision" submitted to the Auckland Council and to LINZ for approval
as to survey as being "the survey plan" for the purposes of the sunset
clause. (37 paras)

EVIDENCE In GR EENBAUM v SOUTHERN CROSS HOSPITALS LTD [2019] NZSC 146 per
- CONFIDENTIALITY Winkelmann CJ, Glazebrook and O'Regan JJ (13/12/2019) the SC refused
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- PROCEDURE leave to appeal from the CA judgment [2019] NZCA 438, 42 TCL 36/4, which
- DISCOVERY had dismissed his appeal from the HC judgment [2018] NZHC 1273 refusing
- NON-PARTY G non-party discovery. G was seeking evaluative material from Waikato
- SENIOR COURTS DHB and W relating to the way they dealt with references on his request
- APPEAL TO SC for credentialing as a surgeon (a) compared with the way they dealt with
- INTERLOCUTORY applications by others and (b) on G's particular application, in his
DECISION claim for damages. The SC did not see G's case as providing an
opportunity for more general guidance, nor did it see any prospect of a
miscarriage of justice arising if leave were not granted (the case did
not raise any issue of principle in relation to s 69, which is clear in
its terms, albeit that it requires a court to undertake a difficult
exercise of balancing different public interests and determining the
appropriate outcome). Nor was the test in Senior Courts Act 2016, s
74(4), that hearing the appeal was necessary in the interests of
justice, met. (14 paras)

INCOME TAX In CO MMISSIONER OF INLAND REVENUE v ROBERTS [2019] NZCA 654 per
- CHARITABLE TRUST Clifford, Goddard and Stevens JJ (17/12/2019) the CA dismissed the CIR's
- FORGIVENESS OF DEBT appeal from the HC decision [2018] NZHC 2153, 41 TCL 36/6, which had
- DEDUCTABILITY allowed R's challenge to the CIR's assessment requiring repayment of tax
refunds previously made for charitable donations consisting of forgiving
parts of a debt owed by the charity to R for money she had previously
lent to it. The CA considered definitions of "pay" and "money" in the
Income Tax Act 2007, s YA 1, the common law meaning in a tax context of
those words and of "monetary" and "money's worth", and definitions in
both legal and general dictionaries and "Laws of NZ". It concluded that
the words "monetary" and "money" in ITA 2007, s LD 3(a) had the wider
meaning (B) in "Laws of NZ" that the words included "not only actual
cash but also a right to receive cash, such as sums standing to the
credit of a bank account, or invested in securities" (that meaning
accorded with the CIR's long-standing acceptance of such actions as
payments). The view of Cooke J in Mills [1983] NZLR 154 (CA), was
distinguished and that of Richardson J in the same case adopted. When
the CA considered legislative history and officials' views on the scope
of the charitable rebate it rejected the latter views: "Having carefully
considered the legislative history described above, we are satisfied it
provides no support for the interpretation of "monetary" or "money"
contended for by the Commissioner. Comments in reports by officials
about "cash" do not assist the Commissioner when that is not the wording
of the statute, and the term appears to have been used in a broad sense
and by way of contrast with gifts of goods and services. The task of the
Court is to interpret the words used in the statute, not paraphrases,
and in particular imprecise paraphrases, used in discussion papers and
officials' reports. We should add that comments by officials, unless
they form part of the parliamentary record, are not an especially
reliable, or orthodox, form of legislative history." (68 paras)

PROCEDURE In CHRISTIE v FOSTER [2019] NZCA 623 per French, Lang and Mander JJ
- PROTEST TO (5/12/2019), proceedings involving a protest to jurisdiction (Republic
JURISDICTION of Ireland or NZ) in the context of a family dispute between siblings
- NZ OR IRISH COURTS over their late mother's will - the mother had been domiciled in Ireland
- NZ PROPERTY and the estate contains assets situated in both Ireland and NZ. The
- FAMILY DISPUTE appellants are the Irish executors of the will. F, who lives in NZ,
- MOCAMBIQUE RULE alleged undue influence of the mother by one of F's other two siblings
MISAPPLIED resident in Ireland, in relation to the mother severing joint tenancies
- EXCEPTIONS with F of two NZ properties (thus removing F's claim to them by
INAPPLICABLE survivorship). The CA overturned the HC decision, [2018] NZHC 3103, 42
TCL 4/6, in relation to F's claim of undue influence and her application
to set aside C's notice of objection to jurisdiction (HC r 5.49) in
respect of that claim. The CA held that the HC erred in finding only a
NZ court had jurisdiction to determine F's claims relating two NZ
properties, by considering itself bound to apply the common law
"Mocambique rule" (that the English courts have no jurisdiction in
proceedings primarily concerned with title to immovable property
situated outside England) on the basis it applies "both ways". The CA
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commented that criticisms of the Mocambique rule as an anomalous

historic relic "appear to be well founded" but this was not the case to
decide this, as the rule has only ever applied to foreign land and not
to land situated in NZ (rejecting the HC "both ways" interpretation).
The CA held that the HC misapplied the rule because when applied by NZ
courts it only governs concerning land in a foreign country, not land in
NZ, and, in any event F's claims are within the established exceptions
to the rule ("in personam" and "administration of an estate"). F's
equitable estoppel and constructive trust claims (based on alleged
promises by the mother to F) fall squarely within the in personam
exception. So too did the undue influence claim that was also
misconceived, having the fundamental difficulty that a joint tenant has
a right to unilaterally sever the joint tenancy at any time. The
question arose how the doctrine of undue influence could be used to
impeach an otherwise indefeasible legal title where the registered
proprietor of the legal title was not the influencer but the very person
whose will it is alleged has been overborne, and who benefited from the
transaction (acquiring a property right) and the influencer did not
benefit, at least in a direct way (her benefit deriving from the will).
F's claim of undue influence did not contain all three requirements
(endorsed in Nathan v Dollars & Sense Finance Ltd [2007] 177, 30 TCL
17/6), in particular, no unconscionable conduct by the mother or her
agent. Thus, the severance of the joint tenancies could not have been
challenged on the grounds of undue influence during the mother's
lifetime, and there is no available challenge against her estate. The
proper target of any undue influence claim is the will. The CA also held
that the HC view that the administration of an estate exception to the
Mocambique rule did not apply as F's claim was in relation to land, not
the estate, was unsustainable. Under the Administration Act 1969, s 71,
probate granted by the HC of Ireland can be re-sealed in enabling the
Irish executors to register a transmission of the mother's half share
into their names despite F's caveat on the titles. On the cross-appeal,
the CA held that independently of the Mocambique rule, the HC should not
have held the Irish Courts did not have jurisdiction. An Irish court
would have the ability to grant F an effective remedy through their
control of the executors. Overall justice required the proceedings be
tried in Ireland as separate proceedings in NZ were not necessary nor
desirable. (139 paras)

SENIOR COURTS KI COMMERCIAL LTD v CHRISTCHURCH CITY COUNCIL [2019] NZCA 645 per Kós P
- RECUSAL and Gilbert J (13/12/2019), a judgment refusing to recall a judgment
- EFFECT OF FAILURE [2017] NZCA 480, 42 TCL 41/2, refusing leave to appeal from the HC
TO RECUSE judgment [2017] NZHC 1076, 40 TCL 23/2, dismissing KI's appeal from the
- REMEDIES EnvC, may be noted for rejecting the submission that the HCJ should have
- JUDGE PREVIOUSLY recused herself because both before and after she had become a partner
PARTNER OF FIRM of a firm of solicitors the firm had acted against KI's corporator and
- FIRM HAD ACTED KI's parent company: the HCJ's recusing herself in two matters related
AGAINST PARTY'S, to the instructions in which her firm had sued KI's corporator for fees
COMPANY'S INTERESTS did not imply that she should have recused herself in this litigation
(the circumstances were very different from the first two as were the
issues). "This is tenuous stuff indeed." In any event, (1) failure to
recuse where there should have been recusal in a court of record does
not make the substantive decision a nullity but only raises possible
prospective invalidity, (2) the remedy for that failure was
discretionary and would not have been granted here ([2017] NZCA 480 had
found that there was no merit in the substantive grounds of appeal so,
even were there bias, it caused no miscarriage of justice), and (3)
remission to the panel whose decision had been the subject of [2017] NZC
480 could not occur as it had been disbanded and new decision-makers
substituted by statute. (20 paras)

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GENERAL REVIEW LETTER

CLIMATE CHANGE The following independent expert advisors on future emission reductions
COMMISSION have been appointed to the Climate Change Commission (in addition to Dr.
- APPOINTMENTS Rod Carr, who was appointed as the Chair-designate for the Climate
- INDEPENDENT EXPERT Change Commission in October, and Ms. Lisa Tumahai will continue in her
ADVISORS role as Deputy Chairperson): Dr. Harry Clark, a New Zealand expert on
agricultural greenhouse gas research; Dr. Judith Lawrence, a thought
leader with international expertise in climate change adaptation;
Ms. Catherine Leining, a leading New Zealand economist on climate policy
and emissions pricing systems; Professor James Renwick, a leading
climate scientist and a recipient of the Prime Minister's Science Prize
for Communication; and Professor Nicola Shadbolt, a farmer, company
director and academic, with expertise in land use and land use change.
The Commission will pick up the work started by the Interim Climate
Change Committee, which was appointed in May 2018. (Minister for Climate
Change, James Shaw, media release, 17/12/2019.)

CLIMATE CHANGE New Zealand's Fourth Biennial Emissions Report projects New Zealand's
- NET EMISSIONS net emissions in 2030 to be nearly 10 per cent lower than previous
PROJECT projections in the Third Biennial Report. The decrease in projected
- FOURTH BIENNIAL emissions can be attributed to the One Billion Trees policy, more
REPORT sustainable farm management practices, and reduced energy use combined
with less carbon-intensive fuels. "One way to think about this report is
as a useful summary of exactly where we are starting from now that our
Zero Carbon Act has passed through Parliament." (Minister for Climate
Change, James Shaw, media release, 19/12/2019.)

CLIMATE CHANGE New Zealanders are being asked to have their say on two important policy
- POLICY DECISIONS decisions. The first of these asks for feedback on proposed changes to
- PROPOSED CHANGES TO the Emissions Trading Scheme to ensure major polluters are paying their
THE EMISSIONS fair share and taking action to reduce emissions. As part of this, views
TRADING SCHEME are sought on a provisional emissions budget for the period 2021-2025.
- BOOSTING RENEWABLE The second is a discussion document, Accelerating renewable energy and
ENERGY GENERATION energy efficiency, on plans to boost renewable energy generation and
- CONSULTATION energy efficiency. Both consultations close on 28/2/2020. (Minister for
Climate Change James Shaw and the Minister for Energy and Resources
Megan Woods, media statement, 19/12/2019.)

ECONOMY The terms of reference for an Inquiry into the economic contribution of
- FRONTIER FIRMS New Zealand's frontier firms have been approved. Frontier firms are the
- INQUIRY INTO most productive firms in the domestic economy within their own industry.
ECONOMIC "These firms are important as they diffuse new technologies and business
CONTRIBUTION practices into the wider New Zealand economy. While we do have some
- PRODUCTIVITY world-leading firms, we need them to lift performance and productivity
COMMISSION to create a pathway for more firms to succeed on the world stage." Work
undertaken by the Productivity Commission in 2016 suggested that New
Zealand's firms were on average, about one-third less productive than
international firms in the same industry. The Commission will lead the
inquiry to identify ways to maximise the performance of these firms and
lift their contribution to the economy. Final reports are due to be
delivered to ministers early next year. (Finance Minister Grant
Robertson, media release, 11/1/2020.)

EDUCATION The members of Te Taumata Aronui, a group to work with Government on

- TERTIARY tertiary education policy from a Māori community and employer
- MAORI VOICE perspective, have been announced. "Te Taumata Aronui will help develop
our tertiary education system, including through the Reform of
Vocational Education, so that it better supports the aspirations, and
reflects the needs, of Māori learners, communities and employers. Māori
are significant employers with social and economic goals, with an
estimated national Māori asset base valued at over $50 billion. This is
particularly important for regional New Zealand, and for primary and
export sectors." Te Taumata Aronui members are Professor Wiremu Doherty,
Maru Nihoniho (MNZM), Te Ahukaramū Charles Royal, Mereraina Piripi, Dr
Eruera Prendergast-Tarena, Brendon Green, Mamaeroa Merito, and Dr Wayne

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Ngata who will chair the Group. (Education Education Minister Chris
Hipkins, media statement, 16/12/2019.)

ENVIRONMENTAL Greg Ryder has been appointed as a member of the Environmental

PROTECTION Protection Authority Board, for a term commencing 1/2/2020 and expiring
AUTHORITY BOARD on 30/6/2022. (NZ Gazette, 18/12/2019.)
- APPOINTMENT

LAW COMMISSION The Law Commission has announced the terms of reference for two
- SUCCESSION LAW projects. The review of succession law will consider who should be
- CLASS ACTIONS AND entitled to claim property despite what the deceased said in their will
LITIGATION FUNDING or when the deceased has died without a will. It will include
- REVIEWS consideration of the Property (Relationships) Act 1976, Family
Protection Act 1955, Law Reform (Testamentary Promises) Act 1949 and
Administration Act 1969, and the Comission will report to the Minister
with recommendations by the end of 2021. The review into class actions
and litigation funding in NZ will consider whether, and to what extent,
class actions and litigation funding are desirable in NZ, and what rules
should govern any class actions and litigation funding regime. A
detailed consultation document is expected in 2020. (Law Commission,
media release, 18/12/2019.)

PUBLIC TRUST BOARD The following have been appointed to the Public Trust Board: John Ross
- APPOINTMENTS Duncan as Deputy Chair and member from 1/2/2020 to 31/10/2021; and
Meleane Debra Burgess and Kevin James Murphy as members from 1/2/2020 to
31/10/2022. (NZ Gazette, 9/1/2020.)

RESERVE BANK Fiona Mules has been appointed as a Director of the Reserve Bank of New
- APPOINTMENTS Zealand from 9/2/2020 to 8/2/2020, and Professor Neil Clayton Quigley
has been reappointed as Chair and Director of the Reserve Bank of New
Zealand from 1/2/2020 to 12/3/2022. (NZ Gazette, 9/1/2020.)

RESERVE BANK The latest Cabinet decisions from Phase 2 of the Review of the Reserve
- REVIEW OF ACT Bank Act include greater powers to monitor banks and hold directors and
- PHASE 2 executives more accountable for their actions; introducing deposit
- DEPOSIT INSURANCE insurance of $50,000 per institution (more than 90% of depositors will
SCHEME likely be fully covered, with many of the others having most of their
- LEGISLATIVE deposits covered - consistent with international best practice); a
PROPOSALS Governance Board to oversee financial stability matters with a Financial
Policy Remit setting out matters the Board must have regard to when
pursuing the Reserve Bank's financial stability objectives); and
measures to increase transparency at the Reserve Bank, including more
oversight for the Auditor-General and the Ombudsman. The Government's
proposed changes incorporate lessons from the Australian Royal
Commission into banking including an in-principle decision to follow
recent reforms in Australia to strengthen director and executive
accountability. (Finance Minister Grant Robertson, media release,
8/12/2019.)

REVENUE Legislation will be introduced to clarify the law regarding donation tax
- GIFTING DONATION credits following the Court of Appeal decision in Commissioner of Inland
TAX CREDITS Revenue v Roberts that found donation tax credits are available for
- CLARIFYING gifts made by way of debt forgiveness. This is contrary to the policy
LEGISLATION TO BE intent that donation tax credits and gift deductions are limited to
INTRODUCED gifts of cash or cash equivalents such as payments made by bank
transfers, credit card or cheques. The proposed legislative change would
confirm that donation tax credits and gift deductions would not be
available for gifts to donee organisations where they are made by way of
debt forgiveness. It would apply retrospectively to 1 April 2008, being
the commencement date of the Income Tax Act 2007. However, a savings
provision would apply to taxpayers who have already taken a position in
reliance on the current legislation and have filed a return or donation
tax credit claim before the date of this announcement. (Revenue Minister
Stuart Nash, media release, 17/12/2019.)

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STATE SERVICES The Crown has adopted a new strategy for resolving historical claims
- HISTORICAL CLAIMS arising from abuse in state care following a review of the historical
- NEW RESOLUTION claims resolutions approach directed by Cabinet as part of its
STRATEGY commitment in April 2019 to six principles guiding the Crown's response
to the Abuse in Care Inquiry. These are: manaakitanga, openness,
transparency, learning, being joined up and meeting our obligations
under Te Tiriti o Waitangi. The new Crown Resolution Strategy updates
the current approach in several ways, including: being more transparent
about what claimants can expect from the Crown; giving claimants the
right to involve whānau, hapu, iwi and community in the resolution
process; following settlement of a claim, being explicit that new or
additional material information that a claimant becomes aware of can
then be considered by the Crown; when claimants choose to litigate
in court, the Crown will concede any factual matters that it doesn't
dispute; and explicit inclusion in the Crown Resolution Strategy of
the six principles guiding the Crown's response to the Abuse in Care
Inquiry. Further work is being done on two other areas of concern to
claimants - producing options for central assessment or review of
historical claims and reforming the Limitation Act, which sets time
limits for historical claims. (State Services Minister Chris Hipkins and
Attorney-General David Parker, media release, 17/12/2019.)

TE PAPA TONGAREWA The following have been appointed to the Museum of New Zealand Te Papa
BOARD Tongarewa Board: Andy Lowe, of Palmerston North, and Cameron Harland, of
- APPOINTMENTS Wellington from 2/12/2019 to 30/11/2022. (NZ Gazette, 17/12/2019.)

TRANSPORT Transport Police will be given new powers to conduct random roadside
- ROADSIDE DRUG oral fluid drug testing to deter, detect and prosecute drugged drivers.
TESTING "Last year 95 people were killed in preventable crashes where the driver
- LEGISLATION was found to have drugs in their system that could impair driving ...
PROPOSED The change will allow Police to test drivers for the presence of drugs
and impairing medication anywhere, any time, just as they can for
alcohol. Drivers who test positive for the presence of drugs will be
fined and immediately suspended from driving for a minimum of 12 hours.
Drivers will also face criminal penalties if they fail a compulsory
impairment test and blood tests confirm impairing levels of drugs in
their system. The threshold for a criminal offence will be aligned with
that for alcohol. This means a blood test that identifies impairing
medication or drugs at or above an amount equivalent to the criminal
drink driving limit (80mg of alcohol to 100ml of blood) will result in a
criminal offence. The oral fluid devices will initially test for THC,
methamphetamine, opiates, cocaine, MDMA (ecstasy), and benzodiazepines
which are the most prevalent and high risk drugs and medications used by
drivers in New Zealand. Police will continue to use the compulsory
impairment test to screen for other impairing drugs. Oral fluid tests
will check for some impairing prescription drugs. However, a medical
defence will be available in instances where people have taken
medication in accordance with their prescription. The government will
work with health practitioners to ensure patients are appropriately
warned if they should not be driving on their prescription. It is
intended to introduce a Bill early in 2020 to enable oral fluid drug
testing to begin in 2021." (Associate Transport Minister Julie Anne
Genter, media release, 18/12/2019.)

VENTURE CAPITAL FUND The Government has issued the Venture Capital Fund Policy Statement
- POLICY STATEMENT outlining the requirements for investments from the new $300 million
fund set up to support New Zealand firms as they expand beyond the
start-up phase. The statement accompanies the recently passed Venture
Capital Fund Act and provides high-level policy directions to the
Guardians of the New Zealand Superannuation Fund, which will oversee and
monitor the performance of the Fund. (Finance ministers, Grant Robertson
and David Parker, media release, 19/12/2019.)

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LEGISLATION LETTER

In the last sitting week for 2019 in the House, the Fair Trading
Amendment and Financial Markets Infrastructure bills were introduced.
The following bills were reported back from select committees: Education
(Vocational Education and Training Reform) Amendment, Electoral
Amendment, Smoke-free Environments (Prohibiting Smoking in Motor
Vehicles Carrying Children) Amendment, and Taxation (KiwiSaver, Student
Loans, and Remedial Matters). The following bills were referred to
select committees: Films, Videos and Publication Classification
(Commercial Video On-demand) Amendment, Infrastructure Funding
Financing, Land Transport (NZTA) Legislation Amendment, Land Transport
(Rail) Legislation, Secondary Legislation and Taumata Arowai - Water
Services Regulator. The following bills were read a third time:
Remuneration Authority (Members of Parliament) Remuneration Amendment
(No 2), Subordinate Legislation Confirmation (No 4), and Te Pire Kai
Unuhia Te Hara Kai Runga I a Rua Kenara/Rua Kenana Pardon.

ASSENTS The following bills were assented to on 13/12/2019 and commenced on

14/12/2019 unless otherwise stated:
73 FARM DEBT MEDIATION ACT 2019. Some provisions commence on 1/2/2020
and the rest commence on 1/7/2020.
74 NATIONAL ANIMAL IDENTIFICATION AND TRACING AMENDMENT ACT 2019
75 DOG CONTROL (CATEGORY 1 OFFENCES) AMENDMENT ACT 2019
76 VENTURE CAPITAL FUND ACT 2019
77 NEW ZEALAND SUPERANNUATION AND RETIREMENT INCOME AMENDMENT ACT 2019
The following bills were assented to on 19/12/2019 and commenced on
20/12/2019 unless otherwise stated:
78 EDUCATION (PASTORAL CARE) AMENDMENT ACT 2019
79 TERRORISM SUPPRESSION (CONTROL ORDERS) ACT 2019
80 MARTITIME TRANSPORT (OFFSHORE INSTALLATIONS) AMENDMENT ACT 2019.
Commenced on 1/1/2020.
81 CREDIT CONTRACTS LEGISLATION AMENDMENT ACT 2019. Commenced generally
on 20/12/2019 with some provisions to commence on date(s) to be
appointed by Order(s) in Council and any remaining provisions to
commence on 1/4/2021.
82 SUBORDINATE LEGISLATION CONFIRMATION ACT 2019
83 REMUNERATION AUTHORITY (MEMBERS OF PARLIAMENT REMUNERATION) AMENDMENT
ACT 2019
The following bill was assented to on 21/12/2019 and commenced on
22/12/2019:
84 TE TURE KIA UNUHIA TE HARA KAI RUNGA I A RUA KENANA 2019 RUA KENANA
PARDON ACT 2019

NEW BILL The FAIR TRADING AMENDMENT BILL (Government bill, 21 clauses, introduced
- FAIR TRADING on 17/12/2019) would address gaps in legislative practices against
AMENDMENT unfair practices by prohibiting unconscionable conduct in trade, and
extending the Act's existing protections against unfair contract terms
in standard form consumer contracts to also apply to small trade
contracts (actual or expected total value of less than $250,000 in any
12-month period). It would also strengthen the ability of consumers to
require uninvited sellers to leave or not enter their proper, including
through the use of generally worded written notices.

NEW BILL The FINANCIAL MARKETS INFRASTRUCTURES BILL (Government bill, 159
- FINANCIAL MARKETS clauses, introduced on 17/12/2019) would establish a new regulatory
INFRASTRUCTURES regime for financial market infrastructures (FMIs), multilateral systems
that provide trading, clearing, settlement, and reporting services for
payments, security derivatives and other financial transactions.

BILL REPORTED BACK The report of the Education and Workforce Committee on the EDUCATION
- EDUCATION (VOCATIONAL EDUCATION AND TRAINING REFORM) AMENDMENT BILL (that seeks to
(VOCATIONAL create a unified and cohesive vocational education training system, 42
EDUCATION AND TCL 33/8) was presented on 23/12/2019 with the majority recommendation
TRAINING REFORM) it be passed with amendments. These include to the interpretation
AMENDMENT section, including to limit the NZ Institute of Skills and Technology
(NZIST) subsidiaries to those that provide education or training, or
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both; the provisions establishing the NZIST as a tertiary institution,

alongside universities and wananga, in respect of functions,
administrative regions, academic freedom (to ensure the right balance is
recognised between ensuring academic freedom and the carrying out of
workforce development (WDC) functions), council membership, and
formation of subsidiaries; add a power for NZ Qualifications
Authority (NZQA) to make rules that prescribe matters about training
packages; in relation to apprenticeships, to expand the definition
of "training package" and amend the definintion of "work-based training"
to include reference to assessment; workplace development councils,
in respect of establishment and disestablishment, functions, duties, and
audit requirements; apprenticeships - activities and
obligations; training levies; and transitional provisions. The
National Party minority acknowleges select committee improvements to the
bill but will not support it. It remains "unconvinced that regional
autonomy will be maintained simply by reference to the NZIST functions
and to the NZIST charter." It disagrees with the bill's intention to
disestablish industry training organisations and distribute their
standard-setting functions to workforce development councils (WDCs) and
the arranging of training functions to the NZIST. It has "grave concerns
for the risks that the reform will not be successful."

BILL REPORTED BACK The report of the Justice Committee on the ELECTORAL AMENDMENT BILL
- ELECTORAL AMENDMENT (that would make changes including to allow voters to enrol on day and
enable voting to take place in a wider range of venues, 42 TCL 29/9) was
presented on 19/12/2019 with the committee unable to agree on whether to
recommend the bill be passed but with the unanimous recommendation the
House adopts the following amendments if the bill proceeds. These
include to make it clear that ballot boxes should be accompanied at all
times by polling place officials; and in relation to managing
disruptions on election day that could lead to the adjournment of
polling (including when the Chief Electoral Officer would release
preliminary results). The report also includes discussion of matters
raised by submitters that are outside the scope of the bill - prisoner
voting, foreign donations and reducing the voting age (noting that these
issues were considered in the course of the committee's Inquiry into the
2017 General Election and 2016 Local Elections (42 TCL 48/1). The
National Party minority view is that NZ's "lack of a written
constitution requires that Governments show restraint in advancing
electoral law changes without strong cross-consultation and engagement."
The National Party does not support same-day enrolment and voting on
Election Day (it does not believe that "99 percent who did enrol should
face the cost and uncertainty of delay for less than 1 percent who did
not bother to enrol", it considers there will be no incentive or need to
enrol, and it is reasonable that candidates know who has enrolled so
they can communicate their policies to them). Neither does it support
increased flexibility around polling booth location.

BILL REPORTED BACK The report of the Health Committee on the SMOKE-FREE ENVIRONMENTS
- SMOKE-FREE (PROHIBITING SMOKING IN MOTOR VEHICLES CARRYING CHILDREN) AMENDMENT BILL
ENVIRONMENTS (that would prohibit smoking in motor vehicles carrying anyone under 18
(PROHIBITING years old, 42 TCL 23/10) was presented on 16/12/2019 with the
SMOKING IN MOTOR recommendation it be passed without amendment. The report discusses why
VEHICLES CARRYING good submissions received were not incorporated due to the bill's narrow
CHILDREN) AMENDMENT focus. These included recommendations to include vaping on the same
basis as smoking (a bill to be introduced soon to incorporate vaping
into the Smoke-free Environments Act); remove the exemption for smoking
in a stationary vehicle being used as a dwelling; and reduce or
remove the 18 month lead-in period(Police needing at least 12 months to
incorporate this new offence). The committee notes that there is no
requirement for submitters to disclose any interests they may have in a
particular issue (a possible conflict of interest with a submitting
organisation that researches the effects of smoking on indigenous
populations apparently being funded, through a secondary organisation,
by the tobacco industry, subsequently drawn to its attention) but draws
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to the attention of the House the possibility of similar conflicts in

future submissions, and that it intends to write directly to the
Standing Orders Committee to seek its consideration of the issue.

BILL REPORTED BACK The report of the Finance and Expenditure Committee on the TAXATION
- TAXATION (KIWISAVER, STUDENT LOANS, AND REMEDIAL MATTERS) BILL (that would amend
(KIWISAVER, STUDENT the KiwiSaver Act 2006, the Student Loan Scheme Act 2011 and other
LOANS, AND REMEDIAL taxation-related Acts and regulations, 42 TCL 26/11) was presented,
MATTERS) along with Supplementary Order Paper No 293 (that would allow people
with life-shortening congenital conditions to withdraw their KiwiSaver
funds before age 65), on 18/12/2019 with the recommendation it proceed
with amendments. They include, to the KiwiSaver amendments, to defer the
application date of the provision allowing KiwiSaver members to change
their contribution rate by giving notice to their scheme provider to
IRD, to give IRD more time to consult on how to reduce associated
compliance costs for employers; and remove the requirement for employers
to provide information on existing employee's ESCT rates. Amendments
proposed to the student loan regime to repeal the requirement due to
take effect on 1/4/2020 for student loan deductions to be taken from
schedular, election-day, and casual agricultural income payments as this
would impose significant compliance costs on employers outweighing the
benefits; and to lower from $1500 to $500 the exemption threshold
for self-employed persons to make student loan repayments. Other
recommended amendments include to clarify the withholding rules for
custodial institutions and relax the reporting rules for overseas
custodial institutions; to the research and development tax credits
regime, to allow entities that derive small amounts of exempt income to
claim the tax credits, and to provide large businesses with some
certainty over receiving research and development tax credits by all
businesses that opt into the significant performer regime to complete
the criteria and methodologies approval process; to the PIE tax
provisions to introduce an end-of-year reconciliation for all investors
in multi-rate PIEs to take effect from the 2020/21 tax year (to address
the inequitable tax treatment arising from overpaid PIE tax in the last
tax year due to the large number of people on the incorrect PIE tax
rate), and give the Commissioner the power to instruct the PIE directly
to change the rate of tax applied to an investor when they believe they
are on the wrong rate. The National Party minority considers that
refunds on overpaid on KiwiSaver accounts should apply from the 2018/19
year onwards and the Government should make the required legislative
amendment, and is also "disappointed that the extension of refundability
for the research and development tax incentive for small firms will not
help many early-stage firms."

SELECT COMMITTEES As at 20/1/2020, there remained time for submissions to be made on the
- BILL SUBMISSION following bills before select committees: Climate Change Response
DATES (Emissions Trading Reform) Amendment, 17/1/2020, Crimes (Definition of
Female Genital Mutilation) Amendment, 27/1/2020, Public Service
Legislation, Sexual Violence Legislation, 31/1/2020, Films, Videos, and
Publications Classification (Commercial Video On-demand) Amendment,
5/2/2020, International Crimes and International Criminal Court
Amendment, Land Transport (Rail) Legislation, Land Transport (NZTA)
Legislation Amendment, 7/2/2020, Racing Industry, 11/2/2020, and Asia
Pacific Economic Co-operation (APEC 2021), 12/2/2020.

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LI 2019/318 The LOCAL GOVERNMENT MEMBERS (2019/20) AMENDMENT DETERMINATION 2019 is

based on the changed approach to setting local government remuneration,
signalled previously, and is operational for the period following the
election of the local government representatives (from 13/10/2019 until
30/6/2020). Under that approach, the Remuneration Authority has created
a total governance remuneration pool for each council, reflecting the
ranking of that council on the appropriate council size index
(territorial authority, unitary authority, or regional authority).
Remuneration for mayors and regional council chairpersons was not
included in the pool but was set individually by the Authority in the
principal determination to reflect each council's ranking on the
appropriate size index position. A further determination is planned for
the first quarter of 2020. It will contain the outcome of the remaining
councils' recommendations.

LI 2019/319 The JUDICIAL OFFICERS SALARIES AND ALLOWANCES (2019/20) DETERMINATION

2019 sets the salaries and the allowances for the Judges of the Supreme
Court, the Court of Appeal, the High Court, the District Court, the
Employment Court, and the Māori Land Court. The Remuneration Authority
states that while "we note that Ministers are seeking to ensure that
remuneration practices of the State take into account their effect on
the distribution of income, the Authority has to act independently in
the application of its statutory obligations. Indicators and benchmarks,
including measures of income relativities, inform the Authority in its
determinations for the judiciary. Across the benches there has not been
strong evidence of a serious situation throughout 2018-19 in relation to
retention or recruitment to any particular bench as a result of the
current level of remuneration. However we may be at a turning point on
recruitment, as we have been advised by several benches of recent
indications from potential candidates that point to the relationship
between remuneration and recruitment as being at some risk of changing
in the coming year. The following 2 specific issues of recruitment have
emerged to have greater significance in the review this year: the need
to recognise a shift in the requirements of candidates for Tikanga
Māori; and the need to support the large-scale recruitment initiatives
to the District Court over the next few years, which will be put in
train shortly." A base increase of 1.5 % is applied to the remuneration
of a Judge of the High Court, and the equivalent dollar amount is then
applied as a fixed-sum increase to the remuneration of the Chief High
Court Judge and the Judges of the Court of Appeal and Supreme Court. The
salary of Judges of the District Court and Māori Land Court are
increased by 2.7% this year. Deemed to have commenced on 1/10/2019 and
expires on 30/9/2020.

LI 2019/320 The STATE-OWNED ENTERPRISES AMENDMENT ACT 2012 (SOLID ENERGY NEW ZEALAND
LIMITED) COMMENCEMENT ORDER 2019 brings into force, on 20/12/2019,
certain provisions of the State-Owned Enterprises Amendment Act 2012
that relate to Solid Energy New Zealand Limited that was removed from
the companies register on 2/8/2019.

LI 2019/321 The MISUSE OF DRUGS (MEDICINAL CANNABIS) REGULATIONS 2019 impose a

minimum quality standard for medicinal cannabis products and related
material and ingredients (Part 1); and provide for medicinal cannabis
licences that authorise various activities relating to medicinal
cannabis products and related material and ingredients (Part 2).
Commence on 1/4/2020.

LI 2019/322 The BIOSECURITY (READINESS AND RESPONSE - FRESH TOMATOES LEVY) ORDER
2019 imposes a levy on fresh tomatoes that are grown in NZ for
commercial purposes and sold in NZ or exported, payable to Tomatoes New
Zealand Incorporated. Fresh tomatoes grown for processing are excluded
from the order. Commences on 3/2/2020 and is revoked on 31/12/2020
unless earlier confirmed.

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LI 2019/323 The BIOSECURITY (READINESS AND RESPONSE - MEAT LEVY) ORDER 2019 imposes
a levy on beef and sheepmeat payable to Beef + Lamb New Zealand (BLNZ).
Commences on 1/3/2020 and is revoked on 31/12/2020 unless earlier
confirmed.

LI 2019/324 The BIOSECURITY (READINESS AND RESPONSE - CITRUS FRUIT LEVY) ORDER 2019
imposes a levy on citrus fruit payable to New Zealand Citrus Growers
Incorporated. Commences on 1/4/2020 and is revoked on 31/12/2020 unless
earlier confirmed.

LI 2019/325 The CONSERVATION (INFRINGEMENT OFFENCES) REGULATIONS 2019 prescribe the

forms to be used for infringement notices and reminder notices issued
under the Conservation Act 1987; and prescribe penalties for
infringement offences under the Conservation Act 1987. Commence on
3/2/2020.

LI 2019/326 The CONSERVATION (INFRINGEMENT OFFENCES IN REGULATIONS) AMENDMENT

REGULATIONS 2019 create infringement offences for contravention of a
number of listed conservation related regulations that will allow DOC
rangers (and, in some cases, Fish and Game rangers) to issue
infringement notices for those offences, rather than prosecute;
prescribe the forms to be used for infringement notices and reminder
notices, and penalties for infringement offences under the Marine
Mammals Protection Act 1978, the Marine Reserves Act 1971, the Trade in
Endangered Species Act 1989, and the Wildlife Act 1953. Commence on
3/2/2020.

LI 2019/327 The NATIONAL PARKS (INFRINGEMENT OFFENCES) REGULATIONS 2019 prescribe

penalties for infringement offences in the National Parks Act 1980 and
prescribe the forms to be used for infringement notices and reminder
notices issued under that Act. They also create infringement offences
for contravention of a number of bylaws made under the National Parks
Act 1980. Commence on 3/2/2020.

LI 2019/328 The RESERVES (INFRINGEMENT OFFENCES) REGULATIONS 2019 prescribe

penalties for infringement offences in the Reserves Act 1977 and
prescribe the forms to be used for infringement notices and reminder
notices issued under that Act. They also create infringement offences
for the contravention of a number of bylaws made under the Act. Commence
on 3/2/2020.

LI 2019/329 The WILD ANIMAL CONTROL (INFRINGEMENT OFFENCES) REGULATIONS 2019

prescribe the forms to be used for infringement notices and reminder
notices issued and prescribe penalties for infringement offences under
the Wild Animal Control Act 1977. Commence on 3/2/2020.

LI 2019/330 The LOCAL GOVERNMENT (OTOROHANGA DISTRICT COUNCIL) ORDER 2019 changes
the name of the Otorohanga District Council to Ōtorohanga District
Council. Commenced on 17/1/2020.

LI 2019/331 The LOCAL GOVERNMENT (OPOTIKI DISTRICT COUNCIL) ORDER 2019 changes the
name of the Opotiki District Council to Ōpōtiki District Council.
Commenced on 17/1/2020.

LI 2019/332 The LAND TRANSPORT (ALCOHOL INTERLOCK DEVICES) AMENDMENT NOTICE 2019
adds the Autowatch TAB 720 alcohol interlock to the list of approved
devices in the principal notice. Commenced on 16/1/2020.

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