Commerce Commission welcomes judgment on merits of its input methodology determinations

The Commerce Commission today welcomed a High Court judgment in relation to challenges against its December 2010 input methodologies decisions. The Court has dismissed all these appeals, ruling in favour of the Commission’s decisions on all but two relatively minor points out of at least fifty eight challenges.

Input methodologies set the upfront regulatory rules, processes and requirements under Part 4 of the Commerce Act, and underpin the regulation that applies to suppliers of electricity lines services and gas pipeline services, and specified airport services supplied by Auckland, Wellington and Christchurch airports.

“It is important for New Zealand’s regulated industries and the consumers of their services that there is certainty about the rules that govern prices, quality and information disclosure,” said Commerce Commission Chairman Dr Mark Berry.

“We are pleased that the Court has found in the Commission’s favour on almost all points. This has been a lengthy process, but an extremely important one as it signals a significant step forward in the maturity of New Zealand’s regulatory regime.

We will review Justice Clifford’s judgment in further detail over coming weeks.” 

The judgment and associated press summary is available on the Courts of New Zealand website at http://www.courtsofnz.govt.nz/front-page/cases/wellington-international-airport-ltd-ors-v-commerce-commission

Background

Input methodologies involve setting upfront regulatory rules, processes and requirements that apply to the regulatory instruments under Part 4 of the Commerce Act.

Input methodologies were determined by the Commission in December 2010, following a two year process with multiple rounds of consultation and workshops with interested parties. The input methodologies can be viewed on the input methodologies page on the Commission's website.

Part 4 of the Commerce Act regulates suppliers of electricity lines services and gas pipeline services, and specified airport services supplied by Auckland, Wellington and Christchurch airports.

Input methodologies High Court appeals

Twelve parties appealed against various aspects of the Commission’s input methodologies in February 2011. Three parties subsequently withdrew their appeals.

The appeals were heard in the High Court in September, October and December 2012, and in February 2013, over a total of 39 days.

The judgment was issued on 11 December 2013.  The Court has upheld all the Commission’s decisions except in two minor respects – one relating to Vector’s appeal as to when controlled prices may be reviewed and the other, the Airports’ appeal as to the date at which their land is to be valued for the first time under information disclosure regulation (refer paragraph [1950], page 635 of the judgment). Parties have until 14 February 2014 to seek leave to appeal the judgment.