On Sep. 16, NZ GVT reported on helping businesses get paid on time.
NZ GVT announced plans to add to the support it has offered New Zealand's small businesses by introducing new measures to help ensure they get paid on time.
Establishing business payment practices disclosure regime to improve information and transparency around business-to-business payment practices across the economy.
Over 97% of businesses in New Zealand are small businesses: late/overdue payments have a negative impact, causing unnecessary stress and uncertainty, while extended payment terms can cause real harm when a supplier has no choice but to accept them.
Large firms (annual revenue over NZD33mn) will be required to publicly report on own payment practices, e.g. late payments, time between receipt of invoices/full payment.
This information will need to be submitted every 6 months, as in Australia and the UK.
Further consultation with business communities will take place in the coming months.
Oct. 26, 2022 Bill Introduced
On Oct. 26, 2022, NZ PRL introduced business payment practices bill with aim to bring transparency to business-to-business payment terms and practices in New Zealand.
Bill now at first reading; the act will come into force on the day after royal assent.
On Nov. 8, 2022, NZ GVT reported that the bill passed its first reading in NZ PRL.
Minister's update reiterated the merits of the regime including how it will encourage larger entities to improve their payment practices to manage any reputational risks.
NZ GVT said that it encourages business communities to provide feedback to help shape the final regulations as well as reporting measures for this important regime.
Jul. 19, 2023 Bill Passed Third Reading
On Jul. 19, 2023, NZ GVT saidBusiness payment practices bill above passed its third reading; discussed key features of the bill and problems the bill seeks to address.
Said the new system will be rolled out to largest organizations first - those with NZD 100mn or more in revenue; first reporting period for this new system will begin 10 months after bill passed, and first disclosures will be made 7 or 8 months after that.
Jul. 21, 2023 Additional NZ GVT Comments
On Jul. 21, 2023, NZ GVT discussed progress of Business payment practices bill above.
Discussed regime features; NZ GVT will administer new public register under regime.
Said first reporting period for new system above will begin 6 months after bill passed.
Reiterated that the first disclosures on register will be made 7 or 8 months after that.
Jul. 26, 2023 Royal Assent, Commencement
On Jul. 26, 2023, NZ GVT said Business payment practices bill above received Royal Assent on Jul. 26; Business payment practices act 2023 commences May 27, 2024.
However, certain provisions commence Jul. 27, 2023, per s 2 (commencement) of act.
Including transitional, savings, and related provisions; appointment of Registrar, Registrar's functions, and Registrar's power to delegate; exemptions; regulations; disclosure periods, disclosure deadlines; amendment to Tax administration act 1994.
Document dated Jul. 26, 2023, was received on Nov. 2, 2023 due to a fixed feed.
These regulations provide for the following matters under the BPP act, i.e. specifying the information that certain large entities must disclose about their payment practices.
In addition, providing that an entity does not need to disclose information about invoices/payments that relate to certain goods, services, or types of transactions such as payments between members of entity’s group or transactions in foreign currency.
Plus, defining an invoice for the purposes of the BPP act; and specifying a permitted departure from the requirements of BPP act or regulations, so that an entity is not required to notify the Registrar of Business Payment Practices of an error/omission.
Specifically, in a disclosure if there is a difference of less than 2 per cent between a percentage or figure included in the disclosure and the correct percentage/figure.
Infringement fees and maximum fines that apply to infringement offenses against s 36 of BPP act; the forms that must be used for infringement notices, reminder notices.
Document dated Aug. 31, 2023, was received on Nov. 2, 2023 due to a fixed feed.
