Australia: Court of Appeal says COMCOM can gag interviewees

NZ Competition and Market Regulation Update
Last Updated: 27 March 2011
Article by Jason Woolley and James Canny

The Court of Appeal has upheld the ability of the Commerce Commission to issue gagging orders. These orders prevent persons summoned to attend an interview before the Commission from disclosing either:

  • the questions the Commission asked them; or
  • the answers or other information they gave in response.

In the case before the Court of Appeal, Commerce Commission v Air New Zealand [2011] NZCA 64, the Commission had issued gagging orders to 13 Air New Zealand employees who had been required to attend interviews with the Commission in connection with the Commission's air cargo cartel investigation. The orders, issued under section 100 of the Commerce Act 1986, prevented the individual employees from discussing the interviews with Air New Zealand or anyone else (other than their own lawyers, who had been present at the interviews).

Section 100 relevantly reads as follows:

100 Powers of Commission to prohibit disclosure of information, documents, and evidence

(1) Subject to subsection (2), the Commission may, in relation to any application for, or any notice seeking, any clearance or authorisation under Part 5, or in the course of carrying out any other investigation or inquiry under this Act, make an order prohibiting—

(a) the publication or communication of any information or document or evidence which is furnished or given or tendered to, or obtained by, the Commission in connection with the operations of the Commission:

(b) the giving of any evidence involving any such information, document, or evidence.

(2) Any order made by the Commission under subsection(1) may be expressed to have effect for such period as is specified in the order, but no such order shall have effect,—

(b) where that order was made in connection with any other investigation or inquiry conducted by the Commission, after the conclusion of that investigation or inquiry.

(3) On the expiry of any order made under subsection (1), the provisions of the Official Information Act 1982 shall apply in respect of any information, document, or evidence that was the subject of that order.

(4) Every person who, contrary to any order made by the Commission under subsection (1), publishes or communicates any information or document or evidence commits an offence and is liable, on summary conviction, to a fine not exceeding $4,000 in the case of a person not being a body corporate, and $12,000 in the case of a body corporate.

Air New Zealand sought judicial review of the Commission's decision to make and maintain the gagging orders. It argued that section 100, properly interpreted, did not give the Commission the power to make the orders. Further, such a power would curtail the right to freedom of expression in section 14 of the New Zealand Bill of Rights Act 1990.

The Court of Appeal rejected Air New Zealand's arguments, and endorsed the Commission's approach. It held:

  • The ambit of section 100 is not limited to the protection of confidential information and can extend to the type of gagging order imposed in this case;
  • Making orders under section 100 is a serious step and the Commission must be satisfied that the orders are necessary and, once made, the Commission must keep such orders under review;
  • The scope of a section 100 order can extend to prevent an interviewee from discussing even the underlying facts of a case;
  • Protecting the integrity of the Commission's investigations was an important goal that justified a temporary impairment to the right to freedom of expression in section 14 of NZBORA;
  • Section 100 can be used to prevent disclosure of the questions posed by the Commission as well as the answers given to the Commission;
  • A section 100 gagging order can remain in place even after the Commission has issued proceedings although the issuing of proceedings represents a major change of circumstances requiring the Commission to reconsider whether it is appropriate for the order to remain in place.

The decision will be seen by the Commission as a significant win in its efforts to combat cartels. The Commission's practice of using issuing gagging orders has long been seen as controversial given their draconian nature. As pointed out by Air New Zealand in its submissions, no other investigating agency in this country has an equivalent power to make gagging orders, and this includes the police and Serious Fraud Office. Part of the Court of Appeal's response to this submission, that those agencies routinely ask potential witnesses not to discuss the content of interviews with other potential witnesses, seems to miss the point. A request not to do something is quite different to an order not to do it, particularly when breach of that order is a criminal offence.

Further, because the Court of Appeal was required to deal with the case before it at the level of principle, rather than delving into the facts, no real guidance was given by the Court on the issue of when the Commission could reasonably be satisfied that gagging orders were 'necessary'. The Commission's submissions on the issue suggest the Commission may be of the view that such orders are necessary whenever the Commission is conducting a cartel investigation. Reference was made to the "...prevention of collusion between witnesses..." and "...significant prejudice arising from the type of witness preparation that targets of an investigation could engage in if the Commission is required to conduct all investigation in an open way." But is it really the case that the risks of collusion between witnesses and improper preparation by and between witnesses are that much greater in a cartel case than in other types of cases - for example serious criminal matters investigated by the police?

The Court of Appeal did suggest one important possible limit on the Commission's use of gagging orders. It indicated that once all the interviews had been completed the Commission should have considered whether or not continuation of the orders was still required at that point.

It remains to be seen whether Air New Zealand will appeal the case further to the Supreme Court. It may not. The Commission indicated to the Court of Appeal that even if successful it did not intend to re-impose the gagging orders. Unless and until the Air New Zealand case is appealed, or the issue comes up for consideration by the Court of Appeal again, it is likely that the first opportunity that companies and individuals the subject of a Commerce Commission cartel investigation may get to speak to their employees about the allegations may be after the Commission has interviewed those employees and / or after the Commission has initiated proceedings. This underlines the importance of businesses having in place appropriate competition law / trade practices policies and a suitable compliance programme to educate their employees in this area.

© DLA Phillips Fox

DLA Phillips Fox is one of the largest legal firms in Australasia and a member of DLA Piper Group, an alliance of independent legal practices. It is a separate and distinct legal entity. For more information visit

This publication is intended as a first point of reference and should not be relied on as a substitute for professional advice. Specialist legal advice should always be sought in relation to any particular circumstances.

To print this article, all you need is to be registered on

Click to Login as an existing user or Register so you can print this article.

Some comments from our readers…
“The articles are extremely timely and highly applicable”
“I often find critical information not available elsewhere”
“As in-house counsel, Mondaq’s service is of great value”

Related Topics
Related Articles
Related Video
Up-coming Events Search
Font Size:
Mondaq on Twitter
Mondaq Free Registration
Gain access to Mondaq global archive of over 375,000 articles covering 200 countries with a personalised News Alert and automatic login on this device.
Mondaq News Alert (some suggested topics and region)
Select Topics
Registration (please scroll down to set your data preferences)

Mondaq Ltd requires you to register and provide information that personally identifies you, including your content preferences, for three primary purposes (full details of Mondaq’s use of your personal data can be found in our Privacy and Cookies Notice):

  • To allow you to personalize the Mondaq websites you are visiting to show content ("Content") relevant to your interests.
  • To enable features such as password reminder, news alerts, email a colleague, and linking from Mondaq (and its affiliate sites) to your website.
  • To produce demographic feedback for our content providers ("Contributors") who contribute Content for free for your use.

Mondaq hopes that our registered users will support us in maintaining our free to view business model by consenting to our use of your personal data as described below.

Mondaq has a "free to view" business model. Our services are paid for by Contributors in exchange for Mondaq providing them with access to information about who accesses their content. Once personal data is transferred to our Contributors they become a data controller of this personal data. They use it to measure the response that their articles are receiving, as a form of market research. They may also use it to provide Mondaq users with information about their products and services.

Details of each Contributor to which your personal data will be transferred is clearly stated within the Content that you access. For full details of how this Contributor will use your personal data, you should review the Contributor’s own Privacy Notice.

Please indicate your preference below:

Yes, I am happy to support Mondaq in maintaining its free to view business model by agreeing to allow Mondaq to share my personal data with Contributors whose Content I access
No, I do not want Mondaq to share my personal data with Contributors

Also please let us know whether you are happy to receive communications promoting products and services offered by Mondaq:

Yes, I am happy to received promotional communications from Mondaq
No, please do not send me promotional communications from Mondaq
Terms & Conditions (the Website) is owned and managed by Mondaq Ltd (Mondaq). Mondaq grants you a non-exclusive, revocable licence to access the Website and associated services, such as the Mondaq News Alerts (Services), subject to and in consideration of your compliance with the following terms and conditions of use (Terms). Your use of the Website and/or Services constitutes your agreement to the Terms. Mondaq may terminate your use of the Website and Services if you are in breach of these Terms or if Mondaq decides to terminate the licence granted hereunder for any reason whatsoever.

Use of

To Use you must be: eighteen (18) years old or over; legally capable of entering into binding contracts; and not in any way prohibited by the applicable law to enter into these Terms in the jurisdiction which you are currently located.

You may use the Website as an unregistered user, however, you are required to register as a user if you wish to read the full text of the Content or to receive the Services.

You may not modify, publish, transmit, transfer or sell, reproduce, create derivative works from, distribute, perform, link, display, or in any way exploit any of the Content, in whole or in part, except as expressly permitted in these Terms or with the prior written consent of Mondaq. You may not use electronic or other means to extract details or information from the Content. Nor shall you extract information about users or Contributors in order to offer them any services or products.

In your use of the Website and/or Services you shall: comply with all applicable laws, regulations, directives and legislations which apply to your Use of the Website and/or Services in whatever country you are physically located including without limitation any and all consumer law, export control laws and regulations; provide to us true, correct and accurate information and promptly inform us in the event that any information that you have provided to us changes or becomes inaccurate; notify Mondaq immediately of any circumstances where you have reason to believe that any Intellectual Property Rights or any other rights of any third party may have been infringed; co-operate with reasonable security or other checks or requests for information made by Mondaq from time to time; and at all times be fully liable for the breach of any of these Terms by a third party using your login details to access the Website and/or Services

however, you shall not: do anything likely to impair, interfere with or damage or cause harm or distress to any persons, or the network; do anything that will infringe any Intellectual Property Rights or other rights of Mondaq or any third party; or use the Website, Services and/or Content otherwise than in accordance with these Terms; use any trade marks or service marks of Mondaq or the Contributors, or do anything which may be seen to take unfair advantage of the reputation and goodwill of Mondaq or the Contributors, or the Website, Services and/or Content.

Mondaq reserves the right, in its sole discretion, to take any action that it deems necessary and appropriate in the event it considers that there is a breach or threatened breach of the Terms.

Mondaq’s Rights and Obligations

Unless otherwise expressly set out to the contrary, nothing in these Terms shall serve to transfer from Mondaq to you, any Intellectual Property Rights owned by and/or licensed to Mondaq and all rights, title and interest in and to such Intellectual Property Rights will remain exclusively with Mondaq and/or its licensors.

Mondaq shall use its reasonable endeavours to make the Website and Services available to you at all times, but we cannot guarantee an uninterrupted and fault free service.

Mondaq reserves the right to make changes to the services and/or the Website or part thereof, from time to time, and we may add, remove, modify and/or vary any elements of features and functionalities of the Website or the services.

Mondaq also reserves the right from time to time to monitor your Use of the Website and/or services.


The Content is general information only. It is not intended to constitute legal advice or seek to be the complete and comprehensive statement of the law, nor is it intended to address your specific requirements or provide advice on which reliance should be placed. Mondaq and/or its Contributors and other suppliers make no representations about the suitability of the information contained in the Content for any purpose. All Content provided "as is" without warranty of any kind. Mondaq and/or its Contributors and other suppliers hereby exclude and disclaim all representations, warranties or guarantees with regard to the Content, including all implied warranties and conditions of merchantability, fitness for a particular purpose, title and non-infringement. To the maximum extent permitted by law, Mondaq expressly excludes all representations, warranties, obligations, and liabilities arising out of or in connection with all Content. In no event shall Mondaq and/or its respective suppliers be liable for any special, indirect or consequential damages or any damages whatsoever resulting from loss of use, data or profits, whether in an action of contract, negligence or other tortious action, arising out of or in connection with the use of the Content or performance of Mondaq’s Services.


Mondaq may alter or amend these Terms by amending them on the Website. By continuing to Use the Services and/or the Website after such amendment, you will be deemed to have accepted any amendment to these Terms.

These Terms shall be governed by and construed in accordance with the laws of England and Wales and you irrevocably submit to the exclusive jurisdiction of the courts of England and Wales to settle any dispute which may arise out of or in connection with these Terms. If you live outside the United Kingdom, English law shall apply only to the extent that English law shall not deprive you of any legal protection accorded in accordance with the law of the place where you are habitually resident ("Local Law"). In the event English law deprives you of any legal protection which is accorded to you under Local Law, then these terms shall be governed by Local Law and any dispute or claim arising out of or in connection with these Terms shall be subject to the non-exclusive jurisdiction of the courts where you are habitually resident.

You may print and keep a copy of these Terms, which form the entire agreement between you and Mondaq and supersede any other communications or advertising in respect of the Service and/or the Website.

No delay in exercising or non-exercise by you and/or Mondaq of any of its rights under or in connection with these Terms shall operate as a waiver or release of each of your or Mondaq’s right. Rather, any such waiver or release must be specifically granted in writing signed by the party granting it.

If any part of these Terms is held unenforceable, that part shall be enforced to the maximum extent permissible so as to give effect to the intent of the parties, and the Terms shall continue in full force and effect.

Mondaq shall not incur any liability to you on account of any loss or damage resulting from any delay or failure to perform all or any part of these Terms if such delay or failure is caused, in whole or in part, by events, occurrences, or causes beyond the control of Mondaq. Such events, occurrences or causes will include, without limitation, acts of God, strikes, lockouts, server and network failure, riots, acts of war, earthquakes, fire and explosions.

By clicking Register you state you have read and agree to our Terms and Conditions