Some new ways the law can help you

Dear *|FNAME|*,

The theme of this month seems to be legislation! And while poring over new Acts might not sound like a good time to you, we think there's some pretty interesting stuff headed your way if:

• you've ever needed to prove your identity or provide information to make a transaction or use a service

• you've been affected by the collapse of a business such as a construction firm.

... or if you're just interested in how the law can provide greater protections, or encourage greater transparency and accountability.

We've also got an update on some proposed legislative reform, which might be demoted to "formerly-proposed reform" if one commentator is correct. And finally, you'll also find your regular housing update, and some thoughts about choosing your business' name wisely...

Avoiding a (digital) identity crisis

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As more and more everyday services and transactions head online, it's becoming increasingly important that we have simple, reliable, and secure ways to verify that we are who we say we are. In other words: a digital identity, consisting of attributes about ourselves, that we can present to service providers.

But how can those providers know the information is accurate? And how can we be sure they'll keep it safe?

That's the aim of the NZ Digital Identity Act, which passed its final reading at the end of March. It establishes a framework for how digital identities can work in New Zealand.

A digital identity service in summary

The framework does not allow for a centralised repository of information about us. Instead, if we opt-in to using it, we can consent to an authorised organisation checking a particular piece of information about us with another authorised organisation that holds it. 

• So, for example, if we needed to provide proof of income when applying for a loan from Organisation A, we could authorise them to access that information from Organisation B (for example, our bank), who already holds it.

This all happens in a simple, fast, secure, reliable, and trustworthy way. 

• It requires us to consent to the sharing of the specific piece of information required for the transaction.

• The service providers/organisations can only share that specific piece of information.

• There are clear rules for how the information must be handled, to ensure security and privacy.

Participation in the service will be voluntary, both for individuals and service providers.

Administering bodies

The framework will be administered by two bodies: the Trust Framework Board and the Trust Framework Authority.

• The Board will develop the framework rules and regulations and recommend them to the Minister.

• The Authority will be responsible for managing an accreditation regime for digital identity service providers, ensuring that they comply with those rules and regulations. The Authority will also enforce the rules, handle complaints, and grant remedies in case of breaches by trust framework providers.

All going well, this will lead to improved customer experiences for us all, reduced fraud, greater privacy protection, and more efficient transactions.

Learn more about the Digital Identity Programme

Greater financial confidence on the way for subcontractors

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When construction firms collapse, many people and businesses can feel the pain. This includes the subcontractors they've employed on their projects, who can often be left out of pocket.

A recent law change, the Construction Contracts (Retention Money) Act, seeks to reduce the risk of this happening by introducing new requirements for retention money.

Retention money is the money held by main contractors (such as construction firms) to ensure subcontractors fulfil their responsibilities. It gets paid out once the work is completed, or after a warranty period.

But according to Master Plumbers chief executive Greg Wallace, under the current law it's not been easy to ensure main contractors are dealing with that money appropriately.

The change now requires main contractors to:

• hold retention money in a separate trust account at a bank

• provide regular reports about that retention money.

This reduces the risk that subcontractors are affected by liquidations or other financial issues, such as what happened with the collapse of Mainzeal in 2013. Companies that fail to comply may face fines of up to $200,000, and their directors could be held personally liable.

If your business keeps retention money, it's important that you make sure you're keeping it in a way that's consistent with the new law when it comes into effect in October. We're here to provide you with any advice you need.

RMA reforms: already on the way out?

The Government's proposed reforms to the Resource Management Act (RMA) may now be less of a certainty, if The New Zealand Initiative's Roger Partridge is to be believed.

In a piece for Stuff, Partridge suggests that three developments during March point to the reforms' likely downfall.

1. First, Chief Justice Helen Winkelman publicly warned in a submission to the Environment Select Committee that the reforms would disrupt the courts, resulting in "extensive litigation" and overburdening the judicial system. Judges are not meant to interfere with parliamentary law-making - but they may express concerns where they feel legislation could affect the administration of justice. So the Chief Justice's words here carry weight.

2. Second, Parliamentary Commissioner for the Environment Simon Upton criticized the proposed reforms, stating that the environment might be better off if they were scrapped. Upton questioned whether the proposals, even if substantively amended, could deliver an enduring framework. Instead, he argued for a comprehensive amendment of the RMA.

3. Lastly, Green MP Eugenie Sage, chairperson of the select committee, called for the reform proposals to be sent back for more public consultation. She suggested that the process was moving too fast and required too many changes to the 859-clause bill.

Partridge argues the reforms have conflicting objectives, disregard property rights, presume that planners know best, undermine local democracy, and "introduce a Pandora's Box of new amorphous concepts". 

Concerns like these have prompted submitters to warn that the new laws might be worse than the RMA they aim to replace. And in an election year, the weight of all these issues makes the RMA reforms in their current form a tough sell.

Trademarks, trading names & beyond...

This week, United States retailer Bed, Bath & Beyond announced that it was going out of business, with its 500+ locations set to close and its thousands of employees facing unemployment.

But it's smooth sailing for New Zealand's Bed Bath & Beyond. Why? Because they're an entirely different company.

It is possible to use the name of an overseas company here in New Zealand, if that company has not trademarked its use here. But while it can come with benefits (the goodwill, trust, or longevity associated with an existing business), it can also come with risk (any issues that other company faces - such as bankruptcy).

So securing your intellectual property - or choosing the right property to secure - can require some careful thought. And coincidentally enough, we're here to offer that. If you're going into business, or you've got an idea or name you need to protect, we're here to help with all the business and IP advice you'll need.

Monthly Housing Update

If CoreLogic is to be believed, we might be starting to see signs of stabilisation in the residential property market, following the COVID-era surges and the drop-off in the past year.

Chief property economist Kelvin Davidson points to underlying market fundamentals and a steadying of mortgage rates as indicators that the end of the downturn is in sight.

Average Christchurch property prices fell another 1.3% in March, slightly more than the 1.1% felt on average across the country. But stepping back to look at the annual change, it becomes obvious the prices here have fared a lot better than in other centres.

No matter how the market is doing, if you're buying or selling, we'll always offer you steady, experienced advice. Whether you've made the decision, or you're still thinking about things, feel free to get in touch. We'll make this part of the process easy.

Thanks *|FNAME|*.

As always, we're only a phone call or email away to talk through any of the challenges, opportunities or questions facing you. Otherwise - see you next month!

Regards,

Clive, Grant and the Team at Canterbury Legal