Conditional approval granted
The Commerce Commission has issued a draft determination to grant conditional authorisation to Payments NZ to collaborate with API providers and third parties.
This collaboration aims to develop and implement a partnering framework for API services.
The commission believes that the potential benefits, including reduced transaction costs and more efficient contracts, outweigh the potential detriments.
Assessment and benefits
The commission’s preliminary view, based on its assessment, is that the proposed arrangement will bring significant benefits.
The benefits include reducing transaction costs associated with API partnerships and developing more efficient contract terms. The potential detriments primarily concern conflicts of interest in decision-making processes, which the proposed conditions aim to address.
Proposed 18-month authorisation
The commission proposed to authorise the arrangement for 18 months, allowing for the expected 12-month discussion period and considering the timing of upcoming regulatory interventions that may provide similar benefits.
“The potential benefits of the proposed arrangement are likely to outweigh the potential detriments,” the commission said.
Submissions invited
The commission is seeking submissions from interested parties on its draft determination.
Submissions should be sent by email to [email protected] with the reference “Payments NZ Authorisation Application” by July 15, with cross-submissions due by July 22.
Background on API and Payments NZ
An API is a set of routines, protocols, and tools for building software applications.
Payments NZ, owned by banks, governs and manages payment system rules and standards. Its API Centre develops and maintains API standards to ensure consistent interaction between API providers and third parties.
Public and regulatory context
Payments NZ’s authorisation application is publicly available on the commission’s case register.
The Commerce Commission may grant authorisation for agreements that might otherwise breach the Commerce Act 1986 if the agreement benefits the public sufficiently.
The commission’s authorisation guidelines explain the process and criteria for such determinations.
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