The Government’s proposal to prevent climate-related lawsuits against major greenhouse gas emitters could have consequences extending well beyond New Zealand’s courts, with one of the country’s leading legal scholars warning it may also undermine the nation’s international climate commitments and obligations under its free trade agreement with the EU.
Emeritus Professor Jane Kelsey of the University of Auckland Law School says legislation currently under consideration raises important questions about whether New Zealand is meeting the environmental standards it has committed to under international agreements.
The proposed law would prevent climate-related tort claims from being brought against companies over their greenhouse gas emissions. It follows the landmark legal action initiated by Northland kaumātua Mike Smith against several major companies, a case that has become one of New Zealand’s most closely watched climate proceedings.
The Government argues the legislation is intended to provide certainty for businesses by ensuring climate policy is determined through Parliament rather than the courts. Supporters say emissions reductions should continue to be managed through existing regulatory frameworks, including the Emissions Trading Scheme and climate legislation, rather than through civil litigation.
Professor Kelsey, however, says the proposal has implications that reach beyond domestic policy. She argues the European Union–New Zealand Free Trade Agreement includes commitments requiring both parties to effectively implement climate obligations and uphold environmental protections.
The agreement contains chapters covering sustainable development, climate change and environmental cooperation. While they are designed to encourage collaboration rather than impose automatic trade sanctions, Professor Kelsey says weakening legal accountability for greenhouse gas emissions could invite increased scrutiny from New Zealand’s international trading partners.
The European Union has increasingly linked trade policy with climate action, embedding environmental standards into its modern trade agreements and introducing measures such as the Carbon Border Adjustment Mechanism to encourage lower-emissions production.
For New Zealand exporters, continued confidence in the country’s environmental credentials is considered increasingly important as overseas markets place greater emphasis on sustainability, emissions reduction and environmental governance.
The proposed legislation has also generated debate over access to justice. Critics argue climate litigation provides communities with an avenue to seek accountability where they believe significant environmental harm has occurred, while supporters of the bill maintain climate policy should remain the responsibility of elected governments rather than the judiciary.
For Māori, the debate carries additional significance. Climate change has disproportionate impacts on many iwi and hapū through coastal erosion, flooding, changing weather patterns and risks to whenua, wai and mahinga kai. Questions have also been raised about how the legislation aligns with Te Tiriti o Waitangi obligations and Māori interests in environmental stewardship.
The bill passed its first reading in Parliament earlier this year and is expected to face further scrutiny as it progresses through the legislative process. As debate continues, legal experts say Parliament will need to balance business certainty, climate accountability, international obligations and New Zealand’s reputation as a country committed to addressing climate change.
Whether the legislation ultimately strengthens investment confidence or creates new legal and diplomatic challenges is likely to remain a significant issue as New Zealand continues implementing both its domestic climate policies and its international trade commitments.
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