Summary of Underpinning Analysis: Customs and Excise (Border Security) Amendment Bill

Agency responsible	New Zealand Customs Service
Portfolio	Customs
Date finalised	2 September 2026
Identification Number	REG: 1696, 1697, 1700, 1721, 1722, 1728, 1738, 1866

Good law-making: 9(i)

The importance of consulting, to the extent that is reasonably practicable, the persons or representatives of the persons that the responsible agency considers will be directly and materially affected by the legislation
Inconsistency identified?	NO
Summary of agency analysis
Targeted consultation relating to Customs-controlled area (CCA) changes was undertaken with key affected parties, including port, airport, and logistics operators. Stakeholders broadly supported the intent of strengthening supply chain security and addressing trusted insider risks. Relevant agencies across the national security and border system were also consulted. While the consultation was targeted rather than fully public, this approach was proportionate given operational sensitivity and the nature of the regulated parties. Overall, consultation was undertaken to the extent reasonably practicable and consistent with Cabinet expectations. Regarding defensive equipment, consultation was undertaken with a range of government agencies with operational or policy interests, including New Zealand Police, New Zealand Defence Force, Ministry of Business, Innovation and Employment, Ministry of Justice, Ministry for Primary Industries, and the Office of the Privacy Commissioner. However, there was no public consultation on defensive equipment undertaken due to the operational sensitivity of the proposals and the need to manage law enforcement risks. Groups representing the public interest in law enforcement matters, as well as the wider public, will have an opportunity for input at the Select Committee stage of the Customs and Excise (Border Security) Amendment Bill.

Good law-making: 9(j)

The importance of carefully evaluating— the issue concerned; and the effectiveness of any relevant existing legislation and common law; and whether the public interest requires that the issue be addressed; and any options (including non-legislative options) that are reasonably available for addressing the issue; and · who is likely to benefit, and who is likely to suffer a detriment, from the legislation
Inconsistency identified?	NO
Summary of agency analysis
The proposals are based on a clear and well-evidenced problem definition: the increasing scale and sophistication of transnational serious and organised crime (TSOC), supply chain vulnerabilities, trusted insider risks, and heightened risks to Customs officers. Existing legislation is no longer sufficient to manage these evolving threats. The analysis considered: Gaps in current legislative powers, compliance tools, and penalties. Limitations of the CCA regime and lack of risk-based regulation. The need for improved information sharing and national security alignment. A range of regulatory options were assessed through multiple Regulatory Impact Statements (RISs), including non-legislative approaches (e.g. operational improvements). Legislative reform was determined necessary to provide clarity, enforceability, and system-level change. Impacts were identified across: Benefits: improved border security, disruption of TSOC, a strengthened national security system, reduced harm to communities and reduced harm to Customs officers. Costs: modest compliance costs for industry (e.g. security plans, audits), implementation costs for Customs.

Good law-making: 9(k)

The importance of the responsible agency identifying and developing effective arrangements for implementing the legislation
Inconsistency identified?	NO
Summary of agency analysis
Implementation arrangements have been identified and are supported by existing and planned resourcing (including Budget 2025 funding). Key features include: Secondary legislation (Chief Executive Rules) to operationalise security management plans. Phased implementation supported by Customs oversight and guidance. Integration with existing audit, licensing, and enforcement systems. Continued engagement with industry to support transition. Development of regulations specifying authorised defensive equipment supported by operational policies, training, and staged adoption of equipment. Risks (e.g. compliance burden, operational complexity) have been identified and mitigated through flexible, risk-based design and the use of graduated enforcement tools.

Good law-making: 9(l)

Legislation should be expected to produce benefits that exceed the costs of the legislation to the public or persons
Inconsistency identified?	NO
Summary of agency analysis
The expected benefits of the proposed legislation outweigh any potential costs to the public. Benefits include: Enhanced ability to prevent, detect, and respond to TSOC. Reduced social harm from illicit goods (e.g. drugs, tobacco). Improved integrity of supply chains and border processes. Maintaining New Zealand’s reputation as a low-risk trading nation. Stronger contribution to national security. Improving the safety of Customs officers and enhancing the ability to manage high-risk situations at the border. Costs include: Compliance costs for CCAs (security plans and audits). Administrative and oversight costs for Customs. Procurement of defensive equipment, training and system changes. These will be assessed in further detail when the secondary legislation is developed. These costs are expected to be modest or marginal relative to the scale of benefits, particularly given the high social and economic harm associated with organised crime.

Good law-making: 9(m)

Legislation should be the most effective, efficient, and proportionate response to the issue concerned that is available
Inconsistency identified?	NO
Summary of agency analysis
The border threat environment has shifted markedly. The Bill represents the most effective and proportionate response available to address the heightened risk of confrontations, interception, and unauthorised access to CCAs. Legislative change is required to address systemic gaps that cannot be resolved through operational changes alone. The approach is risk-based, allowing tailoring of obligations to risk levels. A graduated enforcement framework supports proportionality. Non-legislative options were considered but would not provide sufficient authority or consistency. The proposed defensive tools regime is consistent with comparable regimes internationally and reflects a proportionate response to a high-risk environment. The package balances stronger powers with safeguards, consultation requirements, and alignment with existing frameworks.

Rule of Law: 9(a)(i)

The law should be clear and accessible
Inconsistency identified?	NO
Summary of agency analysis
The Bill improves the clarity of existing legislation by: Explicitly linking the Act to border and national security objectives. Clearly setting expectations for CCAs and Customs. Standardising thresholds to seize and copy documents related to Customs offending to reasonable cause to suspect. The status quo has two different thresholds applying to different types of offending, which has practical implications for law enforcement and border security objectives. Explicitly authorising the use of defensive, restraint and protective equipment, addressing current legal ambiguity. Detailed operational requirements are set in secondary legislation, enabling flexibility while maintaining accessibility for regulated parties.

Rule of Law: 9(a)(ii)

The law should not adversely affect rights and liberties, or impose obligations, retrospectively
Inconsistency identified?	NO
Summary of agency analysis
The proposed amendments do not operate retrospectively and do not impose obligations in respect of past conduct. All changes apply prospectively from commencement. Transitional arrangements will ensure affected parties can comply with new requirements.

Rule of Law: 9(a)(iii)

Every person is equal before the law
Inconsistency identified?	NO
Summary of agency analysis
The legislation applies equally to regulated parties within the border system, including expanded fit-and-proper requirements covering individuals in positions of responsibility. No unjustified immunities or unequal treatment arise. Defensive equipment proposals apply to Customs officers exercising statutory functions and do not create unjustified distinctions between individuals.

Rule of Law: 9(a)(iv)

There should be an independent impartial judiciary
Inconsistency identified?	NO
Summary of agency analysis
The Bill does not affect judicial independence or confer judicial powers on non-judicial bodies.

Rule of Law: 9(a)(v)

Issues of legal right and liability should be resolved by the application of law, rather than the exercise of administrative discretion
Inconsistency identified?	NO
Summary of agency analysis
Administrative powers (e.g. licensing, audits, enforcement actions) are structured within a clear statutory framework. Decisions remain subject to judicial review and existing appeal mechanisms. The defensive equipment framework constrains discretion through: statutory thresholds (use of reasonable force). regulatory prescription of equipment. reporting and oversight mechanisms.

Liberties: 9(b)

Legislation should not unduly diminish a person’s liberty, personal security, freedom of choice or action, or rights to own, use, and dispose of property, except as is necessary to provide for, or protect, any such liberty, freedom, or right of another person
Inconsistency identified?	NO
Summary of agency analysis
The proposed amendments do not unduly diminish individual liberties, freedom of action, or property rights. Some proposals (e.g. expanded search powers, questioning of non-travellers) engage rights and freedoms. However: They are targeted at high-risk border environments. Questioning and search thresholds are retained and standardised. This ensures officers must satisfy an objective legal standard before exercising questioning or search powers. Measures are necessary and proportionate to address serious criminal threats. Overall, any limitations are justified to protect public safety and national security. Defensive equipment proposals engage rights to personal security and bodily integrity (e.g. use of force and surveillance via body-worn cameras). However, limitations are justified as necessary to protect the safety of officers and the public in high-risk environments.

Taking of property: 9(c)

Legislation should not take or severely impair, or authorise the taking or severe impairment of, property without the consent of the owner unless- there is a good justification for the taking or severe impairment; and fair compensation for the taking or severe impairment is provided to the owner; and the compensation is provided, to the extent practicable, by or on behalf of the persons who obtain the benefit of the taking or severe impairment
Inconsistency identified?	NO
Summary of agency analysis
The Bill does not involve systematic taking or severe impairment of property. Existing powers relating to property (e.g. seizure) are linked to unlawful activity and are justified within established legal frameworks. Seizure decisions remain subject to judicial review and existing appeal mechanisms in the Customs and Excise Act 2018.

Taxes, fees and levies: 9(d)

The importance of maintaining consistency with section 22(a) of the Constitution Act 1986 (Parliamentary control of taxation)
Inconsistency identified?	NOT APPLICABLE
Summary of agency analysis

Taxes, fees and levies: 9(e)

Legislation should impose, or authorise the imposition of, a fee for goods or services only if the amount of the fee bears a proper relation to the cost of providing the good or service to which it relates
Inconsistency identified?	NOT APPLICABLE
Summary of agency analysis

Taxes, fees and levies: 9(f)

Legislation should impose, or authorise the imposition of, a levy to fund an objective or a function only if the amount of the levy is reasonable in relation to both— the benefits that the class of payers is likely to derive, or the risks attributable to the class, in connection with the objective or function; and the costs of efficiently achieving the objective or providing the function
Inconsistency identified?	NOT APPLICABLE
Summary of agency analysis

Role of courts: 9(g)

Legislation should preserve the courts’ constitutional role of ascertaining the meaning of legislation
Inconsistency identified?	NO
Summary of agency analysis
The Bill preserves access to courts and does not limit judicial interpretation or review.

Role of courts: 9(h)

Legislation should make rights and liberties, or obligations, dependent on administrative power only if the power is sufficiently defined and subject to appropriate review
Inconsistency identified?	NO
Summary of agency analysis
Administrative powers are clearly defined and exercised within structured frameworks. Affected persons retain access to review and oversight mechanisms.

Additional information

Relevant publicly available inquiry, review, or evaluation reports

Review of the Intelligence and Security Act 2017

https://www.dpmc.govt.nz/sites/default/files/2023-05/Taumaru%20-%20Protecting%20Aotearoa%20New%20Zealand.PDF

Final report from the Ministerial Advisory Group on Transnational, Serious and Organised Crime

https://www.customs.govt.nz/media/2b1jlatk/mag-final-report-71025.pdf

Relevant international treaties, standards and obligations

N/A

Departures from the Legislation Guidelines

The policy to inform the Bill was reviewed by the Legislation Design and Advisory Committee (the Committee) on 3 July 2025. The Committee raised concerns about the necessity of the changes relating to the CCA regime if non-legislative alternatives can achieve the policy objective.

Customs carefully considered and acknowledged the non-legislative options identified by the Committee, including the use of licensing conditions, administrative guidance, and policy settings to give effect to security management planning requirements. However, Customs concluded that a legislative framework was the most appropriate and necessary mechanism to support the transition of the Customs Controlled Area (CCA) regime to a more targeted and risk-based model.

In particular, legislating for the security management plan framework provides a clear, consistent, and transparent basis for setting expectations across all relevant CCA operators, while still allowing the detailed operational and technical requirements to be tailored through Chief Executive Rules. This approach supports a nationally consistent application of security requirements, provides certainty to industry participants, and reinforces the importance of security management planning as a core component of the modernised CCA framework.

Other unusual provisions or features

N/A