Fears New Zealand’s Proposed Telco Law May Broaden State Powers Over Encrypted Messaging

‘New Zealanders will no longer be able to rely on overseas-based networks or applications ... for private or encrypted communications,’ said the FSU.

Illustration of cybersecurity in France, on Jan. 27, 2026. Riccardo Milani/Hans Lucas/AFP via Getty Images

A free speech advocacy group has warned that a proposed telecommunications bill could erode data privacy and expand government surveillance in New Zealand.

In October 2025, the national government introduced the Telecommunications and Other Matters Amendment Bill (Bill 210-1), which mirrors some aspects of Australia’s Online Safety Act.

At its first reading, the proposed law received cross-party backing, with coalition partners ACT and New Zealand First, as well as opposition parties Labour and the Greens, voicing their support.

The Bill seeks to extend New Zealand’s telecommunications regulatory reach to overseas digital and telecom providers, effectively overturning a 2021 High Court ruling that exempted an overseas companies from domestic law.

It would also make overseas providers liable to pay telecommunications development and regulatory levies, which, because they are calculated on earnings, would require them to disclose their revenue.

If their revenue exceeds NZ$50 million (USD$30 million), they could also become subject to New Zealand’s dispute resolution scheme under another proposed telecommunications bill.

Why the NZ Government Introduced the Bill

NZ Minister for Small Business Chris Penk said current telco regulations did not cover the purchase of mobile and broadband services from companies not physically in New Zealand, a rapidly growing trend.

“The fact that our telecommunications legislation doesn’t explicitly capture these providers creates uncertainty for the telco industry, regulators, and, of course, consumers,” he said during a parliamentary session in November 2025.

“While existing telco providers operating in New Zealand are committed to complying with our telco law where it applies to them, this gap could create problems for us in the future, particularly if a regulator ever wanted to enforce a breach against a provider that was not cooperative.”

Making offshore providers subject to local law would have two main benefits—an even playing field for New Zealand providers and an additional layer of consumer protection in the event of a fault, the minister added.

Penk also briefly alluded to a “bespoke enforcement mechanism to address non-compliance by using radio spectrum licensing”—a measure the Free Speech Union (FSU) is calling a “kill switch.”

In essence, the mechanism allows the Secretary of the Ministry of Business, Innovation and Employment (MBIE) to revoke, suspend, or restrict the spectrum licences of New Zealand telcos if they continue to carry the service of a non-compliant overseas company, notably messaging apps or social media platforms.

New Zealand's Minister for Small Business and Manufacturing, Chris Penk. Courtesy Chris Penk.

New Bill Promotes Government Surveillance: Advocacy Group

While the government is emphasising benefits such as stronger consumer protection in the event of service failures, the FSU said the Bill left open the risk of breaking encryption, as well as threaten freedom of speech and whistleblowing.

“This expansion materially affects forms of communication that are essential to freedom of expression, including journalistic source protection, whistleblowing, anonymous or political speech, and the safe communication of vulnerable or marginalised communities,” it said in its submission.

“As a result, New Zealanders will no longer be able to rely on overseas-based networks or applications as offering greater protection for private or encrypted communications, increasing access to private communications pursuant to warrants from surveillance agencies.”

It could also risk offshore providers withdrawing from New Zealand’s small market, “narrowing the range of platforms through which New Zealanders can speak, associate, and receive information,” the FSU added.

In this photo illustration, the Telegram logo is displayed on a number of screens in London, the UK, on Aug. 26, 2024. Leon Neal/Getty Images

A spokesperson for the FSU also confirmed that the bill’s unorthodox enforcement provisions effectively make New Zealand mobile carriers subject to licence restrictions—or potentially even cancellation—because of the actions of an offshore provider over which they have no control.

When asked about a hypothetical example in which Proton Mail—which has vowed to defy Australia’s online safety laws—refused to provide access to its encrypted service, and whether this could then make every New Zealand internet service provider liable for that decision, the spokesperson said this was “a realistic illustration of how the mechanism could operate.”

“The bill does not directly strip an offshore operator of a New Zealand radio/spectrum licence [most offshore providers have no New Zealand licence to revoke],” the spokesperson told The Epoch Times.

“Instead, it puts pressure on New Zealand licence holders: if an offshore provider refuses an obligation, the Secretary [of MBIE] can require New Zealand licence holders to cut the offshore provider off, and may restrict the licence if the holders do not comply.

“That is why our submission describes this as an indirect enforcement tool that, in effect, can impose burdens on New Zealand entities for the conduct or refusal of offshore third parties.”

The spokesperson also provided recommendations.

“We recommend (among other things) an explicit protection for end-to-end encryption where the provider does not possess decryption keys, and procedural safeguards so the Secretary must verify evidence, allow a right to be heard, and carry out a proportionality assessment before depriving a licence holder of its rights,” the spokesperson said.

MBIE’s Response

A spokesperson for the MBIE told The Epoch Times that as the bill is currently before the Select Committee, the department is unable to provide detailed comments on its content, or how it might be interpreted.

At the same time, they confirmed that the bill is intended to have an “extraterritorial effect, bringing offshore providers into [the] scope of New Zealand’s regulatory regime on the same basis as New Zealand-based telecommunications providers, where relevant to the services the provider offers.”

Submissions on the bill have now closed.

The Committee has yet to announce when it will hear from submitters but is due to report back to Parliament on the legislation by May 2026.