New Zealand Blocks Climate Tort Claims Against Businesses

The law change comes against the backdrop of ongoing High Court litigation involving civil claims against six major businesses over their greenhouse gas emissions.

New Zealand businesses will be protected from civil liability claims over climate change damage linked to their greenhouse gas emissions after legislation designed to clarify the role of the courts passed its final reading in Parliament.

Justice Minister Paul Goldsmith said the amendment to the Climate Change Response Act 2002 is intended to give companies greater certainty about their legal obligations, particularly as major businesses face litigation seeking to hold them responsible for climate-related harm. The Government argues that allowing climate liability to develop through individual tort cases could create a separate legal regime alongside the emissions framework already established by Parliament.

The legislation prevents courts from making findings of liability in tort for climate change damage or harm caused by greenhouse gas emissions. It applies to current proceedings as well as future cases, closing off a potential pathway for claimants seeking damages or other remedies from businesses based on their contribution to emissions.

High Court litigation raises questions over climate liability

The law change comes against the backdrop of ongoing High Court litigation involving civil claims against six major businesses over their greenhouse gas emissions. Goldsmith said such cases risk creating uncertainty because decisions made through tort law could impose obligations that differ from those contained in New Zealand's existing climate legislation.

For businesses, the issue reaches beyond the outcome of a single court case. A new body of climate-related tort law could influence investment decisions, compliance costs and assessments of future legal risk, particularly for companies operating in emissions-intensive sectors. The Government's position is that businesses should be able to understand their climate obligations from legislation passed by Parliament rather than face additional standards developed through separate court proceedings.

Goldsmith also argued that tort law is poorly suited to climate change because greenhouse gas emissions come from a vast range of activities and their effects involve environmental, economic and social considerations that extend well beyond an individual company or industry.

Government says Parliament should set climate rules

Under the Government's approach, national climate policy will remain centred on the Climate Change Response Act and the New Zealand Emissions Trading Scheme, rather than being shaped through a series of civil lawsuits.

The ETS places obligations on covered businesses and sectors while using emissions pricing as a tool to support reductions across the economy. The new amendment does not remove those responsibilities, meaning companies already required to meet obligations under the scheme must continue doing so.

Goldsmith said decisions about how New Zealand responds to climate change are better handled at the national level, where elected governments can consider environmental goals alongside economic impacts and wider social consequences. The legislation effectively draws a boundary between climate obligations established through statute and attempts to establish additional liability through tort claims.

ETS obligations remain unchanged for businesses

The Government has stressed that the amendment should not be interpreted as removing existing climate responsibilities from companies. Businesses covered by the ETS will remain subject to its requirements, while the Government itself will continue to have responsibilities under the Climate Change Response Act.

What changes is the legal exposure businesses face outside that framework. Companies will no longer face findings of tort liability for climate damage or harm attributed to their greenhouse gas emissions, including in proceedings that were already underway when the amendment was passed.

Goldsmith linked the move to the Government's broader focus on regulatory certainty, arguing that predictable rules are important for business confidence, overseas investment and economic growth. With Parliament now defining where climate-related liability sits, the Government expects businesses to have a clearer picture of the rules they must follow while New Zealand's wider emissions policy continues to operate through existing legislation.