Under what condition can the Consumer Guarantees Act not be applied?

The application of the Consumer Guarantees Act (CGA) in New Zealand is primarily oriented toward protecting consumers and ensuring that products and services meet certain guarantees, such as acceptable quality and fitness for purpose. However, there are specific conditions under which the CGA does not apply, one of which relates to the context of business transactions.

In this case, when the purchase exceeds a specified threshold for business purposes, the CGA typically does not apply because the buyer is considered to be more capable of protecting their own interests. The Act is primarily designed to protect individual consumers who are purchasing goods or services for personal, domestic, or household use. Therefore, when a transaction is for a business and exceeds the set threshold, it falls outside the consumer protections provided by the CGA, as the buyer is viewed as engaging in a commercial activity with greater responsibilities and expectations.

This distinction is important because it recognizes the difference between consumer purchases, which lack the same level of negotiation power, and business transactions, where parties are expected to have a better understanding of their rights and risks.