WELLINGTON, New Zealand — New Zealand has made a major—and deeply controversial—change to its climate laws, effectively shutting down a legal route that could have allowed individuals and communities to hold major greenhouse-gas emitters liable in court for climate-related harm.
The country’s Parliament passed the Climate Change Response (Tort Liability) Amendment Bill, legislation designed to prevent courts from imposing tort liability on businesses for damage or harm linked to greenhouse-gas emissions.
The measure cleared its final parliamentary hurdle on Tuesday, August 18, by 67 votes to 53, according to reporting carried by Channel NewsAsia.
But behind that vote is a much bigger fight over a fundamental question:
Who should decide what companies owe society for their contribution to climate change—the courts or elected governments?
The Lawsuit That Triggered the Battle
At the centre of the controversy is New Zealand climate activist and Māori leader Michael “Mike” Smith, who brought a landmark case against several of the country’s major greenhouse-gas emitters.
Smith argued that emissions produced or enabled by major businesses contributed to climate change and threatened places with cultural, historical and customary significance to him, particularly vulnerable coastal areas.
His case sought to use traditional areas of civil law—including public nuisance and negligence—as well as a proposed new climate-related duty to challenge corporate emissions.
The litigation eventually reached New Zealand’s Supreme Court.
In February 2024, the Supreme Court unanimously allowed Smith’s public-nuisance claim to proceed rather than striking it out before trial.
Importantly, that decision did not mean the companies had already been found liable for climate damage.
Instead, it meant Smith should be allowed to argue the substantive case in court.
That distinction became crucial when the government intervened.
Government Says Climate Policy Belongs in Parliament
Prime Minister Christopher Luxon’s coalition government argues that New Zealand already has a national system for regulating greenhouse-gas emissions through legislation, including the Climate Change Response Act 2002 and the country’s emissions trading framework.
Justice Minister Paul Goldsmith has argued that allowing courts to develop a separate climate-liability regime could create conflicting obligations for businesses.
The government’s position is essentially that climate policy requires economy-wide decisions balancing environmental, economic and social consequences—and those decisions should therefore be made by Parliament and the executive rather than through individual lawsuits.
During parliamentary debate, government supporters repeatedly warned that successful climate litigation could effectively create a parallel regulatory system alongside New Zealand’s existing climate laws.
Businesses could theoretically face obligations imposed under national climate legislation while simultaneously facing different requirements arising from court judgments.
Supporters of the amendment say eliminating that possibility provides greater regulatory certainty and protects investment.
The Law Goes Further Than Future Lawsuits
One of the most contentious aspects of the legislation is that it does not simply prevent similar lawsuits from being launched in the future.
The statutory restriction also applies to existing proceedings, including Smith v Fonterra.
That means Parliament has effectively intervened while a major climate case was already progressing through New Zealand’s courts.
Government MPs argue this does not remove a liability Smith had already established because no court had yet ruled at trial that the defendant companies were legally responsible for his alleged climate harm.
Opposition politicians see the situation very differently.
Labour MPs argued during parliamentary debate that Parliament was closing off citizens’ access to the courts while active litigation was still underway.
Critics have therefore turned the controversy into something larger than a debate over emissions.
It has become a debate about the boundaries between Parliament, the courts and private citizens seeking legal remedies.
Corporate Lobbying Added Another Layer of Controversy
The political battle intensified after questions emerged about discussions involving companies affected by the litigation.
Parliamentary exchanges in May focused on whether proposals associated with Fonterra and Z Energy regarding changes to climate law had reached the Prime Minister’s office.
Prime Minister Christopher Luxon told Parliament there was no record or recollection of the interaction being questioned and defended the government’s broader position that climate policy should be determined by the state rather than through the courts.
Opposition politicians nevertheless seized on the issue, questioning whether large corporations had enjoyed privileged access while facing potentially consequential litigation.
The government rejected that characterisation.
Fonterra Welcomed the Proposed Change
Fonterra had publicly supported the government’s decision to amend the Climate Change Response Act.
The dairy cooperative argued that businesses already operate within a climate-policy framework established by Parliament and that emissions reductions should be handled through that national regulatory system rather than through separate civil lawsuits.
That argument reflects one of the government’s central concerns.
If courts were ultimately able to impose company-specific emissions obligations, businesses might face a patchwork of legal requirements alongside national emissions rules.
Supporters of the amendment say that could discourage investment and create uncertainty over what companies are legally required to do.
Critics Say an Important Accountability Tool Is Being Removed
Opponents argue the same legislation can be viewed from the opposite direction.
If government climate policies fail to adequately protect communities from environmental harm, civil litigation can provide another avenue for affected people to seek accountability.
Blocking that route potentially leaves government regulation as the primary mechanism for addressing emissions-related climate harm.
That is particularly significant because climate litigation has increasingly been used internationally to challenge governments and corporations over emissions, disclosure practices and alleged environmental damage.
New Zealand’s decision therefore reaches far beyond one lawsuit.
It represents a deliberate attempt to draw a legal boundary around how climate accountability should work.
A Wider Global Climate-Litigation Fight
The New Zealand controversy comes as courts around the world increasingly become battlegrounds over climate policy.
Campaigners have turned to litigation when they believe governments or corporations are failing to reduce emissions quickly enough.
Businesses and governments, meanwhile, have questioned whether judges should effectively determine emissions policy through individual civil cases.
New Zealand has now taken a particularly clear position.
Its government says climate-change obligations should primarily come from legislation—not from courts developing new forms of corporate liability.
That could make the country an important case study for governments elsewhere watching the rapid expansion of climate litigation.
The Bigger Question
The legislation may end one pathway for climate lawsuits, but it is unlikely to end the political argument behind them.
New Zealand still faces the same underlying challenge: determining how responsibility for climate damage should be distributed between governments, businesses and individuals.
Supporters of the new law see regulatory certainty.
Critics see corporate protection from legal accountability.
And at the centre of the dispute remains a question likely to become increasingly important as climate-related losses grow around the world:
When climate change causes identifiable harm, should major emitters ever be answerable directly to the people affected—or should their obligations be determined exclusively through national climate policy?
For New Zealand, Parliament has now given a much clearer answer.
The consequences of that decision could extend well beyond its shores.
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