Quick on the uptake? New Zealand’s new strategic approach to Artificial Intelligence

Recent history of New Zealand’s AI strategy

Over the past few years, artificial intelligence (AI) has been the subject of major successes, lofty promises, clickbait doomsdayers, hard hitting investigations and insightful social commentaries. Despite any potential AI-news fatigue, a recent announcement from the New Zealand Government (Government) deserves your attention.

On 8 July 2025, the Government released “New Zealand’s Strategy for Artificial Intelligence: Investing with confidence” (AI Strategy) which aims to accelerate private sector AI adoption and innovation. The Ministry of Business, Innovation and Employment has published a “Responsible AI Guidance for Businesses” (AI Guidance) alongside the AI Strategy to assist with its practical application.

We are pleased to see this regulatory development. As we wrote last year, Aotearoa New Zealand’s approach to regulation (and empowerment) of the rapid adoption of AI-enabled solutions had been conspicuous in its absence. Until now, New Zealand was the only country in the Organization for Economic Co-operation and Development (OECD) that had not published an AI strategy. Perhaps consequently, most New Zealand organisations are still early in their exploration and adoption of AI. With the adoption of New Zealand’s first AI Strategy, AI adoption rates are predicted to shift as research found that businesses are more likely to invest in AI adoption if their governments provide supportive policy framework.

And, with this shifting use, the AI Strategy highlighted that AI could add NZD76 billion to New Zealand’s GDP by 2038 by enhancing productivity in agriculture, healthcare, education, tourism and more.

In this update, we break down the key components of the AI Strategy and AI Guidance.

 

Light-touch, principles-based policy that aligns with the OECD AI Principles

As expected, the AI Strategy aligns with the Government’s previously stated desire to avoid AI-specific legislative reform. Of particular relevance is the “light-touch, proportionate and risk-based approach to AI regulation” proposed by the then Minister of Science, Innovation and Technology – Hon Judith Collins KC in a June 2024 Cabinet paper (we cover this in more detail in our previous article). A proportionate risk-based approach responds to potential risks in light of their likelihood, magnitude and context. Given the speed at which AI technology develops, this is a responsible and pragmatic approach to regulation.

To achieve this, both the AI Strategy and AI Guidance highlight reliance on existing legislation and regulations for privacy, consumer protection and human rights to manage risk and privacy concerns. Examples of relevant legislation are included in the AI Guidance, alongside an explanation of the potential relevance for AI to each example. Of note are:

• Commerce Act 2001: ensuring AI systems do not engage in practices that restrict competition or mislead consumers (eg algorithmic pricing collusion, false reviews).
• Companies Act 1993: upholding directors’ duties including due care and diligence and legal and ethical obligations.
• Fair Trading Act 1986: avoiding misleading or deceptive conduct related to outputs or use of AI tools.
• Privacy Act 2020, and applicable codes of practice: ensuring responsibilities are upheld for handling personal information (which may be included as part of AI inputs or outputs).

It is well known that AI does make mistakes. A good reminder of this is the reference to the Commerce Act 2001 in the AI Guidance which was prepared with the assistance of AI. There is no such Act. Instead, this reference should have been to the Commerce Act 1986. Was this human error or an AI hallucination? In any event, this a reminder to us all that effective use of AI requires human oversight.

A significant theme in the AI Strategy is international collaboration and compatibility. In June 2024, Cabinet adopted the OECD’s AI Principles to guide the development of trustworthy, innovative, and democratic AI in New Zealand, aligning with other OECD member states. The AI Strategy matched this approach. Notably, the adoption of the OECD AI Principles does not require additional regulatory overlay beyond existing law. Instead, they guide how existing legal frameworks should apply to AI applications. The OECD AI Principles include respecting the rule of law, human rights and democratic values, such as fairness and privacy, as well as robustness, security and safety. As such, the AI Strategy’s incorporation of the OECD AI Principles provides the ethical framework for responsible AI regulation and guidance that align with other OECD countries.

 

Uptake of existing AI technologies, rather than developing new

The AI Strategy has recommended that New Zealand sidesteps enormous capital investments and difficulties accessing global-scale datasets to develop AI models. Instead, it called on New Zealand to be quick on the uptake and become adopters who identify, adapt and deploy ready-made AI solutions for our local challenges. International collaboration and compatibility are again key themes.

Adoption is a way to focus on New Zealand’s strengths. Specifically, the AI Strategy recommended developing expertise in AI governance, ethics and application of AI to position New Zealanders as thought leaders in responsible AI use. It also encouraged businesses to seize available opportunities to create niche applications by leveraging New Zealand’s skillsets and strengths against pre-existing global AI foundations.

 

Resolving barriers to uptake in New Zealand

Through research and stakeholder consultation, the AI Strategy has identified the following existing barriers to AI adoption and provided a coordinated response of government initiatives to resolve them. As promised in the AI Strategy, the Government will address:

• regulatory uncertainty with a commitment to stable and enabling policy through a light-touch and principles-based approach with reference to the OECD policy and principles;
• perceived complexity, ethics and risk by providing Government support to demystify AI for business, including the AI Guidance (discussed below);
• lack of understanding and perceived value through the publication of the first AI Strategy; and
• lack of AI skills by building Kiwi capacity to empower the 43% of non-users who specifically cite a lack of expertise as their main reason for not adopting AI.

Despite this encouragement and problem solving, the AI Strategy contained a caveat: businesses will need to take initiative and responsibility for leveraging AI opportunities for their needs.

 

New Zealand: soon to be an environment where businesses can invest in AI with confidence

Another theme throughout the AI Strategy is creating confidence for businesses adopting and investing in AI. The AI Strategy is intended to provide clear policy and guidance and reduce regulatory uncertainty to empower the private sector to safely use, develop and innovate with transformative AI technologies. In doing so, the Government has signalled “unwavering support for private sector investment in AI” which is “more than a policy preference – it is an economic necessity”.

An example of this is the Research and Development Tax Incentive (RDTI), which offers a tax credit of 15% on eligible expenditure as support for innovation by businesses and organisations. As reported in the AI Strategy, the total estimated spend in New Zealand on AI-related projects since 2019, based on approved RDTI projects, sits at NZD611 million.

Another example of investment in AI is the data centres underpinning the technology. New Zealand is rapidly emerging as a cornerstone of Asia-Pacific’s digital infrastructure in the form of data centres, fuelled by billions of dollars in investment from global technology leaders. These data centres are enabling businesses to embrace AI and digital innovation by providing advanced computing power with low latency solutions close to the endpoint, while meeting the needs of private and public sector organisations with data sovereignty concerns.  While New Zealand’s strengths make it an attractive destination for data centre investment, the industry must address issues such as energy demands, connectivity limitations, regulatory frameworks and workforce readiness. The AI Strategy is one piece of the puzzle for New Zealand’s regulatory framework. We have written in more detail on New Zealand’s data centre opportunities in a previous article.

 

Public sector leadership on responsible AI adoption and use.

In February 2025, the New Zealand Government introduced a new framework to guide the responsible use of AI technologies across the public sector (we cover this in more detail in our previous article). This framework is evident in the AI Strategy, which is transparently explained to have been prepared with the assistance of AI as a demonstration of the Government “walking the talk” while maintaining appropriate oversight and safeguards for sensitive information.

The AI Report encourages businesses to invest in AI technologies, but also demonstrates investment from the public sector, including in education, research, and international partnerships, which will provide the foundation for New Zealand’s AI adoption in coming decades.

 

Responsible AI guidance for business

The AI Strategy reported that AI use in large New Zealand businesses is rising - 48% used AI in 2023 and 67% in 2024. In part, this is due to the explosion of AI tools into our everyday lives in recent years. However, the AI Strategy also noted that New Zealand’s small to medium enterprises (including sole traders, non-profits and individual professionals) have been noticeably more hesitant to adopt AI with 68% not planning to adopt AI into their workflows. Comparatively, only 38% of their Australian equivalents are hesitant in this way. But, as highlighted in the AI Guidance, the size of a business is not always indicative of their AI opportunity.

The AI Guidance steps in at this point to provide practical, non-binding guidance of good practices and actions that can support businesses to confidently adopt AI. It identifies and discusses various types of considerations for businesses using or developing AI systems, including risks to cybersecurity, privacy, human rights, workplace culture, the environment, intellectual property and creators, and physical safety.

While the AI Guidance is a comprehensive and practical guide, users should be mindful that any voluntary guidelines or standards should be used in conjunction with the relevant legal requirements and context-specific guidance produced by industry bodies and peers, or AI suppliers and vendors. As legal service providers, we often hear from clients seeking assistance as they engage with AI suppliers and vendors, seeking to responsibly plan their business transformations and put in place appropriate governance for AI use.

 

What next?

The AI Strategy and AI Guidance are the Government’s first steps to provide some certainty in an area that holds an enormous amount of potential. As such, the Government concluded the AI Strategy with a call to action:

“To businesses considering AI adoption: the Government stands ready to support your journey through guidance and stable policy settings that reward innovation.
To international investors: New Zealand offers a sophisticated market, skilled workforce, and governance framework that makes it an ideal location for AI deployment and development.
To our research community: your work on AI applications, ethics, and governance contributes directly to national prosperity and global knowledge.”

If you are looking to take next steps for AI adoption in your business, or considering entering New Zealand with an AI offering, please get in contact with our team of experts.

DLA Piper is committed to providing world-leading insights and advice when it comes to AI, ensure to stay informed by visiting our international AI in Focus page. We are also rolling out an AI Academy for clients throughout the world. Reach out to join our mailing list to receive updates and invitations to our educational sessions.