Photo: Supreme Court of New Zealand building, by Nick D, available under a Creative Commons license via Wikimedia Commons.
New Zealand will become the first country in the world to give oil, gas, coal and other heavy emitting companies immunity from liability for climate harms caused by their historical emissions after passing a law that appears to have been written by industry.
In May this year, Aotearoa’s government introduced a bill to parliament that would extinguish liability in tort law for climate harms caused by companies and private actors. The move was widely read as an attempt to end a legal claim brought by Maori man Mike Smith. Smith, an elder of the Ngāpuhi and Ngāti Kahu people, brought the action in 2019 against seven companies that emitted greenhouse gases or supplied fossil fuels. The case broke new legal ground as it challenged the historical reluctance of courts in New Zealand to take on climate cases, based on the legal orthodoxy that regulation of greenhouse gas emissions should be left to parliament and not the courts. This is a position shared by courts in neighboring Australia, and one that meant legal observers assumed the case would fail on procedural grounds.
Against the odds, Smith v Fonterra survived multiple challenges and, despite some early setbacks, was eventually appealed to the Supreme Court which held in a unanimous opinion that the matter could proceed to trial. Because Smith’s claim was founded in common law tort and relied on negligence, public nuisance and a proposed new tort of ‘climate system damage’, Smith was not seeking to regulate emissions but seeking to hold individual entities to account for harms and compensation for damage caused by their actions. A recent report by the country’s Climate Change Commission warned that “adaptation is not keeping pace with escalating climate risks in Aotearoa New Zealand, and in some cases is slipping further behind.” That report cited comments by insurer IAG that New Zealand was being hit with a climate-related storm every eight days, with natural hazards causing $4bn of damage each year.
New Zealand’s government—a right-wing coalition government composed of three parties, the conservative National Party, and its junior partners, the libertarian ACT Party and nationalist New Zealand First—responded by trying to kill the lawsuit through legislation for the benefit of the companies subject to the suit. It would later emerge through the discovery process in the Supreme Court that the government had been lobbied directly to kill the case in 2024 by agribusiness giant Fonterra, and service station operator, Z-Energy, which were parties to Smith’s case . Lobbyists for these companies provided a briefing note asking for a liability waiver, including a hand-delivered hard copy given to Matt Burgess, the Chief Policy Officer in the Prime Minister’s Office. Burgess previously worked at the New Zealand Initiative, a free market think tank associated with the Atlas Network, as senior economist. It is understood he has since left his role in the Prime Minister's Office. The government had denied the materials existed when environment groups filed Freedom of Information requests, and a spokesperson for the Prime Minister later claimed there was no record that the materials had ever been received.
The materials largely repeated arguments made by industry the world over in climate matters, and some that have been rebuffed by courts in other jurisdictions, arguing that “the uncertainty associated with the case is creating material sovereign risk and significant uncertainty for the international investment community in New Zealand; it could have a significant impact for New Zealand businesses in terms of their funding and insurance arrangements”. An attachment to the note included a draft amendment suggesting language that could form a bill.
Justice Minister Paul Goldsmith defended The Climate Change Response (Tort Liability) Amendment Bill when it was introduced in May 2026 by claiming it would provide “certainty” to business.
“The Government is acting now to provide legal clarity and certainty and to remove the possible development of a new regime that contradicts the framework Parliament has already enacted to respond to climate change,” Goldsmith said.
From there the bill appears to have been rushed through parliament, with a truncated committee process. New Zealand’s center-left Labour Party and the Greens issued dissenting reports, with Labour pledging to repeal the bill should it pass into law and should the party retake government following elections in November. A small group of experts consulted by the Ministry of Justice about the legislation warned that the law would serve to increase uncertainty rather than eliminate it, adding “no other jurisdiction has enacted such a bar, which would make New Zealand a global outlier.” In mid-August, the bill passed its third reading speech in parliament with a vote of 67 to 53, making it a virtual certainty that it will become law. Because the law applies retrospectively, it is expected that it will end Smith’s case when it comes to a hearing later this year.
The extraordinary move is the latest in a series by the conservative right wing government that, as Drilled previously covered, has been quiet-quitting climate action over the course of its term. Key climate initiatives have been cut, transition programs wound back and a commitment to phasing out oil, gas and coal has been dumped in favor of promoting offshore gas exploration and a plan to encourage the creation of pine plantations in a nominal effort to create a carbon sink. In the context of this inactivity, the decision to grant industry’s request for blanket legal immunity in tort claims marks an escalation.
Laura MacKay, Acting Executive Director of Lawyers for Climate Action New Zealand, said that while it would end past and future claims in tort, it will not end climate litigation on other grounds.
“This is one legal avenue for holding companies accountable. Just because this bill has passed into law, doesn’t mean the legal challenges will stop,” MacKay said. “Another point to make is asking why the government is protecting emitters when it should be focusing on the consequences of climate change.
“That is critical. All the focus and energy right now is going toward protecting climate emitters rather than protecting New Zealanders.”
MacKay said the law would still have an impact, as it would mean those who lived through climate change related disasters will have nowhere to turn for accountability and compensation, particularly in the absence of a national fund or some other mechanism.
“Removing an accountability mechanism without putting in place a legislative alternative is problematic as it leaves an accountability gap where the companies causing those emissions can no longer be held accountable for the damage those emissions causes,” she said.
New Zealand might be the first country in the world to write laws giving business a free pass on climate change, but it is not alone in these tactics, including the associated rhetoric of “business certainty”, which is also being advanced in jurisdictions within the United States. In mid-August, the American Legislative Exchange Council (ALEC) formally adopted a model bill for state legislatures to take up that seeks to give the broadest possible legal immunity from climate litigation. ALEC is a group of right-wing lawyers, political staffers, and former political representatives and judicial officers who coordinate to draft bills on key conservative causes that can be quickly shared and picked up by state legislatures. Matt Kiessling, Senior Director, State Affairs at the American Gas Association currently sits as a private chair on ALEC’s Energy, Environment and Agriculture taskforce. His biography on the ALEC website states: “Prior to assuming this role, he spent nearly seven years leading state and local affairs for a tech industry trade association and brings to AGA more than two decades of experience directing successful political, legislative, and regulatory advocacy programs.”
Compared to its counterpart in New Zealand, ALEC’s model bill, The Energy Producers and Consumers Protection Act goes even further. An extraordinarily expansive ‘everything bill’, it goes far beyond limited liability in tort claims in an effort to predict every conceivable course of legal action against high-emitting companies and stop them with a sweeping legal shield.
Kert Davies from the Center for Climate Integrity described the model bill as the latest in a string of attempts at both the federal and state level in the United States to push for corporate immunity on climate change. This includes a recent effort by Senator Ted Cruz and Representative Harriet Hageman to create a liability shield at a federal level, and similar efforts at the state-level in Louisiana and Iowa, two among at least 15 initiatives according to some counts. Many of these efforts, Davies said, were either rhetorical in nature or incredibly narrow in application. By contrast, the ALEC model bill goes further and serves as a push for the ability of business to act with total impunity on climate change.
“It certainly shows a level of desperation [by industry],” Davies said. “This counterattack is really an assault on democratic processes. We have courts for a reason. It’s to try to redress wrongs. So far in many, many courts around the US and around the world, these cases are being allowed to proceed, and they don’t like it.”
“They don’t want to go through that, because they don’t know they will win in the end.”
It is little wonder why. Attribution science has advanced in recent years to the point where it is now possible to put a dollar figure to the contribution of individual firms to climate harms and raising the prospect of trillion-dollar liabilities. Meanwhile, climate lawsuits against major polluters have been growing in number and even finding traction. In June 2025, German courts paved the way for future nuisance claims resulting from climate harms and in December that year, Philippine survivors of Typhoon Odette filed an application against Shell in British courts. There are dozens of more cases within the United States and other jurisdictions.
Davies compared the situation now to what occurred after decades when tobacco companies began to lose in court and the industry sought immunity laws that would protect them from future claims. These and other efforts, with some notable exceptions such as liability shields for U.S. gunmakers passed in 2005, failed as the complications arising from issuing these sorts of blanket protections to corporate actors was obvious.
“This goes beyond climate change. These immunity waivers set a dangerous precedent,” Davies says. “If the oil and gas industry wants immunity for climate lawsuits, what else do they want immunity from? Oil spills? They can say they were just doing their job. Maybe cancer? Pipeline ruptures? What else? Then you extend it. If we’re handing out get out of jail free cards, who else gets one? Maybe McDonald's wants immunity from causing heart disease. Drug companies get immunity from side effects.”
Even should it be repealed, New Zealand’s immunity law, and its counterparts in the United States, demonstrate the emergence of a global bloc of national and sub-national jurisdictions working to undermine climate action, even as climate harms grow. Drilled has previously covered the emergence of this bloc and its pursuit of a strategy of carbon dominance that, in other applications, has sought to use the power of government to actively strand renewable projects as part of largely unsuccessful efforts to stall the transition away from fossil fuels. This bloc works to undermine global political support and momentum for action on climate change and presents a complication for multi-lateral processes such as the United Nations Framework Convention on Climate Change (UNFCCC) and COP process that is under strain from the Trump administration and a widespread perception that the apparatus is failing to meet the moment.
Centre for International Environment Law (CIEL) Climate and Energy Program Director Nikki Reisch says it remains to be seen whether these sorts of reactionary attempts to protect business and undermine climate justice will succeed, let alone be sustained. Both the United States and New Zealand are just two jurisdictions with critical elections coming up in November and what happens domestically has no bearing on how other countries will confront the problem. Recent decisions, such as the International Court of Justice Advisory Opinion on climate change, similarly make clear that individual states can be held to account for climate harms in international law.
“I think it is folly to believe that somehow this will put a lid on the global movement for, and the demands at the community level for accountability,” Reisch says. “There are undoubtedly more dark days ahead and I think we’re going to see the big climate polluters continue to fight tooth and nail against bearing any responsibility for their contributions.
“Even were bills like that adopted in New Zealand or proposed in model legislation in the US to be taken up and advanced, it cannot and will not put an end to the demand for climate justice and accountability. People will find a way to move their cases forward and obtain redress. I think people power will prevail.”
