Boss can watch you at home

If you thought secret cameras in the ceiling, tracking devices under the car and bugs in the phones were the preserve of drug barons, you're reckoning without the Search and Surveillance Bill introduced to the House last week.

The Commerce Commission, the Reserve Bank and the Ministry of Agriculture and Forestry are among the agencies that will enjoy new and extended powers under the bill.

Most regulatory investigative powers are limited to compelling the production of documents or information, requiring personnel to answer questions and, in extreme cases, physical searches of property.

The bill extends this to covert surveillance, including installing recording devices to intercept calls or conversations, tracking devices to determine the movements and whereabouts of staff, and cameras.

Regulators will be able covertly to break into premises to install such devices. Perhaps more disturbing, nothing prevents a regulator from conducting similar surveillance on (or in) the homes of employees.

If regulators want to use an investigative technique not at present covered by the bill (for example, remotely and covertly accessing your IT network) they can also obtain "residual" warrants.

They will be able to obtain these only if they believe the company or its staff have committed an offence under the relevant act.

However, the offence provisions of many regulatory schemes are extensive, and regulators are increasingly inserting offences into their regimes. Expect surveillance, and other invasive and covert investigative techniques, to be a feature of regulatory interaction in the future.

Regulators will also enjoy a range of ancillary powers that they can exercise in connection with a search or investigative power. These include powers to:

* Detain any person present at premises that are being searched and, if the enforcement officer thinks they may be holding evidence, conduct a "rub-down" search of the person.

* Secure premises and exclude staff from the area, and require your external IT provider (potentially without notifying you) to assist the regulator in accessing and copying your computer network and data storage. In addition, if a representative of a regulator happens to be at a place of business, even in a non-enforcement capacity, they will be able to seize documents or items in plain sight.

Finally, the bill proposes removing or diluting some of the traditional investigative safeguards.

Legal privilege will not bar the issue of a search warrant if the regulator satisfies the official issuing the warrant that your communications with your lawyers are for a "dishonest purpose" or might aid anyone in doing anything you ought reasonably to have known was an offence.

Further, it is up to the regulator when conducting covert surveillance or a search to assess for themselves whether privilege might apply - without consulting you. You are entitled to take steps to protect privileged information from surveillance or search but, of course, you won't know until it's too late.

We expect considerable refinement of the bill in the select committee and think the following minimum changes are necessary:

* A more proportionate response: many of these search powers are disproportionately invasive given the nature of the specific regulatory schemes that they will be appliedto.

* Clear expectations about the limits of residual warrants: under the bill you will have no right to know what devices, techniques and procedures are being used to assist investigations.

* Clarification of the circumstances in which legal privilege will be removed: you rely on privilege to communicate freely with your lawyers, and there should be no doubt about the security of that privilege.

* Home should be out of bounds: it is hard to justify covert surveillance of home and family in the context of commercial or industry regulation. There should be a presumption that surveillance is limited to business and/or public premises.

At the very least, given the extraordinary width of the new powers, we think regulators should adopt transparent guidelines setting out the circumstances (if any) in which the more draconian powers will be used. Forewarned is, after all, forearmed.

* Simon Peart and Richard May are solicitors at Chapman Tripp.