The advertising of chips, chocolate, sugary fizz and other junk foods face new restrictions following a review.
"The major code change is an explicit restriction on advertising occasional food and beverage products to children," said Health Minister Jonathan Coleman.
He sees the review of children's food ads as an important part of his plan to reduce childhood obesity. Eleven per cent of New Zealand children are obese - and 33 per cent are either obese or overweight, the third highest rate in the developed world.
The review panel, reporting to the Advertising Standards Authority, has proposed a single voluntary code on advertising to children to replace the existing two children's codes which cover food and general advertising.
One of the proposed code's rules says: "Occasional food and beverage product advertisements must not be screened, broadcast, published or displayed in any media or setting where more than 25 per cent of the expected audience are children."
The panel made no recommendation on how healthy foods should be distinguished from unhealthy foods, saying only that a new system should be developed. It suggested keeping on in the meantime with the existing system.
That system is similar to the Health Ministry's classification system, defining "occasional" foods and drinks as those "too high in energy and/or saturated fat and/or added sugar and/or sodium and provide minimal nutritional value".
Included are confectionery, deep-fried foods, full-sugar drinks, and artificially sweetened energy drinks.
Advertisers and public health experts are at odds over the proposed new code, on which the authority says it will make a response "in the coming weeks".
Public health specialist Professor Nick Wilson, of Otago University at Wellington, said a voluntary code was just a way for the industry to stave off actual regulation, in the way the tobacco industry had done for 20 years.
The review was "ridiculous" for failing to adopt a classification system. It should have adopted the World Health Organisation's European system or at least the star rating system.
Advertisers have dismissed the WHO system as "aspirational".
Association of New Zealand Advertisers chief executive Lindsay Mouat said that if the proposed code was adopted, this country's standards for advertising to children would be "among the most stringent in the world".
The association was disappointed that the review panel had stuck with defining children as being less than 14 years old.
"There is clear evidence that young people, 12 and over, are able to recognise and decipher commercial messages for what they are," Mouat said.
Coleman announced the release of the panel's review report in a statement to mark one year since the launch of the Government's childhood obesity plan, on which he said good progress was being made.
"Obesity is a serious issue threatening the health of young New Zealanders, which means some of our kids could end up living shorter lives than their parents."
He said the food and beverage industries were committed to finding solutions to childhood obesity through an industry-wide pledge. Some had also made specific pledges to change their recipes, advertising and labels.
"I welcome the pledges which [have] been developed by the Ministry of Health and the sector. Industry will report back on their progress in a year's time."