Councillor Linda Cooper, Chair of the hearingspanel, said the policy had to find a balance between respecting the legal right for shops to sell the products and the need to protect the most vulnerable in the community.
"From our work in consultation with Aucklanders, we quickly found that many people wanted the products banned outright," she said.
"However as it is the Government licensing the products, we could only act within the legal parameters that were set, which meant controlling the areas where the products could be sold.
"So we have tried to find a balance between the legal rights of retailers to sell the products while keeping the most vulnerable away from easy access to them.
"I am pleased with the policy and with the committee's decision to adopt it, and hope it will go some way to protecting those in our community who need it most," Ms Cooper said.
Although the council cannot prevent substances being sold in outlets licensed by the Government, it may ensure retail outlets are not near vulnerable communities, schools and treatment centres for mental health issues or substance abuse.
After considering 1454 submissions on a draft Local Approved Product Policy in a five days of hearings, a committee led by councillor Linda Cooper has recommended a tightening of the opportunity for sales outlets in the suburbs but suggests a special case be made for easing up in the CBD entertainment and nightlife hub.
Inspector Davey said the hearings committee had taken a reasonable approach in specifying criteria for sales outlets in the outer suburbs.
However for the city centre, the recommendations were for far less stringent measures, particularly around schools.
"We would encourage the council to be consistent with policy across the whole of the Auckland region, irrespective of suburb or population density.
"We believe psychoactive substances should not be sold from or nearby to established licensed premises whether they be on or off-licences."
The police failed to persuade the hearings committee to prevent shops opening within 500m around all primary and secondary schools, saying this should still allow locations for retailers even in high density zones around Auckland City district.
Police, with the Alcohol Health Watch organisation, are seeking an additional restriction to prevent outlets within 50m of an existing alcohol off-licence store.
Alcohol Health Watch director Rebecca Williams said availability of psychoactive substances and alcohol multiplied the potential harm in the central city.
"You are attracting types who want to drink heavily and they are more likely to use other substances."
Councillor Cooper said the committee felt this was too restrictive for the central city area, because the exclusion zones would be joining together and the committee had a 200m buffer between sales outlets.
Schools had not asked to be in an exclusion zone.
Councillor Cooper said any issues of anti-social behaviour in the Myers Park and other mid-city public areas could be dealt with by the Public Safety and Nuisance Bylaw.
"We will make sure there is robust enforcement and work closely with police.
"In two years we will review the policy and if we find there is significant problem and harm, the council can add it in. But at the moment there is insufficient evidence."
2013: Government brings in the Psychoactive Substances Act to control the manufacture and sale of licensed substances.
2014: Act amended to cancel all permits for selling the substances, until the Health Ministry develops regulations for approval of low risk products and store retail licences - possibly completed around June. The Psychoactive Substances Regulatory Authority is to make all decisions on retail licenses, valid for three-year terms.
2015: Auckland Council hears 1454 submissions on how it should decide where the substances can be sold within Auckland. Its policy seeks to protect "vulnerable" people as best as possible, by banning licence locations in the poorest areas and also near social housing, schools and neighbourhood centres. The council cannot ban sales of legal highs in the whole region because the act gives people the legal right to buy.
Location Restrictions
Auckland City Centre:
•Retail outlets will not be licensed in areas of with a high proportion of people living in social housing and within 200m of an existing licensed outlet.
All other areas of Auckland, retail licenses will not be granted for:
•Areas of high deprivation - the area will be in the most deprived 30 per cent of New Zealand.
•Neighbourhood centres.
•Within 500m of a school teaching students year 7 and above.
•Within 200m of a school for students between Years 1-6 inclusive.
•Within 500m of an existing licence retailer.
•Within 100m of a marae.
Licences will not be granted in these special restricted commercial areas:
Hunters Corner, Papatoetoe; Manurewa; Mt Wellington Highway/ Waipuna Rd, Mt Wellington; Papakura Caravan Park, Papakura; Don Buck Rd/Triangle Rd, Henderson; Manukau Station Rd; Te Hana, Rodney.
