Storm IMC has warned New Zealand businesses that review gating now carries legal risk under the Fair Trading Act, as pressure from both Google and regulators increases.
Review gating uses software to screen customer satisfaction before prompting people to post reviews on public platforms such as Google and Meta. Customers who report a positive experience are directed to leave a public review, while dissatisfied customers are sent to a private feedback form, reducing the visibility of negative responses.
Widely marketed as a reputation management tool, the practice is used across sectors including healthcare, trades, hospitality, real estate, and franchise operations. Storm IMC said many businesses may not realise it can breach both platform rules and consumer law.
Platform pressure
Google has stepped up action against manipulated reviews, with automated detection playing a larger role in enforcement. Storm IMC cited Google data showing review deletion rates rose by more than 600% between January and July 2025, while nearly 2% of monitored business locations were losing at least one review a week at the peak of that activity.
Although those figures cover several forms of review manipulation rather than review gating alone, they point to broader tightening oversight. Storm IMC compared the shift with Google's earlier crackdowns on prohibited search practices, which sharply affected businesses that relied on tactics that breached platform rules.
Regulatory cases
In New Zealand, the issue has also moved beyond platform compliance into formal regulatory enforcement. The Commerce Commission has identified review manipulation as an active priority under the Fair Trading Act.
One of the clearest recent cases involved The TV Shop, which operates the Thin Lizzy brand. It was convicted on 13 charges after posting undisclosed staff reviews and preventing low-rating reviews from appearing on its own website. A penalty hearing is still pending.
The case followed a Commerce Commission investigation after consumers spotted discrepancies in the company's review profile. It has become one of the most prominent examples of the regulator's willingness to pursue misleading review practices through the courts.
Bachcare was penalised in an earlier case after withholding reviews below a 3.5-star threshold from public display. The holiday home rental platform was fined $117,000 in 2019 in a case that highlighted the legal risk of selectively suppressing weaker customer feedback.
Higher penalties
The stakes could rise further if proposed legal changes proceed. Legislation before Parliament would increase the maximum penalties for Fair Trading Act breaches from $200,000 to $1 million for individuals, and from $600,000 to $5 million for companies, or three times the commercial gain made or loss avoided, whichever is greater.
The change would significantly increase the financial exposure for businesses found to have misled consumers through manipulated review practices. It would also strengthen deterrence at a time when online reviews increasingly influence consumer choice and commercial performance.
Founder Ronan Nichol said businesses should not assume the issue is limited to a small group of bad actors.
"I have sat in meetings where review gating is being sold as a legitimate product. Most of the business owners using this software have no idea they are in breach of Google's policies or the Fair Trading Act. The Bachcare case was triggered by a single consumer noticing an edited review. The enforcement is already underway and the penalty increases will make the consequences far more serious," Nichol said.
Storm IMC urged businesses to review their customer feedback processes and stop using any system that screens reviewers before they reach a public platform. It also recommended sending review requests to all customers after each interaction and responding to negative feedback rather than diverting it from public view.
The agency argued that businesses in the strongest long-term position will be those that collect feedback without filtering and deal openly with criticism. In sectors where online ratings affect bookings, leads, and sales, that distinction could become more important as scrutiny increases.
"The businesses that come out of this period strongest will be the ones that have been doing it properly, delivering good work, asking all customers for honest feedback, and responding professionally to everything they receive," Nichol said.