The Building Federation is warning a new law could allow foreign companies to dump cheap building materials in New Zealand.

Last week Parliament passed government legislation allowing the Commerce Minister to override anti-dumping rules when it was considered to be in the public interest.

The government has also extended the suspension of anti-dumping duties on residential building materials in order to lower costs.

That means an importer will not face penalties if a product is being sold here at an unfairly low price.

But the head of the Building Federation, Bruce Kohn, said the government was sending the wrong message.

He said there was a danger this country would become a "dumping ground" for any global supplier that wanted to get rid of its products, whether they were compliant or not.

Industry body Metals NZ's chief executive, Gary Hook, said he knew of a number of companies wanting to launch a complaint about dumping.

"You know there's a big hurdle to that, it costs a lot of money to do that.

"And I guess the signals we are getting from government would clearly indicate that even if you did invest that money in trying to protect your options you are up against a pretty stiff regime."