Chief Censor David Shanks has labelled the live-stream video of the Christchurch terror attack as 'objectionable', meaning it is illegal to distribute.
Under its new classification, people found to be distributing the video could face up to 14 years in prison, or a $10,000 fine.
Shanks appeared on The AM Show this morning to discuss the video.
"I have classified this video as objectionable which makes it illegal to share and distribute and to possess."
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He said it is hard to police social media platforms, but now sharing the video can have consequences, which he hopes will stop its spread.
"The argument that social media platforms have around this is that they operate like a phone company, that they're not responsible for what is put on their platforms and delivered through their platforms.
"It's a matter of taking stock of what we've got. Now there is action that can be taken for those who are posting, reporting and publishing this material.'
Shanks also said some tech companies had worked hard to ensure there was limited access to the video, but he had no word yet about the number of people who watched it, whether on purpose or accidentally.
"Any industry player has a duty of care to its consumers and we need to understand how bad this was, I've had reports that this clip was auto-playing on people's feeds."
He said while it is hard for him to regulate platforms like Facebook and Twitter, the companies need to stop deferring responsibility over the hosting of the video on their platform.
"It doesn't wash with me, I'm a media regulator with the responsibility to protect New Zealanders from harm."