Companies manufacturing drugs often used as 'legal highs' could be banned from producing such drugs in New Zealand unless they provide clinical evidence that the drugs are safe for consumption.
The law imposes strict controls on products such as synthetic cannabis and legal "party pills", which mimic the effects of drugs like ecstasy without using illicit substances.
"These products have had a shocking effect on young people and their families," Associate Health Minister Todd McClay said.
"Up until now, frontline officers have had to deal with the consequences," he continued. "Now police can be proactive, and with the help of the public we can ensure that this new law is successfully enforced."
McClay said he had received accounts of children as young as 11 becoming addicted to the synthetic drugs, but New Zealand's "world-leading" legislation would address the problem.
"The sooner this dangerous muck is out of our dairies (newsagents) and corner stores the better," he said.
Previously, authorities had to prove a synthetic drug was harmful before ordering it off the shelves.
Under the new law, all synthetic psychoactive drugs will be illegal until their producers can provide clinical proof, such as toxicology reports and evidence from trial studies, that they are safe.
The department of health has estimated that carrying out such tests will cost manufacturers up to NZ$2 million ($1.6 million) for each synthetic drug, effectively deterring them from trying to sell such substances in New Zealand.
The law also stops the products being sold to minors and bans them from easily accessible retail outlets such as service stations and convenience stores.