New Zealand is to ban shark finning in its waters within two years, Primary Industries Minister Nathan Guy announced Sunday.

It is already illegal in New Zealand to slice the fin off a shark and throw it back alive, and Guy said the new ban would be extended to finning a shark and dumping the carcass at sea.

It will start to take effect in some areas next October and cover all New Zealand waters by 2016.

"The practise of finning sharks is inconsistent with New Zealand's reputation as one of the best managed and conserved fisheries in the world," he said.

Conservation Minister Nick Smith said New Zealand's attitude to sharks "has come a long way since the 'Jaws' days of the only good shark being a dead shark".

"This ban on finning is an important step towards improving shark conservation," he added.

New Zealand has 113 species of sharks of which seven are already protected including great whites, the whale shark and the basking shark.

According to the UN Food and Agriculture Organisation, shark stocks are being decimated with about 100 million killed globally each year, mostly for their fins which are a sought after delicacy in Asia.

They are used in the lucrative shark fin soup market as well as in the production of many traditional medicines.