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His comments follow an incident in which a speedboat smashed into a yacht before flying through the air into a wharf and injuring four people, one of them seriously.
The collision happened at Herald Island in West Auckland about 11.30pm on Saturday.
Police are investigating if alcohol was a factor in the crash.
The speedboat, occupied by a young couple, appeared to be weaving between moored yachts before the crash, according to witnesses. The boat had tried to pass between two yachts moored at the wharf and collided with both vessels.
The speedboat then crashed on to the floating dock then slid over it and sank.
Maritime police said the harbourmaster would be salvaging the boat today.
Mr Key told TVNZ's Breakfast programme today it was a "nice idea" to impose drinking limits for boaties, but in reality, it would be difficult to implement.
"If you get in a boat with someone that's highly intoxicated, or you're driving a boat and you're highly intoxicated, that is a really dumb thing to do."
But it would be difficult to have the equivalent of a "booze bus" on the high seas, he said.
The Recreational Boating Forum would be looking at the issue and making recommendations to the government in April, he said.
Mr Key also said it would be costly to test boaties' blood alcohol levels compared with the amount of alcohol-related incidents that happen.
Fisherman Jayson Hoff, who saw Saturday night's crash said a family, including two children, had been sleeping on the yacht when the speedboat smashed into it.
"We heard a woman screaming and we broke through a gate to try to help," he said. "The people on the yacht were already getting the man and the injured woman out of the water.
"The woman on the speedboat had her legs pretty smashed, had cuts and couldn't move. There also seemed to be something wrong with her back."
He said te speedboat had no lights on and was travelling fast just before the crash.
Police, ambulance and coastguard attended the scene and police said they were investigating.