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Wanganui District Council banned such patches from the city at its meeting yesterday.
The bylaw gives police powers to fine patchwearers $2000 and to take their gang insignia from them.
Mr Laws said it was "extraordinarily" rare for Parliament to give a council such power.
"To ban gang patches and gang insignia will give a real fillip to Wanganui police and to Wanganui citizens," he said.
"It removes gangs' most powerful and intimidatory weapon."
A report on the bylaw submissions hearing, tabled at yesterday's meeting by senior councillor Randhir Dahya, said the bylaw was intended to deal with gangs, but would not affect clubs and groups who were law-abiding and non-confrontational generally.
"There are people in Wanganui who will say we don't have a gang problem but the fact is there is a gang problem in Wanganui, just as there is in other towns and cities," Mr Dahya's report said.
Police "totally supported" the passing of the bylaw, the report said.
"This bylaw demonstrates this council's commitment to making Wanganui a safe place for all."
The council was required to signpost where the bylaw would be enforced, and could not determine "all public places in the district are public places", the report said.
Mr Laws said that the voice of the Wanganui community had been instrumental in guiding the council, with 67 percent of people voting in Referendum '07 that gang insignia be banned.
"We are the first city and council in New Zealand to say 'enough' to the predations and petty terrorism of gangs," he said.
"Now it is time for the rest of New Zealand to follow our lead. We don't have to put up with these criminals who are intent upon undermining our society. They must not be tolerated."