The regulator issued a 'stop now' letter to PD Mart, while it investigated potentially misleading labelling that may have falsely claimed the products complied with car seat safety standards.
PD Mart has a store at the Northwood Supa Centa in Christchurch and sells more than 50,000 products.
PD Mart has initiated a recall of all affected car seats, and the information has been published on the government's Product Safety website.
The products may not comply with the car seat standards and may pose a potential risk for children, the commission's recall alert said.
It said consumers should immediately cease using the car seats and return them to PD Mart for a refund.
"The Commission has zero tolerance for risks to children's safety," said competition, fair trading and credit general manager Vanessa Horne.
The Commission said it had an ongoing investigation into PD Mart due to safety concerns about multiple products.
"During this investigation, we also identified issues with car seats, which feature labels claiming compliance with recognised safety standards - claims the Commission believes may be false or misleading," Horne said.
"We consider this likely to be a breach of the Fair Trading Act, and consumers may have been misled into believing the products were compliant with safety standards, when that is likely not the case."
It said some car seats lacked proper installation instructions, which was a "critical omission".
"When critical information regarding installation and use is not provided, the consequences can be serious," Horne said.
PD Mart has stores in Auckland and Christchurch.
-RNZ and Star News
