Consumer Affairs minister Paul Goldsmith - who took over from Craig Foss, who set up the working group - also weighed in, saying clamping should be a "last resort".
The move follows an original Code of Conduct in 2012, which focused only on regulating clamping companies.
Automobile Association senior policy analyst Mark Stockdale, a member of the group, said the new code was much broader and would cover the activities of all private parking enforcement companies.
The key element to the new code was a "hierarchy of enforcement options", led by a "breach notice" - what most people would call a "ticket", he said.
"The breach notice should be the main enforcement tool for most parking operators. It's the most effective tool while also balancing the need to provide a fair enforcement penalty for motorists." Fairness in cost was a critical factor and "no one can justify $200" - the maximum clamping penalty, he said.
"It's vastly more expensive [than a breach notice] and it doesn't free up a parking space."
Under the next option, companies would call in a tow truck, which would free up parking spaces in congested areas.
"You would only use a wheel clamp for repeat offenders where they are not causing an obstruction. That is going to be a change in the way some companies operate because their approach is to use a wheel clamp only."
While voluntary, the new code would have support, with many more companies than the clamping code which had just five signatories, he said. "The industry is aware the industry needs cleaning up."
He said the code would hopefully be finalised by the end of the year. The AA's view, he said, was that "there is no place for clamping in New Zealand".
Mr Goff, who took up the cause of motorists around his Mt Roskill electorate office, said the proposed code was a "huge improvement".
"What worried me about clamping was that the cost and over-all penalties were disproportionate to the offence by the person who may well have made a mistake."
Mr Goldsmith said officials had told him there was good progress towards a new code of conduct.
"I believe that wheel clamping has a place of last resort in a range of options available to parking enforcement operators."
Herald inquiries have found two of the five original signatories to the 2012 Code of Contact are no longer in the business.
Daniel Clout - a high-profile clamper in Taranaki under the banner of Egmont Security - quit the business after anger from locals.
The other high-profile clamping company boss was Gordon Ward, who was still in the business despite two liquidations and a bankruptcy.
His NZ Clamping Co Ltd went into liquidation in March last year following criticism for clamping in suburban Auckland areas.
His other parking enforcement company, Comprise Group Ltd, went into liquidation at the same time. NZ Clamping Co Ltd was listed in its latest liquidation report as owing $434,273. Records showed ACC and Inland Revenue to be among the main creditors.
The month before the companies folded, Elite Parking Services Ltd was set up and carried on clamping in suburban Auckland shopping areas. According to Companies Office documents, it operates from the same premises as NZ Clamping Co Ltd.
Mr Ward stepped down as a director in July after being found bankrupt by the High Court at Auckland. He remains a shareholder of the three companies with his wife, Karin Busby-Ward.
Neither Mr Ward nor director Wayne Wilson responded to calls for comment.
Trouble brewing in Titirangi
Wheel clamping in the carpark of SuperValue market in Titirangi, West Auckland, has led to calls for a boycott and even claims of violence.
Laingholm's Erica Lang faced a $200 fine to get a clamp off her car and told the Herald it made her want to drive further to Green Bay to do her shopping. She was nabbed when picking up takeaways.
She said she pulled into the first spot in the otherwise empty carpark and was gone for two minutes while collecting dinner.
Ms Lang said she returned to find she had been clamped for using a park requiring a mobility pass.
"I had to give her $200 cash or she wouldn't release my vehicle."
Another woman said she punched a clamper during a row. Her car was clamped while still running, leading to a row during which her father was grabbed at the throat, she said.
She was "justified ... punching him off my dad" because the "scumbag grabbed him around the throat", she said.
Demop owner Julie Eastmure has the hair salon above SuperValue and has a separate enforcement company for her three parking spots, which acts on the tickets she issues.
She supports enforcement but said she was frustrated to see Elite Parking Services clampers using her parking spots as a good vantage point to find targets in neighbouring SuperValue parks.
SuperValue owner Pranil Ranchhod told the Herald he took to the community Facebook page after locals started talking about organising a boycott of the shop. He wrote how he hired the clamping company "reluctantly" after complaints from locals who kept finding cars in the two disabled parks without mobility passes.
There had since been fewer parking problems, he said.
Elite Parking Services Ltd director Wayne Wilson said he "did not have time to talk to you about this". He said he would call back, but did not.
