Tokelau is angered at New Zealand plans to give its administrator in the islands a veto over decisions made by the Tokelau government.
Siopili Perez, who was appointed Ulu, or leader, of Tokelau last week, used his opening speech at the General Fono to protest the New Zealand proposal.
The Asia Pacific Report said this move would give the administrator, David Nicholson, oversight of Tokelau development funds when spending is greater than $US346,000 dollars.
The Ministry of Foreign Affairs and Trade gave up this level of control over the General Fono in 1996.
It comes after Tokelau reportedly bought helicopters - a move that infuriated Foreign Minister Murray McCully.
The administrator was dispatched to Tokelau to seek a please explain, but the Tokelau Government is yet to make a public comment.
The Asia Pacific Report quotes Labour's Pacific Island Affairs spokesperson Su'a William Sio saying power over Tokelau's affairs should lie with the General Fono, not New Zealand.
He called it a heavy handed approach that smelt of arrogance.
Tony Angelo, a constitutional adviser to Tokelau, said the veto powers could compromise New Zealand's compliance with the United Nations decolonisation requirements.