The Commerce Commission has released a new video, giving guidance to traders on false, misleading or unsubstantiated claims and how to avoid making them.
The video’s title and key message is ‘If you can’t back it up, don’t say it.’
“We think that message captures what traders need to consider when they make claims about their products. It’s particularly important traders can back it up when they make claims that consumers can’t themselves verify, and must rely on what the trader says,” says Commissioner Anna Rawlings.
“Examples of that include claims such as ‘free range’, ‘organic’, or ‘Made in New Zealand.”
The Commission refers to such claims as credence claims, and they are a current priority area for the Commission, particularly those relating to food products and country of origin claims.
“If those claims are misleading, they are harmful to consumers because consumers may pay a price premium for characteristics of a product that do not exist. They’re also harmful to competition because they give an unfair advantage to traders who can’t back up their claims. Finally, they can have an impact on New Zealand’s reputation with tourists and in export markets,” she says.
The video includes examples of recent cases taken by the Commission, including the Commission’s first prosecution for unsubstantiated representations, where a heat pump supplier made claims about the efficiency of some of its heat pumps, but the court found it couldn’t back them up.
Another case is bee pollen that a health supplement company said was from “the hardworking bees of New Zealand’s pristine wilderness”, when the bees and their pollen were actually from China
“We want to catch traders’ attention with this video, and for them to then get more detailed information from our website, or to seek independent legal advice. Once again, if traders can’t back up what they intend to say, they must not say it,” says Ms Rawlings.