As a business, there are rules in the Fair Trading Act that apply to all aspects of promoting and selling goods and services – from advertising and pricing to sales techniques.
Complying with the Consumer Guarantees Act
You must meet minimum guarantees for the products and services you sell to consumers. These include that goods are of an acceptable quality and that repair facilities, refunds or replacements will be available for a reasonable time if goods are faulty or services are substandard.
To help consumers make informed decisions when buying and caring for goods, there are information standards in place requiring suppliers to disclose information.
There are currently seven consumer information standards that are set by regulation under the Fair Trading Act. To help consumers make informed decisions about the goods they are buying and how to care for them, you must disclose certain information about the goods you are offering to supply.
As a trader, you cannot contract out of your obligations to consumers under the Fair Trading Act. However, there is an exception where you may be able to contract out of some of your obligations when dealing with other traders.
Consumers must be able to rely on the information traders provide when they are buying goods and services. Your business must not mislead consumers about price, quality, features, deliverables or any discounts – everything must be accurate and clearly described.
The Fair Trading Act makes it illegal for anyone in trade to mislead consumers, give false information, or make misrepresentations. It also applies to advertising in all forms such as online, print, TV, social media – and in all dealings with consumers.
When manufacturers, importers, distributors and retailers of a product share responsibility for reducing the environmental impact of their product it is referred to as product stewardship. Product stewardship schemes can have significant benefits for New Zealand but they must still comply with the Commerce Act.
Whenever you promote or sell your goods and services you must use accurate and clear information. This is regardless of whether it is said verbally or in writing.
It is the overall impression given by pictures, advertisements, promotional material, media clips, radio or a sales pitch. It is not only about what information you are given, it includes impressions given when important information is left out. Be accurate and reliable in what you say to customers and potential customers.
You must not mislead customers when giving quotes and estimates, or in your invoices. Consumers must be able to rely on a quote or estimate as these help them make a decision about whether to purchase the goods or services.
If you are a business that deals with consumers and you use standard form contracts, you need to make sure your terms are fair.
The Fair Trading Act aims to protect consumers against unfair terms in standard form consumer contracts. If your contract with your customer is for goods or services normally acquired for personal or domestic use then it is likely to be a consumer contract.
Consumers have certain rights when buying goods and services from someone who is ‘in trade’, so it is important to know when you are in trade and to meet your buyers' expectations.
These Consumer Remediation Guidance will help businesses put things right for consumers after a likely breach of one of the laws the Commission enforces.
