Making accurate claims

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Substantiation

Consumers are faced with advertising claims that goods and services are cheaper, superior, healthier or have other benefits. It is illegal for your business to make a claim about your good or service without a reasonable basis. In many cases your customer will not have the time, resources or ability to establish for themselves if these claims are accurate. You must be able to substantiate (prove) your claims by providing evidence to support them.

Tips for businesses

• be specific and detailed rather than using vague claims such as ‘eco-friendly’, ‘planet friendly’ and ‘sustainably sourced’ which can be difficult to understand and have the potential to mislead
• don’t make claims that you don’t have reasonable grounds for believing to be true
• rely on facts, figures and credible sources of information, not guesses and unsupported opinions
• keep documentation or other information that you have gathered in the process of sourcing or researching a good or service
• you must have reasonable grounds for claims at the time they are made; substantiating a claim after it was made may not get you off the hook.

Health and nutritional claims

Claims made about the health or nutritional benefits of a product must not mislead consumers, and your business should be able to substantiate or prove them. Consumers are entitled to rely on the accuracy of information you provide in promotional materials or packaging to make an informed decision.

You should also remember to keep claims clear and simple. Consumers who are unfamiliar with technical or scientific terms may be misled if you are unclear or vague.

Health claims describe a relationship between the use or consumption of a product and a health benefit. Food Standards Australia New Zealand (FSANZ) and Medsafe each have key roles to play in regulating the use of health claims on food products and medicines respectively. Our role is in relation to health claims being inaccurate or misleading.

Nutritional claims are claims that suggest or imply that food or drink products have particular beneficial nutritional properties such as being 'low fat', 'high fibre', 'rich in vitamin C'. These claims can still break the law if they are true but misleading such as promoting something with no added sugar when it has fructose or lactose added.

You can read more about health and nutritional claims on New Zealand Food Safety's website.

Alternative health practices have the same obligations by law as traditional medical practitioners, in terms of making sure any claims are accurate and to not mislead consumers.

Place of origin

Customers will often be influenced by the place of origin of goods. They may prefer to buy New Zealand made products or believe that goods made in certain countries are preferable to others.

Whether a product is New Zealand made will vary depending on the nature of the product and what consumers may understand about it. It is not possible to set out a precise formula as to exactly which products can be called 'New Zealand made'.

Considerations include:

• for a clothing item, where is it actually changed from fabric into a garment?
• for a food item, where were the ingredients grown? Were they transformed elsewhere into another food item?
• for a manufactured product, is it substantially manufactured in New Zealand? Where were the critical parts manufactured? Are any significant stages of manufacture carried out overseas?

Example: A health products business claimed that two of its dietary supplements were 100% New Zealand made when all the active ingredients were imported from overseas. The High Court found that the business had made misleading "New Zealand made" claims about those dietary supplements. The decision made it clear that claiming a dietary supplement is "New Zealand made" may be misleading if the key ingredients do not come from New Zealand, even if they are packaged or turned into tablets here.

Making environmental claims

Consumers are increasingly discerning about the environmental impact of their purchasing decisions and may pay more to reduce this impact. However it is an area where they can easily be misled.

If you make environmental claims such as about sustainability, recycling, carbon neutrality, energy efficiency, the use of natural products or the impact on animals and the natural environment, these must be accurate, scientifically sound and able to be substantiated.

Retailers should be clear about the environmental benefits of their products and their processes, and specific about the part of a product or production process that the claim relates to. If you choose to make claims about how your business intends to lessen its impact on the environment, be specific and accurate.

Claiming products are organic

Organic is a labelling term for products that follow organic production standards. There are certification bodies or authorities that certify organic products.

If you sell products labelled or marketed as "organic" for example, ‘made from 100% organic cotton’, you must be able to substantiate that they are, in fact, organic and were produced organically. If you claim that your products are 'certified organic' you must be able to provide the certificate to prove your claim.

Read more about growing organically on the Ministry for Primary Industries website.

Using certification marks and endorsements

Certification marks and endorsements are commonly used by clothing and fashion retailers to show the environmental qualities of goods for sale or a process. However, it may not be clear what these endorsements mean. It’s important that retailers do not overstate an environmental benefit.

If a certification mark or logo is displayed, retailers should consider providing consumers with information that explains the meaning of the mark or logo displayed.