Consumer rights FAQs
The information below is designed to answer some of the questions both consumers and businesses may have about their rights and obligations in relation to COVID-19.
Please note that the Commission does not enforce the Consumer Guarantees Act. It is self-enforcing, meaning you need to take your own action by raising concerns with the business. If that does not resolve the issue you can take a case to the Disputes Tribunal.
For up-to-date information on COVID-19 please see the dedicated Government website – www.covid19.govt.nz
COVID-19 product claims
Q: I have seen lots of people on Facebook claiming to have products that cure, prevent, treat or protect against COVID 19? How do I know these are real?
A: It is illegal for any person or business to make a claim about a good or service without a reasonable basis. They must be able to substantiate (prove) their claims with evidence to support them.
If you have concerns about any sellers’ claims relating to COVID-19 please let us know by filling out our complaint form
The COVID-19 virus has had a significant impact on both consumers and businesses, with disruptions to travel, trading and events. The virus has many wondering what their rights and obligations are in these situations. We have produced a fact sheet that outlines some of the legal principles that apply to these situations.
Q: I went to buy face masks and sanitiser at my local store but they had increased the price by 200% since last week, can they do that? I thought price gouging was illegal?
A: While businesses are free to set their own prices, and increasing prices above levels charged previously isn’t illegal in New Zealand, the Fair Trading Act prohibits misleading and deceptive conduct and false representations. This means that if a business gives a reason for a price increase it must be true or the business risks breaching the law. Consumers should ask for the reason a price has increased and if they are concerned the reason that is given is not true they should let us know by filling out the complaint form on our website.
The Ministry of Business, Innovation and Employment has established PriceWatch (email@example.com) where you can report exploitative pricing. MBIE will be referring any that the Commission could take action over to us.
Q: People are selling hand sanitiser for super high prices on Trade Me, is this allowed?
A: Private sellers are free to set their own prices. However, they must comply with whatever rules the site (eg, Trade Me or Facebook) sets. Both Trade Me and Facebook have implemented rules to prevent exploitative pricing. When you come across listings with pricing you think is exploitative on items like sanitiser and masks you should report it to the site (eg, Trade Me or Facebook).
Limited sales of supplies
Q: People are panic buying and my supermarket has restricted the sale of toilet paper to one pack per person, can they do this?
A: Yes, however we recommend that the supermarket clearly states what limitations are being applied to goods.
Q: Lots of online businesses are still selling their products but won't dispatch the items until after the lockdown is over. Is that ok and is my money safe?
A: Businesses are allowed to sell their products with a future delivery date as long as they are clear about when they will dispatch the items (eg, after the lockdown). They must also reasonably believe they will be able to fulfil the order at the end of the lockdown.
However, there are risks in purchasing online in an environment when businesses are also affected by the lockdown – if a business stops trading and does not deliver, then you may not get your items or your money back.
Q: I have purchased a product online and the seller has now delayed delivery of the product again, what are my rights?
A: When you, as a consumer, buy goods from a business, you have rights under the Consumer Guarantees Act. Under the Consumer Guarantees Act goods should arrive within the stated time frame or within a reasonable time if a date is not given. If this does not happen then you can reject the goods and ask for a full refund.
When buying online, you should be aware that significant overseas events like the spread of COVID-19 can have an impact on the availability of goods. If your purchase is time-critical you should double check with the seller that the item is in and stock and when you can expect it to arrive.
What is a “reasonable time” depends on the surrounding circumstances. If international or domestic goods transport is disrupted or lockdowns are in place, this may mean that a lengthier than normal delay may be “reasonable.” Where possible, we recommend that you discuss delivery timeframes with the supplier at the time you make the order so that both parties are clear about what is expected.
Q: I have purchased a product online and the seller has cancelled my order as they can no longer supply it. They have given me store credit but I want a refund, can I get one?
A: If an online seller cancels your paid order, and does not deliver goods, you are entitled to a refund under the Consumer Guarantees Act.
Q: I have purchased a product online and the seller has told me they can’t supply it for 3 months and they are still selling it on their website, is this allowed?
A: Yes, the seller is permitted to offer goods for sale with a deferred delivery date, as long as the applicable timeframe is made clear to consumers.
Sellers are, however, prohibited from offering goods for sale where they have no realistic expectation of being able to deliver them. A good should not be offered for sale when the seller, not having the good in stock, does not have knowledge of when the item will be in stock and able to be delivered.
There may be times when, through no fault of its own, a seller is unable to supply goods as advertised. Businesses should have a ‘raincheck’ system in place to ensure that the business supplies the goods or equivalent goods, at the advertised price, as soon as is practicable. The goods should be provided within a reasonable time if the raincheck is accepted by the customer. If the customer does not wish to accept a raincheck, a refund should be provided.
Q: I had to call a tradie to do an urgent job and they charged me a COVID-19 surcharge, can they do that?
A: Businesses can set their own prices for products and services, including charging a surcharge. If they do apply a surcharge it must be clearly disclosed before the consumer makes a decision to purchase or engage the service. The reason for the surcharge must be accurately described or the business risks breaching the Fair Trading Act. For example, a business cannot claim the surcharge is for personal protective equipment (PPE) if they are not using PPE.