Reminder to businesses about ‘Made in New Zealand’ claims
Published14 May 2018
The Commerce Commission is reminding all businesses that any ‘Made in New Zealand’ claims they make about their products must be accurate, able to be substantiated and must not mislead consumers about the country of origin.
The Fair Trading Act (FTA) prohibits businesses from making false or misleading claims about the country of origin of their products. Symbols such as kiwis or the New Zealand flag can also convey a misleading impression about the origin of the product if, in fact, it is not manufactured or produced in New Zealand.
Whether a product is ‘made in New Zealand’ depends on a number of factors, including the nature of the product and what consumers understand about it. Some examples help explain how the meaning of “made” can vary depending on the product:
For a clothing item, where is it changed from fabric into a garment?
For a food item, where were the ingredients grown?
For a manufactured product, was it substantially manufactured in NZ? Where was the primary componentry made? Were any substantial stages of manufacture conducted offshore?
Commissioner Anna Rawlings says consumers will often be influenced by the origin of goods when they are considering whether to buy something and are likely to – and are entitled to – rely on the information provided by the retailer about origin.
“Some consumers are happy to pay a higher price for goods which they believe are made in New Zealand, and for some, this represents an important ethical decision. Country of origin claims are also important for local manufacturers that want to protect the value placed on a genuinely New Zealand made product.”
“Any labelling must be clear and truthful. For example, if a manufacturing process includes steps taken within New Zealand and overseas, some brands choose to explain this with labelling such as ‘Packaged in New Zealand using imported ingredients’. For clothing, an accurate claim might say “Designed in NZ and manufactured in China,” she said.
This reminder to businesses follows nine complaints received by the Commission about the accuracy of some t-shirt “Made in NZ” labelling by clothing brand, WORLD.
After a preliminary assessment of these complaints, the Commission has opened an investigation. We are currently unable to make any further comment on that investigation.
The Commission has produced a video called ‘If you can’t back it up, don’t say it’which offers guidance to traders about being able to substantiate that their representations are true.
Suppliers of new clothing and footwear have specific country of origin labelling requirements under the Fair Trading Act in addition to being prohibited from making false or misleading country of origin claims. The Consumer Information Standard for Country of Origin (Clothing and Footwear) Labelling includes a requirement that suppliers attach to the clothing or footwear a permanent label with the country of origin. You can read more about country of origin labelling here.
Other country of origin cases
The Commission has taken a number of country of origin cases in recent years which include:
In May 2017 a health supplement company and its owner were fined more than $500,000 for claiming that bee pollen was New Zealand-made when the bee pollen was sourced from China.
In April 2016 the High Court found that a health supplement company’s “New Zealand made” claims were misleading because all the active ingredients were imported from overseas.
Since 2011 the Commission prosecuted 11 companies and 11 individuals for selling imported alpaca rugs as “Made in New Zealand”, and/or for claiming duvets were predominantly alpaca, merino wool or cashmere when they were not. A total of more than $1.5 million in fines had been ordered when the most recent company was fined in 2017.
