More Commerce Commission action against small print highlights this is still a Fair Trading Act problem.

Commission Fair Trading Manager Rachel Leamy said that the Commission's just signed settlement with Bridgestone/Firestone New Zealand Limited is the tenth recent prosecution or settlement involving small print. The Commission has also warned another 14 companies.

"Courts have ruled specifically on small print," Ms Leamy said. "It cannot be used to qualify or change the overall impression created by advertising. The Commission will continue to actively monitor small print and if problems continue, then we will have to consider taking more prosecutions."

In a precedent setting case in 1996, Judge G.S. Noble found a company guilty of breaching the Fair Trading Act and stated:

"As to qualifications, small print cannot save a representation from being misleading, and I propose to adopt the approach in Henderson where the Court in effect ignored the qualifications and looked squarely at the representation and asked 'Is that misleading'."

The case just settled involved Bridgestone/Firestone television and newspaper advertisements for budget tyres. The advertisements were broadcast and published in June last year.

In the settlement, Bridgestone/Firestone agreed that its television advertisements risked breaching the Act because the small print was difficult to read, too small, remained on screen for an insufficient time and materially altered the main message.

It also agreed that its print advertisements risked breaching the Act because they contained small print which qualified the main message.

Both television advertisements featured a voice over stating "two tyres for $99". Text in the first television advertisement offered "two new budget tyres for $99", and in the second offered "two new budget tyres from $99".

Small print on the screen briefly at the end of the advertisements stated "155/80R13".

The small print referred to the smallest sized budget tyre. Other budget tyres were not available at the advertised price. Prices for budget tyres ranged from two tyres for $99 up to $89 for one.

The heading of the press advertisements stated "2 new budget tyres - $99". In small print at the bottom of the advertisements was "based on tyre size 155/80R13".

Bridgestone/Firestone has signed a Deed of Settlement giving written undertakings including:

  • agreeing that the advertisements risked breaching the Fair Trading Act;
  • that it will ensure all future advertising and promotional material clearly sets out all important terms and conditions;
  • having solicitors carry out an external audit of its compliance programme;
  • reporting back to the Commission on the audit and subsequent changes made to the programme;
  • that it will fund a Commission-run seminar for the tyre industry;
  • that the Commission has the right to take court action if the settlement is breached; and
  • that the Commission will publicise the settlement.

Media contact: Fair Trading Manager Rachel Leamy

Phone work (04) 498 0908

Communications Officer Vincent Cholewa

Phone work (04) 498 0920

Commission media releases can be viewed on its web site www.comcom.govt.nz