COMMERCE COMMISSION REMINDS BUSINESSES ABOUT NZ MADE CLAIMS

The Commerce Commission has reminded all businesses that any ‘Made in New Zealand’ claims made about a product must be accurate, able to be substantiated and must not mislead consumers about the country of origin.

The reminder comes after the Commerce Commission received nine complaints about the accuracy of “Made in NZ” labelling on some t-shirts sold by NZ clothing brand, WORLD. After a preliminary assessment of these complaints, the Commerce Commission opened an investigation to further look into the matter.

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 convey a misleading impression about the origin of a product if it is not manufactured or produced in New Zealand.

A number of factors, including the nature of the product and what consumers understand about it, can impact whether a product is ‘Made in New Zealand.’ The meaning of “made” can also vary depending on the type of products. For example, the place in which a clothing item is transformed from fabric into an actual garment.  For a food item, “made” implies where the ingredients are grown. Manufactured products are impacted by many factors such as; Where was the primary componentry made? Was the product substantially manufactured in NZ? Were any substantial stages of manufacture conducted offshore?

Commissioner Anna Rawlings states that consumers will often be influenced by the origin of goods when they are considering whether to buy something and are likely to rely on the information provided by the retailer about the source.

“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,” said Rawlings.

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 a false or misleading country of origin claim. 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.

The Commission has also 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 whether or not their representations are true.