Earlier this year I wrote about Alt TV being hauled over the coals by the Advertising Standards Authority because it offered viewers the chance to win “$10,000 prizes”, when in fact the TV station was only giving away scratch-n-win tickets. Well, now they are not alone.
The Commerce Commission recently reported that ANZ Bank was fined $80,000 in court in relation to advertisements for a Bonus Bonds promotion. The offer in its advertising said that there was a chance to win $1 million plus $500,000 to spend on a bach. In fact, the prize was a chance to pick one of 100 envelopes – and only one of the envelopes contained the main prize.
Recently while walking through central Auckland I saw Alt TV creative director Oliver Driver. I must say I half expected him to fold up and slot into a cardboard box, because that’s what happens to him in the “Buy Kiwi and we’ve got it made” advertisements on TV.
We’ve recently had a Fair Trading Act court case about whether a particular product was in fact “NZ Made”. When we see products promoted as New Zealand made, we should be able to believe it. But what exactly does “New Zealand made” actually mean? This case was about office chairs. A New Zealand company had distributed a promotional brochure with a silver fern on the back cover and the words “NZ made”.
The chairs were designed in New Zealand and assembled in New Zealand, but almost all of the components were manufactured overseas. Only the foam padding had actually been made in New Zealand. Almost two thirds of the production costs of the chair were taken up by the design, the foam parts and assembly of the chairs in New Zealand. Sounds like us, doesn’t it? Not this time.
The court refused to focus on any one particular factor to decide whether something was New Zealand made, acknowledging that in today’s marketplace there are often many different country of origin claims for products. “NZ Made” is different to “NZ Built” or “NZ Assembled” or “produced in NZ from local and imported ingredients”. The important point is that every claim must accurately represent the true position; otherwise it is likely to be misleading.
Chair components manufactured overseas included the gas-lift mechanism, plastic seat back, castors and the chair base. The manufacture of these components involved major processing – raw metals and plastics were transformed overseas into finished chair components using processes that would be expensive to set up here. The chair was almost in its final form, barring assembly, which was a comparatively minor stage that could be finished with hand tools. The court held that the New Zealand steps of design, foam manufacturing and assembly were not enough to justify the claim that the chair was “NZ Made”: this claim was misleading.
The important point is that if you want to promote a product as New Zealand made, you need to check carefully, to ensure that your claim is accurate. Depending on the facts, you might not be able to make a broad “NZ Made” claim, but you might be able to say “NZ assembled” or use another, accurate, focussed claim.
I must say that I agree with Judge Ongley’s comment: “The quality of the chairs is not in doubt.” I say this because halfway through writing this article, I realised I was sitting on one of these very chairs, and it is certainly a good one. It must be that New Zealand design.
Richard Anstice is a staff solicitor in Rae Nield’s office. This article is intended for general information,and should not be relied on as specific legal advice. You should consult a lawyer for advice relating to your own specific legal problems. Rae and Richard can be contacted at email@example.com.