DECEMBER 2024

ALCOHOL 

Australia 

Is this image of Santa appealing to minors in alcohol advertising?

A complaint was made to the ABAC regarding an Instagram advertisement for Billson’s 12 Days of Christmas Vodka featuring a person dressed as Santa.[1] The complainant argued that the advertisement was appealing to minors by using the well-known image of Santa, and thus breached Part 3(b)(i) of the ABAC Code for having a strong appeal to minors.

In coming to its decision, the Panel looked at a range of past decisions that dealt with a similar issue. In its review, the Panel found the relevant factors to be:

  • There is no prohibition on referencing Santa in alcohol advertising;

  • yet it will elevate the likelihood of having a strong appeal to minors;

  • it is a case-by-case assessment; and

  • the context is key.

Using these factors, it was held that Santa was the ‘dominant feature’ in the Instagram post and included the product box which resembled and a present, and these two elements made it likely to appeal to minors. Thus, the advertisement was found to breach Part 3(b)(i) of the ABAC Code.

RTD found to be breach Code for promoting a health benefits

A complaint was made to the ABAC Code regarding a series of Instagram posts and internet marketing that imply their RTD has health benefits.[2] For example, the advertisement includes the slogan 'Better Nights. Better Mornings', the claim that their drinks are 'infused with superfoods', and a range of other claims surrounding the ‘natural and healthy’ ingredients in the beverage.

Part 3 (c)(iv) of the ABAC Code provides that an Alcohol Marketing Communication must not suggest the consumption of alcohol provides any therapeutic or health benefit. The Panel found that a reasonable person would likely understand the marketing to suggest the product is offering a health benefit by avoiding negative consequences. By promoting the healthy ingredients in a way that suggests you will feel better the next day, the company breached the Code. 

As there has been an influx in healthy alternative and ‘clean’ alcoholic beverages, alcohol companies should be wary of avoiding claims of suggesting a health benefit. 

FOOD & NON-ALCOHOLIC BEVERAGES

Australia

“50% faster growth” claim found to be misleading

A complaint was upheld against Abbot for a PediaSure YouTube advertisement claiming the product promotes “50% faster growth” in children.[3] The complainant argued the claim was misleading or deceptive and not supported by sufficient scientific evidence. 

The Ad Standards Community Panel (the ‘Panel’) found the advertisement breached Section 2.1 of the AANA Food and Beverages Code (the ‘Code’) for being misleading, as it failed to clarify that the claim applied only to children at nutritional risk and relied on an outdated study from 20 years ago using a previous product formulation. Although the advertisement included a disclaimer explaining the claim, the disclaimer was only visible for less than two seconds and was thus difficult for viewers to read and comprehend.

The Panel also determined the advertisement breached Section 2.3 for making an unsupported health claim, as the advertiser did not provide sufficient scientific evidence to meet the Australian Food Standards Code requirements. The health claim “50% faster growth” lacked sufficient scientific evidence as not only was the study referenced out of date and using a different product formulation, it was also geographically and demographically limited as it involved a small sample size of 90 children from the Philippines and Taiwan. Thus, the advertisement was found to breach both Section 2.1 and 2.3 of the Code and the complaint was upheld.

This decision highlights the need for advertisers to ensure health claims are accurately presented and scientifically substantiated to avoid misleading consumers.

Kellogg's Special K Lower Sugar cereal held not be misleading

A complaint was made against a Kellogg's Special K Lower Sugar advertisement alleging it provided an unclear sugar comparison with Special K Original.[4] The complainant argued the sugar content comparison was misleading as it did not directly align 100g of Special K Lower Sugar (9.5g) with 100g of Special K Original (13.9g), and that the 40g serving size comparison (3.8g vs. 5.56g) was not immediately clear.

Section 2.1 of the AANA Food and Beverages Code (the ‘Code’) provides that an advertisement must not be misleading deceptive. The Ad Standards Community Panel (the ‘Panel’) determined that while the 100g comparison might have provided additional clarity, the advertisement clearly stated the 40g serving size comparison. The Panel noted the information was factually accurate and an average consumer in the target audience being health-conscious adults, would not likely be misled. Although requiring consumers to calculate sugar differences is not ideal, the Panel found it did not breach Section 2.1 of the AANA Food and Beverages Code.

This decision provides an interesting comparison to the Abbot decision where the advertisement was misleading, highlighting that factually accurate information and serving sizes are unlikely to mislead consumers.

ACCC releases guidance on 'free range' labelling during Avian Influenza outbreak

The ACCC has released new guidance for poultry egg and meat producers regarding the use of ‘free range’ labelling following an H5N1 avian influenza outbreak in Australia.[5] In the case of an outbreak, government regulations may require poultry producers to house their flocks indoors to contain the spread of the virus, including protecting native bird populations. These “housing orders” will be determined by the relevant Commonwealth, State, and Territory Chief Veterinary Officers.

Under the ACCC’s guidance, poultry egg and meat producers impacted by a government-issued housing order will be allowed to continue using ‘free range’ labelling for up to 90 days without risking enforcement action from the ACCC. This provision applies broadly to the poultry industry, not just chicken producers.

ACCC Deputy Chair Mick Keogh explained the decision: “Our approach provides certainty to poultry egg and meat producers that during an initial period after housing orders come into effect, they will not face ACCC enforcement action for labelling products as ‘free range’ while they deal with the immediate threat of H5N1.”

The ACCC will continue to monitor the situation and intends to review and update its guidance within 90 days of a confirmed H5N1 outbreak in Australia. 

For more information, see the guidance here.

AICIS continue to seek guidance on the timeline for updated Industrial Chemicals Categorization Guidelines 

The Australian Industrial Chemicals Introduction Scheme (‘AICIS’) sought feedback on its proposed timeline for updating the current Industrial Chemicals Categorization Guidelines (‘Guidelines’).[6] The Guidelines were introduced in 2020 to guide manufacturers or importers of industrial chemicals in determining which approvals steps they must take before going to market for their specific product. AICIS intend to amend the Guidelines in September 2025, and additionally annually if required.

Submissions have since closed, but businesses should be aware of possible changes and when they will come into effect.

New Zealand

Commerce Commission filing criminal charges against major supermarkets

The Commerce Commission has announced it will file criminal charges against Woolworths NZ, Pak’nSave Silverdale, and Pak’nSave Mill Street for alleged breaches of the Fair Trading Act due to inaccurate pricing and misleading specials.[7]

Since its 2022 grocery market study, the Commission has focused heavily on improving pricing integrity within the grocery sector. Grocery Commissioner Pierre van Heerden noted the ongoing need for accurate reporting: “Supermarkets don’t have consistent processes for recording customer complaints, which means they can’t effectively identify compliance issues. This impacts consumers and undermines competition.”

To address this, the Commission is developing a mandatory disclosure standard under the Grocery Industry Competition Act. This will require supermarkets to regularly report on customer complaints, particularly those relating to pricing and promotions. The aim is to identify trends, resolve issues quickly, and improve overall transparency.

The separate charges against Woolworths NZ and the two Pak’nSave stores showcase the Commission’s intent to hold supermarket operators accountable. The Commission expects to publish a draft of the mandatory disclosure standard early in the new year.

This serves as a strong reminder for supermarkets (and other businesses) to prioritise accurate pricing and clear promotions to ensure compliance with the Fair Trading Act. 

MPI extend consultation on proposed changes for importing food and fibre plants  

The New Zealand Ministry for Primary Industries (‘MPI’) have extended the consultation deadline for proposed changes to the importing of food and fibre plants for planting.[8] The proposed changes are regarding the time and location of quarantine for imported food and fibre plants for planting.  

The original end-date of the consultation was 20 December 2024. The new deadline for submissions is 31 March 2025. For more information on the proposals and how to make a submission, see more information here. The MPI have also summarised key features, benefits, and drawbacks of each option for the proposal in a document found here.

Australia and New Zealand

FSNAZ seeks comments on use of a nutritive substance in infant formula 

Food Standards Australia New Zealand (‘FSANZ’) is calling for comment on an application to permit the use of a nutritive substance in infant formula products.[9] The application proposes using bovine milk fat globule membrane-enriched whey protein concentrate (‘MFGM-WPC’) as a source of phospholipids in infant formulas. MFGM-WPC contains lipids and proteins found in both human and cow milk, where FSANZ has found it to be very similar to human milk for the purpose of supporting infant development.

FSANZ have stated MFGM-WPC offers various health benefits and provides no safety risk to infants.

For more information on the application, see here. Submissions close on the 6 February 2025. To make a submission, click here.

FSANZ seeks comments on new source of human identical milk oligosaccharide in infant formula products

In addition to the above, FSANZ also seek submissions on an application to permit a new genetically modified organism for a human identical milk oligosaccharide used in infant formula products.

2′-fucosyllactose (‘2ʹ-FL’) is a non-digestible carbohydrate that naturally occurs in human milk, which is used as a nutritive substance in infant formula products.  

FSANZ concluded there were no public health and safety concerns associated with the applicant’s 2′-FL.  

The 2′-FL is chemically and structurally identical to the naturally occurring substance present in human milk and other 2′-FL already assessed and permitted by FSANZ.

Submissions close 24 December 2024. To make a submission, click here.

CONSUMER LAW 

Australia 

BMW ad breached Code for unsafe driving

A complaint has been upheld regarding a BMW Australia advertisement depicting unsafe driving.[10] The television advertisement showed a car performing a skid near a cement pier, a car being airborne, and a serious of wheelspins, burnouts or “wheelies”, which are serious driving offences in Australia.

Clause 2(a) of the FCAI Motor Vehicle Advertising Code (‘Code’) states that advertisements for motor vehicles must not portray unsafe, reckless, or menacing driving that would breach road safety or traffic regulations. The Panel held that despite the advertiser’s claim that the scenes used historical or film-based content, the ad as a whole portrayed unsafe driving behaviours that breached the Code. Specifically, the controlled skid was deemed unsafe as it occurred near a platform edge and could cause accidents if copied by non-professional drivers, and the airborne vehicle scene was not clearly differentiated as fantasy and as part of an action movie. Thus, the Panel found the advertisement to breach Clause 2(a) of the Code for depicting unsafe driving practices. 

This decision acts as a reminder that advertisements including unsafe practices must be obviously exaggerated and clearly performed by professionals to ensure compliance with the FCAI Code.

Complaint against alleged sexist Youi advertisement dismissed

A complaint made regarding three versions of a Youi television advertisement being discriminatory has been dismissed.[11] Two versions of the advertisement included a man saying you need to shop around to find the best insurance company, with a child responding "Is that like how Aunty Kate shops around to find the best boyfriend?". The complainant claimed the advertisement discriminated against or vilified women by portraying Aunt Kate as promiscuous and shaming her for her dating choices, and discriminated against men by implying they are nothing more than commodities to 'shop around for'.

Section 2.1 of the AANA Code of Ethics (the ‘Code’) provides that advertisements must not discriminate against or vilify a person or group based on attributes such as gender, race, ethnicity, or other listed characteristics. 

Does the advertisement discriminate against or vilify women? 

The Panel found that Aunt Kate’s response, “I just have high standards,” was seen as empowering, reflecting her control and choice in dating. In a second version of the advertisement, although Aunt Kate’s response was omitted, the child’s comment about “shopping around for boyfriends” was light-hearted and not intended to shame or demean women. Thus, the advertisement was not found to breach Section 2.1 of the Code for discriminating against or vilifying women. 

Does the advertisement discriminate against or vilify men?

The Panel found that the comparison of dating to shopping for insurance was interpreted as humorous and not objectifying or ridiculing men. Thus, no breach was found for discriminating against or vilifying men.

This decision highlights how context and tone play a crucial role in assessing claims, with humour often being accepted when done respectfully.

Advertisement breached Code for unsafe riding  

A complaint was made regarding an advertisement from Rig Ebikes featuring someone on an e-bike riding down a street.[12] The complaint concerned unsafe behaviour as the advertisement featured high-speed riding and stunts on e-bike, and that the use of e-bikes on the road is illegal. Section 2.6 of the AANA Code of Ethics (the ‘Code’) states that advertisements must not depict material contrary to prevailing community standards on health and safety.

The Panel held in its discussion that activities such as riding on one wheel and standing on the seat while travelling over 70 km/h posed significant risks of serious injury or death. Additionally, the advertised e-bikes exceeded power and speed limits (250 watts and 25 km/h) set by South Australian road rules and most Australian jurisdictions. These bikes are classified as motorcycles, requiring registration and proper safety compliance. Finally, the advertisements captions including "Go crazy speeds" and “POV you like going fast” encourage reckless driving. The combination of these aspects constituted a breach of Section 2.6 of the Code and the complaint was upheld.  

This acts as a reminder to ensure advertisements are not depicting unsafe or illegal behaviours and also ensuring awareness of legal requirements relating to use of e-bikes!

Online florist to pay $1 million in penalties for misleading ‘local’ representations

The ACCC have order online florist Meg’s Flowers Pty Ltd to pay $1 million in penalties for misleading customers.[13] The ACCC held that Meg’s Flowers made false or misleading representations that it was a local florist in each of the towns, suburbs or localities referred to on its websites and in Google advertisements. In reality, Meg’s Flowers did not have any local shops available to customers, and orders were fulfilled at one of the 11 locations or in some instances, subcontractors. This would have mislead customers into believing they were supporting a small local business, and also potentially taken sales away from true local florists. 

In addition to the penalty, the Court ordered Meg’s Flowers to establish a compliance program, publish a corrective notice on its website, and contribute to the ACCC’s costs.

This decision acts as a reminder to be truthful and accurate with representations, especially those claiming to be ‘local’ 

ACCC initiate proceedings against Webjet for misleading prices and bookings

The ACCC has initiated proceedings against Webjet Marketing Pty Ltd, alleging the online travel booking platform made false and misleading representations regarding flight prices and bookings.[14] 

The allegations regard Webjet advertising “flights from $x” without including compulsory fees, such as the ‘Webjet servicing fee’ and ‘booking price guarantee’ fee, which ranged between $34.90 and $54.90 per booking. These fees were often hidden in fine print or required scrolling to view, making them unclear or not sufficiently prominent. The misleading price claims were displayed across Webjet’s app, website, marketing emails, and social media posts over a five-year period, from November 2018 to November 2023.

The ACCC also alleges Webjet misled consumers by confirming flight bookings online and via email when, in 382 instances, flights had not been secured with the airline. In these cases, Webjet allegedly sought additional payments to finalise bookings or offered refunds, leaving some consumers to choose between paying more or cancelling other travel plans at a potential loss. 

ACCC Chair Gina Cass-Gottlieb emphasised that businesses must display accurate, all-inclusive pricing and avoid misleading representations, especially during times of cost pressure when consumers are seeking savings. “A statement about the lowest price must be a true minimum price, not subject to hidden fees,” she stated. 

The ACCC is seeking penalties, declarations, injunctions, consumer redress, and other orders. This case highlights the importance of transparency in pricing and compliance with consumer law.

Koala Living fine $56,340 and to compensate consumers for misleading consumer guarantee rights

Koala Living, a furniture and homewares retailer, has paid in penalties for making false or misleading statements about consumers’ rights to remedies for faulty products.[15] The ACCC received numerous regarding Koala Living wrongly stating that consumer rights to remedies for faulty products were limited to a 72-hour period or the period of the manufacturer’s warranty, and that Koala Living could choose the type of remedy for minor and major faults. Koala Living also misled consumers in stating delivery fees were not refundable, when consumers actually have a legal right to receive compensation for foreseeable loss or damage they suffer because of the failure to comply with a consumer guarantee.

Koala Living admitted that their conduct likely contravened Australian Consumer Law and paid the penalties of $56,340. They also undertook to provide compensation to affected customers. Compensation will amount to 20 per cent of the purchase price in addition to the amount promised under the consumer guarantee. They have also removed incorrect statements from their website and undertaken to review its policies and procedures. 

ACCC takes legal action against Magnamail over misleading prize promotions 

The ACCC has commenced proceedings against mail-order retailer Magnamail for allegedly making false and misleading claims in its “pre-draw” promotions.[16] The retailer’s parent company, Direct Group, is also accused of being involved in the conduct. 

Between May 2022 and July 2023, Magnamail allegedly sent promotional materials, including letters, envelopes, catalogues, and scratch cards to hundreds of thousands of consumers. These materials claimed that consumers were eligible to claim major prizes, such as cash amounts up to $25,000, iPads, or jewellery, if they ordered from Magnamail’s catalogues. However, the prizes had already been pre-drawn, meaning only a small number of pre-selected winners were eligible for the advertised prizes. Consumers who were not pre-drawn had no chance of winning despite claims like:

  • “YOU HAVE DEFINITELY WON a prize valued up to $20,000...”

  • “CONGRATULATIONS, YOU HAVE QUALIFIED FOR A PRIZE...”

The ACCC also alleges that Magnamail’s scratch card promotions were misleading, as all cards and “lucky numbers” were identical, giving the impression of increased odds that did not exist. 

ACCC Chair Gina Cass-Gottlieb highlighted concerns that many consumers, particularly elderly or vulnerable individuals, may have been enticed into buying products based on these misleading representations. Some consumers reported distress upon discovering they were ineligible for major prizes. “Businesses running prize promotions must not mislead consumers about their eligibility,” Ms Cass-Gottlieb said.

The ACCC is seeking penalties, injunctions, declarations, and other orders. 

This case serves as a reminder for businesses to ensure promotions are clear, accurate, and transparent, protecting consumers from false expectations.

New Zealand

Commerce Commission release 2024-25 compliance and enforcement priorities  

The Commerce Commission has revealed its 2024-25 enforcement priorities, targeting sectors and practices most likely to harm Kiwi consumers and competition.[17] The key focus areas combine enduring priorities with new areas of concern as per public complaints, market trends, and economic conditions.

Enduring Priorities:

The Commission will maintain its focus on:

  • Cartels and anti-competitive conduct

  • Product safety

  • Supporting market regulation

  • Protecting vulnerable consumers

2024-25 Key Focus Areas:

  • Bid-Rigging Cartels: Combatting anti-competitive behaviour in public procurement contracts.

  • Non-Compete Agreements: Addressing agreements that unlawfully restrict competition.

  • Illegal Online Sales Conduct: Targeting fake reviews, misleading scarcity claims, drip pricing, and subscription traps.

  • Breaches in the Grocery Sector: Ensuring pricing accuracy and compliance with industry codes.

  • Breaches in Telecommunications: Action against misleading marketing, billing, and sales practices in this essential service sector.

  • Motor Vehicle Finance: Holding lenders accountable for responsible lending practices, with a focus on protecting vulnerable consumers.

  • Unconscionable Conduct: Addressing conduct that severely departs from expected standards of fairness.

Commerce Commission Chair Dr John Small emphasized the need to address conduct contributing to rising cost-of-living pressures, particularly where vulnerable consumers are disproportionately affected. He also highlighted the Commission's increased enforcement capacity, noting that its litigation fund will be “overcommitted” to take on significant and challenging cases.

“This is about protecting consumers, preserving competition, and ensuring markets work well,” Dr Small said. “Businesses need to ensure they’re playing by the rules.” 

The Commission’s priorities demonstrate its commitment to targeting harmful conduct across key sectors, increasing consumer confidence, and ensuring fair market practices. Businesses are encouraged to review their practices to ensure compliance. 

Commerce Commission challenges Contact and Nova over GST-exclusive pricing

The Commerce Commission is calling on energy and broadband providers Contact and Nova to stop displaying GST-exclusive prices by default, a practice that can mislead consumers by making prices appear 15% cheaper.[18] “This approach is unique in retail and creates an illusion of savings that aren’t real,” says Telecommunications Commissioner Tristan Gilbertson.

The challenge follows a review of guidelines issued last November to address misleading marketing of bundled energy and broadband services. While most providers have improved their practices, Contact and Nova continue to use GST-exclusive pricing for energy.

“With rising electricity costs and cost-of-living pressures, it’s unhelpful for providers to combine GST-inclusive broadband prices with GST-exclusive energy pricing in the same bundle,” Mr Gilbertson said.

The Commission noted that other providers such as Mercury, Electric Kiwi, Pulse Energy, and 2degrees are now fully compliant. Contact and Nova have been urged to align with the guidelines or face further action.

Consumers are encouraged to carefully compare GST-inclusive prices when evaluating bundles to avoid confusion. The Commission will continue to monitor the market and advises consumers to use TDR (Telecommunications Dispute Resolution) if they encounter any issues.

The focus remains on ensuring transparency and fairness in pricing to help consumers make informed decisions.

Commerce Commission files criminal charges against One NZ over “100% Mobile Coverage” claims

The Commerce Commission has filed criminal charges against One NZ (formerly Vodafone NZ) for its campaign promoting “100% mobile coverage.[19] Launching 2024”. Deputy Chair Anne Callinan stated the claims may have misled consumers by creating the impression that all mobile services such as calls, texts, and data, would be fully accessible from all locations in New Zealand starting in 2024.

The Commission highlighted significant limitations with One NZ’s claims:

  • The initial service, expected in 2024, will only support text messaging, with delays averaging two minutes.

  • The service will require line of sight to the sky, meaning it may not work indoors, in cars, or under trees.

  • The launch timeline is vague, with availability possibly as late as 31 December 2024.

“These limitations could significantly reduce the usefulness of the service, which was not made clear in the advertising. Misleading claims like these may distort competition and influence consumers’ purchasing decisions,” Ms Callinan said.

The Commission is taking action to ensure businesses provide clear and accurate representations so consumers can make informed choices in a market as large as telecommunications.


Footnotes:

[1] https://www.abac.org.au/wp-content/uploads/2024/12/181-24-FINAL-Determination-4-December-2024-1.pdf

[2] https://www.abac.org.au/wp-content/uploads/2024/11/150-24-FINAL-Determination-13-November-2024.pdf

[3] https://adstandards.com.au/wp-content/uploads/2024/12/0295-24.pdf

[4] https://adstandards.com.au/wp-content/uploads/2024/12/0290-24.pdf

[5] https://www.accc.gov.au/media-release/accc-publishes-‘free-range’-labelling-guidance-for-poultry-industries-for-a-potential-h5n1-outbreak

[6] https://www.foodlegal.com.au/inhouse/flb_articles

[7] https://comcom.govt.nz/news-and-media/media-releases/2024/criminal-charges-on-the-way-for-major-supermarkets

[8] https://www.mpi.govt.nz/consultations/improving-the-system-for-importing-food-and-fibre-plants-for-planting/#:~:text=The%20Ministry%20for%20Primary%20Industries,5pm%20on%2031%20March%202025.

[9] https://www.foodstandards.gov.au/media/call-comment-use-nutritive-substance-infant-formula

[10] https://adstandards.com.au/wp-content/uploads/2024/12/0280-24.pdf

[11] https://adstandards.com.au/wp-content/uploads/2024/12/0289-24.pdf

[12] https://adstandards.com.au/wp-content/uploads/2024/12/0298-24.pdf

[13]https://www.accc.gov.au/media-release/online-florist-ordered-to-pay-1m-in-penalties-for-its-misleading-‘local’-representations

[14] https://www.accc.gov.au/media-release/webjet-alleged-to-have-made-misleading-claims-about-airfare-prices-and-flight-bookings

[15] https://www.accc.gov.au/media-release/koala-living-pays-penalties-and-will-compensate-consumers-for-false-or-misleading-statements-about-consumer-guarantee-rights

[16] https://www.accc.gov.au/media-release/mail-order-company-magnamail-in-court-for-alleged-misrepresentations-to-hundreds-of-thousands-of-consumers

[17] https://comcom.govt.nz/news-and-media/media-releases/2024/comcom-outlines-priorities,-sharing-sectors-and-conduct-in-its-crosshairs

[18] https://comcom.govt.nz/news-and-media/media-releases/2024/comcom-targets-bundling-loophole

[19] https://comcom.govt.nz/news-and-media/media-releases/2024/comcom-takes-legal-action-over-one-nzs-100-coverage-claims-for-spacex-service


NOVEMBER 2024

ALCOHOL

Australia

ATO interpret definition of ‘beer’ for excise tax purposes

In September, the Australian Taxation Office (‘ATO’) released a second draft of its Excise Determination 2024/D2 (‘Draft Determination’), clarifying the definition of "beer" for excise tax purposes.[1] This draft is crucial for the alcohol beverage industry, as beer is taxed at a significantly lower rate than other alcoholic drinks such as spirits. While the statutory definition of beer under the Excise Tariff Act 1921 remains the same, the ATO's updated interpretation focuses on how additives can affect the essential characteristics of a beer.  

The draft specifies that the ‘integral elements’ of a beer is that it must primarily be brewed from cereals, fermented with yeast, contain limited sugars, and be made bitter with hops, excluding products like seltzers. Additives like water, spirits, and flavours are permitted within limitations found in the Excise Tariff Act 1921. These limitations include that:

  • spirits may be added to the beverage if the spirit does not exceed 0.5% of the total volume of the final beverage.

  • flavours/sugar may be added but final product must not have more than 4.0% by weight of sugars.

  • artificial sweeteners may not be added.

  • water (or other flavours) may be added to reduce the alcohol content of the beverage as long as the alcohol content of the final product is more than 1.15% by volume of alcohol.

The Draft Determination also stated that adding more than 50% unfermented substance to the fermented substance, such as water, means the product may no longer qualify as "beer." This change has raised concerns among brewers who often dilute high-alcohol brews. The final version is set to be implemented on February 1, 2025, with further details pending after industry feedback.

For more information, see the Draft Determination here.

Multiple breaches found for Protein Vodka Seltzer

A complaint was made regarding a range of social media posts advertising a Protein Vodka Seltzer.[2] The complaint concerned statements of the product claiming to offer health benefits such as ‘No one should choose between enjoying a delicious drink and their health goals. Vodka Pro gives you the best of both worlds’, and #healthylifestyle. Secondly, the complaint regarded excessive or rapid consumption of alcohol seen through an advertisement showing an individual drinking 10 cans, and another individual ‘necking’ the remainder of a can. Finally, the complaint dealt with safety concerns where the advertisement showed people in swimwear with the cans, inferring they were using the swimming pool whilst drinking. 

The complaint was upheld for all issues; Part 3 (c)(iv) of the ABAC Code for health benefit concerns, Part 3 (a)(i) and (ii) for excessive or rapid consumption concerns, and Part 3 (d) for safety concerns.

This decision acts as a reminder of the strict rules surrounding alcohol advertising. 

Non-alcoholic alternative found to breach Code

A complaint was made regarding a YouTube advertisement for ‘Heaps Normal’ non-alcoholic beer.[3] The advertisement referred to a man drinking the beer and saying  “say no to water”; referring to beer as a replacement for water. As the product is less than 0.5% alcohol, the product is considered non-alcoholic. However, Part 5 (b)(i) of the ABAC Code states that an Alcohol Alternative will be subject to the Code if fails to clearly and prominently identify the product as an Alcohol Alternative. The Panel held that the advertisement failed to clearly identify the product as a zero alcohol beer, and that a reasonable person could likely think the advertisement referred to a regular type of beer.

Thus, the advertisement was held to the standards of the ABAC Code. The relevant standard within the Code is Part 3 (c) where an Alcohol Marketing Communication must not suggest alcohol consumption can offer a health or therapeutic benefit. The Panel stated that the implicit message within the statement was that alcohol provides the same health essentials as water and is thus a viable alternative. Thus, the advertisement was held to breach Part 3 (c) of the ABAC Code.

This decision acts as a reminder that alcohol alternatives will be held to the same standard as alcoholic products if the advertisements are not clear enough.

Giveaway for alcoholic ‘Hard Fizz’ cans found to breach Code

A complaint was made regarding an Instagram post promoting a giveaway to win a pallet of Hard Fizz alcoholic seltzers or $5000 cash.[4] The complainant concerned that the giveaway promoted excessive alcohol consumption. The relevant section of the ABAC Code is Part 3 (a)(i)(A) for encouraging excessive alcohol consumption.

The Panel held that the advertisement breached Part 3 (a)(i)(A) of the ABAC Code. The Panel stated that although nothing in the advertisement depicted excessive drinking, the sheer quantity of alcohol offered as a prize was enough to suggest excessive alcohol consumption. They stated that while a reasonable person would likely interpret the prize as a way to promote the product and would likely choose the cash prize option, the large quantity of alcohol offered as a prize endorses excessive alcohol use as socially acceptable.

This reasoning acts as a reminder for promoting excessive consumption in giveaways, and can also be applied in other fields such as giving away a high quantity of Occasional Foods.

First-ever whiskey dispenser found not to breach Code

A complaint was made regarding multiple advertisements for a Fireball whiskey bubbler promoted at Robin Hood hotel.[5] The complainant argued that the whiskey dispenser advertisements promotes excessive drinking and could appeal to minors due to similarities to water dispensers found in schools. The relevant sections can be found in Part 3 of the ABAC Code for excessive alcohol consumption and alcohol marketing not appealing to minors.

The Panel held that on balance, the ABAC standards had not been breached. In their discussion, it was stated that the underlying concern with the advertisements was an issue regarding responsible service of alcohol (‘RSA’), which is dealt with not by the ABAC but NSW Liquor and Gaming. Additionally, the promotion was held in a controlled environment of a hotel where the patron was served a single shot, not suggesting excessive or irresponsible alcohol consumption. There was also no messaging or other means suggesting excessive alcohol consumption. Regarding the appeal to minors, the Panel held that while minors would be familiar with the dispensers, the appeal would be no greater to minors than it would be adults, and would likely be incidental Rather than evident.

On the balance of these factors, the Panel dismissed the complaint. This is an interesting decision to show how far the ABAC will go in finding a breach, where evident breaches are often needed. 

FOOD & NON-ALCOHOLIC BEVERAGES

Australia 

Key supermarket chains partake in public hearings

From 7 to 22 November, the ACCC conducted a series of public hearings as part of the ongoing supermarket inquiry.[6] The hearings involved executives of Aldi, Coles, Metcash, Woolworths and other stakeholders. This allows the ACCC to gain a more complete understanding of the key issues in the retail grocery.

The hearings were livestreamed and can be found here. A transcript will be released in upcoming weeks.

Complaint regarding McDonalds ad targeting minors dismissed  

A complaint was made regarding a McDonalds television advertisement for a Mario Kart Happy Meal.[7] The complainant argued that the advertisement promoted unhealthy foods to minors. Section 3.1 of the AANA Food and Beverages Advertising Code (‘Food Code’) states that advertising of Occasional Food or Beverage products must not target children. The Panel noted the advertisement promoted a Happy Meal featuring a chicken wrap, tomatoes and an apple juice. The products within the Happy Meal do not meet the definition of an Occasional Food or Beverage Product in the Food Code as per the FSANZ criteria. However, the Panel noted that there is what looks like a single chicken nugget shown on the table in one scene of the advertisement. A chicken nugget is held to be an occasional food product, however, the Panel considered that the depiction of the product was not clear and thus fell outside of the product being advertised.

Although the Panel found it would be appealing to children due to the product of a happy meal and content of the ad including toys and Mario cart, because the product was not an occasional food, no breach was found.

Crumbl Cookie saga raises issues of parallel importing

A recent pop-up in Bondi drew Australians with promises of authentic Crumbl Cookies, which have taken over the online world, only to leave customers with stale cookies at $17.50 each.[8] The pop-up wasn’t affiliated with the US-based Crumbl brand but was run by an entrepreneur reselling imported cookies while using Crumbl’s trademarks and branding. This raises important legal questions about parallel importing, which is where authentic goods are purchased overseas and resold in another country without the brand’s consent. While legal if the products are genuine, businesses must avoid trademark or copyright infringement and misleading conduct.

To stay compliant, ensure products are authentic, create original promotional materials, avoid implying brand endorsement, and register an ABN. Brands concerned about unauthorised resales can protect themselves by registering trademarks in Australia.

New Zealand 

MPI give update on the Organic Products and Production Act

The MPI considers that significant progress has been made in implementing the Organic Products and Production Act 2023, which became law in April 2023.[9] This Act aims to boost consumer confidence in organic labelling, provide certainty for businesses, and support international trade of organic products. The new regime will set comprehensive requirements for businesses in the organic sector, covering production through to sale. Once the National Organic Standard is finalized, businesses will have a transition period before the new system becomes mandatory. 

Key milestones include Cabinet’s April 2023 approval of proposals for Organic Process Regulations and a National Organic Standard. The drafting process involves careful refinement to ensure alignment with policy intent, supported by feedback from the Organic Sector Advisory Council and input from Organics Aotearoa New Zealand. The complex nature of the regulations means they are now expected to be put into effect in April 2025.   

The MPI has also been comparing New Zealand’s legislation with the EU’s organic regulations. Detailed discussions and negotiations with the EU are expected later this year and next year. 

As we enter the new year, businesses should be aware of these regulations being finalized and what it would mean for your products. 

D-allulose permitted as a novel food

D-allulose has now been approved for use as a tabletop sweetener and as an ingredient in certain manufactured foods.[10] The approval is for D-allulose produced using the approved enzyme D-psicose 3-epimerase (EC 5.1.3.30) from Microbacterium foliorum.

However, the brand Samyang’s Nexweet has been given an exclusive period of use for 15 months. This means that when the exclusivity period ends, other brands of D-allulose produced using the approved enzyme will be permitted for sale.

Approval for D-allulose produced by other enzymes that are not permitted must be requested through the FSANZ application process.

For more information, see here.

Outcomes from Food Ministers Meeting 15 November 2024

On 15 November 2024, the food ministers met on 15 November to discuss food regulation and policy matters.[11]

The key outcomes consisted of:

  • Regulation of infant formula products – ministers approved an amended policy guideline on the Regulation of Infant Formula Products. The amendment expands the definition of ‘infant formula product’ and ensures regulation of cell-based human milk products is consistent with ‘traditional’ infant formula products.

  • Regulation of toddler milk – ministers recommended that FSANZ review the provisions of the FSANZ Code relating to the composition and labelling of toddler milk, to ensure they are up to date with latest evidence and international developments.

  • Update on nutrition labelling – update on the holistic review of the nutrition information panel (‘NIP’). Identified the objective, guiding principles, and proposed scope for the NIP review. The ministers noted this was a priority for FSANZ, where FSANZ will examine the available evidence and undertake broad stakeholder consultation to inform the review.

  • The Health Star Rating (‘HSR’) system – alongside the review of the NIP, ministers provided an update on the oversight of the HSR system. The ministers continue to oversee the system, where a simplified and proportionate governance structure will support the ongoing work in exploring mandating the system.

  • The FSANZ Workplan – ministers noted that work on commercial foods for infants and young children will be prioritized next meeting.

The food ministers will meet on 14 February 2025.

MEDICINES & COSMETICS

New Zealand

Government introduces new Medical Products Bill

The Government has announced plans to replace the Medicines Act 1981 with a new Medical Products Bill.[12] A key goal of the new framework is to regulate medicines and medical devices in a risk-proportionate manner, ensuring that lower-risk products face less stringent requirements. For example, simple devices like surgical masks may only require self-declaration, while more complex products will undergo detailed review. Additionally, medicines and devices that have already been approved by trusted overseas regulators will have the ability to be approved earlier in New Zealand.

The proposed legislation also aims to support innovation by allowing flexibility to assess new technologies, such as artificial intelligence-based medical devices, without requiring frequent legislative amendments. Products like certain cells, tissues, and AI software may be excluded from regulation via secondary legislation. There will be no approvals for export-only products, yet work is being done in this area to support exporters requiring certification for overseas markets.   

Natural health products, which were previously included under the now-repealed Therapeutic Products Act 2023, will be regulated separately under a standalone bill. This decision responds to concerns that the TPA over-regulated low-risk natural health products. The Government plans to engage with the sector over the next year to develop this framework.

Drafting of the Medical Products Bill is underway, with further proposals, dealing with clinical trials, pharmacy regulation, advertising, and exporter support, expected by March 2025. The Government aims to pass the Bill by 2026, with implementation around 2028.

SUSTAINABILITY

New Zealand 

Feedback wanted for ARL packaging claims – kerbside standardization

Representatives at the Australasian Recycling Label (‘ARL’) are seeking participation in a survey to track the process on the new kerbside collection rules. The new rules essentially provide that only certain plastics are allowed for kerbside collection, meaning businesses must update packaging accordingly. The team at ARL are seeking feedback in order to identify any challenges with the transition, where insight can be passed on to both the Commerce Commission and ARL members.

The Commerce Commission has stated that they expect businesses to make all reasonable efforts to ensure customers have the correct information and remove potentially misleading recycling claims from packaging and advertising. It is important that businesses have thus updated their packaging, and to improve this process, completed the survey with any issues faced. 

Whilst the survey has now closed (29 November 2024), you may wish to reach out to the ARL team directly. 

APCO propose Caps and Lids Recycling Scheme as alternative pathway 

In February 2024, New Zealand's kerbside standardisation came into effect, which excluded caps and lids from kerbside collection.[13] The Caps and Lids Recycling Scheme (‘Scheme’) then allowed plastic and metal caps and lids to be collected and recycled. The Scheme aims to divert as many metal and plastic caps and lids as possible from landfills and reintroduce them into the recycling and make use of the valuable materials. 

APCO has sought feedback on recognising the Scheme as an alternative recycling pathway within the ARL program. This means that if recognised, only scheme contributors will be eligible to apply the ‘Check Locally’ ARL label on packaging for qualifying materials in the New Zealand market.

Update on Soft Plastics Recycling Scheme (‘SPRS’)

The Steering Committee for the SPRS is proposing an update to the soft plastics thresholds for New Zealand. The Committee proposes the update to come into effect on 1 January 2027, and for all new and on-pack packaging claims to be compliant to thresholds by 1 January 2028. The proposed threshold update for the SPRS aligns with current international best practices and extends opportunities for use of recycled materials.

CONSUMER LAW

Australia

Complaint regarding swear word dismissed despite children in audience  

A complaint was made regarding an implicit reference to the word ‘shit’ in a Appliances Online Pty Limited advertisement.[14] A voice-over and subtitles states "say goodbye to S#!* appliances". The complaint concerned the advertisement being offensive when children are watching. The relevant section is Section 2.5 of the Code of Ethics, that states advertising shall only use language which is appropriate in the circumstances, including appropriate for the relevant audience and medium.

The Panel looked at whether the advertisement targeted children. Overall, the Panel considered that the language used was appropriate in the circumstances, including for the relevant audience and medium. 

In coming to this reasoning, the Panel noted that although the audience was broad and would thus include children:

  • The word ‘shit’ is commonly used in Australian vernacular, and its use as a description of broken appliances is consistent with this colloquial usage,

  • the word is not used in a demeaning or aggressive manner; and

  • the word is not used, or written in full, and would not be understood by anyone not already familiar with the language.

Thus, on the balance of these factors the complaint was dismissed.

Getty Images to refund customers for misleading subscription cancellation charge

Getty Images has agreed to refunding about $78,000 to more than 200 customers, after imposing charges for cancellation of iStock subscriptions which were more than those outlined in its terms and conditions.[15] 

The ACCC alleged that between November 2023 and February 2024, Getty Images may have misled customers by stating in its online iStock terms and conditions that cancelling a subscription after a one-month free trial period would only incur an “administrative charge”. However, this charge amounted to 50% of the remaining cost of the customer’s annual subscription, which the ACCC argue would not be reasonably expected by customers partaking in a free trial and cannot be considered administrative costs. As well as many complaints regarding this issue, the ACCC also received complaints about the iStock website only stating the monthly price of annual subscriptions without stating the total price. This pricing may have also misled customers about the term of the subscriptions. Getty Images has now amended these statements. Regarding the cancellation charge, Getty Images are currently in the process of emailing and  refunding affected customers.

This acts a reminder for businesses to clearly and accurately state the total price and key terms and conditions, especially when selling subscription-based products. 

New Zealand

Dick Smith warned for automatically signing customers up to membership subscription

The Commerce Commission has issued a warning to Kogan Australia Pty Limited, commonly known as Dick Smith, for likely misleading consumers by automatically signed customers up for a $149 membership subscription.[16] Commerce Commission General Manager, Vanessa Horne says consumers are focused on their intended purchase when shopping online and should not have to watch out for being automatically signed up to a subscription through a pre-selected tick box. “To avoid automatically subscribing, a customer would have to first recognise the tick box had been selected, which meant they were signed up, and then actively de-select the option.”.

The Commission investigated allegations of misleading conduct under the Fair Trading Act following complaints from consumers that they were unknowingly supplied a 14-day free trial of the FIRST membership, which led to an ongoing payment obligation to pay $149 (annually) or $14.99 (monthly) once their trial period had ended.  

From 3 July to 19 September 2023 Dick Smith’s website used a pre-selected tick box to add a FIRST trial to all eligible consumers’ shopping carts, unless consumers unticked the box. Most of the Commission’s complainants were unaware they had been signed up to the FIRST trial during their purchase until they received a $149 charge from Dick Smith after the 14-day trial.

The Commission believes this conduct was likely in breach of the Fair Trading Act, and have issued a warning letter to Dick Smith. Dick Smith have since amended the automatic tick box and offered a refund to complainants.

The Commerce Commission have stated their focus on ensuring businesses are not misleading customers about online purchases or subscriptions, and encourage individuals to let them know on their website. Business should be aware that this is an enforcement priority of the Commission.


Footnotes:

[1] https://www.ato.gov.au/law/view/document?docid=DEX/ED2024D2/NAT/ATO/00001

[2] https://www.abac.org.au/wp-content/uploads/2024/10/131-142-143-144-24-FINAL-Determination-11-October-2024.pdf

[3] https://www.abac.org.au/wp-content/uploads/2024/10/126-24-FINAL-Determination-2-October-2024.pdf

[4] https://www.abac.org.au/wp-content/uploads/2024/10/122-24-FINAL-Determination-30-September-2024.pdf

[5] https://www.abac.org.au/wp-content/uploads/2024/10/132-24-FINAL-Determination-20-October-2024.pdf

[6] https://www.accc.gov.au/about-us/conferences-and-events/supermarkets-inquiry-public-hearings

[7] https://adstandards.com.au/wp-content/uploads/2024/11/0256-24.pdf

[8] https://www.lexology.com/library/detail.aspx?g=08ae3f31-b2b1-4c5d-b20e-975b31e36b48

[9] https://createsend.com/t/d-68DA7DF84B9B14C82540EF23F30FEDED

[10] https://createsend.com/t/d-933687CE2D3235FC2540EF23F30FEDED

[11] https://www.foodregulation.gov.au/food-ministers-meeting-communique-15-november-2024

[12] https://www.lexology.com/library/detail.aspx?g=f4cb0cd1-22b4-4a9c-bc6a-1bdd7d092cec

[14] https://adstandards.com.au/wp-content/uploads/2024/10/0241-24.pdf

[15] https://www.accc.gov.au/media-release/getty-images-to-refund-customers-for-allegedly-misleading-istock-subscription-cancellation-charge

[16] https://comcom.govt.nz/news-and-media/media-releases/2024/dick-smith-warned-for-sneaking-subscriptions-into-shopping-carts


October 2024

ALCOHOL

Australia

Alcoholic coconut water claiming ‘hangover cure’ held to be a breach

A complaint was made regarding an article on delicious.com.au titled ‘Australia’s new boozy coconut water is a party starter and hangover cure is one’.[1] The complaint objected to calling an alcoholic product a hangover cure. The ABAC Adjudication Panel (the ‘Panel’) held that the Delicious article was not an alcohol marketing communication under the ABAC Responsible Alcohol Marketing Code (the ‘Code’), as the company Coastal Drink Co was not aware of the article and had no connection or participation involved with the article.

However, the company then posted the article to its own Instagram account, which made the Instagram post an Alcohol Marketing Communication under the Code. Thus, the Instagram post was held to breach Part 3 (a)(i) of the Code for promoting the excessive consumption of alcohol, Part 3 (c)(i) for suggesting alcohol may contribute to an improvement in mood (by referring to a ‘party starter’), and Part 3 (c)(iv) for suggesting the consumer will receive a health benefit by consuming the product as it will be a ‘hangover cure’.

Although the initial article was not deemed to be within the jurisdiction of the ABAC, it is an important reminder to businesses that resharing or posting content on social media can constitute an advertisement and thus be subject to the Code.

‘Pre’s’ liquor products found to be appealing to minors

A complaint was made to the ABAC Panel regarding ‘Pre’s’ liquor products appealing to children through the names, colours, and emojis.[2] The colourful products included images of fruits with faces and one blowing up a bubble gum balloon, with the names “Green Apple Vodka”, “Bubble gum Grape Vodka” and “Tropical Vodka”.

Part 3 (b)(i) of the ABAC Responsible Alcohol Marketing Code (the ‘Code’) provides that an Alcohol Marketing Communication must not have a strong or evident appeal to minors. The Panel looked at the usual factors when determining an appeal to minors, including the packaging, colours, imagery, and names. They also looked at the brand name ‘Pre’s’ which would be associated by a reasonable person with ‘preloading’ or drinking before an event or place. Regarding the Bubble gum Grape Vodka, the Panel found that the product name would typically be associated with confectionary and thus be relatable to minors, as well as the imagery of the emoji blowing a bubble gum bubble. They also noted the nostalgic element with the colouring and branding gained from childhood or adolescence.

Regarding the Green Apple Vodka, the Panel noted that the name Green Apple would more readily be associated with non-alcoholic drinks, and that the cartoon style, anthropomorphic, winking green apple would be familiar and relatable to minors.

Although both products clearly contain the word ‘vodka’, the Panel noted that the aim of Part 3(b) is not to avoid minors confusing the product with a soft drink, but to avoid minors being drawn to an alcohol beverage due to the strong appeal.

Regarding the Tropical Vodka product, it was held that as the name ‘Tropical’ would not be readily associated with non- alcoholic products, and the imagery of the pineapple shape would have no greater appeal to minors than it would to adults, no breach was found.

Thus, it was held that the Bubble gum Grape Vodka and the Green Apple Vodka breached Part 3 (b)(i) of the Code, and the complaint is dismissed regarding the Tropical Vodka packaging.

New Zealand  

‘Horny Jane’ RTD found to breach Code

A complaint was made to the ASA regarding a series of website pages and Instagram advertising made by Plain Jane.[3] The advertising can be seen as follows:

Labelling/ Website

The Horny Jane can includes the Plain Jane logo with red devil horns. The back of the can, as well as the image of the can on the website included text such as:

  • “A force of nature a whirlwind of fun and the life of the party”

  • She is mischievous, fiery and wildly promiscuous”

  • “But watch out her kisses are sweet, the taste will leave you wanting more”

  • “An unforgettable vixen who will make you flirt with danger, leave you chasing the next thrill and stir up trouble”

  • “...she is known for not letting the good times end”

  • “With her the night is always young, the spontaneous adventures are wild and never end!”

Website – “The Story” page

·       “Healthy RTD”

·       “Healthy, guilt-free”

·       “Bang for your buck”

·       “High percentage”

The Instagram posts consisted of various advertisements showing people partying with the cans such as playing beer pong or drinking games.  

The complainant concerned that the Instagram posts were socially irresponsible, and had concerns with the name ‘Horny Jane’, the various health claims and excessive drinking references on the labelling and website. 

The Complaints Board said the labelling and website page were in breach Rule 1(d) of the Alcohol Advertising and Promotion Code (the ‘Code’). Rule 1(d) states that alcohol advertising must not suggest that alcohol can improve or enhance a situation or personal attributes. Here, it was found that the advertising suggested that those who consume the Horny Jane product would be the “life and soul of the party in a sexualised way”. The Complaints Board also held the website and labelling advertising to be in breach of Rule 1(c) of the Code for not demonstrating responsibility and low-risk consumption. Statements such as “the taste will leave you wanting more”, “not letting the good times end” and “the night is always young...adventures never end” were implying you should continue to drink, which could be seen to represent irresponsible, harmful or excessive consumption of alcohol.

Regarding “The Story” website page, the words “healthy” and “guilt-free” were also found to breach Rule 1(c) for not demonstrating responsibility and low risk consumption, as this is not appropriate wording in an alcohol advertisement. The majority held however that the words “bang for your buck” and “high percentage” did not reach the threshold for Rule 1(c), as it was held that the context of the sentence likely meant the statement “bang for your buck” referred to the taste and the value for money of the product, not the alcohol levels.

The Complaints Board also held the labelling and website and “The Story” website page had not met the high standard of social responsibility required under Principle 1 of the Code.

Various breaches were found for the Instagram advertisements, however the complaints were settled due to the company removing the advertisements.

Thus, the complaint was upheld in part, and settled in part. This is a useful decision that looks at a range of issues within alcohol advertising, acting as a reminder for businesses of the high level of social responsibility needed with alcohol advertising.

FOOD & NON-ALCOHOLIC BEVERAGES

Australia

ACCC files proceedings against Woolworths and Coles for misleading customers

The ACCC announced they are launching separate proceedings against Woolworths and Coles for allegedly misleading customers.[4]The ACCC allege the two grocery chains misled customers on price discounts on over 200 products over the span of 20 months. They allegedly misled customers by temporarily increasing the price of goods before applying a discount as part of a promotional campaign, meaning the discounted price was still higher than the original price.

ACCC Chair Gina Cass-Gottlieb stated, “Australian consumers have come to understand that the ‘Prices Dropped’ and ‘Down Down’ promotions relate to a sustained reduction in the regular prices of supermarket products. However, in the case of these products, we allege the new ‘Prices Dropped’ and ‘Down Down’ promotional prices were actually higher than, or the same as, the previous regular price”. She also discussed the importance of accuracy of pricing and discount claims in the grocery sector as consumers rely on discounted prices due to the cost of living pressures.

The ACCC is seeking declarations, penalties, costs and other orders such as community service to fund charities in delivering meals to Australians in need. As potential penalties have risen in the past few years, it will be a significant decision to witness the approach the courts take in determining the potential penalty.

Australia Government to tackle supermarket ‘shrinkflation’

The Government have announced measures to tackle the ongoing issue of shrinkflation in supermarkets and potentially others in the retail sector.[5] Shrinkflation is the increasingly common practice where the product’s size is reduced but the price stays the same. The Government have stated they will strengthen the Unit Pricing Code (‘Code’) so that consumers can make better comparisons, and bring in substantial penalties for supermarkets that breach the Code.

“Unit pricing helps consumers spot good value for money while being able to see the price of products by their volume, weight or per unit, so they aren't tricked by unchanged packaging hiding less product,”, the government stated.

The government also announced they will consult on ways to improve the Code such as better visibility of unit pricing on products and increasing accuracy and specificity of measures.

This announcement follows the government’s promise to provide the Commission with an extra $30 million to help it undertake more investigations and legal action against supermarkets and other retailers.

This is one of the actions taken in light of the recent interim report of the commission’s year-long supermarkets inquiry, showing the government’s priority on the supermarket sector.

Interim Report for ACCC’s Supermarkets Inquiry reveals consumer and supplier concerns

The Interim Report for the ACCC’s year-long Supermarkets Inquiry revealed important feedback and information from consumers and suppliers.[6] Many Australian consumers and grocery suppliers have told the ACCC they are concerned that some of Australia’s supermarket retailers have considerable market power and are engaging in practices which disadvantage both their customers and suppliers. The ACCC notes concerns with the supermarket retailing in Australia being an oligopoly, with Woolworths and Coles accounting for 67 per cent of supermarket retail sales nationally, Aldi 9 per cent, and Metcash 7 per cent.

The Interim Report revealed the following information:

·       Consumers report having lost trust in supermarket pricing:

o   Difficulty in comparing products due to pricing practices such as frequent specials, short-term lowered prices, bulk-buy promotions, member-only prices and bundled price.

·       Barriers to expansion:

o   Difficulty entering and expanding in supermarket retailing, and the significant investment, time and differentiated offering required to expand.

o   “Our preliminary view is that planning and zoning laws may slow a supermarket retailer’s ability to develop new stores by creating additional costs or adding significant delays,” Mr Keogh said.

o   Compared to ALDI, Coles and Woolworths have interests in a significant number of sites for future supermarkets 

The ACCC will continue to consider the issues raised and will present a final report of the Inquiry in February 2025. The ACCC have identified 14 various products such as chicken, bananas and eggs that will be of focus for the remainder of the Inquiry.

The ACCC invites feedback on the key issues raised in the Interim Report which have since closed (18 October 2024). 

New Zealand

Commerce Commission declines Foodstuffs merger

The Commerce Commission has declined Foodstuffs North Island Limited and Foodstuffs South Island Limited proposal to merge and become a single national grocery entity.[7] Chair Dr John Small said that the Commission was not satisfied that the proposed merger would not substantially lessen competition in multiple acquisition and retail markets. By reducing the number of major buyers of grocery products from three to two, the merged entity would likely be able to extract lower prices from supplier as well as decreasing competition in the sector. Dr John Small noted concerns that the merge would lead to reduced investment and innovation by suppliers, meaning reduced consumer choice and potential quality of grocery products for consumers. It would also have the potential to make it harder for other grocery retailers to compete, leading to a future lack of competition in the grocery industry. Finally, Dr Small looked at the increased risk of price coordination between the merged entity and Woolworths.

After seeking several extensions to consider the clearance of the merger, the Commission has found they are not satisfied the merger would not substantially lessen competition. The determination with complete reasons and an executive summary can be found on the case register here.  

New Zealand calls for businesses to donate food

The Food Recovery Network has observed a steady decline in food donations from food businesses.[8] Aotearoa Food Rescue Alliance (AFRA) is encouraging businesses that may not have considered donating food to explore the opportunities and protections offered by the ‘Good Samaritan’ clause in the Food Act 2014. This clause provides safeguards for businesses donating food through AFRA's member organisations.

AFRA supports over 30 food rescue organisations across the country, which operate a variety of models to distribute rescued and donated food to community kitchens, foodbanks, freestores, and other community organisations. Collectively, these groups distribute the equivalent of 29 million meals annually, reaching over 1,000 recipient organisations. Food recovery organisations can access the AFRA Food Safety Guide, which provides valuable information on good food safety practices, ensuring that donated food is safe and suitable for recipients. The guide also includes links to NZFS’s published food safety resources.

If you work in a food business, consider donating food or sharing this information to those in the industry. More information on donating food can be found here.

Z Energy advertisement not enough to undermine the health and wellbeing of consumers

A complaint was made the ASA complaints board claiming a Z Energy television advertisement promoted unhealthy eating.[9] The advertisement showed 2 workers' having lunch, where one worker opens a container of leftovers brought from home, and the other has a pie and energy drink. The worker with the pie and energy drink says, “Z is for having what everyone else is having”.

The Complaints Board held that the advertisement did not reach the threshold to undermine the health and wellbeing of consumers. The Complaints Board referred to the Guidelines under Rule 1(h) and agreed the advertisement did not encourage regular or excessive consumption of occasional foods or promote an inactive or unhealthy lifestyle. 

This shows a practical decision by the Complaints Board as it should not be a breach simply to show the consumption of normal amounts of  occasional foods and beverages.  

Overseas

Court rules EU countries can’t ban “steak” or “sausage” names for plant-based foods

On October 4, the Court of Justice ruled that EU countries cannot stop companies from naming plant-based meat alternatives “steaks” or “sausages”.[10] This came as a win for French lobby group Protéines France, who challenged the decision of the French Government to ban them from using terms such as “steak” and “ham” for its plant protein products.

The decision means that unless an EU country has already created a law defining what a sausage or a burger is, it cannot ban plant-based companies from using generic terms for its meat alternatives. According to a court statement however, judges stated that EU countries can intervene if the name is misleading.

Whether meat names for plant-based alternatives are misleading has been a point of debate in Australia and New Zealand over past few years, making this an important decision beyond the EU. 

New legislative proposals to regulate the “Nutri-Score” labelling system in the EU 

The “Nutri-Score” labelling system used in various EU countries is under scrutiny in Romania, with new legislation proposed to regulate its use.[11] A draft Government Decision released in September 2024 aims to clarify how the label can be applied by setting rules for economic operators and penalties for non-compliance. The Nutri-Score system, designed to help consumers make healthier food choices, has faced criticism in some nations, including Romania, where authorities argue it oversimplifies nutrition information and disadvantages local products. The draft legislation exempts traditional Romanian and certain EU-certified products, and mandates that products with Nutri-Score labels be displayed separately and include detailed nutritional information accessible via QR codes. Retailers must also notify authorities and obtain approval from Santé Publique France to use the label, with non-compliance resulting in substantial fines. The initiative aims to align Romania with European standards while improving transparency and consumer protection.

This will be an interesting area to watch as it is uncertain how the legislative proposal will take place and evolve.

MEDICINES & COSMETICS

New Zealand

Ministry of Health update on medical product and natural health product bills

The Ministry of Health has released an update on 17 October 2024 regarding:

·       New Medical Products Bill

On 30 September, Cabinet agreed to repeal and replace the Medicines Act 1981 with a new Medical Products Bill.  This will regulate medicines and medical devices.   The Government intends to pass the bill in 2026 and for it to come into effect around 2028.  The Bill will include provisions to give existing products time to transition to the new regime. Further information will be provided by a webinar from the MoH (this will not discuss natural health products).  You can subscribe to receiving updates including when this webinar will be held here.

·       New Standalone Bill for Natural Health Products

Cabinet also agreed that the natural health products will be regulated under a standalone bill, to be developed following engagement with the natural health products sector.  MoH will work with the Ministry for Primary Industries to agree the timing and manner of stakeholder engagement.  Work on the bill will not commence until after they have engaged with stakeholders and no decisions have been taken on the scope or approach to be adopted in the bill.   

You can read more about the update from MoH here.   

Consumer NZ Investigation into BlackGold’s Organic Mushroom Elixir reveals it considers the product may be falling short of regulations

Vanessa Pratley at Consumer NZ recently investigated BlackGold’s Organic Mushroom Elixir (the ‘Elixir’) to see whether the ‘supplement’ is making legitimate claims.[12] The Elixer claims to lower cholesterol, blood pressure and stress, and may help prevent cancer.  Although the Elixir is labelled as a supplement, the statements and testimonials on BlackGold’s website make therapeutic claims, which by law only registered and pre-vetted medicines or medical devices can do. A spokesperson for Medsafe stated that the claims about the product and the presentation would imply it is a medicine and not a supplemen, and as the Elixir has not been approved as a medicine under the Medicines Act, Medsafe stated they would inquire into the issue. Consumer NZ also found false celebrity endorsements on the website which could have misled consumers, and thus the company risk breaching the Fair Trading Act.  

SUSTAINABILITY

Australia

Government seeks views on reforming packaging regulations

The Australian Government is seeking submissions on the potential reform options for regulating packaging in Australia.[13] Since 2023, considerable work has been done to lay the groundwork through consulting with industry and peak bodies regarding packaging reforms, with an aim to transition to a circular economy. 

Cameron Hutchison, head of the Waste and Resource Recovery Branch at the Department of Climate Change, Energy, the Environment and Water (‘DCCEEW’), stated there is a need for reforms due to the current systems not meeting environmental targets. “There's a significant gap between the amount of packaging designed to be recovered and the amount that’s recovered. We are well short of achieving the National Packaging Targets in 2025, particularly the targets for plastic packaging,” Hutchison said. The packaging regulatory reform is highlighted as crucial for addressing plastic consumption and pollution in Australia.

The consultation paper outlines three options: strengthening the current co-regulatory framework, implementing national mandatory requirements, or establishing an extended producer responsibility scheme.

Option 1: Strengthening the current co-regulatory arrangement

Option 1 would maintain the current co-regulatory framework but strengthen it through improved compliance and enforcement. This option would require ongoing industry and state and territory government involvement to address free riders. It must be noted that Hutchinson stressed that the ongoing systemic issues of the current arrangement would remain.

Option 2: Setting national mandatory requirements

Option 2 would see a shift to a Commonwealth regulator scheme with nationally consistent mandatory requirements for packaging. This option could include bans on problematic materials and chemicals (eg carbon black, oxo-degradables and PFAS), progressive bans on packaging with low recyclability, and mandatory recycling labelling. These obligations would apply to individual businesses that place packaging on the Australian market and would capture domestically manufactured and imported packaging. 

Option 3: Establishing an extended producer responsibility scheme

Option 3 would introduce a national extended producer responsibility (EPR) scheme using financial mechanisms and regulatory obligations. This option could use eco-modulated fees (as outlined in APCO’s 2030 strategy) to drive design behaviour change and provide ongoing system funding. 

Stakeholder feedback is very important during the consultation process. For more information on making a submission, see here.Submissions close 28 October 2024.

New Zealand

Greenpeace sues Fonterra over allegedly misleading 100% grass-fed butter claim

Greenpeace is suing Fonterra over an alleged ‘100 percent New Zealand grass-fed’ claim on its Anchor butter products.[14]

Greenpeace have filed two causes of action under the Fair Trading Act:

  • that the grass-fed label is misleading as to the nature, manufacturing process, and characteristics of the butter contained in the packaging; and 

  • that the grass fed label is false or misleading representation about the kind, standard, quality, grade and composition of the butter. 

Greenpeace are seeking a mandatory injunction requiring Fonterra to remove the label and publish corrective advertising of similar form and prominence. They are also seeking an injunction to stop Fonterra from making this claim in the future on butter which is produced from cows that are not entirely fed grass and grass-derived feeds and/or fed on feed originating entirely from NZ. 

Greenpeace spokesperson Sinéad Deighton-O'Flynn said in a statement "Fonterra is misleading their customers through this branding, presumably to make themselves appear more environmentally friendly and sustainable".

Fonterra have confirmed receipt of proceedings and provided no further comment. Fonterra consider their dairy cows to be “grass-fed” while allowing 20% of their diet to not be grass (and likely imported feed).  Whilst this is speculation by Essence, there is a potential argument that could be raised by Fonterra that they are not claiming the butter to be “100% grassfed” instead that the butter is “100% New Zealand” and that the cows are grassfed.  This is due to the placement of the logo and lock-up with the claims being separated (see above). Perhaps also relying on the reasonable consumer in New Zealand understanding that there will be times the cows cannot be fed grass and will be fed other feeds in these situations.                      

Nonetheless, it is an interesting case to keep an eye on and is another example of increasing private actions by organisations alleging misleading environmental and greenwashing claims. 

Maximum Residue Levels for Agricultural Compounds Food Notice updated

The Food Notice: Maximum Residue Levels for Agricultural Compounds has been updated and came into effect on 30 September 2024.[15] The Notice replaced the previous notice dated 21 March 2024. The sections changed were Schedules 1 and 3, where the following changes were made:

·       Setting of new MRLs for penflufen;

·       amendment of MRLs for piperonyl butoxide;

·       amendment of the entries for glufosinate- ammonium and mecoprop in Schedule 1; and

·       addition of a listing for calcium and its salts in Schedule 3.

See the updated food notice here.

CONSUMER LAW

Australia

Complaint regarding 7-Eleven ad showing unsafe driving dismissed

A 7-Eleven television advertisement showing a man sprawled over a broken windscreen while the car is being driven has been dismissed.[16] The complainant argued that the advertisement clearly depicted unsafe driving and is extremely dangerous. The Ad Standards Community Panel (the ‘Panel’) noted Section 2.6 of the AANA Code of Ethics (the ‘Code’), where advertising shall not depict material contrary to Prevailing Community Standards on health and safety.

The minority considered that while the context of the advertisement was an action movie style scene, the behaviour of lying on the bonnet of a moving vehicle was realistic and could encourage copycat behaviour.

However, the majority considered that the advertisement was exaggerated and fantastical and unlikely to be seen as realistic. The Panel considered that the behaviour in the advertisement is unlikely to be found to be encouraging or condoning unsafe behaviour.

Thus, it was held that there was no breach and the complaint was not upheld. The Panel being divided shows that although exaggerated activities may not be considered to breach the Code, advertisers should act with caution when displaying dangerous behaviours.

Complaint regarding blurred out nudity dismissed

A complaint regarding a Mad Paws advertisement showing blurred out nudity has been dismissed.[17] The complainant was concerned that the television advertisement was sexual, contained obvious blurred nudity and was not appropriate for family viewing times. The Ad Standards Community Panel (the ‘Panel’) noted Section 2.4 of the AANA Code of Ethics (the ‘Code’) which states advertising shall treat sex, sexuality and nudity with sensitivity to the relevant audience.

Overall, the Panel considered that the nudity was treated with sensitivity to the relevant broad audience. The Panel in its reasoning stated that although the advertisement contained nudity and was during a time when children would be in the audience, the genitals were covered, the advertisement was considered humorous in nature, not sexual, and there was no sex or sexuality contained within the advertisement.

As there was no sex or sexuality and the nudity was treated with sensitivity, there was no breach of Section 2.4 and the complaint was not upheld.

ACCC receive additional funding for enforcement in retail and supermarket sector

On 1 October, the Treasurer announced additional funding of $30 million over 3.5 years for investigations and enforcement relating to the supermarket and retail sector.[18] ACCC Chair Cass-Gottlieb said the additional resources will allow for enhanced enforcement and compliance activities by the ACCC. With the supermarket and retail sectors being at the forefront of the ACCC’s priorities, this funding will aim to continue to look at the issues currently at play.  

“This funding will enable us to escalate a range of investigations in this sector, including in relation to potential misleading pricing claims or practices, claims about delivery timeframes and costs including for regional and remote Australians, and businesses misrepresenting consumers’ rights under the Australian Consumer Law,” Ms Cass-Gottlieb said. 

Alongside the recent interim report on the 12-month inquiry into Australia’s supermarket sector, this additional funding highlights Australia’s focus and promising future on tackling the issues within the retail and supermarket sectors.

Footnotes:

[1] https://www.abac.org.au/wp-content/uploads/2024/09/125-24-FINAL-Determination-19-September-2024.pdf

[2] https://www.abac.org.au/wp-content/uploads/2024/10/107-24-FINAL-Determination-10-September-2024.pdf

[3] https://cdn.asa.co.nz/backend/documents/2024/08/13/24115.pdf

[4] https://www.accc.gov.au/media-release/accc-takes-woolworths-and-coles-to-court-over-alleged-misleading-prices-dropped-and-down-down-claims

[5] https://theconversation.com/shrinkflation-is-the-albanese-governments-next-target-to-protect-supermarket-shoppers-240339#:~:text=“Unit%20pricing%20helps%20consumers%20spot,government%20said%20in%20a%20statement.

[6] https://www.accc.gov.au/media-release/accc-supermarkets-inquiry-moves-into-next-phase-after-hearing-consumer-and-supplier-concerns

[7] https://comcom.govt.nz/news-and-media/media-releases/2024/commerce-commission-declines-clearance-for-the-proposed-foodstuffs-merger

[8] https://createsend.com/t/d-5EEB3A0F289C68442540EF23F30FEDED

[9] https://cdn.asa.co.nz/backend/documents/2024/08/27/24142.pdf

[10] https://www.politico.eu/article/france-cant-ban-sausage-names-for-plant-based-meat-eu-top-court-says/

[11] https://baciupartners.ro/whos-keeping-score-new-legislative-proposals-to-regulate-the-nutri-score-labelling-system/

[12] https://www.consumer.org.nz/articles/do-mushroom-supplements-and-brain-drinks-really-boost-your-body-and-mind

[13] https://www.packagingnews.com.au/latest/australia-s-packaging-regulatory-reform-what-s-next

[14] https://www.rnz.co.nz/news/national/529460/greenpeace-sues-fonterra-over-100-percent-grass-fed-butter-claim

[15] https://www.mpi.govt.nz/dmsdocument/19550-Maximum-Residue-Levels-for-Agricultural-Compounds

[16] https://adstandards.com.au/wp-content/uploads/2024/09/0237-24.pdf

[17] https://adstandards.com.au/wp-content/uploads/2024/09/0231-24.pdf

[18] https://www.accc.gov.au/media-release/accc-welcomes-additional-retail-sector-enforcement-funding


August/September 2024

ALCOHOL

Australia

“Good wine is cheaper than therapy” held to be a breach

Murrumbateman Winery have accepted the breach and removed their advertisements following a complaint regarding their roadside signs.[1] The complainant argued that the signs reading “Good wine is cheaper than therapy” encourages drinking to solve problems rather than seeking professional help.  

Part 3 (c)(iv) of the ABAC Code states that an advertisement must not suggest that the consumption of alcohol offers any therapeutic or health benefit, is needed to relax, or helps overcome problems. The signs were held to be a breach of Part 3 (c)(iv) of the ABAC Code by suggesting that the consumption of alcohol offers a mental health benefit.

Alcohol suppliers must be cautious around advertising choices, even regarding lighthearted advertisements and particular in regards to mental health.

Recent decisions suggest standards for alcohol marketing within sightline of schools are not fit for purpose

Part 4 of the ABAC Code provides that as per the Outdoor Media Association (‘OMA’) Placement Policy, advertising of alcohol beverages cannot be displayed within a 150 metres sightline of a primary or secondary school.

One complaint was made to the ABAC regarding a Lion Beer Australia advertisement for Tooheys New that was placed on a bus shelter shed near Maria Regina Primary School.[2] Although the Lion Beer advertisement was well within 150 metres from the primary school, it was held that the advertisement was not visible from the school and was thus not within the sightline of the school. This means that the OMA Placement Policy and thus Part 4 of the ABAC Code have not been breached. This was the first time that the Panel has considered a complaint regarding alcohol advertising that is within 150 metres of a school, but not within the sightline of the school.

Another complaint regarding two Hard Rated Alcoholic Lemonade advertisements was dismissed as the advertisements were not within the view of a school as per the Placement Standards.[3] The complaint regarded one advertisement near a children’s play area in Melbourne, and one advertisement placed in a tunnel at Sydney’s Central Station. As neither of the advertisements were within the sightline of a school, the OMA policies and hence Part 4(a) of the ABAC Code have not been breached.

The Panel noted in both these decisions the potential issues with these Placement Standards. The OMA have announced that a new version of the MOVE tool will be released later in 2024 to better refine where alcohol ads can be placed. The Panel recommend the following for a more accurate coverage of children audiences:

  • exclude alcohol advertising being placed on bus shelters within 150 meters of a school;

  • exclude alcohol marketing from placement on buses used for school routes; and

  • test the new MOVE data and technology to eliminate specific sites for alcohol advertising if the reasonably expected audience of an alcohol ad exceeds 20% minors.

It is important for alcohol companies to stay up to date with these potential changes as new restrictions for placement of alcohol marketing would apply.

Breach found against River Road Liquor for ‘healthy’ zero carb beer

A complaint was made concerning a social media advertisement promoting zero carbohydrate beers with the phrase “feeling like a healthy sip this long weekend?”.[4] The complainant argued the advertisement promotes zero carbohydrate beers as being healthy. It was found that the advertisement breached Part 3(c)(iv) of the ABAC Code for suggesting that the consumption of alcohol offers a health benefit. The company has accepted the breach and since taken down the advertisement.

Companies must be cautious when promoting low or no carbohydrate alcoholic beverages, as although they can be a healthier alternative, implying the product is healthy or is healthier will still constitute a breach.

Hahn beer product placement within TV interview - is this an alcohol advertisement?

A complaint was made regarding advertising for Hahn Ultra beer (owned by Lion ) being placed throughout a Sunrise breakfast television interview between Buddy Franklin (retired AFL Player) and a Sunrise interviewer.[5] The complainant argued that the product placement of Hahn beer during the interview was   an advertisement hidden within the interview.

The complaint also concerned the timing that the interview was aired, where it was 7.55am and thus could be viewed by children.

In its defence, Lion argued that the interview was not an alcohol ad and accordingly it was not subject to the regulatory requirements on the broadcast of alcohol marketing on television.  

This decision is interesting as it calls into focus the ABAC Placement Standards and the Commercial Television Industry Code of Practice (‘CTICP’) with the Panel needing to determine:

  • the interview and whether this was an alcohol marketing communication (or an ad) for ABAC purposes;

  • the interplay between the ABAC and CTICP; and

  • whether the ABAC Placement Standards had been breached.

 Is the interview an alcohol marketing communication?

The relevant code is Part 4 of the ABAC where alcohol marketing communications cannot be placed when minors would be in the audience. The Panel held that the product placement and consumption throughout the interview would be captured under the ABAC as an alcohol marketing communication. The Panel noted the definition of ‘marketing communication’ under Part 8 of the ABAC where the communication has been generated by or is within the reasonable control of a producer, distributor or retailer of alcohol. It was held here that Lion had a reasonable measure of control over the communication as they had entered into a commercial relationship with Mr Franklin to act as a product ambassador for Hahn Ultra, the interview and product placement was organized by Lion , and they had supplied Channel 7 with a promotional video for the product. Thus, the interview was captured under the definition of alcohol marketing communication. 

Is the interview an advertisement under the CTICP?

The interview, however, would not be captured [under the definition of a commercial] under the CTICP, but this does not exclude liability under the ABAC. The CTICP creates time of day restrictions as to when alcohol advertising can be shown on linear free to air TV. The CTICP uses a definition of ‘commercial’ that means any advertising for a product which is scheduled within a program or between programs for which the licensee receives payment. The interview was not captured under this definition of commercial as there was no payment to Channel 7 for the interview, and the interview itself was the ‘program’, meaning it was not a separate ad placed within a program. Thus, under the CTICP the interview was not an advertisement.

Were the ABAC Placement Standards breached? 

As the Panel considered the interview was an alcohol communication, under Part 4 (a) of the ABAC, the broadcast of the segment at 7.50am was held to be a breach as minors would be likely to be in the audience. 

This serves as a reminder that advertisements in various forms such as product placement within a television interview will be subject to the ABAC. Although the CTICP provides a narrower definition of commercial, it is important to know that liability can still be found under the ABAC for other forms of advertising.

Complaint regarding Minion replaced with Hard Rated Lemonade dismissed

A complaint was made to the ABAC Panel regarding a giant Minion exhibit being replaced with a Hard Rated Alcoholic Lemonade exhibit.[6]

The complainant noted the concerns with children seeing a massive can of alcohol instead of their favuorite movie character in the exact same spot. The Panel noted the relevant sections of Part 3(b)(i) and Part 4 of the ABAC Code. Part 3(b)(i) of the Code provides that alcoholic marketing communications must not have strong or evident appeal to minors, and Part 4 outlines the placement standards for alcohol marketing communications.

The Panel noted the unique nature of the issue, where the advertisements are not linked at all but merely the similar shape and size alcoholic beverage replaced the Minion advertisement.

In their discussion, the Panel discussed the usual factors that would give rise to a breach of Part 3(b)(i), such as colours, imagery, or activities that are familiar and thus appealing to minors. The Panel held there to be no breach due to the advertisements not being linked at all, where they noted if the Hard Rated lemonade advertisement had featured minions, this would have been enough. The placement standards under Part 4 of the Code were also not breached as the advertisement was not within 150 meters of a school as required. Thus, the complaint was dismissed. 

This showed commonsense prevailed with the Panel making it clear that ads that may be placed in the subsequent same location, but not linked or shown together, would not be considered as one advertisement for the purposes of the ABAC Code.   

New Zealand

More than 30 New World South Island liquor licences to be suspended for 48 hours 

Alcohol Regulation and Licensing Authority ordered 32 New World South Island supermarkets to suspend their licences to sell alcohol for the two-day period in October.[7]  The ban will take in around three-quarters of FSSI’s New World portfolio which comprises a total of 43 supermarkets across the South Island.

The suspension of liquor licences was sought by police inspector Ian Paulin following an alleged violation of The Sale and Supply of Alcohol Act (Act) earlier this year.

The alcohol harm prevention office applied to ARLA to suspend the off-licences, resulting in a two-day hearing in Christchurch District Court in August.

The breaches related to the online promotion of DB Export Gold and Ultra Low Carb products on 9 January, which was advertised at a 26.1% mark down for club card owners.

Under the Act, the promotion of discounts of alcohol products of more than 25% is prohibited, unless:

  • on licensed premises; or

  • in a catalogue or similar price-list of the holder of an off-licence for remote sellers (online sales).  

In its decision, ARLA found 32 of the stores were in breach of the Act, resulting in the suspension of their off-licences for 48 hours, most of which will begin at 7am on Tuesday 8 October.

“[Police] previously warned the chain for the same breach including advertising a 50% discount, double the allowed 25%.”.

This shows that alcohol pricing advertisements are being monitored and enforced when wrong.  Further, that when a warning is received, a business must ensure there are robust systems and procedures in place to ensure any pricing errors are mitigated and/or corrected.  

Whilst the fines for a breach of this section of the Act are relatively small (not more than NZD 10,000 per offence), the alternative penalty of suspension of a licence can result in a significant number of lost sales (suspension can be up to 7 days).

Complaint not upheld for Lion NZ low carb claim

The Complaints Board did not uphold a complaint for Speight’s Summit Ultra billboard advertisement claiming to have “75% less carbs…than the average carb content of leading NZ beer brands”.[8] The complainant argued that the claim was misleading to not specify what brands the product has 75% less carbs than.

The relevant codes for truthful presentation and comparative advertising are Principle 2, Rule 2(b) of the Alcohol Advertising and Promotion Code, and Principle 2, Rule 2(d) of the Advertising Standards Code. The Complaints Board said that the nature of the comparison in the advertisement was clear.  

The Board agreed that the claim of having 75% less carbs than leading beer brands would require substantiation in order to ensure the advertisement was not misleading. It was held that the Advertiser has provided adequate substantiation to support the claim made, through evidence of repeated testing comparing the carbohydrate content of Summit Ultra against ten leading beer brands sold in New Zealand.

The results found that Summit Ultra consistently had at least 75% less than comparative brands. Rule 2(b) of the Alcohol Advertising and Promotion and Advertising Standards Codes only requires Advertiser’s to hold evidence to substantiate claims made if challenged, where it does not need to be included in the advertisement or disclaimer. The complaint was thus not upheld.

This was an interesting case as, whilst the ASA did not uphold the complaint, if this was investigated by the Commerce Commission there is a question mark over whether the reference to ‘leading’ brands is clear enough to the consumer.  Referencing ‘leading brands’ invites confusion from a consumer perspective as consumers may have their own (erroneous) ideas as to what they think are the leading brands.    Consumers may have different interpretations about “leading” – For instance, “leading” to some consumers may mean the top selling, while to others it may mean best value, best taste and/or best known (which could be influenced by regional/supply issues).

Lion’s claim also did not make it clear what type of beer it was comparing against – was it a like for like comparison (lager versus lager) or were the leading brands of a different type of beer with a higher carb content.  Lastly, the comparison was an average which calls into question whether any of these individual leading brands were lower or the same in carb content to Lion’s product and therefore the claim is potentially misleading on an individual comparison and basis. It is also always recommended to put the date of your testing on the claim (eg. 2024) as this indicates the year of substantiation which mitigates the risk in case the comparison is no longer true in the future.

To be clear, we are not saying that Lion’s claim is misleading or that the Commerce Commission would have considered the claim misleading, but it does call into question further consideration that would likely have been undertaken by the Commission if the complaint was made to this regulator.

Te Aro Brewing breach Code for use of Kupe on alcohol packaging

Two complaints were made regarding advertising for Te Aro Brewing’s Age of Discovery beer, which featured images of Polynesian explorer Kupe.[9] The first complainant said the advertising exploits, degrades, denigrates, and demeans the mana of Kupe, the persons, peoples, and places associated with Kupe, and is highly offensive to use Kupe for alcohol advertising. The second complainant said the advertisement was “cultural appropriation of a Rangatira of significant status in Te Ao Māori and Pasifika”. Principle 1 of the Alcohol Advertising and Promotion Code and Advertising Standards Code states that alcohol advertising and advertisements more broadly must be prepared with a high standard of social responsibility to consumers and society. Rule 1(c) of the Advertising Standards Code also provides that advertisements must not contain anything that is indecent, or exploitative, or degrading, or likely to cause harm, or serious or widespread offence.

The Board held that the advertisements were likely to cause serious offence, especially to Māori, because they featured images of an esteemed tupuna in order to promote the sale of alcohol. In their discussion, the Board referred to the Guide of Appropriate Use of Māori Culture in the Brewing Industry (the ‘Guide’), and pointed out that although there was “nothing unflattering or denigrating” to the mana of Kupe in the advertisements, the mere use of the image to promote alcohol was culturally offensive. Thus, the complaint was upheld.

This is an important decision that shows the use of an image of Kupe is enough to be culturally offensive. It is important for advertisers to be familiar with the Guide to ensure appropriate depiction of Māori culture.

Multiple breaches found for BEE Alcoholic Lemonade advertising 

A complaint was made by Alcohol Health Watch regarding website and Instagram advertising for BEE Pink Alcoholic Lemonade.[10]

The most interesting finding regarded a complaint about a post that BEE Alcoholic Lemonade were tagged in on Instagram. The tagged post included a video of people in a boat towing a toboggan and being followed by a jet ski, and a photo of a person’s hand holding a can with “drinkbee” tagged.

Although the company had no involvement in the tagged post, the ad was located on the tagged section of the @drinkBEE Instagram page. The Complaints Board referred to the ASA Quick Guide to Social Media Marketing for Alcohol which warns advertisers to “Be aware of user-generated content that tags your brand, it will be subject to the Alcohol Advertising and Promotion Code”. As the alcoholic lemonade was associated with water sports, this was a breach of Rule 1(e) of the Code for encouraging unsafe practices. The advertisements were taken down, and thus the complaints were settled.

This decision serves as a reminder for advertisers to be active in monitoring their tagged content to ensure it complies with the Code. 

FOOD & NON-ALCOHOLIC BEVERAGES

Australia

Complaint upheld for McDonalds ad targeting children

A complaint was upheld for a McDonalds advertisement targeting children during ‘prime time’ TV.[11] The advertisement included children in minion costumes featuring the happy meal and banana dessert range.

Section 3.1 of the AANA code states that advertising of occasional food or beverage (OFB) products must not target children. The Panel considered that the placement of the advertisement was not at a time that would expect a significant proportion of children to be watching. However, the Panel also considered that the product would have a significant appeal to children due to the meal including a toy, and that the content of the advertisement was principally appealing to children due to minion references from the popular movie franchise. The Panel found the latter points to outweigh the expected audience of the advertisement at the time of airing. Thus, Section 3.1 of the AANA was breached, and the complaint was upheld.  

Advertisers in Australia should be wary of this decision as it suggests that even if children are not expected to be a significant proportion of the audience, if the OFB product has significant appeal and the content is principally appealing to children,  breaches can still be found for targeting children.

Golden Eggs complaint upheld on review for misleading claims

Following the decision to dismiss the complaint regarding a Golden Eggs advertisement in May 2024, the complaint has since been upheld following a request for review.[12] The complaint was regarding an advertisement from Golden Eggs which included statements such as "[Caged] hens are less stressed which means they produce more eggs" (and in comparison to free range hens) and "cage hens live in a climate-controlled environment which allows them to live almost stress-free." The relevant section of the AANA is Section 2.1 where advertising of food or beverage products must not be misleading or deceptive or likely to mislead or deceive.

The original decision in May was dismissed on the basis that although there was no academic research provided for the claims, there were adequate grounds found for the claims as the advertiser had experience farming in both cage and free-range hens. A request for review was submitted arguing that there were flaws in the Panel’s decision as there was no reliable source for the claims. The Panel on review reinstated that the test for misleading or deceptive was objective. Based on this objective standard, it is clear the Panel in the original decision did not apply an objective criteria to reach its findings. As no evidence was provided for the claims made in the advertisement, the advertisement was misleading. Thus, it was held on review that the advertisement breached section 2.1 of the AANA.

This decision on review acts as a reminder that advertisements must have adequate evidence for claims which is based on an objective standard.

New Zealand

Complaint regarding Beef & Lamb Ltd misleading claim settled

A complaint concerning Beef & Lamb Ltd’s claim that New Zealand is number 1 in the world on the animal welfare standards has been settled.[13] The complainant argued that the claim was misleading as the Animal Protection Index places New Zealand below other countries in terms of farm animal welfare. The Chair accepted the complaint to go before the Complaints Board to consider whether Principle 2, Rule 2 (b) of the Advertising Standards Code for truthful presentation had been breached. However, the claim was settled as the advertiser amended the advertisement by removing the claim.

Dairy company plead guilty for misleading customers about “100% Pure New Zealand” products

Milkio Foods Limited, a dairy company based in Hamilton, has been fined $420,000 for misleading customers about the origin of some of their dairy products.[14] The claims included that their ghee products were "100% Pure New Zealand", while actually sourcing the main ingredient from India. Milkio also misrepresented information to maintain the FernMark logo and license number, which is a respected international symbol for New Zealand-made products. The company pleaded guilty to 15 breaches of the Fair Trading Act for including false claims about the country-of-origin of the butter in their ghee products and unauthorized use of the FernMark logo and license number.

In deciding the penalty amount Judge Ingram emphasised the significant damage the misrepresentations could do to the New Zealand dairy industry, noting the damage was “not merely to consumers, but also to other producers who rely upon “brand New Zealand” in connection with sales of dairy products.”

Judge Ingram referred to the use of FernMark as the “cherry on top of Milkio’s brand positioning strategy…intended to provide an additional and unassailable layer of quality assurance to the consumer.” 

“In this case the claimed level of negligence or carelessness reaches a level that might fairly be described as wilful blindness, perhaps to the point of “commercial sleepwalking”, Judge Ingram said.

Vanessa Horne, General Manager of Fair Trading at the Commerce Commission, states that this was an important case to prosecute due to the global reputation of New Zealand's export brand and that the conviction should “… serve as a warning to others who may be looking to falsely claim the New Zealand brand,”

The case was originally referred to the Commerce Commission by the Ministry for Primary Industries which indicates the discussion these regulators have with each other. 

The Commission has undertaken a number of enforcement actions against companies who make misleading or false origin claims, and businesses should ensure that any claims made are accurate and not misleading. 

Grocery Commissioner calls for transparency regarding supermarket pricing errors

The Commerce Commission believes the refund policies of major supermarkets are inadequate or unknown to kiwi consumers, leading to “tens of millions of dollars a year” being lost.[15] The Commission stated that they are hearing too many examples of inaccurate or misleading pricing from supermarkets, where accurate and clear pricing is a consumer right and expectation.

The Grocery Commissioner has also stated the supermarkets processes for recording customer complaints lack clarity and consistent reporting, meaning potential compliance issues are not being identified. In response to this, the Grocery Commissioner Pierre van Heerden stated he will be introducing a mandatory disclosure standard that will require the major supermarkets to regularly disclose information about customer complaints, including pricing and promotional issues.

For more information about the expectations of major supermarkets, read more here.

Submissions opened for review of Grocery Supply Code

A review is underway of the new Grocery Supply Code (the ‘Code’) to test if the Code is helping fix the power imbalance between suppliers and major supermarkets.[16] The Code was created to increase transparency and certainty for suppliers through a set of rules for supermarkets to follow, ensuring more confidence and choice in consumers. The Review takes place to address concerns that suppliers may not be benefitting from the protections under the Code.  

The Grocery Commissioner seeks views on the operation of the Code. Submissions were closed on 16 September.

New Zealand Food Safety warns of choking hazard in jelly-cups

New Zealand Food Safety is warning consumers against eating mini jelly cups containing konjac due to a significant choking risk, especially for young children and the elderly.[17] This warning follows thousands of similar products being seized and destroyed by authorities in Australia. These jelly cups are commonly sold in bags or noodle cups and measure around 45mm or less in width and length.

New Zealand Food Safety has identified and removed a small number of imported mini jelly cups containing konjac from store shelves.

New Zealand Food Safety support investigation into methamphetamine disguised as lollies

New Zealand Food Safety (‘NZFS’) deputy director-general Vincent Arbuckle states NZFS’s ongoing support to the police in their investigation of methamphetamine disguised as branded lollies.[18] Vincent Arbuckle says the public should not consumer Rinda-branded pineapple lollies and report any of the lollies to the police. Although there is no wider food safety issue present, the NZFS are prepared to act quickly should an issue arise.

This is an ongoing criminal investigation, and any inquiries should be directed to the police. 

National government end ban on GM and GE

National have announced they will end the nearly 30-year ban on genetic modification (‘GM’) and genetic engineering (‘GE’) outside of labs.[19] Under National’s new Harnessing Biotech Plan, the government aim to pass legislation to end the ban and set up a gene tech regulator by 2026. As with the regulator, the new law will be closely based off Australia’s Gene Technology Act 2000, where applications will be assessed under a risk framework and streamlined to be in line with other OECD countries.  

Science Minister Judith Collins says the uplifting of the ban will enable enormous benefits for climate change, agriculture and health sciences. This will be an area to watch for new developments in the Harnessing Biotech Plan and proposal for legislation. 

Consultation recovering the costs of good management activities at the border

Customs and MPI are undertaking public consultation on proposed changes to goods fees and levies. 

Proposals being consulted on include:

  • Moving from per document to per consignment charging for low value goods (valued $1000 or less).

  • Introducing differential charges for high value air and sea consignments (valued over $1000).

  • Discontinuing one export related fee.

  • Introducing a commercial vessel charge to recover the costs of managing commercial vessels.

  • Bringing transhipped goods and empty containers within the scope of the charging regime.

  • Moving to full cost recovery for clearing low value air cargo.

  • Recovering the cost of clearing low value goods arriving by international mail.

  • Adjusting fee levels so that Customs’ goods management activities are financially sustainable

If all of the proposals being consulted on are implemented following consultation, there will be changes to the rates and structures of some fees. The rates of some fees would increase and rates of others would reduce.

Consultation closes on 31 October 2024.  More information and consultation documents can be found here.  

Australia and New Zealand

FSANZ to advance nutrition labelling

On 13 August 2024, FSANZ announced they will progress work on nutrition labelling to ensure consumers are informed to make healthy dietary choices.[20]

The work will progress two nutrition labelling proposals:

FSANZ also announced they will begin preparatory work to inform ministers’ future decision-making on mandating the Health Star Rating (‘HSR’) system. This follows the disappointment expressed by ministers in May 2024 regarding the uptake of the HSR system. This work will be undertaken in parallel with the scoping of a holistic review of the Nutrition Information Panel (‘NIP’) found on the back of packaged goods.

These decisions by FSANZ support the need for consumers to feel informed and empowered in making choices about food. Companies should keep an eye out for updates within nutrition labelling requirements.

Ministers agree to modernize food regulatory system  

On 25 July 2024, FSANZ ministers agreed on content for a System Statement and Regulator Commitments.[21] The System Statement outlines the purpose of the food regulatory system (the ‘System’), the roles of governments in the System, and provides an overview of System participants.  

A Strategic Plan for the System is also being developed to outline the focus areas for the next 3 years. This Strategic Plan will ensure outcomes of safe and suitable food, a healthy food supply, informed and empowered consumers, and thriving food economies.

The Regulator Commitments outlines principles to promote trust and improve efficiency and effectiveness throughout the system.  

Those in the food industry should keep up to date about these documents which can be found here when finalized.

FSANZ accept application on infant formula products

On 15 August 2024, FSANZ commenced assessment to permit the use of milk fat globule membrane enriched whey protein concentrate as a nutritive substance in infant formula products.[22]

An opportunity to comment will be available at a later date.

Overseas – US

Challenge brought against Florida ban on cultivated meat

On 1 July 2024, a ban on cultivated meat came into effect in Florida.[23] Cultivated meat producer Upside Foods have since brought a legal challenge against the ban, alleging the ban is unconstitutional and “economic protectionism”.  It argued that Florida’s ban violates the US Constitution’s provisions that prohibit protectionist measures designed to favour in-state businesses at the expense of out-of-state competitors:

“By targeting cultivated-meat, which is produced outside Florida, the law seeks to protect local meat producers from competition, undermining the principles of a national common market”.[24] 

More will be available at a later date as Upside Foods takes the issue to court.

US FDA release guidance for Voluntary Sodium Reduction Goals

On 16 August 2024, the US FDA released a second edition of Draft Guidance for Industry: Voluntary Sodium Reduction Goals.[25] The guidance looks at the Phase 2 goals for reducing sodium, which aim to take place over a three year period. The new guidance reduces the average sodium intake and requests producers to reduce their sodium accordingly. The voluntary targets are aimed at an average sodium intake of 2750 milligrams per day, which is 20% less than the Phase 1 target of 3400 milligrams a day in the 2021 guidance.

Submissions close 14 November 2024.  Businesses who export applicable food categories into the US may wish to consider submitting and/or monitoring to ensure you are across.  Submissions can be made here.  

Overseas – UK

Fake olive oil seized as prices rise

As prices continue to rise over the past couple years, more cases of fake extra virgin olive oil have arisen.[26] In August, 18,000 liters of fake olive oil were seized in Portugal. This amounted to €57,000 worth of oil, with 177,690 labels falsely mentioning olive oil (when the products were standard cooking oil). This follows a major operation in Italy where police seized a total of 42 tonnes of faux extra virgin olive oil worth €900,000 (here chlorophyll was used to adulterate the oils).

Due to increasing prices and supply and demand issues with the production of olive oil, it is important to be wary of the frauds occurring internationally.

MEDICINES & COSMETICS

Overseas

Global impact of EU AI Act for the health sector

The EU Artificial Intelligence (AI) Act is a comprehensive framework designed to regulate the development, deployment, and use of artificial intelligence across the European Union.[27] The AI Act will be directly applicable to providers and deployers of AI systems that are marketed or used in the EU, irrespective of whether such operators are located inside or outside the EU. The Act will implement a horizontal, cross-sector approach across most industry sectors. As international law firm Hogan Lovells explains, this includes anticipated challenges of the impact of the Act in the healthcare ecosystem. For example, global companies wishing to market medical devices and products in Europe will need to seek a balance between innovation and ensuring safe and responsible use of AI per the AI Act.

Generally, it is essential for businesses to evaluate and understand the impact of the AI Act, preparing for the transformation that AI will bring to business operations.

The following extracts have been provided with permission (and thanks) from food law specialist Jessica Burt’s from UK law firm Mills & Reeve. See more information here.

ASA looks at implied health claims for food supplement and doctor testimonials

The ASA has ruled that a number of ads for Nutritional Sciences Ltd’s supplements breached the CAP Code as they contained misleading and unsubstantiated health claims. The ruling examined the situation where there was a click through link to products rather than an immediate association and the use of an alleged testimonial from a doctor, ‘Dr. Paul O’Connell’.

The ads were for the ‘Activ8 Joint Complete’ product, a supplement that Nutritional Sciences Ltd claimed on its website:

  • ‘Relieves soreness, stiffness and discomfort’

  • ‘Prevents inflammation, damaged cartilage, and bone decay’

  • ‘Facilitates joint repair & recover’

  • ‘Improves movement and flexibility’ 

These claims were often accompanied by testimonials from Dr. Paul O’Connell. 

The ASA received two complaints with the following challenges:

  • The claims that Activ8 Joint Complete could treat or cure human disease breached the Code.

  • The specific health claims in the ads, which must be authorised on the Great Britain Register of nutrition and health claims, breached the Code.

  • The claim that Dr. Paul O’Connell was the ‘NHS’s leading joint expert’ was misleading and should be substantiated.

The ASA upheld the first and second issues, stating that it was likely the wording would be understood by consumers as treatment for arthritis or other degenerative joint conditions, or a preventative treatment for the effects of ageing on the joints.  Consequently, the claims were prohibited under the CAP Code.  Crucially, it did not matter that the ads did not attribute the claims to a specific product, rather it was enough for the ASA to determine that the ad was for that supplement as the ads linked through to the website where the supplement was sold. 

The ASA upheld the third issue as Nutritional Sciences Ltd did not provide any evidence to substantiate this claim, or that Dr. Paul O’Connell was registered as a medical doctor on the General Medical Council’s Register.  The ASA also noted that had evidence been provided, the issue would still be upheld as the CAP Code states that health claims referring to the recommendation of an individual health professional are not acceptable in marketing communications for food supplements.

The ASA ruled that the ads must not appear again in the forms complained of and told Nutritional Sciences Ltd that it cannot make claims that its products could treat human disease or refer to the recommendation of an individual health professional in its marketing for such products.  The matter was referred to CAP’s Compliance team.

This ruling demonstrates the importance of compliance with ASA investigations and adherence to the CAP Code in the context of health claims. 

ASA cracks down on ads claiming to treat menopause symptoms

The Advertising Standards Authority (ASA) published two rulings on 26 June 2024 upholding complaints in relation to marketing food supplements for menopause.

The ads identified were from two companies: Rejuvit Labs, LLC and Femtech Healthcare Ltd (t/a KeyForHer). All the ads identified by the ASA in these rulings were paid-for Facebook ads for food supplements claiming to treat common menopausal symptoms such as hot flushes and ‘brain fog’. Furthermore, the Rejuvit ads included health claims relating to weight loss (specifically, the alleged rate and amount of weight loss), while the KeyForHer ad included claims relating to the function of the immune system, bone health, heart health and cognitive function.

In both rulings, the ASA found that the advertisers had crossed the line and were making medical claims that the supplement could treat the symptoms of menopause. Since medical claims are not available to food supplement products, these claims were unlawful. Furthermore, the ads also made other unlawful claims including health claims and claims about the rate of weight lost.

These two rulings form part of the ASA’s wider effort to tackle ads claiming to treat the symptoms of the menopause follow on from recent CAP guidance on the topic of menopause claims specifically. The ads were identified through the ASA’s Active Ad Monitoring system, which uses AI to capture ads online and machine learning models to recognise potential issues for investigation. This type of proactive investigation by the ASA is typically used when a particular harm has been identified and suggests an ongoing focus on this area. Therefore, any advertisers looking to make claims about menopause should do so with caution, particularly if the product is regulated as a food supplement (rather than a medicine) as supplement products are not able to make medical claims which limits what can be said about these products in advertising.

SUSTAINABILITY

Australia

ACCC publish draft guide on sustainability collaborations and Australian competition law

The ACCC seeks submissions regarding a draft guide to sustainability collaborations.[28] The draft guide is designed to help businesses understand the competition risks that may arise when working together with other businesses to achieve positive environmental outcomes. Under the draft guide ACCC authorization may be available to facilitate these agreements. ACCC authorization provides a legal exemption from the competition provisions of the Competition and Consumer Act (CCA). This would mean businesses can collaborate on sustainable matters without risk if the ACCC or third parties taking legal action again them for a breach of competition law. When deciding whether to accept an application for an authorization, the ACCC will consider a range of public benefits, including those that protect the environment and promote sustainability.

The ACCC is currently seeking feedback from businesses, peak bodies and other stakeholders on the draft guide. Submissions closed on 26 July 2024. 

See the draft guide here.

Federal Court orders a landmark $11.3 million penalty to Mercer in greenwashing case

On 2 August 2024, the Federal Court ordered Mercer Superannuation (Australia) Limited to pay a $11.3 million penalty after making misleading statements about the sustainability of some of its superannuation investment products.[29] This was the Australian Securities and Investments Commission’s (‘ASIC’) first greenwashing case brought before the Federal Court.

The Court found Mercer made misleading statements on its website about seven ‘Sustainable Plus’ investment options, where they stated they excluded investments in companies involved in carbon intensive fossil fuels, alcohol production and gambling. However, those who took up the Sustainable Plus options were found to have investments in a number of companies that were involved in the excluded industries.

ASIC Deputy Chair Sarah Court expresses the importance of the large landmark penalty, where it demonstrates the importance of making accurate ESG claims to investors and potential investors.

New Zealand

New caps and lids recycling scheme launched

A group of Packaging Forum member organizations and brand owners have established a new scheme for caps and lids to be collected, stored, and recycled.[30] This follows the decision in February where caps and lids for many items were no longer accepted in kerbside recycling bins.  

One of the partners Foodstuffs is allowing caps and lids to be turned in at 16 Pak’nSave, New World and Four Square stores in Auckland, Tauranga, and Christchurch. Special collection bins have been installed at stores to accept a wide range of plastic and metal caps and lids, including beer and wine caps and lids from jars.

The initiative allows brands and organizations to continue to work towards the sustainable packaging commitment made by many in the New Zealand Plastic Packaging Declaration in 2018. This commitment was for all their packaging to be reusable, recyclable or compostable by 2025.

For information about the current selected stores with collection boxes, see here.

CONSUMER LAW

Australia

ACCC allege Good Guys misled customers on store credit promotions

ACCC have initiated proceedings against The Good Guys Discount Warehouses (Australia) Pty Ltd for allegedly making misleading representations about their store credit and ‘StoreCash’ promotions.[31] The Good Guys ran promotions between July 2019 and August 2023 which offered consumers a store credit or StoreCash if they spent a certain amount of money on qualifying products in its store.

The ACCC allege that the representations were misleading as the advertising did not disclose that:

·       to receive the credit, customers had to receive marketing materials; and

·       the credit was available for a limited time of seven to ten days only.

 The ACCC alleges this ad and similar ones used in the promotions contained the following false or misleading representations:

  • The Good Guys’ advertisements gave the impression that the only requirement for obtaining the Store Credit (or StoreCash) was to make the qualifying purchase. This was false or misleading because the customer needed to opt-in to receive marketing communications to obtain the credit.

  • The Good Guys’ advertisements gave the impression, by not mentioning an expiry time, that the Store Credit (or StoreCash) either would not expire or would expire after a reasonable period. This was false or misleading because for the majority of promotions, the credits expired within a short time of seven to ten days.

The Good Guys relied upon a bracket key (>) to link the Store Credit> or StoreCash> headline to the fine print at the bottom: >T&Cs & Exclusions apply. But the Terms & Conditions & Exclusions were not displayed, or even summarised in the advertisements.  The T&Cs which contained the ‘opt-in’ and ‘expiry’ conditions, were accessible only on The Good Guys website or on a screen in the online purchasing process.

“Businesses should be on notice that promotional conditions must be prominently disclosed to consumers, rather than buried in hard-to-find locations, or they risk enforcement action under the Australian Consumer Law,” ACCC Chair Cass-Gottlieb said.

This is the first legal action the ACCC has taken concerning the ‘opt-in to marketing materials’ condition.

The key lessons here:

  • Full disclosure:  Ensure any requirements, such as signing up to marketing communications, are prominently displayed and not hidden in the fine print;

  • Time Limited Offers:  For time limited offers (like redeeming a voucher) clearly state the exact duration of the offer, ensure this redemption period is reasonable, and that this information is clearly visible; and

  • Redemption Gifts:  If there is a limited number of redemption gifts available, make this clear and visible (eg. 3,000 redemption gifts available).  Ensure that the number is reasonable. 

ACCC accepted undertakings from Telstra, Optus and TPG in investigation into Google’s search services

The ACCC has accepted undertakings from Telstra, Optus, and more recently, TPG, as part of the ACCC’s ongoing competition investigation into Google’s search services in Australia.[32]

During the investigation into Google’s conduct, the ACCC became aware of agreements that Google had entered into with Telstra, Optus and TPG which meant Google’s search services were pre-installed as the default search service on Android devices supplied by these companies. These agreements limited the ability for rival search engines to be pre-installed and promoted on Android devices, in return for a share of Google’s advertising revenue. These agreements expired on 30 June 2024.

Telstra, Optus and TPG have each undertaken that they will not renew or enter any new arrangements with Google that require its search services to be pre-installed and set as the default on their devices. 

These undertakings arise as part of the ongoing investigation into Google’s search services in Australia. The ACCC continue to investigate competition and consumer issues with Google being the dominant search engine in Australia.

Mercedes-Benz ad breach Code for unsafe driving

A complaint regarding a YouTube advertisement from Mercedes-Benz featuring a fast car through a tunnel has been upheld.[33] The advertisement clearly showed an F1 driver and associated driving, with the disclaimer "George Russell - Driver - Mercedes-AMG Petronas Formula One Team. Filmed on closed track. Overseas model shown". The complainant argued the advertisement showed dangerous driving as the vehicle was speeding and losing traction and drifting.

The relevant clause is clause 2(a) for unsafe driving under the Federal Chamber of Automotive Industries Voluntary Code of Practice for Motor Vehicle Advertising (the ‘FCAI Code’). The advertiser argued the advertisement was clearly showing a professional F1 driver and not a regular driver, but the Panel noted there was no use of a helmet or race gear that would typically be used in F1 racing.

The Panel also stated that the type of disclaimer used should be avoided, as disclaimers cannot be used to justify material that would otherwise be in breach of the FCAI Code. Thus, the complaint was upheld and a breach of clause 2(a) of the FCAI Code was found.

This decision acts as a reminder to be cautious with using disclaimers even in what seem like obvious cases, as this may not be able to be used as a “get out of jail free” card in some cases.

New Zealand

Key compliance reminders as Commerce Commission indicates it will take tougher approach to penalties

A Letter of Expectations issued by the Minister of Commerce in April 2024 where the Minister of Commerce encouraged the Commission to “be brave” in using the tools it has available. 

In response,  the Commerce Commission has agreed to “be a brave, efficient and effective regulator”  and have indicated that there may be potential reform to increase the current penalties under the Fair Trading Act.  The Commission noting that these penalties are at “serious risk of failing to deter conduct that harms consumers and should be reviewed urgently”. 

This appears to be consistent with the current practice of the Commission pushing for higher penalties in recent cases.

The Letter in Response makes for an interesting read.

Key focus areas for retailers to be aware of:

  • Pricing and promotion claims eg. Frequent discounting that misleads consumers about the amount they are saving off the usual price.

  • Country of origin claims eg. Claiming a product is New Zealand made when the key ingredient is from another origin.

  • Claims about consumer guarantees eg. Claiming that there is no liability when compensation may be available under the Consumer Guarantees Act.

  • Greenwashing and environmental claims eg. Claiming environmental benefits that are vague, exaggerated or unsubstantiated.

  • Delivery promises and delays eg. Claiming that goods will be delivered within a specified time period when this is not the case.

  • Product safety eg. Have a robust compliance system in place if products are subject to product safety standards

  • Changes to the FTA relating to gift card expiry requirements are also currently going through Parliament.  If enacted, this will prohibit the selling of gift cards with an expiry date of less than three years after the initial sale date.

Retailers should be familiar with the key focus areas, as the harsher approach taken to compliance from the Commission reveals these enforcement priorities.

Commerce Commission updates its Enforcement Response Guidelines

The Commerce Commission has also recently updated its Enforcement Response Guidelines, these not having been updated since 2013.  

The key changes include:

  • Focus on self-reporting:  there is a strong emphasis on co-operating with the Commission to find solutions to potential breaches.  The Commission will also consider the extent to which the business helps or cooperates with the Commission.

  • Stop Now Letters as an Enforcement Tool:  As an alternative to court proceedings, the Commission may issue a Stop Now letter to put the recipient on urgent notice of their concerns.  This may be publicized such as with the first Stop Now letter to One NZ earlier this year (here).

  • Consideration of “personal or professional hardships” in making enforcement decisions in relation to individuals.  The Commission has noted that it will consider “whether and to what extent [an] individual is suffering under personal or professional hardship” in making enforcement decisions.  This indicates that the Commission may consider the human toll enforcement may take on individuals, including on mental health.

  • Practical Examples of Mitigation:  The Commission have suggested that mitigating steps include product safety recalls, admitting to a breach, compensating customers or donating to an appropriate public cause.

  • Outlining factors the Commission will consider before prosecution:  Where a breach concerns an individual, the Commission may consider their role in the business, whether they acted with intent and/or directly benefited from the conduct, and whether the individual has demonstrated remorse.

  • Alignment with the  Solicitor-General's Prosecution Guidelines for the use of Warnings including:

    • Engagement on the content of warning letters before they are issued;

    • Further guidance on what information may be published by the Commission, and particularly in relation to its decision to publish warning letters on its website; and

    • One month review period for recipients who have received a warning letter.  This review is processed as a complaint and is dealt in accordance with the Commission’s complaint process.

The guidelines provide helpful clarity of current practice for individuals and businesses when engaging with the Commission. They are also a useful reminder of the weight that the Commission attaches to voluntary self-reporting and overall collaborative approach with the Commission throughout any enforcement process. 

Complaints not upheld for One NZ adoption ad

Eight complaints were not upheld for One NZ’s television advertisement featuring an adoption story line. [34] The advertisement followed the narrative of a young male acknowledging he is adopted and undertaking a journey to uncover his heritage. He travels to Scotland with the help of a One NZ employee and connects with a Scottish woman who appears to be his birth mother. The complainants argued the advertisement was inappropriate as it presented the serious and sensitive topic of adoption and the search for birth parents in a lighthearted way. Two complainants also argued that advertisement was disrespectful to indigenous and Māori people in the context of forced and interracial adoptions.

The Complaints Board said the depiction of adoption in the advertisement’s storyline, while offensive to some consumers, did not reach the threshold to breach Principle 1 and Rule 1(c) of the Advertising Standards Code. Principle 1 states that advertisements must be prepared and placed with a due sense of social responsibility to consumers and to society. Rule 1(c) states that advertisements must not contain anything that is indecent, or exploitative, or degrading, or likely to cause harm, or serious or widespread offence, or give rise to hostility, contempt, abuse or ridicule. In coming to the decision, the Board agreed the Advertiser had chosen to take a light-hearted, simplistic approach to the emotive subject of adoption, avoiding the complex reality of adoption. In regard to complaints about the interracial narrative, the Board said there was not enough detail in the advertisement to draw any conclusions about how this adoption came to be, and therefore this aspect of the advertisement did not breach the Advertising Standards Code.

These complaints not being upheld shows the line ASA are willing to draw, yet advertisers should still be cautious around sensitive topics such as adoption.

Footnotes:

[1] https://www.abac.org.au/wp-content/uploads/2024/07/93-24-FINAL-Expedited-Determination-8-July-2024.pdf

[2] https://www.abac.org.au/wp-content/uploads/2024/07/78-24-FINAL-Determination-1-July-2024.pdf

[3] https://www.abac.org.au/wp-content/uploads/2024/07/90-98-24-FINAL-Determination-22-July-2024.pdf

[4] https://www.abac.org.au/wp-content/uploads/2024/08/117-24-FINAL-Expedited-Determination-20-August-2024.pdf

[5] https://www.abac.org.au/wp-content/uploads/2024/08/101-103-24-FINAL-Determination-29-July-2024.pdf

[6] https://www.abac.org.au/wp-content/uploads/2024/08/102-24-FINAL-Determination-14-August-2024.pdf

[7] https://www.rnz.co.nz/news/business/528127/more-than-30-new-world-supermarket-liquor-licences-suspended-after-advertising-breach

[8] https://cdn.asa.co.nz/backend/documents/2024/06/20/24084.pdf

[9] https://cdn.asa.co.nz/backend/documents/2024/08/13/24133.pdf

[10] https://cdn.asa.co.nz/backend/documents/2024/08/08/24114.pdf

[11] https://adstandards.com.au/wp-content/uploads/2024/08/Final-Case-Report-0188-24_.pdf

[12] https://adstandards.com.au/wp-content/uploads/2024/05/Final-Case-Report-0122-24.pdf

[13] https://cdn.asa.co.nz/backend/documents/2024/07/11/24122.pdf

[14] https://comcom.govt.nz/news-and-media/media-releases/2024/dairy-company-guilty-of-making-false-claims-of-100-pure-new-zealand-on-products-from-india

[15] https://comcom.govt.nz/news-and-media/media-releases/2024/kiwis-likely-losing-tens-of-millions-of-dollars-a-year-from-supermarket-pricing-errors

[16] https://comcom.govt.nz/news-and-media/media-releases/2024/comcom-testing-if-supply-code-rule-book-is-helping-fix-power-imbalance-in-groceries

[17] https://www.mpi.govt.nz/news/media-releases/new-zealand-food-safety-warns-of-jelly-cup-risk/

[18] https://www.mpi.govt.nz/news/media-releases/new-zealand-food-safety-supporting-police-investigation/

[19]https://assets.nationbuilder.com/nationalparty/pages/17969/attachments/original/1686430379/Biotech_Policy.pdf?1686430379

[20] https://www.foodstandards.gov.au/media/fsanz-advance-nutrition-labelling-focus-consumers

[21] https://www.foodregulation.gov.au/activities-committees/food-ministers-meeting/communiques/food-ministers-meeting-communique-25-july-2024

[22] https://www.foodstandards.gov.au/food-standards-code/circulars/notification-circular-300-24

[23] https://www.flgov.com/2024/05/01/governor-desantis-signs-legislation-to-keep-lab-grown-meat-out-of-florida//

[24] https://ij.org/press-release/institute-for-justice-files-lawsuit-challenging-floridas-ban-on-cultivated-

[25] https://www.fda.gov/food/food-labeling-nutrition/sodium-reduction-food-supply

[26] https://www.mills-reeve.com/insights/blogs/food-and-agribusiness/august-2024/food-agri-update-26-august

[27] https://www.lexology.com/library/detail.aspx?g=8897037e-64d8-4745-8ce1-45254e8ba633

[28] https://www.accc.gov.au/media-release/accc-consulting-on-guide-to-sustainability-collaborations

[29] https://asic.gov.au/about-asic/news-centre/find-a-media-release/2024-releases/24-173mr-asic-s-first-greenwashing-case-results-in-landmark-11-3-million-penalty-for-mercer/

[30] https://plastics.org.nz/environment/news-events/news/1005-cap-and-lids-recycling-scheme-launchedc

[31] https://www.accc.gov.au/media-release/the-good-guys-in-court-over-allegedly-misleading-store-credit-promotions

[32] https://www.accc.gov.au/media-release/accc-accepts-undertakings-from-telstra-and-optus-during-its-ongoing-investigation-into-googles-search-services and https://www.accc.gov.au/media-release/accc-accepts-undertaking-from-tpg-in-ongoing-investigation-into-googles-search-services

[33] https://adstandards.com.au/wp-content/uploads/2024/08/0198-24.pdf

[34] https://cdn.asa.co.nz/backend/documents/2024/07/09/24106.pdf


July 2024

FOOD & BEVERAGE

Australia

‘Strawberry Cloud’ cocktail complaint upheld for appealing to minors

The Belrose Hotel have been found to breach the ABAC Responsible Alcohol Marketing Code (Code) for their ‘Strawberry Cloud’ cocktail.[1] The complainant argued that the marketing of the cocktails had a strong appeal to minors. The Panel considered the name ‘Strawberry Cloud’ being of reference to a popular confectionary, the cocktail garnish including popular confectionaries such as rainbow sour straps and marshmallows, and the imagery as a whole to be familiar and popular with minors. It was held that as a whole, a reasonable person would understand the posts to have a strong appeal to minors, and thus the advertisement breached part 3(b)(i) of the Code.

This acts as a reminder to be cautious around alcohol advertising appealing to minors and particularly if using popular confectionary names/images to describe the product.

ACCC and FSANZ comment on avian flu preventative measures  

With a recent outbreak of avian influenza in Australia, the ACCC have notified some egg producers that they will refrain from prosecuting producers for ‘free-range’ claims. The egg producers may be required to quarantine their poultry within specific control zones in certain areas to mitigate the outbreak which would otherwise technically mean the eggs could not be marketed as ‘free range’.  The ACCC have made it clear in new guidance that in circumstances where producers are required under government housing orders to house their flocks for certain periods, that producers will not face enforcement action from the ACCC in relation to their free-range labeling.[2]   

 Additionally, the FSNAZ have released a statement on avian influenza, stating it is not a food safety concern and that it is safe to eat property cooked chicken meat, eggs, and egg products.

Parliamentary committee recommends sugar tax on sugar sweetened beverages in Australia  

An Australian parliamentary committee investigating the impact of diabetes have released a report making 23 recommendations.[3] The committee discussed the strongest risk factor of diabetes being obesity, where it goes hand in hand with the “diabetes epidemic”. Among the recommendations was a tax on sugar sweetened beverages. The Australian Medical Association recommends the tax be set at $0.40 per 100 grams of sugar, in line with the World Health Organization’s (WHO) recommendation to raise the retail price of sugary drinks by at least 20%. The report calls for implementing a levy on sugary beverages similar to the UK model with tiered taxes according to the sugar content.

Whether the sugar tax will be implemented is potentially unlikely due to the coalition members of the committee disagreeing with the recommendation for a  tax. Their dissenting opinion was due to the evidence that suggests the tax would disproportionality affect low-income households, and that this comes at a time of a cost-of-living crisis.

The WHO however recommend a mandatory sugar levy to reduce sugar intake in soft drinks due to, what is in their view, the successful results from the UK. WHO noted that the levy in the UK resulted in a 34.3% reduction in total sugar sales in soft drinks between 2015 and 2020.

The full list of recommendations can be seen here, which also include recommendations to:

  • implement food labeling reforms targeting added sugar to allow consumers to identify the content of added from front of packlabeling, and separate added sugar in the Nutrition Information Panel;

  • consider regulating marketing and advertising of “unhealthy food” to children (aged under 16 years) and be applied to TV, radio, gaming and online.  It is proposed that a definition of “unhealthy food” be developed; and

  • the Australian Government implement a national public health campaign to increase awareness of the importance of prevention, identification of early signs and good management of diabetes.

New Zealand

Lion NZ complaint upheld for duck shooting ad  

The complaints board upheld a complaint about Lion NZ Limited’s digital marketing advertisements for the “Wear it proud” Speights merchandise.[4] The ads contained the Speights logo along with the phrase “Duck Season Sale”, camouflage clothing, and a shot of a lake and ducks. The complaint was concerned with the implicit link between alcohol and a gun sport. The Complaints Board found that although there was no explicit connection of alcohol consumption to duck shooting, the ad alluded to an implicit link. This was enough to constitute a breach of Principle 1 and Rule 1 (e) of the Alcohol Advertising and Promotion Code, where the advertisement did not reach the high standard of social responsibility needed, and by alluding to weaponry, portrayed situations that encourage unsafe activities. The advertisements are to be removed and not used again.

This shows the high standard of social responsibility connected to alcohol advertising, where implicit references can be enough to constitute a breach.  

NZ Food Safety updates Guidance Document: Chemistry and Manufacturing Information for Agricultural Chemicals

On 14 May 2024, the MPI released the updated version of the guidance document on agricultural chemicals. The document explains the chemistry and manufacturing information that should accompany an application to register an agricultural chemical trade name product under the Agricultural Compounds and Veterinary Medicines (ACVM) Act 1997. Changes to the guidance document include changes to batch analysis requirements and to release and expiry specifications.  

If agricultural chemicals are relevant to your practice or business, you should familiarise yourself with changes made to the guidance document. See the updated guidance document here. 

NZ Food Safety updates General Export Requirements for Bee Products

On 16 May 2024, the MPI released the updated version of the Animal Products Notice: General Export Requirements for Bee Products. The notice sets out general requirements for honey and other bee products to be eligible as an export under section 167(1) of the Animal Products Act 1999. The changes to the requirements include a new provision 3.3.1(3)(C) which enables a beekeeper or operator to apply to the MPI Director General to establish that the honey   remains fit for purpose and paid the relevant application fee (if any is prescribed by regulations). 

See the updated requirements here. 

Australia and New Zealand

Work underway to review cell-based human milk products

The Food Regulation Secretariat has issued the following updates on 25 June 2024:

  • Issues Paper: Food Regulatory Framework Considerations for Cell-based Human Milk Products – considers whether food regulation frameworks apply to cell-based human milk. It was found that:

    • cell-based human milk products are unlikely to replicate the composition and health benefits of human milk, but are comparable from a function and regulatory perspective to infant formula products

    • existing food regulation frameworks are appropriate for cell-based human milk products, but will require some specific provisions to address unique characteristics of cell-based human milk products

    • the principles of the Policy Guideline on the Regulation of Infant Formula are relevant for cell-based human milk products

    • there are outstanding matters that need further review to understand food regulatory gaps

  • Investigate food safety issues related to synthetic breast milk – activity which looks at the potential issues with the manufacture and creation of commercializing cell-based human milk. The Food regulation Standing Committee (FRSC) will progress work to amend policy guidance to ensure regulatory consistency between cell-based human milk and ‘traditional’ infant formula.  

As work is underway to ensure consistencies and suitability of the framework for cell-based human milk products, it will be an area to watch as further review is needed.

Overseas

France introduce new “shrinkflation” measures

On 1 July, France introduced new measures to combat “shrinkflation”, which is the practice of reducing the size of products without reducing the price.[5] Retailers will be required to notify consumers when a food or consumer good is affected by shrinkflation due the size decreasing. This notification must be in place for at least 2 months.

With shrinkflation being seen by some as a way retailers get around increasing profits or maintaining prices, we are seeing more media attention locally [6] in this regard (but no potential law changes on the horizon at this stage).

The following extracts has been provided with permission (and thanks) from food law specialist Jessica Burt’s from UK law firm Mills & Reeve. See more information here. 

Ultra processed foods to be key issue after election 

The House of Lords select committee on food, diet and obesity recently called for evidence on ultra processed foods, high fat, salt or sugar foods and obesity. The aim of the committee is to assess how shifts in behaviours and trends have impacted obesity, how government policies have influenced these shifts, and the role of the industry and the wider public in the public health landscape. The Lords’ inquiry will resume after the 4 July election. 

The Scientific Advisory Committee on Nutrition (SACN), which previously raised concerns over the impact of UPF also raised doubts over the quality of the evidence to prove its links with bad health outcomes stating there were “uncertainties around the quality of evidence available”.   

The SACN will assess the latest evidence at a meeting on 20 June before making recommendations to the new government later in the year. 

Plant based alternatives and the use of defined names in Trade Marks vs Descriptives and possible divergence in approach UK and EU  

There have been several recent cases in UK and EU concerning the use of descriptive terms in the branding of alternative plant based food products which specifically do not contain the named ingredient.  Descriptive trade marks can be very difficult to register, there is also a distinction between trade mark registration and food marketing and labelling.  There appears to be a different approach taken between EU and UK courts in their application to defined terms. 

Trade marks that merely describe the characteristics of a product, such as its ingredients or nature, generally lack distinctiveness and may not benefit of trade mark protection. Although descriptive terms may be eligible for trademark protection if they acquire a secondary meaning, indicating a strong association with a specific brand over time may be enough and each case is likely to turn on its own specific facts.

Not Milk

The latest of which concerns a Chilean plant-based food manufacturer who failed to register the trade mark 'Not Milk', after a European court refused on the basis of descriptiveness/ lack of distinctiveness. By decision of 8 May 2024 (T-320/23), the General Court (GC) confirmed that the sign "NOT MILK" was in fact descriptive of the products in classes 29 and 32, and that the graphical elements did not significantly alter its descriptive nature.

Mybacon

Previously this year food company Myforest Foods Co. failed in their appeal to register the trade mark “MYBACON” for its plant-based food product. The EU General Court agreed with the EUIPO that the mark “MYBACON” was likely to mislead the public about the characteristics of the products to which it was to be applied, which were plant-based meat substitutes.  

Post Milk Generation

In the recent Oatly UK case the trade mark ‘POST MILK GENERATION’ was found by the UK High Court to be validly registered.  It found the use of the term ‘milk’ in Oatly’s marketing did not amount to its products being “designated” to consumers as dairy products, so there was no deception. 

This therefore distinguishes against TofuTown case that found the term ‘milk’ could not be used to describe plant-based products in marketing, even if accompanied by the use of additional descriptive language to clarify its intended meaning Purely plant-based products cannot, in principle, be marketed with designations such as ‘milk’, ‘cream’, ‘butter’, ‘cheese’ or ‘yoghurt’, which are reserved by EU law for animal products (europa.eu). This was found because the trade mark in Oatly does not describe any product.

Legislation:  The use of the term ‘milk’ is specifically legislated via Regulation (EU) No 1308/2013 which defines the term ‘milk’ as the “normal mammary secretion obtained from [..] milking”, ‘milk products’ as those derived exclusively from animal milk, and ‘composite products’ as those in which milk or a milk product is an essential element. It goes on to state that:

  • The term ‘milk’ cannot be used for any product that does not satisfy that definition, regardless of whether the term is used in the product description or in a trade mark (the “definition prohibition”); and

  • use of this term in advertising (even if not on products) must not claim or suggest that the product is a dairy product if it is not (the “advertising prohibition”).

Use of the term ‘milk’ would be permitted only to describe the raw materials and to list ingredients there are also specific exceptions ie “coconut milk” due to longstanding traditional usage.

McDonalds EU Big Mac Trade Mark not extended to Poultry 

McDonald's has not been provided its EU trade mark ‘Big Mac’ in respect of poultry products following a judgment of the European General Court.  The court held that McDonald’s had failed to prove that it was genuinely using the Big Mac label over a five-year period for chicken sandwiches, poultry products or restaurants.

See more here.

MEDICINES & COSMETICS

Australia

Better Leaf face fine for unlawful advertising

The Therapeutic Goods Administration (‘TGA’) have issued infringement notices totaling to $171,972 to Better Leaf Pty Ltd for alleged unlawful advertising of medicinal cannabis. The TGA allege that the advertisements referenced the treatment of serious diseases or conditions. These references are prohibited or restricted under the Therapeutic Goods Act 1989 (the ‘Act’), which must be approved by the TGA. 

The potential fines show the high standard of advertising surrounding cannabis products, especially surrounding prohibited or restricted representations under the Act.

New Zealand

Submissions open to repeal Therapeutic Products Act  

On 24 June 2024 a Bill was introduced to Parliament to repeal the Therapeutic Products Act.[7] The repeal Bill then passed its first reading in Parliament on 27 June. The Health Committee now seek submissions from the public to have their say about the repeal Bill. The closing date for submissions is 29 July 2024. The final date for the Select Committee to report back to the House is 1 November 2024.

CONSUMER LAW

Australia 

Fertility program found to breach Code

The Complaints Board have upheld a complaint against Gyna Fertility for misleading and offensive advertisements.[8] The ad included the characters ‘time’ and ‘food’ discussing fertility whilst a lady waits for a fertility test. The complainant argued that the ad implies fertility issues are due to age and diet, which is misleading and offensive to a vulnerable group of women struggling to get pregnant. The issue of whether the advertisement was misleading was not considered by the Panel. The Panel found however the advertisement to be in breach of section 2.1 of the AANA Code of Ethics (the ‘Code’) for discrimination or vilification. Overall, the Panel considered that the advertisement portrayed women, especially those with fertility issues, in a way that vilified them based on age and gender.

This breach highlights the need for extra caution surrounding sensitive issues such as fertility.

Multiple breaches found against gambling app advertisement  

A complaint was made against gambling app Sportsbet for an advertisement showing a man streaming sky racing on his phone while driving a golf cart.[9] The complainant argued that the advertisement encourages people to use their phone whilst driving a vehicle, sending the wrong message about driving and road safety. The Panel held the advertisement to breach both section 2.8 of the Wagering Code and section 2.6 of the AANA Code of Ethics. Section 2.8 of the Wagering Code states that advertising or marketing communication for a wagering product or service must not portray, condone or encourage excessive participation in wagering activities, where failing to put the phone down while engaging in the gambling was considered excessive participation. Section 2.6 of the AANA Code states that advertising shall not depict material contrary to Prevailing Community Standards on health and safety, where using a phone while driving amounts to a breach. Sportsbet have since discontinued the advertisement.

This serves as a reminder of the high standard given to health and safety concerns and gambling activities in advertising.  

National Consumer Congress 2024 – Product Safety 

Gina Cass-Gottlieb, Chair of the ACCC, introduced the National Consumer Congress on 27 June 2024.[10] The Congress outlined the 2024/25 product safety priorities. These priorities include:

·       Nursery products

·       Product safety online

·       Sustainability and product safety

·       Emerging technology

·       Improving product safety data

Cass-Gottlieb also discussed the compliance and enforcement priorities, as well as the product safety regulatory framework. For more information, see the transcript here.

Novelty toy supplier and operator to pay penalties for battery testing non-compliance

Novelty toy supplier MDI International Pty Ltd (MDI) and the owner and operator of Timezone, Kingpin and Zone Bowling, TEEG Australia Pty Ltd (TEEG), have each been ordered to pay $49,500 in penalties.[11] The high penalties follow the infringement notices ACCC issued against them for alleged breaches of the Australian Consumer Law by failing to comply with testing requirements for button battery safety. The ACCC issued three infringement notices to each company in relation to the supply of three novelty toy products containing button batteries: the World’s Smallest Alarm Clock, the Pocket Fart Gun, and the Sonic Spinner. These products were available to be redeemed as prizes by consumers at TEEG venues, including Timezone, thus subjecting TEEG to the same penalties as the toy supplier. Between July 2022 and June 2023, MDI supplied TEEG with approximately 10,000 units of the products without completing all required testing, where TEEG then on-supplied approximately 5,000 of the products to consumers.

These penalties show how those who further supply products can still be liable to the same penalties as the original supplier, and should thus ensure compliance with Australian Consumer Law. 

New Zealand

Responding to complaints about misleading claims – ASA information session

The NZ Advertising Standards Authority recently held an information session on responding to complaints about misleading claims. Takeaways from the session include:

  • There is increased scrutiny on environmental claims and greenwashing.  You must be able to support these claims not just in relation to the individual claims but also within the overall context of the ad. 

  • If you have a scientific study that supports your claim, be careful with how you market the study and ensure that your marketing language does not change the meaning or the outcome of the study. The consumer marketing language must still represent the outcome of the study.

  • The onus is on the advertiser to support the claim, not the complainant.

  • Science-based claims such as “clinically proven” require robust substantiation. For example, a claim that a face cream is clinically proven to visibly reduce wrinkles where the evidence is self-assessment by 20 women looking in the mirror, will not be acceptable. The ASA Board will look at the substantiation that supports the claim, including whether the study has been peer-reviewed, published, the sample size etc. The entire study must be provided to the ASA and you must highlight the areas of the study that support the claim. 

  • Implied claims still require substantiation to show a reasonable basis.  Claims like “better” and “friendlier” still require evidence to support the claim being made. 

  • Evidence such as media stories, testimonials or Wikipedia articles are not reasonable substantiation.   

  • When the ASA considers a complaint, the first question they consider is what is the consumer takeout?  This is in light of the context, medium, product and audience.  Each ad must stand on its own merit so although the entire campaign may add additional context, it is the lone ad that will be considered.

 Further top tips from the ASA complaints team include:

  • Read the complaint carefully;

  • Consider whether you want to settle the ad or defend it;

  • Quality of evidence is important – not only for claims but also to support placement decisions;

  • Remember that the full text of your response will be published in the written decision and released to media – so be careful what is said; and

  • Talk to the ASA if you have any questions.

Pyramid scheme operator ordered to pay the largest fine to date of $5.9m

Shelly Cullen, the promotor of the pyramid scheme ‘Lion’s Share’, has been ordered by the Auckland District Court to pay $5.9m.[12] Ms Cullen promoted the global cryptocurrency-based scheme to Māori and Pasifika communities in New Zealand during 2020 and 2021. The amount ordered includes a $600,000 penalty, which is the largest criminal fine to be issued to an individual under the Fair Trading Act. The remaining order of $5.3m reflects the amount of commercial gain she made throughout the scheme. The Judge noted that Cullen’s offending is at the top of the scale, and thus the starting point of the maximum penalty of $600,000 is completely appropriate and proportionate in these circumstances.

The seriousness of the offending has been proportionality remedied with the largest fine under the Fair Trading Act to date.

Overseas

CMA Complaint ’responsibly sourced’ [13] 

Campaign group 'Open Seas' has submitted a complaint to the Competition and Markets Authority (CMA) about the use of the term ’responsibly sourced’ in the labelling of scampi and alleged this was misleading consumers. 

The complaint referred to specific supermarkets including Co-op, M&S, Sainsbury’s and Tesco.

Whilst the use of the claim was reported to be “in line with strict third-party guidance from the Sustainable Seafood Coalition”, Open Seas have argued the definition of ‘responsible’ had been redefined “to suit the interests of companies that have a direct financial interest in selling seafood”.

The use of complaints to the CMA either to raise profile of activist groups or to pressure food companies will become more likely and carry even greater risk after the passing of the Digital Markets, Competition and Consumers (DMCC) Act on 24 May.  The Act is expected to come into force in autumn this year.

The CMA will now have the power to directly enforce consumer protection laws in the UK and sanction breaches, and will cover misleading consumer claims, including greenwashing. This will mean that cases will no longer need to go through the courts so there will not be the judicial brake on the CMAs powers of enforcement. In recent years the CMAs investigations have been particularly on green advertising claims and fair pricing.

The use of this tactic of raising complaints by activist groups is therefore likely to carry the potential for greater risk for food businesses. 

For Australia and New Zealand, this is an area to watch as similar concerns arise around ‘responsibly sourced’ claims.


Footnotes:

[1] http://www.abac.org.au/wp-content/uploads/2024/06/86-24-FINAL-Determination-18-June-2026.pdf

[2] https://www.outbreak.gov.au/sites/default/files/documents/ACCC-guidance-free-range-claim-HPAI-H7.pdf

[3]https://www.aph.gov.au/Parliamentary_Business/Committees/House/Health_Aged_Care_and_Sport/Inquiry_into_Diabetes/Report

[4] https://cdn.asa.co.nz/backend/documents/2024/06/20/24087.pdf

[5] https://www.foodnavigator.com/Article/2024/05/15/Shrinkflation-labelling-in-France#:~:text=How%20will%20consumers%20be%20alerted,per%20product%2C%20is%20two%20months.

[6] https://www.stuff.co.nz/nz-news/350331125/daylight-robbery-who-shrunk-our-biccies

[7] https://moh-therapeuticproducts.createsend7.com/t/i-e-flkjjjk-tjjhthiikd-q/?mc_cid=0960ce3889&mc_eid=abb0e8538d

[8] https://adstandards.com.au/wp-content/uploads/2024/06/0138-24.pdf

[9] https://adstandards.com.au/wp-content/uploads/2024/06/0142-24.pdf

[10] https://www.accc.gov.au/about-us/news/speeches/national-consumer-congress-2024-introduction-and-accc-keynote-address

[11] https://www.accc.gov.au/media-release/novelty-toy-supplier-and-the-operator-of-timezone-kingpin-and-zone-bowling-pay-penalties-for-alleged-button-battery-testing-non-compliance

[12] https://comcom.govt.nz/news-and-media/media-releases/2024/pyramid-scheme-promoter-ordered-to-pay-$5.9m-in-record-fair-trading-act-case

[13] The following extract has been provided with permission (and thanks) from food law specialist Jessica Burt’s from UK law firm Mills & Reeve. See more information here.


June 2024

FOOD & BEVERAGE

New Zealand

Commerce Commission extends deadline for decision of Foodstuffs merger

The Commerce Commission (Commission) has decided to issue a Statement of Unresolved Issues for the application from Foodstuffs North Island and Foodstuffs South Island seeking clearance to merge. [1]  The Statement of Issues will be published “in due course” and will outline the Commission’s provisional competition issues with the proposed merger.   The Statement of Unresolved Issues will invite submissions from Foodstuffs and other interested parties.  The Statement is not a final decision and does not mean the Commission intends to decline or clear the merger.  The Commission was originally scheduled to make a decision by 21 June 2024.  The new decision date is 1 October 2024.

Commerce Commission files proceedings against Foodstuffs North Island with anti-competitive land covenant allegation.

The Commission has filed proceedings in the Wellington High Court against Foodstuffs North Island, alleging that it lodged restrictive land covenants with the intention of preventing competitors (eg. Woolworths New Zealand) from opening new supermarkets and/or expanding existing ones at several locations in the North Island. 

The Commission announced that the parties have entered into a settlement to resolve the proceedings.[2] The High Court will determine the final orders to be made in relation to the case.

The proceedings follow an investigation into the conduct which came to light in 2021/2022 during the Commission’s market study into the grocery sector. The study identified that the use of covenants on land, or in leases by the major retailers, was limiting the number of sites available to competitors.

This case serves as a reminder that the Commission will take legal action against companies that use land covenants to prevent entry or expansion by competitors. 

Consultation on options for export exemptions from NZ composition and/or labelling requirements under the Food Act 2014

This consultation is important if your business manufacturers food or beverages in New Zealand and exports overseas.  The current law means that, unless specifically exempt, all food and beverage products exported overseas must comply with NZ composition and labelling laws even if the country you’re exporting to differs.  This has led to a lot of headaches when, for example, the product is not sold in NZ but must adhere to NZ law that is more onerous than the importing market.  In these cases, food businesses are currently required to submit an application to the Ministry for Primary Industries (MPI) to have their food export exempted from New Zealand composition and/or labelling requirements to meet the importing country requirements.

There are limitations with the current individual exemption process and this consultation seeks feedback on some alternative options.  MPI is proposing the following four options:

  • Option 1: Maintain the status quo. This option uses section 347 of the Food Act 2014 to continue to provide exemptions on an individual application/case-by-case basis. This approach means each exemption is specific to a particular food exported to a particular market.

  • Option 2: An exemption in regulations for all food exports from New Zealand standards relating to composition and labelling, with conditions. 

  • Option 3: An exemption in regulations for all food exports from New Zealand standards relating to labelling (no conditions to be met) and composition (with conditions to be met, potentially including where health claims are made or government assurances are required).

  • Option 4: An exemption in regulations for all food exports, with a differentiated approach for different classes of product or market. For example, foods that are intended for consumption by a higher-risk population group may have some specific conditions that are different from another class of products.

Submissions close 26 July 2024.  Further details can be found in the discussion document here:  https://www.mpi.govt.nz/consultations/options-for-export-exemptions-from-new-zealand-composition-andor-labelling-requirements-under-the-food-act-2014/?utm_source=notification-email

Auckland Liquor importer & distributor fined NZD 244,000 for selling illegal liquor [3]

Importer Golden Grand Trading Ltd pleaded guilty to three charges under the Food Act 2014 including being an unregistered importer and was fined NZD 142,000.  Distributor Mayajaal Holdings Ltd was fined NZD 102,000 after pleading guilty to one charge under the Food Act 2014. 

The offending included both companies recklessly possessing for sale or selling non-compliant alcohol involving some 5,534 bottles of imported liquor that had either no lot codes or were stickered with a lot code that was not genuine. The liquor had an estimated retail value of $292,526. 

Lot codes are particularly important when it comes to safety and recalls which is likely a reason for the hard line taken by NZ Food Safety.  Another aggravating factor was that Golden Grand Trading had in 2012 received a warning about importing liquor with non-compliant labelling following an investigation. It resulted in a large amount of alcohol being destroyed. Letters were also sent to Mayajaal Holdings about requirements under the Food Act.

The sentence is part of a wider Ministry for Primary Industries compliance investigation called 'Operation Spirit'. In 2022, another Auckland liquor importing company was fined more than $150,000 for also importing thousands of bottles of liquor that had lot codes removed or tampered with.

Complaint settled regarding Southern Cross Healthcare advertisement promoting alcohol use

A complaint was made to the Advertising Standards Authority (‘ASA’) regarding a Southern Cross Healthcare Tik Tok advertisement.[4]The advertisement promoted a free online mental health check-in service offered by Southern Cross, where it refers to being “introduced by the cocktail crew” coupled with a group toasting various cocktails. The complaint was concerned with the advertisement promoting alcohol for those who could be vulnerable to mental health issues. The chair noted the relevant codes were the Financial Advertising Code Principle 1, where Financial Advertising must be prepared and placed with a high standard of social responsibility to consumers, and rule 1(h) of the Advertising Standards Code where advertisements must not undermine the health and wellbeing of individuals. The complaint was settled as the advertiser agreed to take the advertisement down.

Although the complaint was settled, it can act as a reminder to advertisers to be wary of their target audience and make sensible advertising decisions.

Australia and New Zealand

Approval – Food Minister’s Meeting Notification

On 4 June 2024 FSANZ approved variations arising from the following applications and proposal. FSANZ has notified these approvals to the Food Minister's Meeting: 

  • P1028 – Infant Formula[5]

  • A1261 Irradiation – Increase in maximum energy level[6]

  • A1281 Food derived from herbicide-tolerant and insect-protected corn line DP910521[7]

  • A1282 Subtilisin from GM Bacillus subtilis as a processing aid[8]

  • A1283 2′-FL from GM Corynebacterium glutamicum in infant formula products[9]

Once FSANZ has notified the Food Ministers’ Meeting of its decision, it has 60 days to either request FSANZ to review the approved standard or inform FSANZ that it does not intend to request a review.

The FSANZ Food Standards Work Plan

The FSANZ Work Plan has recently been updated and is available on the FSANZ website here:  Food Standards Work Plan.[10] 

Information regarding key Proposals is as follows:

  • P1010 – Review of Formulated Supplementary Sports Foods (still awaiting the first call for submissions).

  • P1024 – Revision of the Regulation of Nutritive Substances and Novel Foods (still on hold pending FSANZ Act review).

  • P1049 – Carbohydrate and sugar claims on alcoholic beverages and P1059 – Energy labelling on alcoholic beverages (FSANZ Board to complete Approval in early December 2024).

  • P1055 – Definitions for gene technology and new breeding techniques (second call for submissions is intended to be released mid-2024).

  • P1056 – Caffeine Review (second call for submissions intended to be released late October 2024).

  • P1058 – Nutrition labelling about added sugars (work still underway regarding consumer testing and research).

Australia

Grocery Code of Conduct

Earlier this year, the Australian Government commenced an independent review of the Grocery Code led by Dr Craig Emerson. On Monday, the final report was handed down with 11 recommendations, including:

  • Mandatory:  that the voluntary Code be made mandatory for retailers with an annual revenue of over $5 billion, and protect all suppliers;

  • Tighter Protections:  addressing the fear of retribution, more reasonable and transparent agreements, pricing clarity and education for suppliers;

  • Dispute Forum: an anonymous complaints mechanism and disputes forum (potentially binding retailers to decisions awarding compensation of up to $5million); and

  • Increased Penalties: to the greater of $10million/3 x benefit gained or 10% of turnover (you may have seen 'billion dollar fines' headlines given Coles/WoW turnover);

The Australian Government has responded in support of the recommendations, committing to prioritising the drafting of new legislation. 

More information can be found here: https://treasury.gov.au/review/food-and-grocery-code-of-conduct-review-2023

Café Instagram advertisement found to breach Code for alcohol use

A complaint was made to the ABAC regarding Third Wave Café’s Instagram and email advertisements.[11] The Instagram video advertisement contained cheap alcohol prices with a conversation between two people, where a man says “hey guys, are you an alcoholic like Monica?” and asks her “how’s the drinking habit going?”. The email advertisement concerned only the cheap prices.  

The complaint argued these advertisements make light of alcoholism and promote binge drinking. The Panel held that the Instagram advertisement breached Part 3(a)(i) and (ii) of the ABAC Code, in that the advertisements encourages excessive and rapid alcohol consumption.

In reaching the decision, the Panel found that a reasonable person would probably understand the low prices as being associated with excessive consumption. The Panel noted that although the video could be understood as amusing, treating excessive alcohol consumption as amusing is still in breach of the ABAC standards. The email advertisement was not found to be a breach, but the Instagram video on the other hand went beyond advertising the drinks special and suggested excessive alcohol use facilitated by the cheap prices. Thus, the complaint regarding the Instagram advertisement was upheld.

This complaint acts as another reminder to be cautious around promoting excessive alcohol use, even if humorous in manner.

Complaint upheld for 24 ICE marketing

The ABAC have found Boozoom Pty Limited breached two provisions of the ABAC Standard in relation to the packaging and digital marketing of the product ‘24 ICE’.[12]

The complainant argued the packaging and product design as well as that it was similar to popular ice-block treats meant it has a strong appeal to minors in breach of ABAC Standard 3(b),), and that the advertisement included the alcohol products being consumed in a swimming pool.

 The Panel found the advertisements breached Part 3(b)(i) for targeting minors, where they used guidance from earlier decisions and found as a whole, the advertisement would appeal to minors. This was due to the bright colors, ice-block style products, and lack of clear alcoholic packaging on box.

In regard to the individuals in the advertisements consuming alcohol by a swimming pool, the Panel also found a breach of Part 3(d) of the ABAC Standard regarding alcohol and safety. The advertiser has since taken the advertisements down.

This acts as a reminder that advertisers should be especially careful with alcohol packaging and advertising appealing to minors. 

Product Recall Guide

Maddocks have released a Product Recall Guide which covers the essential topics for businesses operating in Australia. These topics include what constitutes a recall, preparing for and executing a recall, and a checklist and top tips. This guide can assist companies in the food and beverage industry in staying on top of the product recall regime in Australia.

To download a version of the guide, follow the link here.

Overseas  

The following extracts have been provided with permission (and thanks) from food law specialist Jessica Burt’s from UK law firm Mills & Reeve. See more information here.

UK release new rules on ‘alcohol alternatives’

Relating to the promotion of beverages with an ABV at or below 0.5%, the new rules cover the content, targeting and scheduling of alcohol alternative product ads.

The new guidance provides more detailed information on what is expected from advertisers and covers:

  • ABV Limits: For the purposes of the Codes, alcohol alternatives products are those at or under 0.5% ABV, which is typically in line with how the alcohol alternatives market broadly describes their ‘alcohol free’ products.

  • Definition: Alcohol alternatives are non-alcoholic drinks (those at or under 0.5% ABV) that are intended to replace alcoholic drinks in contexts where they would normally be consumed, e.g. non-alcoholic beer. The Codes state that an ad will be subject to the new rules “…if it is likely to be understood by the audience as an ad specifically for an alternative to alcohol, whether in general or as a non-alcoholic version of a particular alcoholic drink…”.

  • Cross-promotion and Shared Branding:  Ads might, whether by accident or design, have the effect of promoting alcoholic drinks. A clear example would be promotion of alcohol alternatives alongside alcoholic drinks, as part of a wider brand range or by a retailer. More implicitly, the use of alcohol-related imagery (similar packaging, glassware, or serving styles) without clarity about the alcohol-free nature of the product is likely to be considered to have the effect of promoting alcoholic drinks, even though the product itself is an alcohol alternative. Ads for alcohol alternatives which have the effect of promoting alcoholic drinks or a wider alcoholic brand must comply with the rules relating to alcoholic drinks.

These expectations adopted in the UK could be followed in Australia and New Zealand as alcohol alternatives continue to increase in popularity.

Tonic Nutrition Complaint upheld for making unauthorised nutrition claims

A website and Instagram reel made unauthorised nutrition and comparative nutrition claims, and discredited competitors' products. The listing statements included “No Added Sugar, No Junk, Vegan”. A table comparing the Daily Immunity product with various competitor products including Berocca. The CAP Code stated that marketing communications must not discredit or denigrate another product or marketer. The rule applied irrespective of whether or not a claim was true, if it appeared in a comparative advertisement and was expressed in terms which were insulting, derogatory or demeaning. Ads which included comparisons with competitors which went beyond a robust and objective comparison of their products or services risked breaching that rule.

This complaint reinforces the need to ensure claims are true and backed up with substantial evidence.

 Lidl removes ‘Strathvale Farm’ from webpages as misleading

Lidl has now removed the out of date references on its webpages. In March 2016 Tesco, launched a controversial budget range of seven own-label “farm” brands – including Woodside Farms and Boswell Farms for fruit and veg as well as meat.  Other retailer farm ranges were highlighted in the media including Asda’s ‘Farm Stores’, which features an old - fashioned barn and tractor on the label, Lidl’s ‘Birchwood Farm’ meat range (which was marketed as ‘Strathvale Farm’ in Scotland), Aldi’s ‘Ashfield Farm’ and Marks and Spencer’s ‘Oakham’ chicken.   It was alleged these names implied local and smaller scale sourcing which was misleading as some of the foods were imported from overseas.

Accurate and truthful labelling continues to be at the forefront globally and should remain a priority for advertisers.

MEDICINES & COSMETICS

Australia

TGA commence proceedings against Montu Group for unlawful advertising of medicinal cannabis

The Therapeutic Goods Administration (‘TGA’) have commenced proceedings against Montu Group Pty Ltd and its subsidiary Alternaleaf Pty Ltd in the Federal Court of Australia.[13] The TGA alleged Montu and Alternaleaf of publishing unlawful advertising of medicinal cannabis on their website and social media. Additionally, the TGA brought proceedings against the director, Mr Strauch, alleging he aided, abetted, counselled, or produced the unlawful advertisements. Alternaleaf is a fully online medical clinic that provides ‘holistic health’ services. Specifically, the issue with the advertisements was concerned with promoting the use of medicinal cannabis for the treatment of serious diseases and disorders directly to consumers. Thus, implying and representing that medicinal cannabis is approved by the TGA, safe, “miraculous” in nature, and was additionally approved by health professionals. The TGA is seeking declarations and pecuniary penalties and an injunction to prohibit any future unlawful advertising of medicinal cannabis by Montu, Alternaleaf and Mr Strauch.

The TGA’s action shows the strict approach to advertising of medicinal cannabis, where companies wishing to expand into the market should be aware of the strict rules and restrictions.

Overseas

Advertisement for supplement claiming to cure hangovers prohibited [14] 

A TikTok ad for a hangover cure claimed that a food supplement could help hangovers. This advertisement was a claim that a food could prevent, treat or cure disease, which is prohibited.

The UK ASA further assessed the brand name Hangcure and the product name Hangcure Rebound. They considered that the word Hangcure would be understood by consumers to be a shorthand for "hangover cure”, and would therefore be understood as a claim that the Hangcure Rebound product, and other products sold under the Hangcure brand name, could prevent or cure a hangover. The product and brand names were therefore a claim to prevent, treat or cure hangovers, which was prohibited. The ad breached rules 15.6 and 15.6.2 of the UK Code of Non-broadcast Advertising and Direct & Promotional Marketing (Food, food supplements and associated health or nutrition claims).

SUSTAINABILITY

Overseas – UK

October 2027: Deposit Return Scheme (DRS) to launch in UK [15]

Deposit Return Schemes across the UK are stated to become operational in October 2027. The schemes will introduce a deposit on single-use drinks containers, which is refunded upon return of the container. The deposit provides a financial incentive for consumers to return drink containers for recycling and is expected to boost recycling levels. The scheme will mean deposits are applied to in scope drinks containers, which can be redeemed upon return of the container for recycling. There has been an ongoing issue around which materials will fall under the DRS, where Wales are intending to include glass. Many retailers and drink suppliers have stated that may reduce their number of products supplied to Wales if glass is included in the DRS. 

The next steps will see legislation enacted to bring the schemes into existence across the UK and amending the existing Deposit and Return Scheme for Scotland Regulations 2020. It signifies the ongoing focus on sustainability globally, where concerns highlight the need to balance sustainability with economic interests.

CONSUMER LAW

New Zealand

Commerce Commission alleges 2degrees made misleading claims

The Commerce Commission have filed 8 charges under the Fair Trading Act against 2degrees for making misleading claims about their ‘free Aussie Business roaming’ for business mobile plans.[16] The claims were made between 2020 and 2023 and were alleged to create the impression that customers would have the ability to roam year round at no extra costs, when there was actually a 90-day cap on the free roaming. 2degrees have since removed the 90-day limit on free roaming, refunded customers who were charged past the 90 days, and updated their promotions.

Fair Trading General Manager, Vanessa Horne states this action can act as a reminder for businesses on the importance of accurate and truthful headlines, and not to hide key information in the fine print. 

Australia

Report reveals concerns over visibility and choice over data collection 

The latest Digital Platform Services Inquiry report highlights consumers concerns with how much their data is being collected, used and shared.[17] Data firms collect consumer data from a range of sources and use it for other purposes, such as marketing and advertising. Consumers revealed they find it difficult to understand, consent to and control what happens to their data. The report follows a 2023 consumer study which found 74% of Australians are uncomfortable with their personal information being sold to or shared with other companies.  

The ACCC have recommend a new set of mandatory codes of conduct for designated digital platforms, and new mandatory obligations to address scams, harmful apps, and fake reviews, and to include notice and action requirements and stronger verification of business users and reviews.

The following complaints signify the importance of complying with relevant advertising codes, even when the intention is to be amusing or the advertisement is animated.

Complaint upheld for inappropriate slogan

Ad Standards Community Panel (‘the Panel’) have upheld a complaint against Bergmann Plastering for the slogan “First we get plastered then we fill your holes".[18] The complainant argued Section 2.2 of the AANA Code of Ethics (the ‘Code’), where advertising should not employ sexual appeal in a manner which is exploitative or degrading of any individual or group of people. The Panel found the advertisement to be degrading of women as it sexualized women as objects, which was found to be a breach of section 2.2. Additionally, the complainant argued a breach of Section 2.6 of the Code, where advertising shall not depict material contrary to Prevailing Community Standards on health and safety. The Panel considered that the term ‘plastered’ commonly meant getting drunk, and notes excessive drinking is not appropriate in the workplace and is thus a breach. The Panel found the advertisement breached Sections 2.2 and 2.6 of the Code, and thus the complaint was upheld.

Complaint upheld for cartoon advertisement portraying violence

A complaint was made against Metroll Darwin for a television advertisement containing a cartoon of two men walking through the bush.[19] One of the men shoots a cockatoo, where the complainant alleges a breach as it is illegal to kill a protected species. The relevant section of the AANA Ethics code is Section 2.3, where advertising shall not present or portray violence unless it is justifiable in the context of the product or service advertised. The Panel notes that although the advertisement is a cartoon, the act of shooting an animal constitutes violence and is thus a breach under Section 2.3. In finding the breach, the Panel upheld the complaint.

Overseas - UK

New research and guidance on ads in podcasts published[20]

The Advertising Standards Authority (ASA) has published new guidance on ensuring ads read by podcast hosts and content creators are identifiable, which will come into effect on 16 August 2024. The research focuses on host-read ads in podcasts and offers interesting insights into listeners' perceptions of advertising in podcasts, including preferred terms for distinguishing ads from editorial content.

The guidance can be of assistance to advertisers as even though in the UK, the increased popularity of podcasts will require clarity on disclosure of ads in podcasts. See the guidance here.

Footnotes:

[1] https://comcom.govt.nz/news-and-media/media-releases/2024/commission-to-issue-statement-of-unresolved-issues-on-proposed-foodstuffs-merger

[2] https://comcom.govt.nz/news-and-media/media-releases/2024/comcom-files-proceedings-against-foodstuffs-north-island-for-blocking-rivals

[3] https://www.mpi.govt.nz/news/media-releases/liquor-importer-and-distributor-fined-244000-for-trying-to-sell-product-without-legitimate-bottles-labels/?utm_source=notification-email

[4] https://cdn.asa.co.nz/backend/documents/2024/05/23/24086.pdf

[5] https://www.foodstandards.gov.au/food-standards-code/proposals/P1028

[6] https://www.foodstandards.gov.au/food-standards-code/applications/Application-A1261-Increase-in-the-maximum-energy-level-for-machines-used-to-generate-X-rays-to-irradiate-food?mc_cid=d4c8d9decd&mc_eid=eb5ad9f221

[7] https://www.foodstandards.gov.au/food-standards-code/applications/a1281-food-derived-herbicide-tolerant-and-insect-protected-corn?mc_cid=d4c8d9decd&mc_eid=eb5ad9f221

[8] https://www.foodstandards.gov.au/food-standards-code/applications/a1282-subtilisin-gm-bacillus-subtilis-processing-aid?mc_cid=d4c8d9decd&mc_eid=eb5ad9f221

[9] https://www.foodstandards.gov.au/food-standards-code/applications/a1283-2-fl-gm-corynebacterium-glutamicum-infant-formula-products?mc_cid=d4c8d9decd&mc_eid=eb5ad9f221

[10] https://www.foodstandards.gov.au/food-standards-code/changing-the-code/workplan?mc_cid=d4c8d9decd&mc_eid=eb5ad9f221

[11] http://www.abac.org.au/wp-content/uploads/2024/05/61-62-24-FINAL-Determination-16-May-2024.pdf

[12] http://www.abac.org.au/wp-content/uploads/2024/05/45-24-FINAL-Determination-15-May-2024.pdf

[13] https://anisimoff.com.au/tga_medical_cannabis_advertising/

[14] The following extract has been provided with permission (and thanks) from food law specialist Jessica Burt’s from UK law firm Mills & Reeve. See more information here.

[15] As above.

[16] https://comcom.govt.nz/news-and-media/media-releases/2024/2degrees-free-aussie-business-roaming-claims-not-fair-dinkum,-comcom-says

[17] https://www.accc.gov.au/media-release/consumers-lack-visibility-and-choice-over-data-collection-practices

[18] https://adstandards.com.au/wp-content/uploads/2024/05/0088-24.pdf

[19] https://adstandards.com.au/wp-content/uploads/2024/05/0099-24.pdf

[20] The following extract has been provided with permission (and thanks) from food law specialist Jessica Burt’s from UK law firm Mills & Reeve. See more information here.


MAY (no. 2) 2024

FOOD & BEVERAGE

New Zealand

Burger King ad did not breach Code for crunching noises

The ASA Complaints Board did not uphold 17 complaints for crunching noises in Burger King’s TV, radio, and digital marketing ads.[1] The complainants were concerned that the loud crunching noises of people eating were triggering for those who suffered from misophonia and those who get distressed by eating sound effects. Some complainants were also concerned with the ads displaying bad manners and inappropriate eating behavior. The Complaints Board held that the ads did not reach the threshold to cause harm, or serious or widespread offence to consumers. Thus, Burger King were not in breach of Principle 1 or Rule 1(c) of the Advertising Standards Code.

Although this complaint was not upheld and was able to be defended, it acts as a reminder that some issues like this are highly sensitive and often complained about (so businesses should expect to receive complaints).  

Grocery Supply Code introduces protections for suppliers

The new Grocery Supply Code which came into effect 28 March 2024 aims to provide transparency and certainty for suppliers when it comes to agreements with supermarkets.[2] The intention is that this will help even the playing field within the grocery sector and the power imbalances between major retailers and suppliers. Grocery Commissioner Pierre van Heerden states that handshake or verbal agreements are no longer enough, and that suppliers should be encouraged to negotiate terms of agreements first. The negotiations that will arise will have a direct benefit for consumers regarding the high grocery prices. The Commission will be closely monitoring supermarkets compliance with the Code and whether any changes need to be made.

Suppliers are encouraged to negotiate terms with supermarkets and understand their protections and rules under the new Code. See here a checklist for suppliers to follow when entering agreements with supermarkets.

Key outcomes of recent Food Ministers’ Meeting  

The ANZ Food Ministers met on 3 May 2024 to discuss food regulation and policy matters.[3] The key outcomes can be summarised as:

  • Agreed on concepts and recommendations for progressing the review of the Food Regulation Agreement;

  • Agreed to progress work to amend policy guidance to ensure regulatory considerations for cell-based human milk products are consistent with traditional infant formula products;

  • Monitoring the uptake of the Health Star Rating (HSR) system following independent review of the HSR system in 2019; and

  • FSANZ presented Consumer Insights Tracker results which showed consumers have confidence in food safety and issues, and insight into how consumers use information on food labels

Health Star Rating (HSR)

Following the independent review of the HSR system in 2019, the Food Ministers set uptake targets for the system to reach by the end of 2025.

At the meeting on 3 May, the Food Ministers expressed their disappointment with the current uptake results, noting that it is significantly off-track to reaching the 70% uptake by November 2025. If the final target is not met by the industry, they previously agreed to consider mandating the system. This consideration to mandate the system was reiterated in the meeting, where next steps on implementation will be discussed in the July meeting.

It is important to note the outcomes of this meeting as it provides the current regulation and policy priorities of the Food Ministers.

Australia

Stricter approach to alcohol marketing proposed following Hard Solo breach

Following Hard Solo’s breach in November 2023, Liquor & Gaming NSW (L&GNSW) are proposing a formal recommendation to ban alcoholic beverages leveraging elements of an established soft drink.[4] The Hard Solo decision concerned an alcoholic version of a popular lemon soft drink ‘Solo’ which has been in the Australian beverage market for over 50 years. The Panel found a breach of Part 3 (b)(i) of the ABAC Code by having strong or evident appeal to minors, due to the similarities between the alcoholic and non-alcoholic beverages. L&GNSW seek for the Minister responsible to declare a class of liquor products “undesirable” under s 86 of the Liquor Regulation 2018 (NSW), where the class is “any liquor product the lead branding elements of which are that of an established or iconic soft drink brand”. A licensee could be liable for punishment of up to 50 penalty units for selling or supplying of any such product.

Following submissions regarding the proposed ban, the L&GNSW have provided an update and opened submissions for further comment. Concerns were raised with clarity of the wording, issues when considering the taste profile when determining what is an ‘undesirable liquor product’, and that the ABAC regulatory system does not warrant the proposed ban. The L&GNSW have provided three revised options that are open for further feedback:

Option 1 - The following class of liquor product be prohibited:

“Any [ready to drink] liquor product in respect of which the branding elements of a soft drink brand feature more prominently than the alcoholic brand or component of the relevant product, in a way that is likely to be attractive to minors or confused as solely a soft drink product. For the avoidance of doubt, this does not preclude the placement of soft drink branding elements (including trademarks and trade dress) on liquor products.”

Option 2 - The following class of liquor product is prohibited:

Any ready to drink liquor product the packaging of which contains:

(a) core branding elements derived from a soft drink brand; and

(b) no clear reference to, or association with, an alcohol brand

Option 3 - Not formally declare a class of liquor product undesirable, but rather rely on the existing provisions in the Liquor Act combined with the ABAC system and the development of liquor product and packaging guidelines.

Further submissions close 7 June 2024. Suppliers of alcoholic and soft drink beverages should keep an eye out for any progressions surrounding this proposal, which signifies the strict approach taken to alcohol marketing. 

Pressure on supermarket suppliers to justify high prices

Cost-of-living prices have prompted recent inquiries into the supermarket sector. These reviews are putting pressure on supermarkets and could have an impact on suppliers. The three significant reviews are:

  • Senate Inquiry into Supermarket Prices: look at the price setting practices, market power of major supermarkets and consider the role of multinational food companies in supermarket price inflation

  • Independent review of Grocery Code: recommendations that the Code be made mandatory, apply automatically to all supermarkets with annual revenue of A$5bn, and that civil penalties apply for serious breaches (up to a maximum of $10 million, 10% the corporation’s turnover or three times the benefit gained from the breach)

  • ACCC Supermarkets Inquiry: the ACCC’s inquiry will be far deeper and broader than the other two inquiries on foot and will be backed up by the ACCC’s far reaching investigative tool kit (see April newsletter for more information) 

Addisons have also provided some useful tips for you as a supplier, which can be summarized as:

  • Get your pricing records and trading terms/commercial agreements with supermarkets (if any) in order

  • Think about how you would explain any major price increases

  • Think about key pricing issues such as profits margins and bargaining power

  • If you receive a compulsory notice from the ACCC, don’t delay dealing with it 

See the full article here for more helpful information.  

‘Our cow’ complaint upheld for claims of meat quality

The Panel found ‘Our Cow’ had breached three provisions of the AANA Food and Beverages Code (‘the Code’) for an email advertisement.[5] The advertisement included a number of claims relating to the product, including “antibiotic and hormone free meat” and that consuming the product means that you will feel better and have more energy (than eating other products which have been exposed to antibiotics and other chemicals). The Panel found the advertisement to breach the following provisions of the Code:

  • 2.1 Not misleading or deceptive

    • No substantiation for the claim that the meat will make you feel better and have more energy

  • 2.3 Unsupported nutritional/health claims

    • Found an average consumer would interpret the advertisement as making a health claim about the product, and that this was not supported by evidence

  • 2.1 Discrimination or Vilification

    • Advertisement did portray or depict material in a way which discriminates against or vilifies a person or section of the community on account of disability 

The complaint being upheld acts as a reminder to be careful when making comparative claims and particularly those that could be denigrating to competitors with no real basis to the claim.

Overseas

Limits for 'Subject to availability' disclaimers

A webpage in the UK made misleading claims about the availability of complimentary food and drink for First Class passengers on Cross Country Trains.[6] 

The ASA considered that the ad positioned complimentary food and drink as a key part of Cross Country Trains’ First Class offering, with “Sit back, relax, and enjoy complimentary refreshments” appearing in the heading of the webpage. That page linked to a page headed “First Class Train Food and Drink” where further details of the complimentary offering were described. The ASA acknowledged that text underneath those claims stated "*All items and offers listed are subject to availability, may change or may be withdrawn at any time”. Two specific routes were referenced where “a reduced selection of drinks and snacks will be available on trains where catering is provided”. However, the ASA considered that this was not sufficient to counteract the overall impression that complimentary food and drink would be available on all but a few First Class services.

The ASA considered that the scheduled rate of between 70% and 78% of services offering catering was insufficient to substantiate the overall impression of the ad that “complimentary food and drink” would be available on all but a few First Class services.

This decision can help you as an advertiser to be wary of how far you can go with ‘subject to availability’ disclaimers.  It is important to remember that disclaimers cannot ‘fix’ an otherwise false headline claim. 

MEDICINES & COSMETICS

New Zealand Therapeutic Products Act (TPA) to be repealed

NZ Associate Health Minister Casey Costello announced on 8 May 2024 that the TPA will be repealed this year.[7] Costello explains how, in her view, the repeal will allow for a better regime can be put in place to provide New Zealanders safe and timely access to medicines, medical devices, and health products.

Later this year, the Government will consider proposals for new legislation. Until then, no action will be required by businesses or practitioners as the TPA was not intended to come into force until 2026. See our previous newsletter for more information.

How to comply with the Cosmetic Products Group Standard

The Environment Protection Authority have released a spreadsheet to help compliance with Schedules 4-8 of the Cosmetic Products Group Standard. The spreadsheet can be used as a helpful tool to facilitate searching and filtering of substances (note that it should not be used as a legal instrument).

Schedules 4-8 outline the rules for:

·       Schedule 4 – Prohibited ingredients

·       Schedule 5 – Restricted ingredients

·       Schedule 6 – Allowed colourants

·       Schedule 7 – Allowed preservatives

·       Schedule 8 – Allowed UV filters 

See the spreadsheet here.

SUSTAINABILITY

Overseas – UK

ASA provide research into environmental claims in food advertising

On 18 April 2024 the ASA published research into environmental claims in food advertising.[8] The key findings include issues of:

  • Broad claims like ‘good for the planet’ raise some concern as so general and/or absolute, that they were unlikely to be verifiable and allow brands to avoid providing evidence if allowed

  • Implied attributions of products from terminology and imagery (such as ‘natural’ = organic)

  • The use of specific terminology like ‘plant-based’ or ‘vegan’ was assumed by consumers to be accurate as it was clear and verifiable, where inaccuracy can have high consequences

  • Nutritional perception and healthy eating were held to be the largest catalyst for purchasing decisions, where environmental impacts tend to be used for post-rationalization

  • Claims comparing the environmental impact of plant-based versus animal products risked total disengagement for being too ‘preachy’ 

The ASA have stated that will continue engagement and propose additional monitoring of environmental claims in food advertising. These results can help guide advertisers on how consumers engage with environmental-based food advertising.

CONSUMER LAW 

New Zealand 

NZ ASA release new Children and Food and Beverage Codes

The ASA have released the new Children’s Advertising Code and Food and Beverage Advertising Code which will replace the current Children and Young People’s Advertising Code. [9]

As summarised by the ASA, the new Codes are:

  • The Food and Beverage Advertising Code extends safeguards to ensure a high standard of social responsibility for food and beverage advertising to consumers and prevents targeting of occasional food and beverage advertising to children under 16. The new Code strengthens existing restrictions on sponsorship advertisements relating to occasional food and beverage products and includes brand sponsorship advertisements associated with these products.

  • The Children’s Advertising Code provides clear guidelines to ensure advertisements do not encourage unsafe practices, promote bullying, encourage peer pressure or unhealthy body images, or include content that is not age-appropriate for children. The Code extends existing restrictions to ensure a high level of social responsibility in advertising to children under 16 years of age, across all advertising in all media platforms, at all times.

The Codes will come into effect from 1 November 2024 for all advertising, and 1 August 2024 for all new advertising. We will provide more information to you in the near future on what these changes will mean for you.

Complaint settled for 1 Cover “Bali Belly” advertisement

A complaint was made to the ASA regarding a 1 Cover website and bus advertisement.[10] The ads contained the text “Bali Belly” and showed a man sitting at a restaurant holding up octopus with chop sticks. The complainant alleged that the advertisements were inappropriate and offensive to those whose normal cuisine included octopus and implies that non-western food is poisonous. The advertiser took the advertisements down and the complaint was settled. 

Although settled, this complaint acts a reminder of the risk areas that are commonly being complained about. One of the common themes to look out for is stereotyping. 

Ticket seller Viagogo found to have misled customers

The Commerce Commission have succeeded against Viagogo for misleading customers for over 8 years.[11] Specifically, Viagogo was found to have misled consumers about authenticity as an official ticket seller and resale platform, and the price, scarcity, and validity of tickets. Viagogo were one of the most complained about traders, where consumers were under the impression they were buying legitimate tickets, but finding out at the door that they were invalid. The High Court has ordered that Viagogo correct the misleading information on its website and update its terms and conditions in contracts with Kiwi consumers to allow for customer disputes to be dealt with through the New Zealand courts.

This finding acts as a reminder that the Commerce Commission can successfully hold global businesses to account, ensuring businesses comply with obligations under the law. 

Commerce Commissions convicts “biggest scammer in New Zealand”

The Commerce Commission have successfully prosecuted Shelly Cullen under the Fair Trading Act on five charges relating to the global cryptocurrency-based scheme to Māori and Pasifika communities.[12] This was held to be one of the largest pyramid schemes the Commission has seen, with Cullen public stating “I am going to make history as one of the biggest scammers in New Zealand”. The pyramid scheme was responsible for a loss of almost $NZD17 million to approximately 150,000 participants.

Fair Trading General Manager Vanessa Horne says this is an example of the current risks of pyramid schemes appearing as legitimate opportunities due to evolving use of social media and cryptocurrencies. Consumers should be wary of these pyramid schemes disguised as ‘investment opportunities’.

Australia

Qantas agree to $20m payments to customers and $100m penalty proposed for misleading consumers

On 6 May 2024 an agreement was announced that ACCC and Qantas will ask the Federal Court to impose a $100 million penalty on Qantas for breaches of the Australian Consumer Law (ACL).[13] Qantas admitted to misleading customers by advertising for flights it had already decided to cancel and cancelling flights without promptly telling ticketholders of its decision. Qantas also agreed to pay about $20 million to more than 86,000 customers who were sold tickets on flights that Qantas had already decided to cancel. Qantas has also admitted that its misconduct continued from 21 May 2021 until 26 August 2023.

ACCC chair Ms Cass-Gottlieb states that if the penalty is accepted, it will send a “strong deterrence message” to companies, particularly with emphasis on communicating clearly, accurately, and honestly with consumers. If the penalty is imposed, it signifies the severity of misleading many customers over a long period of time.

Complaint regarding The Climate Study Group’s “myth” ad upheld

A complaint was made to the Ad Standards Community Panel (‘the Panel’) regarding a print advertisement with the headline “The carbon dioxide climate myth”.[14] The complainant argued that the content of the article would mislead consumers to believe that climate change is a myth, contained incorrect claims, and would be indistinguishable from editorial content. The Panel considered the issue of whether an environmental claim has been made at all, finding the advertisement contained many claims, including that fossil fuels can be used without negative impact to the environment. The Panel found the Climate Study Group breached s 1(a) of the Environmental Code in that it was misleading, and s 3(a) for a lack of adequate substantiation for the claims made. The ad has been discontinued.

This decision acts as a warning that groups such study groups are still subject to the AANA Codes. It shows the strict approach to climate-denial advertisements and environmental claims more generally without evidence to back up claims.

Footnotes:

[1] https://cdn.asa.co.nz/backend/documents/2024/04/18/24041.pdf

[2] https://comcom.govt.nz/news-and-media/media-releases/2024/traditional-handshake-supply-agreements-not-good-enough-for-$25b-grocery-sector

[3] https://www.foodregulation.gov.au/activities-committees/food-ministers-meeting/communiques/food-ministers-meeting-communique-3-may-2024

[4] https://www.lexology.com/library/detail.aspx?g=d40fd3be-4d79-4e65-b5b5-95e9eab1dfc8

[5] https://adstandards.com.au/wp-content/uploads/2024/04/0078-24.pdf

[6] The following extract have been provided with permission (and thanks) from food law specialist Jessica Burt’s from UK law firm Mills & Reeve. See more information here. 

[7] https://www.beehive.govt.nz/release/therapeutic-products-act-be-repealed?mc_cid=d807f76f94&mc_eid=abb0e8538d

[8] https://www.mills-reeve.com/insights/blogs/food-and-agribusiness/april-2024/food-and-agri-update-19th-april

[9] https://www.asa.co.nz/2024/04/30/media-release-asa-announces-new-codes/

[10] https://cdn.asa.co.nz/backend/documents/2024/05/02/24064.pdf

[11] https://comcom.govt.nz/news-and-media/media-releases/2024/legal-victory-over-viagogo-an-important-win-for-kiwi-consumers

[12] https://comcom.govt.nz/case-register/case-register-entries/lions-share-and-shelly-rose-cullen/media-releases/comcom-secures-conviction-against-promoter-who-claimed-theyd-be-one-of-the-biggest-scammers-in-nz

[13] https://www.accc.gov.au/media-release/qantas-agrees-to-20m-payments-to-customers-and-subject-to-court-approval-a-100m-penalty-for-misleading-consumers

[14] https://adstandards.com.au/wp-content/uploads/2024/04/Final-Case-Report-0032-24.pdf

The content in this article does not constitute legal advice and should not be relied on as such. Essence may change the content described on the site at any time without prior notice.  


May 2024

FOOD & BEVERAGE

New Zealand

Complaint not upheld for Lions NZ Limited and Asahi Beverages advertisements

A complaint was made regarding four alcohol advertisements that were placed during the film A Star is Born. The complainant argued the alcohol advertisements were inappropriately placed during a film about alcohol and drug addiction.[1]

It was held that the advertisements did not reach the threshold to breach Principle 1 or Rule 1(a) of the Alcohol and Promotion Code which raises issues of social responsibility and targeting of alcohol advertising. In deciding this, the complaints board considered two precedent decisions.  The first was regarding a TAB ad during a gambling addiction episode of Coronation Street. The Board said the placement of this ad during a long running and fictional programme such as Coronation Street did not meet the threshold to condone or encourage harm from gambling.  The gambling was not the over-riding theme of the programme and the complaint was not upheld.  The second precedent decision was upheld.  Here it was a Speights ad that was shown during a documentary programme that was a about Michael Hogan dealing with addiction.  The Board considered that this ad was poorly placed and in a programme with sensitive content addressing real addiction problems.  TVNZ did acknowledge that the placement of the ad should not have occurred and this was a mistake.  The Board also took into account the context, medium, audience and product in making the decision, stating that because the film ‘A Star is Born’ is fictional and addiction is only a secondary storyline, the claims were not upheld.

Although this complaint was not upheld, it can act as a reminder to advertisers to be careful regarding placement of ads during programmes and ensuring that the ad is appropriate and socially responsible in this context. 

ASA release new Children and Food and Beverage Codes

The ASA have released the new Children’s Advertising Code and Food and Beverage Advertising Code which will replace the current Children and Young People’s Advertising Code and create a stand-alone Food and Beverage Code. [16]

As summarised by the ASA, the new Codes are:

  • The Food and Beverage Advertising Code extends safeguards to ensure a high standard of social responsibility for food and beverage advertising to consumers and prevents targeting of occasional food and beverage advertising to children under 16. The new Code strengthens existing restrictions on sponsorship advertisements relating to occasional food and beverage products and includes brand sponsorship advertisements associated with these products.

  • The Children’s Advertising Code provides clear guidelines to ensure advertisements do not encourage unsafe practices, promote bullying, encourage peer pressure or unhealthy body images, or include content that is not age-appropriate for children. The Code extends existing restrictions to ensure a high level of social responsibility in advertising to children under 16 years of age, across all advertising in all media platforms, at all times.

The Codes will come into effect from 1 November 2024 for all advertising, and 1 August 2024 for all new advertising. We will provide further information in the upcoming newsletter.

Proposal to amend the Maximum Residue Levels for Agriculture

The NZ MPI is proposing to amend the New Zealand (Maximum Residue for Agricultural Compounds) Food Notice. New Zealand Food Safety is proposing the following changes: [2]

  • 5 amended entries for maximum residue levels in Schedule

    • Brodifacoum, bromadiolone, flocoumafen, pindone and dieldrin and aldrin

  • 4 new entries for maximum residue levels in Schedule 1

    • Coumatetralyl, difenacoum, difethialone, and diphacinone

Submissions close 24 May 2024. For more information, see the consultation document here.

NZ MPI release allergen labelling guide

In February 2024, the rules surrounding allergen labelling changed. Any food packaged and labelled before 25 February 2024 under the previous allergen labelling rules may be sold for a further 2 years. To support this change, the NZ MPI released a guide of the rules for declaring food allergens in food and drink products. The guide summarises the rules to:

  • Use required allergen names

  • List allergens in bold font

  • Use individual nut names of the 9 specified tree nuts

  • Use ‘fish’ or ‘mollusc’ or ‘crustacean’ as appropriate

  • Use mandatory ‘contains’ statement

  • List ‘wheat’ as a separate allergen to ‘gluten’

The guide can assist you as a manufacturer or supplier in ensuring products meet the new rules. See the guide here.

Australia

ACCC’s Supermarket Inquiry reveals sacrifices made due to grocery prices

A consumer survey as part of the ACCC’s Supermarket Inquiry has revealed the sacrifices Australians are making due to high prices.[3] The survey so far has revealed:

  • Lower income and younger Australians are spending up to one-quarter of their net income on groceries

  • Households are spending more time looking for savings, substituting fresh foods with frozen, and cutting back on non-essential items

  • Some are skipping or sacrificing meals to feed their children properly

The survey is intended to deepen understanding of how Australian’s shop for groceries by hearing directly from community experiences. Over 13,000 consumers responded to the survey and submissions have since closed. Findings will be revealed in the ACCC’s interim report due the end of August.

Interim report on Food and Grocery Code of Conduct is open for comment

On 8 April 2024, Dr Emerson released an interim report on the Australian Food and Grocery Code of Conduct (the Code) as part of assessing supermarkets conduct with suppliers.[4] The Code is a voluntary code that does not incur penalties for breaches under the Competition and Consumer Act 2010. The interim report however recommends that compliance with the Code becomes mandatory for supermarkets with annual revenues exceeding $5 million.

If the Code is implemented to be mandatory and attract penalties, this will have a major impact on the current power imbalances between supermarkets and their suppliers. See the interim report here. Comments closed 30 April 2024. 

Inquiry into Food and Beverage Manufacturing in Australia welcomes submissions

The Australian House of Representatives Standing Committee on Industry, Science and resources invites submissions on its inquiry into Food and Beverage Manufacturing in Australia.[5] The committee commenced its inquiry on 18 March 2024 with a focus on innovation and adding value within the industry. The inquiry has special regard to (as quoted from terms of reference, see more here):

  • innovation trends and new technologies, both locally and internationally;

  • ways to support new and emerging products and industries, including premium and niche products, new proteins and Indigenous foods;

  • opportunities across both domestic and export markets for Australian manufactured products, including shifting consumer trends;

  • approaches to circular economy, waste reduction and decarbonising, including packaging and food waste;

  • how the research sector can help to grow this ecosystem;

  • future workforce and skills needs; and mechanisms for the Australian Government to support further innovation and sustainable growth in the sector.

Submissions closed 1 May 2024.

Australia and New Zealand [6]

Moringa oleifera accepted as a novel food

On 2 April 2024, FSANZ accepted application A1294 – Moringa oleifera as a novel food. Noosa Organica Pty, the applicant, seeks to permit the sale of Moringa oleifera leaf, immature pods, and seed oil as food.

FSANZ approves variations

 At a Food Ministers Meeting on 13 March 2024, FSANZ notified approval of the following variations:

  • A1254 Rosemary extract as a food additive – extension of use

  • A1273 Steviol glycosides as a food additive in food for special medical purposes

  • A1275 Transglutaminase from GM Bacillus licheniformis as a processing aid

  • A1276 Food derived from herbicide-tolerant soybean line MON94313

  • A1277 2’-FL from GM Escherichia coli K-12 in infant formula products

Other Jurisdictions

The following extract has been provided with permission from food law specialist Jessica Burt’s from UK law firm Mills & Reeve.[7] See more information here: https://www.mills-reeve.com/people/jessica-burt

Consultation open for fairer food labelling changes

A consultation has been launched on proposed food labelling changes. The UK government, the Scottish Government, Welsh Government and the Northern Ireland Executive jointly published this consultation. The consultation closes on 7 May 2024. The key areas are:

  • Country of origin - proposals around clearer display of origin information on certain foods.

  • Method of production - proposals on mandatory labels and a five-tier system for pork, chicken, and eggs products.

The consultation also seeks views on whether it should be mandatory requirement to state the origin of meat, seafood, and dairy products outside of the home, for example on menus in cafes and restaurants, to give consumers access to the same information while dining out. What comes from the consultation will be of interest in Australia and New Zealand as similar changes could occur.

MEDICINES & COSMETICS

New Zealand

Repeal of Therapeutic Products Act – what’s next?

The Government’s 100-day plan included to begin repealing the Therapeutic Products Act 2023 (the Act). The Act was set to come into force by 1 September 2026. There are few details about the proposed approach, but Buddle Findlay lawyers have summarized what we know so far:[8]

  • Associate Minister of Health Casey Costello advised Parliament at the end of February that she was going to seek Cabinet’s approval to begin work repealing the Act

  • The Government has the opportunity to replace this with new legislation

  • Ms Costello has stated that any new regulation of medicines and medical devices will need to balance high quality with being accessible and affordable

  • Any new legislation may have a long lead time

  • The Government would seek input from relevant stakeholders when developing any new legislation

It is unsure whether reform of natural health products will be included in any new legislation, however Costello notes it is outdated and fragmented. If the Act is repealed, other acts like the Medicines Act 1981, Dietary Supplements Regulations 1985 and Sunscreen (Product Safety Standard) Act 2022 will remain in force until any new legislation is passed.

This is an area to keep a close eye on for any developments.

New Government proposes biotechnology innovation

The New Zealand Government proposes to overrule current restrictions on the use of genetic technologies and introduce reforms. The reforms are aimed to open up access responsibly and safely to the benefits of gene technology.[9] Currently, genetic modification is governed by The Hazardous Substances and New Organisms (HSNO) Act 1996. In New Zealand you cannot import, develop, field test, or release a genetically modified organism without approval from the Environmental Risk Management Authority (ERMA).[10]

 The Harnessing Biotech Plan proposes to:

  • End the effective ban on gene editing (GE) and genetic modification (GM) in New Zealand

  • Create a dedicated regulator to ensure safe and ethical use of biotechnolog

  • Streamline approvals for trials and use of non-GE/GM biotech

Changes are expected to come into effect mid 2025. This could lead to increased benefits for areas of climate change and advances in health sciences.

Australia

Therapeutic Goods Advertising and Compliance Education Plan 2024

The Therapeutic Goods Administration (TGA) have released a 2024 Education Plan for Therapeutic Goods Advertising and Compliance. The education priorities are outlined as:[11]

  • Communication and education products relating to Import, Advertising and Supply Compliance Priorities 2023-24

  • Publish information on compliance and enforcement activities for transparency and as a deterrent to non-compliance

  • Maintain and enhance fit-for-purpose educational resources on the TGA website and provide training and education opportunities

  • Engage with key stakeholders, including members of the TGACC as partners in education and communication activities

  • Maintain and enhance an advertising enquiry management function

These priorities are to be focused on in line with the 2023-24 compliance and enforcement priorities, which include vaping products, medicinal cannabis and MDMA. Read more here.

SUSTAINABILITY

Australia

ACCC initiates claim against Clorox for ‘50% ocean plastic’ claims

The ACCC have brought proceedings against Clorox Australia Pty Ltd for making false or misleading environmental claims.[12] The ACCC alleges that the GLAD-branded kitchen and garbage bags advertised on their products that they are made of 50% ‘ocean plastic’, when in reality they are made from plastic collected from communities located 50km from the shoreline. Thus, the ACCC alleges that the claims were misleading as consumers would be likely to believe from the statement and the blue coloured packaging and wave imagery that the plastic was sourced from the ocean.

This action highlights the ACCC’s increased focus on environmental and greenwashing claims, where ACCC’s chair Cass-Gottieb stated that it reflects the enforcement priority of ensuring environmental claims are accurate. This will be a case to watch and highlights the need to ensure claims are accurate.

Vanguard found to have made misleading environmental claims

On 28 March 2024, the Federal Court of Australia found investment company Vanguard to have made misleading environmental claims. The Australian Securities and Investment Commission (ASIC) brought a claim against Vanguard for making misleading claims in relation to the exclusionary screens applied to investments in a Vanguard index fund. Investments held by the fund were based on an index which Vanguard claimed to exclude only companies with significant business activities in a range of industries, including those involving fossil fuels. However, it was found that a significant number of the securities in the index were not researched or screened against the applicable ESG criteria. Thus, Vanguard misled investors and was found to have breached the ASIC Act several times.

This was ASIC’s first win on a greenwashing claim and acts as a reminder of the seriousness of misleading environmental claims. It shows the commitment from all regulators towards combatting greenwashing claims, and thus suppliers should be cautious in ensuring accuracy of all claims.[13] 

Overseas

EU reaches agreement on new sustainable packaging rules

On 4 March 2024, the EU Parliament and Council reached a provisional agreement on new rules surrounding substantiable packaging.[14]

The key measures include:

  • Measures cover full life cycle of packaging

  • Less packaging, less waste, restrictions on certain packaging formats

  • Ban on “forever chemicals” (PFAS) in food contact packaging

  • Each European generates almost 190kg of packaging waste every year

The EU Parliament and Council need to formally approve the agreement before it can enter into force. If these rules are implemented, they could have a ‘domino effect’ in Australia and New Zealand and spark increased sustainable measures in these jurisdictions.

The following extracts have been provided with permission (and thanks) from food law specialist Jessica Burt’s from UK law firm Mills & Reeve.[15] See more information here: https://www.mills-reeve.com/people/jessica-burt

CMA publishes Undertakings on Green Claims in Fashion Sector

ASOS, Boohoo and George at Asda have signed formal undertakings secured by the Competiton and Markets Authority (CMA) that commit them to change the way they display, describe, and promote their green credentials.

Amongst other things, these include:

  • Green claims: must ensure all green claims are accurate and not misleading.

  • Further explanation on green fabric ranges must be specific and clear, referencing ‘organic’ or ‘recycled’, rather than more ambiguous phrases – e.g. using terms like ‘eco’, ‘responsible’, or ‘sustainable’, without further explanation.

  • Criteria for green ranges: The criteria used to decide which products are included in environmental collections must be clearly set out and detail any minimum requirements

  • Part of life cycle claim: Where an Environmental Claim is not based on all aspects or all parts of the Product’s life cycle, it must ‘Clearly and Prominently’ set out a summary of the parts or aspects of the life cycle to which the Environmental Claim relates to the extent necessary to ensure it is not misleading and any further information relating to the Environmental Claim

  • Use of imagery: The firms must not use ‘natural’ imagery – such as green leaves – logos, or icons to suggest a product is more environmentally friendly than it actually is.

  • Product filters: Search filters must be accurate, only showing items that meet the filter requirements

  • Environmental targets: Any claims made to consumers about environmental targets must be supported by a clear and verifiable strategy, and customers must be able to access more details about it

  • Accreditation schemes: Statements made by the companies about accreditation schemes and standards must not be misleading.

These commitments reinforce the global focus on green claims and advertising and can be linked to the food industry to encourage suppliers to focus on ensuring products are ‘green’.

Proposal for the ‘Green Claims Directive’

The ECD is meant to work together with the proposal for a Directive on substantiation and communication of explicit environmental claims (the ‘Green Claims Directive’).  The Green Claims Directive will introduce stricter regulations on environmental claims and labelling and verification requirements. The Green Claims Directive will provide for more details by setting minimum requirements on the substantiation and communication of voluntary specific environmental claims (non-generic) and their verification in a business-to-consumer (“B2C”) context. Organisations could also face exclusion from public procurements and financial penalties for failure to comply of up to 4% of their annual turnover.

The Green Claims Directive is now being reviewed by the Council of the EU and we expect to hear more on the text of this Directive and its implementation date following the European Parliament elections in June 2024. If the Directive is passed it could have an influence in Australia and New Zealand to create stricter regulations on environment claims, labelling and verification requirements.

Easigrass claim upheld for misleading environmental claims

A Facebook post and website for artificial grass made misleading claims about recyclability, and misleadingly implied the product was eco-friendly. Recylability - The ASA considered that consumers would understand the claim that Kensington Eco-Grass was “fully recyclable” to mean that the entire product was easily recyclable once it had reached the end of its life cycle. We considered that consumers would expect that recycling process to be widely available and easily accessible to UK consumers.

Eco – The CAP Code required that the basis of environmental claims must be clear and that unqualified claims could mislead if they omit significant information. It required that absolute claims must be supported by a high level of substantiation. It also said that claims must be based on the full life cycle of the advertised product, unless the ad stated otherwise.

The ads did not contain any qualifications or further information about the basis of those claims. The ASA considered the direct and implied claims that the product was “eco-friendly” would be understood to mean that the advertised product was not harmful to the environment at any point during its full life cycle. The ASA therefore expected to see a high level of substantiation demonstrating that absolute claim.  This was not provided and the ads were found to be misleading.

This acts as another example of the strict approach taken globally on greenwashing claims.

CONSUMER LAW

New Zealand

Beds 4 U found to have made misleading claim

A complaint was made to the ASA regarding a Beds 4 U advertisement which contained the statements “Slumberzone – Best NZ made bed and mattresses brand” and “Most Luxurious in NZ”. [17] The complaint stated that the claims were misleading as they provided no documentation such as a survey or official report of proof behind the claims. The Chair noted that the claims were misleading under Principle 2, Rule 2(b) of the Code, but due to the advertiser cooperating and amending the advertisement, the matter was settled and not placed before the Complaints Board.

This complaint can act as a lesson when making comparative claims, where statements such as these must be justified with legitimate proof.

Commission Commerce files charges against Beaurepaires

The Commerce Commission has filed seven charges against Beau Ideal Limited, formerly trading as Beaurepaires, under the Fair Trading Act for allegedly selling non-compliant extended warranties without customers’ knowledge or consent.[18] It was alleged that Beaurepaires did not provide the necessary information under the Fair Trading Act when selling the warranty. There was no comparison of the protections provided under the warranty and the consumers rights under the Consumer Guarantees Act (the Act), and no statement of the consumers right to cancel. Comparative information is required to ensure consumers transparency and all information needed to make a decision on whether an extended warranty is necessary compared with their rights under the Act. The maximum penalty for adding goods or services to an invoice without a customer’s knowledge or consent under the Fair Trading Act is $600,000, and $30,000 for selling extended warranties that do not comply with the disclosure requirements.

As this case goes before the courts it will be one to keep an eye out for as it highlights the importance of compliant warranties to ensure consumer transparency.

Australia

Australians warned of fake invoices from scammers

The ACCC have urged customers to check payment details before paying emailed invoices due an influx of scammers impersonating businesses.[19] In 2023 it was reported that Australian’s lost $16.2 million to payment redirection scams, even though the number of scams reported decreased. The ACCC explain how this indicates that the amount of money lost per scam was increasingly more than the previous year.

These statistics can serve as a reminder that scammers are becoming more sophisticated and intelligent, and subsequently businesses should take further care in ensuring legitimacy of emails and payment details. 

Health and safety

Below are two recent Australian decisions regarding health and safety breaches. These decisions can act as a reminder to ensure all advertisements comply with health and safety requirements under the AANA Code of Ethics.

Donoghues Clothing

This advertisement for Donoghues Clothing depicted a family on a farm with children travelling in a side-by-side utility terrain vehicle.[20] The complainant argued that the advertisement showed unsafe driving as the ad included young children kneeling unrestrained in the rear cargo area, where deaths have occurred in similar circumstances. The Panel found that the advertisement breached section 2.6 of the Code relating to health and safety, so the complaint was upheld. The advertisement was immediately taken off the air by the advertiser.

eBay Australia and New Zealand

A complaint was made regarding an eBay advertisement which showed a car raised with a mechanic nearby ready to move under the vehicle.[21] It was argued that the advertisement showed a dangerous positioning that could result in death. The Panel noted that the car was raised in an unsafe manner using only a jack at the front and one axle stand at the rear of the vehicle. Due to the unsafe behavior in the advertisement, it was held that the advertisement breached section 2.6 of the Code. eBay have stated that intend to discontinue the advertisement.

Gender stereotyping

A common theme emerging in recent advertising complaints is gender stereotyping. See below a New Zealand, Australian and two recent UK complaints which show the varying thresholds for what is needed for a gender discrimination breach.

NZ:  Foodstuffs New World advertisement complaint not upheld

A complaint was made to the Advertising Standards Authority (ASA) regarding a New World TV advertisement.[22] The advertisement showed a man shopping and getting New World loyalty points when scanning the bar code. The advertisement stated the man is getting more than just brownie points, which the complainant argues suggests the man is doing his partner a favor and thus enforces harmful gender stereotypes. The Chair of the Complaints Board ruled that the issue did not reach the threshold to breach Principle 1, Rule 1(c) of the Advertising Standards Code which covers decency and offensiveness claims.

Although this claim was defended, there has been an increase in gender-related complaints which will lead to breaches in some cases. Extra caution should be given to stereotyping concerns due to an increased global focus on inequalities.

Australia:  Chatime found to have breached AANA Code for casual sexism

The Ad Standards Community Panel (the Panel) have found Chatime breached section 2.1 of the AANA Code of Ethics in relation to an email advertisement.[23] The advertisement contained the phrase "'50% off' 'According to Girl math that is basically free’". The complainant claimed the advertisement was offensive and contained casual sexism as it implied that girls cannot do math. The Panel upheld the complaint on the basis that although the company could be merely hopping on an internet trend, the term “girl math” conveys an unflattering perspective on women through the idea that women are not good with money or at math. Thus, the advertisement was held to have breached section 2.1 of the Code for discrimination or vilification on the account of gender.

This complaint being upheld can act as a reminder to advertisers to ensure negative stereotypes are not conveyed, even when claims may seem humorous or light-hearted due to internet trends.

UK:  A TV ad for a cleaning tool presented gender stereotypes

A three-minute TV ad for JML’s Hurricane Spin Scrubber, seen on 7 January 2024, depicted a number of women using the cleaning tool in bathrooms, kitchens and other home environments.[24] The ad included a male and female host. The male host described the product and demonstrated how it worked.  Four of the women described their experiences with the tool.  A male voice-over concluded, “To get your hands on the Hurricane Spin Scrubber and a sparkling clean home call now, or visit jmldirect.com.”

The BCAP Code stated that ads must not include gender stereotypes that were likely to cause harm, or serious or widespread offence. Joint CAP and BCAP guidance stated that gender-stereotypical characteristics included attributes or behaviours usually associated with a specific gender. The guidance stated that ads may feature people undertaking gender-stereotypical roles, such as showing women cleaning, but they should take care to avoid suggesting that stereotypical roles or characteristics were: always uniquely associated with one gender; the only options available to one gender; or never carried out or displayed by another gender.

This breach can be compared to the following advertisement where the threshold was not met:

UK:  A TV ad was conversely held by the ASA not likely to cause serious or widespread offence over its portrayal of men

A TV ad for furniture retailer DUSK, seen in October and November 2023, featured an older woman sitting in a quirkily decorated room, sipping tea while speaking to the camera. She said, “Of course I thought about going down the traditional route, you know, visiting a big old showroom, flicking through endless swatches and then ordering a sofa for well over a grand. But instead, I decided to buy direct from dusk.com and have money left over to pay Carlo!” A topless man, with his head out of the frame, walked into the room and poured tea into the woman’s cup. The woman then looked at the camera and said, “Dusk sayin’.” Forty complainants, who believed that the ad objectified men, challenged whether the ad was harmful and offensive. The ASA did not uphold the complaints. The ASA considered that because he was shirtless, and his face was not in frame, viewers’ focus would be drawn to his body. However, he appeared only briefly at the end of the ad, and in a manner that was not sexually suggestive in tone.

This suggests that timing and context are important factors when considering gender stereotype complaints, and also give an idea of what will and will not be enough to constitute a breach.

Footnotes:

[1] https://cdn.asa.co.nz/backend/documents/2024/03/28/24005.pdf

[2] https://www.mpi.govt.nz/consultations/proposals-to-amend-the-new-zealand-maximum-residue-levels-for-agricultural-compounds-food-notice-10/

[3] https://www.accc.gov.au/media-release/higher-grocery-prices-force-many-consumers-to-make-sacrifices-accc-hears

[4] https://treasury.gov.au/consultation/c2024-510813

[5] https://www.foodsouthaustralia.com.au/news-item/15481/federal-inquiry-into-food-and-beverage-manufacturing-announced

[6] https://foodlegal.com.au

[7] https://www.mills-reeve.com/insights/blogs/food-and-agribusiness/april-2024/food-agri-update-5-april-2024

[8] https://www.lexology.com/library/detail.aspx?g=1e7a1350-97e4-4d61-b06f-0b81ec6498b2

[9] https://www.national.org.nz/harnessingbiotech

[10] https://www.lexology.com/library/detail.aspx?g=46c7cdef-f68f-4445-b24b-e32b79676c70

[11] https://www.tga.gov.au/resources/publication/publications/therapeutic-goods-advertising-and-compliance-education-plan-2024

[12] https://www.accc.gov.au/media-release/glad-bags-manufacturer-in-court-for-50-ocean-plastic-claims?utm_source=ACCC%20media%20alerts&utm_campaign=92a21f4ce3-EMAIL_CAMPAIGN_2024_04_18_01_24&utm_medium=email&utm_term=0_0b94b1dddb-92a21f4ce3-%5BLIST_EMAIL_ID%5D

[13] https://asic.gov.au/about-asic/news-centre/find-a-media-release/2024-releases/24-061mr-asic-wins-first-greenwashing-civil-penalty-action-against-vanguard/

[14] https://foodlegal.com.au

[15] https://www.mills-reeve.com/insights/blogs/food-and-agribusiness/april-2024/food-agri-update-5-april-2024

[16] https://www.asa.co.nz/2024/04/30/media-release-asa-announces-new-codes/

[17] https://cdn.asa.co.nz/backend/documents/2024/03/28/24042.pdf

[18] https://comcom.govt.nz/news-and-media/media-releases/2024/commerce-commission-drives-legal-action-against-beaurepaires

[19] https://www.accc.gov.au/media-release/beware-of-fake-invoices-from-scammers-impersonating-businesses

[20] https://adstandards.com.au/wp-content/uploads/2024/04/0073-24.pdf

[21] https://adstandards.com.au/wp-content/uploads/2024/04/0074-24.pdf

[22] https://cdn.asa.co.nz/backend/documents/2024/04/11/24062.pdf

[23] https://adstandards.com.au/wp-content/uploads/2024/04/Final-Case-Report-0056-24.pdf

[24] The following extracts have been provided with permission (and thanks) from food law specialist Jessica Burt’s from UK law firm Mills & Reeve.[24] See more information here: https://www.mills-reeve.com/people/jessica-burt   

The content in this article does not constitute legal advice and should not be relied on as such. Essence may change the content described on the site at any time without prior notice.  


April 2024

FOOD & BEVERAGE

New Zealand

The Commerce Commission have published a Statement of Issues on the proposed Foodstuffs merger

An application has been received from Foodstuff North Island Limited and Foodstuffs South Island Limited seeking a merger. In response, the Commerce Commission have issued a Statement of Issues which outlines the potential competition concerns with the proposed merger. Specifically, the Statement of Issues considers whether competition in upstream and downstream markets for supply of groceries will be substantially lessened by the proposed merger. The Statement of Issues does not mean the Commission intends to decline the merger, but instead invites submissions from Foodstuffs North Island, Foodstuffs South Island and any other interested parties. The Commission have delayed the decision and are scheduled to make a decision by 31 May 2024, with submissions closing 18 April 2024. You can read more about the submission process and find the Statement of Issues here.

The potential merger holds particular interest for those in the food sector, as having one national grocery entity has the potential to lessen competition in the food market in New Zealand.

New Zealand Bill Aiming to Remove GST from Food Defeated

On 20 March 2024, a Bill aiming to remove Goods and Service tax (GST) on food was defeated.  The Bill aimed to remove GST from food in order to recognize the cost-of-living pressures and that food products are basic necessities of life that people should be able to access without taxation.  The Bill was introduced by Rawiri Waititi from the Maori Party.

Kombucha Bros remove advertisements after complaint concerning children and alleged misleading health claim

Alcohol Healthwatch (an organization dedicated to reducing and preventing alcohol-related harm) took issue with two ads made by Kombucha Bros.  The first was a website ad which showed the label for the Kombucha Bros Gin Kombucha claiming it was “good for you”.  Alcohol Healthwatch complained that this was a misleading health claim as alcohol products are not good for you.  The second Facebook ad showed a small child holding a berry in their hand and presenting it to the camera.  The text said “Summer means family, sun, lush berries and sticky fingers …”.  Alcohol Healthwatch were concerned as the ad featured children consuming the product, and it was unclear whether the child was drinking kombucha or alcoholic kombucha. 

Upon receiving the complaint, Kombucha Bros removed the advertisements and so the complaint was settled.  Even so, this is still an interesting case as it indicates that Alcohol Healthwatch are actively monitoring advertising.

Australia

Breach of ABAC by Tradie Beer – irresponsible marketing of alcohol

The finding was released on 2 January 2024 in relation to an Instagram advertisement for Tradie beer. The complaint relates to videos posted on the Tradie Brand and Tickford Racing Instagram pages. The complainant alleged that the advertisements had recreated a scene from the movie “The Hangover” and promoted misuse of alcohol and driving vehicles.

It was found that the advertisement on Tickford Racing’s Instagram did not fall under the ABAC code, but the Tradie Brands advertisement did. The advertisement was held to make implicit representations of normalizing excessive alcohol consumption through references to the behavior in “The Hangover”. Thus, Tradie Brands breached Part 3(a)(i) and (ii) of the ABAC Code. Part 3(a)(i) and (ii) of the Code state that alcohol marketing communication must not show, encourage, or treat as amusing, irresponsible alcohol consumption or consumption that is inconsistent with the Australian Guidelines to Reduce Health Risks from Drinking Alcohol.

This signifies the ABAC’s strict approach with ensuring responsible drinking and is an area alcohol advertisers should be cautious of.

Australian Medical Association Calls for Digital Black-out on Junk Food Ads

On 29 March 2024, the Australian Medical Association (AMA) published a call for a digital black-out on junk food ads.  The AMA have submitted to the Department of Health and Aged Care that there are significant preventative health benefits of a digital black-out on junk food adverts coupled with heavy restrictions on television advertising, sponsorship, and new promotion and placement rules in the retail market.[1] 

 How could this impact you?

This may have an impact on stringent marketing restrictions which could be financially and logistically burdensome for industry and is something to watch.

Australian Public Health Leaders Call for Health Levy on Sugary Drinks

On 05 February 2024, members of the Rethink Sugary Drink alliance (including the AMA, Cancer Council Australia, the Australian Dental Association, Food for Health Alliance, and Heart Foundation) submitted a position statement calling for the introduction of a 20% health levy on sugary drink manufacturers. The statement is backed by new AMA research that found a 20% health levy on sugary drinks could raise around $1 billion each year, which could be used to fund crucial obesity prevention and other health initiatives.[2] Furthermore, the research suggests the policy could reduce the amount of sugar Australians consume every year by nearly 2.6 kilograms per person, which is approximately 650 teaspoons of sugar.

The Australian Beverage Council has responded, broadly deeming the proposed policy action as too simplistic to address the complex issue of obesity and misguided, lacking backing by credible scientific evidence.[3]

How could this impact you?

This is something to keep an eye on as the introduction of a sweetened beverage tax in Australia would be financially burdensome for industry in Australia, particularly if an appropriate timeline is not provided to afford industry enough time to reformulate.

Australia and New Zealand

FSANZ update Work Plan

FSANZ updated their work plan on 12 February 2024, providing more detail of upcoming applications and proposals over the next 18 months. The Work Plan proposes develop standards and variations to standards for applications and proposals. It also provides visibility as to the progress of applications and proposals, with estimated timelines for consultation. For more information, see the complete Work Plan here: https://www.foodstandards.gov.au/sites/default/files/2024-03/Work%20Plan%20March%202024.pdf

FSANZ make changes to ‘no added sugar’ labelling

Food Standards Australia New Zealand (FSANZ) have recently amended requirements for ‘no added sugar’ labelling. The amendments create stricter requirements and more clarity for consumers. The revised standard in the Australia New Zealand Food Standards Code (Food Code) will not permit ‘no added sugar’ claims when a food:

·        contains or is an ‘added sugar’ as defined under the Food Code; and

·        does not contain ‘added sugars’ but contains more sugars than

o   10g per 100g for solid food; or

o   7.5g per 100ml for liquid food.

The amendment also includes a clear definition of ‘added sugars’ as including various sources such as honey, brown sugar and D-tagatose.

How could this impact you?

The amendments will have an impact on the industry as businesses with ‘no added sugar’ claims must ensure they meet the new requirements under the Food Code and it is possible that they may no longer be able to make these claims. The amendment was made on 13 December 2023 and provides a 4-year transition period where businesses will need to comply with the new requirements by 13 December 2027.

FSANZ new appointment

FSANZ has recently announced that Dr Matt O’Mullane will be replacing Mr Glen Neal as the FSANZ General Manager, Risk Management, and Intelligence (effective 8 April 2024).  Matt previously looked after the Standards and Surveillance team at FSANZ and the Evaluation Branch within the Office of the Gene Technology Regulator.  Glen Neal has joined the private sector as Partner at Agite Consultancy, a strategic advisory firm that combines reputation and risk management with project delivery experience. [4]

Current FSANZ Public Consultations

Current FSANZ call for comments include:

  •  Application A1284 to permit the use of triacylglycerol lipase from a genetically modified strain of Trichoderma reesei to be used as a processing aid in baking and cereal-based processes.  Submissions are due 6pm (AEDT) 17 April 2024.[5]

  •  Application A1287 to permit the sale and use of food derived from corn line MON94804, genetically modified to have reduced overall plant height.  Submissions are due 6pm (AEDT) 30 April 2024.[6] 

Other Jurisdictions

Fatal anaphylactic reaction to peanuts highlights need for improvement

In July 2020, a 23-year-old with a peanut allergy passed away in the UK after consuming a takeaway pizza. The pizza was ordered from a local restaurant through a third-party food ordering platform. Although the customer did not specify the allergy in the order, the inquest revealed that in the allergen section of the restaurant’s food safety documents, there was no information about peanuts being present. The coroner concluded that she would write to authorities expressing support for a law change that would make it mandatory for restaurants to publish food ingredients on their main menu.

If changes occur overseas in strengthening allergen cautions, this could lead to the same trend in Australia and New Zealand.

The following extracts have been provided with permission (and thanks) from food law specialist Jessica Burt from UK law firm Mills & Reeve. See more information here: https://www.mills-reeve.com/people/jessica-burt

CMA – Infant Formula Market Study

The UK’s Competition and Markets Authority has launched a market study into the supply of infant formula in the UK after finding prices had soared by 25% over two years. The launch of a market study means the CMA will be able to use its compulsory information gathering powers, rather than rely on firms providing information voluntarily.

The CMA said it intends to conduct the market study as swiftly as possible and with the intent of publishing a final report in September 2024.

Vegan Labelling Campaign

The UK Food Standards Agency (FSA) has launched a campaign ‘Vegan Food and Allergens Campaign’ to support people who have an allergy to milk, eggs, fish and crustaceans or molluscs. The campaign encourages people with allergies, or who buy for someone who has, to always check for a precautionary allergen statement such as ‘may contain’, on products labelled 'Vegan' to decide on whether it’s safe to eat.

Vegan labels are used to support a dietary choice, and do not intentionally contain products of animal origin. Vegan food could still be prepared in areas alongside products such as egg, milk, fish, crustaceans or molluscs - whereas free-from foods are not. 

To use a free-from label, food businesses must follow strict processes to eliminate risks of cross-contamination so that they do not contain any of the allergen that they claim to be free-from. 

The FSA recently updated its food labelling technical guidance for food businesses and industry.[7] The update advises businesses to use a Precautionary Allergen Label (PAL) alongside a vegan label, if cross-contamination can’t be ruled out. 

GCA investigation

The Groceries Code Adjudicator (GCA) is investigating whether intermediaries are being used in the fresh supply chain by retailers to circumvent the Groceries Supply Code of Practice, The Grocer reported in February.[8] The move follows concerns raised by suppliers and politicians of all stripes that producers are falling outside the usual scope of GSCOP due to the employment of middlemen.

The GCA’s office has confirmed to the Grocer magazine it was “gathering information” on the issue.

HFSS Promotions consultation – Scotland

The food and drink industry in Scotland is facing restrictions on promotions of HFSS foods. The new consultation restricting promotions of food and drink high in fat, sugar or salt (HFSS) proposes banning all promotions of HFSS products. These would include bans on temporary price reductions and meal deals – measures Westminster moved away from due to the cost-of-living crisis.

Elsewhere the ban echoes the scrapping of HFSS promotions in prominent locations in England, but gives business 12 months to phase out the promotions of multibuy deals. The Scottish government said it would use the same nutrient profiling model definition as that being used in England to define the products in scope.

Scottish ministers blamed the “poor response” from industry to voluntary measures to make food healthier for going ahead with the proposals, with the plans due to come into force in 2025. The consultation closes on 21 May 2024.[9]  

Blanket restrictions on direct marketing of high in fat, salt or sugar (HFSS) foods to under 16s

A recent Advertising Standards Authority (ASA) adjudication on Burger King ads looked at the requirements on marketers not to promote HFSS to under 16s.[10]  It found that practical steps to actively exclude those who were under 16 were necessary, over and above simply stating the offer was not open to them, when it came to the creation of a mailing list for direct marketing. 

The take home for marketers of HFSS products in the UK is:

·        to require the completion of date of birth for targeted audience lists; and

·        an active removal of those under 16 irrespective of how small a percentage of the audience they may be.

Claims “rustic”, “traditional” and “authentic” examined by ASA

The ASA ruled on advertising from Hovis Ltd t/a Hovis that complaints should not be upheld concerning internet and social media content (own content and site) on 28 February 2024.[11]

Three webpages and an Instagram post were held not to have misleadingly used the terms “rustic”, “authentic”, “traditional”, “artisanal-inspired bread” and “no artificial preservatives”.  The ruling highlighted the importance of context and specifying what part of the product or process the claim may relate to.  The ASA maintained their position that a consumer would have broad understanding of industrial mass production. Also, the importance for producers to have substantiated all the claims they use in advertising.

The Real Bread Campaign (Sustain), who understood the bread was produced using automated industrial techniques, and that it included artificial preservatives, challenged whether the following claims were misleading and could be substantiated:

·        “rustic”, “authentic” and “traditional”;

·        “artisanal-inspired bread”; and

·        “no artificial preservatives”.

The ASA considered that because the Hovis brand was well known, the ads appeared on their own website and Instagram page, and the products were shown in plastic packaging, consumers would understand that the products had been produced on an industrial scale. As such, it was probable that they contained some additional ingredients and processes to those used in handmade breads. This position underlined that the mere use of these terms would not be persuasive in themselves to inform the entirety of the processes the product would have been subject to and what the consumer would infer from them.

 All claims were held not to be misleading.

SUSTAINABILITY

Australia

First draft of AANA’S Environmental Claims Code released

The Australian Association of National Advertisers (AANA) released an exposure draft of the new Environmental Claims Code on 18 January 2024. The Code has been adopted to ensure advertisers and marketers develop and maintain rigorous standards when making environmental claims. The Code will increase consumer confidence, and in turn, benefit the environment, consumers, and the industry itself. The Code is accompanied by a Practice Note which provides guidance to advertisers and complainants and must be followed by the AANA in making decisions. If a final version of the Code is adopted, the Code will form part of the AANA Codes of Practice that apply to product advertisements and marketing.

The introduction of this Code highlights the growing need for regulation of greenwashing claims. Public submissions have closed for the exposure draft, so it will be an area to keep a close watch on.

Steps towards implementing new packaging regulation

In November 2023, Australian Environment Ministers agreed on the specifics of a new packaging regulation. This follows the promise to reform packaging regulations by 2025. The Environment Ministers have agreed:

  • that the Commonwealth Government will be the regulator and will mandate how packaging is designed, set minimum recycled content requirements, and prohibit harmful chemicals, and

  • that design requirements for packaging will be finalised, by the end of 2024

The public will have the opportunity to provide views on the proposed regulation in mid-2024. The mandatory design requirements will be introduced by the end of 2025 under the new regulatory scheme that will be implemented.

APCO introduce new label for soft plastics

The Australian Packaging Covenant Organization (APCO) released a new label for soft plastics. The new Australian Recycling Label (ARL) was launched in July last year and consists of a ‘Check Locally’ logo. The logo aims to increase consumer awareness and provide accurate recycling information, where consumers will be directed to the ARL website and provided information on kerbside and drop-off services. The logo can be used for soft plastics and any other material where significant kerbside or drop off collections exist but are not yet available to 80% of the Australian population.

Brands have until 1 July 2025 to complete their on-pack updates, when it will become an ACCC expectation. Brands should start reviewing their work now.

New Zealand

Chair settles complaint about misleading environmental claims from the Christchurch Airport

A greenwashing complaint was made to the ASA regarding the text “climate positive” on the Airport’s websites and documents. The complainant claimed that this text implies the company has a positive impact on the environment. The complaint was settled due to the Christchurch Airport’s cooperation and self-regulation, also defending their claim with proof of independent certification. This complaint shows the increased focus on combatting greenwashing claims.

CONSUMER LAW

Australia

ACCC compliance and enforcement priorities in 2024/25

The ACCC have released the list of priorities and enduring priorities for compliance and enforcement in 2024 and 2025.

 The priorities include:

·        Environmental claims and sustainability

·        Supermarket sector – food and groceries

·        Essential services: telecommunications, electricity, gas, energy, and financial services

·        Aviation

·        Digital economy

·        Unfair contract terms

·        Consumer guarantees

·        Consumer product safety issues for young children

·        National Disability Insurance Scheme (NDIS) providers

 The enduring priorities which the ACCC consider as detrimental enough to regard as long-term priorities include:

 ·        Cartel conduct

·        Anti-competition conduct

·        Product safety

·        Consumers experiencing vulnerability or disadvantage

·        Conduct impacting First Nations Australians

·        Small businesses

·        Scams

Providers should be cautious of these priorities which could lead to changes in the various sectors and increased enforcement risk. For more information, see the full compliance and enforcement policy and priorities list here: https://www.accc.gov.au/system/files/compliance-enforcement-policy-priority-2024_0.pdf

Online florist to pay $1 million for false and misleading representations

The Federal Court in Australia has ordered Bloomex to pay AUD $1 million in penalties for misleading online star ratings and price representations. The Canadian online florist and gift retailer admitted it had breached Australian Consumer Law when it published misleading star ratings for its products, advertised products at a discount when they were not sold for the original higher price it claimed, and did not sufficiently disclose added surcharges.

In addition to ordering Bloomex to pay the AUD $1 million in penalties, the Court also imposed injunctions, and ordered that Bloomex establish a compliance program and pay the ACCC’s costs. The penalty and various other orders signify the severeness of misleading consumers over a long period of time and is something businesses should be extremely cautious of. 

The key takeaways here are:

  • ensure with ‘strikethrough’ and ‘X% off’ pricing claims that the products have previously been sold at the higher price displayed (and for a reasonable period before the sale;

  • disclose added fees and surcharges upfront rather than dripping throughout the online checkout process; and

  • ensure your online reviews and product ratings are accurate and current.   This is particularly important as fake online reviews and misleading representations in the digital economy is an area of ongoing interest for the ACCC. 

 ACCC takes proceedings against Mosaic Brands for false or misleading delivery times

On 4 March 2024, proceedings commenced in the Federal Court against Mosaic Brands, the owner of online clothing cites Noni B, Rivers and Katies, for allegedly breaching the Australian Consumer Law. The potential breach consists of allegedly failing to deliver several hundred thousand products to customers within the delivery time frame advertised on its website. The alleged advertisements stated that items would be delivered between two and seventeen days from purchase. The ACCC claims that 26% of deliveries were outside of this period, and thus made false or misleading representations to consumers. Additionally, the ACCC also alleged that Mosaic Brands wrongfully accepted payment for goods when it failed to deliver orders within the advertised (or reasonable) timeframes or failed to deliver at all.

This case will be one to watch and acts as a reminder for all businesses to meet claims for delivery and other services.

Proposed law to direct market complaints to ACCC

The Competition and Consumer (Fair Go for Consumers and Small Businesses) Amendment Bill (the Bill) was introduced into Parliament on 15 February 2024. The Bill proposes to enable certain consumer advocacy and small business groups to make designated complaints to the ACCC.   The ACCC will then be required to assess the designated complaint and publicly respond within 90 days. The ACCC’s response must state what further action, if any, will be taken in response to the complaint. The ACCC have supported the Bill.  Similar schemes operate in the United Kingdom and Canada. 

This may result in increased enforcement action by the ACCC due to matters referred to it from consumer and small business advocacy groups, and any decisions by the ACCC regarding these complaints, being made public (which could result in negative publicity and brand damage).

New Zealand

NZ Court of Appeal confirms that offshore manufacturers are liable under Consumer Guarantees Act

On 15 December 2023, the Court of Appeal in Body Corporate Number DPS 91535 & Ors v 3A Composites GmbH confirmed that overseas manufacturers are subject to the New Zealand Consumer Guarantees Act 1993 regardless of whether they have a place of business in New Zealand. Thus, both the supplier and overseas manufacturer have a legal obligation to provide safe and quality goods in New Zealand, and can be held liable if they fail to meet warranties under the Act. This gives consumers rights against overseas manufacturers in regard to breaches of guarantees, ensuring higher quality and accountability from providers.

MEDICINES & COSMETICS

Australia

TGA fines Liquefy Health for unlawful importation and advertising of unapproved complementary medicines

The TGA has issued 4 infringement notices totaling $75,120 against Liquefy Health for importing and marketing 2 ‘shot’ wellness drinks. The TGA alleges that these wellness drinks are unapproved complementary medicines that are required to be registered on the Australian Register of Therapeutic Goods (ARTG). As the complementary medicines were not registered on the ARTG at the time of the importation and advertising, this is an offence under the Australian therapeutic goods laws.

This decision can act as a reminder to providers on the importance of registering complementary medicines, even for products such as wellness ‘shots’ that do not appear to be medicines on face value.

TGA issues safety advisory statement for Ashwagandha

On 22 February 2024 the TGA published a safety notice regarding medicines containing Withania somnifera (Ashwaghanda). The TGA highlighted the serious side effects that can occur in some people when consuming the widely used and accessible Ashwaghanda. The safety notice specifically discusses the potential effects of gastrointestinal symptoms and in very rare occasions, liver injury.

Currently, listed medicines under the ARTG containing over a certain amount of Ashwaghanda are required to include a warning statement. No further action is required, where the safety notice intends to act as a general warning to consumers, health professionals and sponsors.

The Environmental Protection Authority of New Zealand has announced it will ban PFAS in cosmetics

The Authority have announced that PFAS (perfluoroalkyl and polyfluoroalkyl substances) or also known as ‘forever chemicals’, will be banned in cosmetic products in New Zealand. This is following growing concerns and evidence surrounding the environmental and health effects of PFAS. PFAS is used in products to resist water, heat, oil, and stains, and are subsequently used in various cosmetic products. The strong bonds mean the chemical does not break down easily, which can cause build up in our bodies and potentially be toxic.

The announcement means that from 31st December 2026, the import or manufacturing or cosmetics containing PFAS will be prohibited in New Zealand. Additionally, by 31st December 2027, selling or supplying cosmetics containing PFAS in New Zealand will be banned, and by 30th June 2028, all PFAS-containing cosmetic products will need to be disposed of.

Although the ban may not affect many New Zealand cosmetic companies due to its limited use in New Zealand cosmetics, overseas providers will require higher regulation of PFAS. The decision indicates positive change and is one of the many updates that have been made to the Cosmetic Products Group Standard, ensuring cosmetic products are safe and strengthen regulations to keep up with international developments.

Footnotes:

[1] https://www.ama.com.au/ama-rounds/29-march-2024/articles/ama-calls-digital-black-out-junk-food-ads

 [2] https://www.rethinksugarydrink.org.au/media/call-for-health-levy-on-sugary-drinks.html

[3] https://www.australianbeverages.org/calls-for-a-tax-on-soft-drinks-misguided/

[4] https://www.agite.nz/

[5] https://www.foodstandards.gov.au/food-standards-code/applications/a1284-triacylglycerol-lipase-gm-trichoderma-reesei-processing-aid

[6] https://www.foodstandards.gov.au/food-standards-code/applications/a1287-food-derived-short-stature-corn-line-mon94804

[7] https://www.food.gov.uk/business-guidance/food-allergen-labelling-and-information-requirements-technical-guidance-general-background-on-allergens

[8] https://www.thegrocer.co.uk/supply-chain/gca-examining-impact-of-code-circumventing-middlemen/688090.article

[9] https://consult.gov.scot/population-health/restriction-promotion-of-food-and-drink-proposed/

[10] https://www.asa.org.uk/rulings/bkuk-group-ltd-a23-1210912-bkuk-group-ltd.html

[11] https://www.asa.org.uk/rulings/hovis-ltd-a23-1217043-hovis-ltd.html

The content in this article does not constitute legal advice and should not be relied on as such. Essence may change the content described on the site at any time without prior notice.