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Misleading packaging: Less product than advertised

Key Takeaway

Misleading packaging in New Zealand, where products contain less than advertised, is prohibited. The Fair Trading Act 1986 bans misleading conduct and false representations about product quantity. The Consumer Guarantees Act 1993 ensures goods match their description and are of acceptable quality. Consumers have rights to remedies like refunds or replacements if these laws are breached.

Misleading Packaging: Less Product Than Advertised in New Zealand

In New Zealand, consumers are protected against misleading packaging that suggests a product contains more than its actual quantity. This area of law is primarily governed by the Fair Trading Act 1986 and the Consumer Guarantees Act 1993, which establish rules for businesses and provide rights for consumers.

The Fair Trading Act 1986: Prohibiting Misleading Conduct

The Fair Trading Act 1986 aims to promote a trading environment where consumers and businesses can participate confidently. It prohibits various unfair trading practices, including misleading packaging.

  • General Prohibition on Misleading Conduct: A "person in trade" (someone carrying on a business) must not engage in conduct that is misleading or deceptive, or is likely to mislead or deceive [Source: Fair Trading Act 1986, s 9]. Packaging that makes a product appear larger or fuller than it is, leading consumers to believe they are purchasing more, could be considered misleading conduct.
  • False or Misleading Representations: Specifically, a "person in trade" must not make a false or misleading representation about the standard, quality, quantity, grade, composition, style, or model of goods [Source: Fair Trading Act 1986, s 13(a)]. If packaging indicates a certain quantity (e.g., net weight or volume), but the product contains less, this is a direct breach of this section.
  • Unsubstantiated Representations: A "person in trade" must also not make an "unsubstantiated representation," which is a representation made without reasonable grounds for believing it to be true [Source: Fair Trading Act 1986, s 12A(1)]. If a quantity is stated on packaging, and the supplier cannot substantiate that claim with reasonable evidence, this section may apply.
  • Enforcement and Penalties: The Commerce Commission is responsible for enforcing the Fair Trading Act 1986 [Source: Fair Trading Act 1986, s 35]. Breaches can result in various outcomes, including "pecuniary penalties" (fines) imposed by the courts [Source: Fair Trading Act 1986, s 40]. Courts may also make orders, such as ordering a person to pay damages to any other person who has suffered loss or damage as a result of the contravention [Source: Fair Trading Act 1986, s 43(2)(d)].

The Consumer Guarantees Act 1993: Rights to Matching Description and Quality

The Consumer Guarantees Act 1993 (CGA) provides specific guarantees to consumers when they acquire goods or services from a "person in trade" [Source: Consumer Guarantees Act 1993, s 1A]. A "consumer" is generally defined as a person who acquires goods or services of a kind ordinarily acquired for personal, domestic, or household use or consumption [Source: Consumer Guarantees Act 1993, s 2(1)].

  • Guarantee as to Description: Where goods are supplied by description to a consumer, there is a guarantee that the goods will correspond with that description [Source: Consumer Guarantees Act 1993, s 9]. If the packaging explicitly describes a certain quantity, and the actual product contains less, this guarantee has been breached.
  • Guarantee as to Acceptable Quality: Goods must also be of "acceptable quality" [Source: Consumer Guarantees Act 1993, s 6]. This means, among other things, that they must be fit for all purposes for which goods of that type are commonly supplied, acceptable in appearance and finish, free from minor defects, safe, and durable [Source: Consumer Guarantees Act 1993, s 7(1)]. While less direct for quantity than the guarantee as to description, a significant discrepancy between advertised and actual quantity could contribute to the goods not being of acceptable quality.
  • Consumer Remedies: If goods fail to comply with a guarantee under the CGA, a consumer may be entitled to remedies:
    • Minor Failure: If the failure can be remedied, the consumer may require the supplier to remedy it within a reasonable time [Source: Consumer Guarantees Act 1993, s 18(2)(a)]. If the supplier fails to do so, the consumer can have it remedied elsewhere and recover costs, or reject the goods [Source: Consumer Guarantees Act 1993, s 18(2)(b)].
    • Substantial Failure: A "substantial failure" is one where the goods would not have been acquired by a reasonable consumer fully aware of the extent of the failure [Source: Consumer Guarantees Act 1993, s 21]. In the case of a substantial failure, the consumer can reject the goods or claim compensation for any reduction in value [Source: Consumer Guarantees Act 1993, s 18(3)]. Rejecting goods typically means obtaining a refund or a replacement [Source: Consumer Guarantees Act 1993, s 23].

Interaction Between the Acts

The Fair Trading Act 1986 and the Consumer Guarantees Act 1993 work together to protect consumers. The Fair Trading Act 1986 focuses on regulating the conduct of "persons in trade" to prevent misleading practices across the market, while the Consumer Guarantees Act 1993 provides specific rights and remedies for "consumers" concerning the quality and fitness of goods and services. Both Acts can apply concurrently to address issues arising from misleading packaging.

When to Seek Independent Legal Advice

Individuals encountering issues with products containing less than advertised are encouraged to seek information and support from consumer protection bodies such as Consumer Protection New Zealand, which is part of the Ministry of Business, Innovation and Employment. For free legal advice, Community Law Centres throughout New Zealand offer services to individuals who qualify.

Key Resources