`Ethical Choice` Stickers — What`s in a Claim?By Mojo Mathers 28th November 2012
Misleading ‘ethical choice’ stickers
Fairtrade have just taken Dole to court over their misleading ‘ethical choice’ stickers. I hope that they win their case as I believe that this logo has been confusing customers since it first appeared on our shelves.
It was developed by Dole when All Good Organics Fair Trade bananas were taking off and appears to be a convenient way for Dole to get a slice of the action by saying “we’re ethical too!”
I sit on the Commerce Select Committee and we have been covering the Consumer Law Reform Bill which covers misleading claims on products.
This Bill, which proposes the most significant changes to consumer laws in more than 20 years, is a substantive and complex piece of legislation which updates a number of laws including the Consumer Guarantees Act (CGA) and the Fair Trading Act (FTA).
Despite some lobbying from big businesses, our committee recommended further substantive changes to the Bill:
- Tripling the penalties for breaches of the FTA
- Compulsory interview powers for the Commerce Commission (but with protection against self-incrimination)
- Provisions preventing unfair contract terms in standard form contracts
Most significantly for conscious consumers, the Bill proposes a prohibition on making “unsubstantiated representations”.
This is a biggie as it means that the onus of proof about a claim will shift from the Commerce Commission onto the business making the claim instead.
The difficulty with the law as it stands is that the Commission has to prove a claim to be untrue, which can be very difficult, or costly. Reversing the onus of proof will make the work of the Commission much more effective.
Unsurprisingly this change was opposed by many businesses who argued that it would be too difficult or expensive to require them to provide evidence for their claims – a weak augment that the committee rightly rejected.
Consumers do want to shop consciously, companies know that, and some companies will take advantage of that fact, by making specific claims that are not true, undermining the efforts of independent certification schemes and genuine claims.
The simple rule of thumb for these businesses is, if you don’t have evidence to support your claim on a product, don’t make that claim!
The same arguments were raised in Australia when they strengthened their consumer protections, but a year on businesses who were protesting against changes are now happy with how the law applies.
The Green Party is pleased to be supporting this strong, well supported legislation that will help protect consumers from unsubstantiated claims of businesses trying to get a free ride on the back of hard work undertaken by responsible businesses.