The Australian Competition and Consumer Commission (ACCC) has again shown its commitment to one of its 2013 focus areas - misleading credence claims.
A credence claim is a claim about the attributes or origin of a product, for example 'free range', 'environmentally friendly' or ‘made in Australia’.
On 8 May 2013 the ACCC announced that it was pursuing two solar panel companies, P & N Pty Ltd and P & N NSW Pty Ltd (Euro Solar) and Worldwide Energy and Manufacturing Pty Ltd (Australian Solar Panel), for alleged misleading conduct.
The ACCC alleges that the companies:
- made representations that their solar panels were made in Australia when in fact they were made in China; and
- posted fake testimonials on their website and on YouTube.
In a statement ACCC Chairman Rod Sims confirmed that the ACCC is ‘prioritising work in the areas of credence claims and fake testimonials’.
These latest cases continue the ACCC’s 2013 focus on credence claims. Earlier this year the ACCC issued proceedings against Luv-a-Duck alleging that the company had engaged in false, misleading or deceptive conduct by use of the following statements on its packaging, website and brochures:
- its ducks were ‘grown and grain fed in the spacious Victorian Wimmera Wheatlands’; and
- its ducks were ‘range reared and grain fed’.
These cases are an important reminder for companies to use credence claims carefully and consider the following before publishing a credence claim:
- what is the overall impression of the claim: and
- whether that overall impression is likely to be misleading to consumers.
Companies should also beware that posting fake testimonials and purchasing ‘likes’ can result in action for misleading or deceptive conduct.