ACCC Fines Companies for False or Misleading Juice Representations

Friday 29 May 2015 @ 8.51 a.m. | Legal Research | Trade & Commerce

Supabarn Supermarkets Pty Ltd (Supabarn) and The Real Juice Company Pty Ltd (The Real Juice Company) have each paid penalties totalling $20,400, following the issue of two infringement notices to each company by the Australian Competition and Consumer Commission (ACCC) in relation to representations made about two juice products from the private label range of juices manufactured by The Real Juice Company and sold by Supabarn.

Background

The ACCC issued the infringement notices because it had reasonable grounds to believe that Supabarn, a supermarket operator, and The Real Juice Company, a juice manufacturer, had made false or misleading representations about the composition of the private label 2 litre apple juice and 2 litre cranberry juice products, in contravention of the Australian Consumer Law (ACL) [Sch 2 to the Competition and Consumer Act 2010 (Cth)].

The ACCC considered the labelling of the apple juice product made the false or misleading representation that the product was made from fresh apples grown in Australia through use of the phrases:

  • “It’s produced locally using the freshest quality Apples”;
  • “Straight From a Farm"; and
  • “Made in Griffith”.

when the product was made from reconstituted apple juice concentrate imported from China.

The ACCC considered the labelling of the cranberry juice product made the false or misleading representation that the product did not contain added sugar or any other additives through use of the phrases:

  • “No added sugar; No artificial flavours; No artificial colours; No preservatives”;
  • “So if you like your juice fresh with nothing else added”; and
  • “It’s really just fruit juice!”.

when the product contained added sugar and other additives.

Reaction from the ACCC

The ACCC Chairman Rod Sims said of this matter:

“Truth in advertising is a priority area for the ACCC. Consumers should be able to make informed purchasing decisions and not be misled regarding the composition of products. The claims we say were made versus the reality in this situation are very concerning, particularly given recent controversy over the source of some food products. In addition, false or misleading claims of this kind not only mislead consumers, but can also disadvantage competing suppliers in the market, especially those who are using Australian grown fruit. Both manufacturers and retailers can be responsible for representations made on packaging or labelling of the products they supply, and each level in the supply chain should have systems in place to ensure that their products are compliant with the Australian Consumer Law.”

Comment from Supabarn

A Supabarn spokesman said that the supermarket was a "victim" as much as its customers. The spokesman commented:

"Supabarn itself was misled by Real Juice about the composition of its product. Supabarn is considering its legal position in relation to the conduct of Real Juice."

The label on the apple juice product also falsely claimed: "It's produced locally using the freshest quality Apples" and "Straight From a Farm".

The label on the cranberry juice product also falsely said: "So if you like your juice fresh with nothing else added" and "It's really just fruit juice!"

Company Background

The Real Juice Company is an Australian owned and operated manufacturer of juice products located in Griffith, NSW. Supabarn owns and operates four supermarkets in Canberra and five in Sydney.

From at least January 2014 to March 2015, The Real Juice Company manufactured and supplied nine flavoured juices to Supabarn under a private label contract. Both companies ceased supplying these juice products after becoming aware of the ACCC’s concerns.

Powers of the ACCC

It is noted that the payment of a penalty specified in an infringement notice is not an admission of a contravention of the ACL. The ACCC can issue an infringement notice where it has reasonable grounds to believe a person has contravened certain consumer protection laws.

TimeBase is an independent, privately owned Australian legal publisher specialising in the online delivery of accurate, comprehensive and innovative legislation research tools including LawOne and unique Point-in-Time Products.

Sources:

ACCC acts on alleged false or misleading juice representations – ACCC Media Release MR 93/15

Supabarn's fruit juices claim 'Made in Griffith' when really from China, says ACCC – Article from smh.com.au

Related Articles: