Sentencing — false or misleading representations — place of origin of products — approval to use label — Fernmark — Fair Trading Act 1986, ss 10, 13(f), 13(j) & 40(3) — Sentencing Act 2002, s 24(2)(a) — Commerce Commission v Go Healthy New Zealand Ltd [2019] NZDC 25295 — Commerce Commission v Steel & Tube Holdings Ltd [2020] NZCA 549. The defendant was to be sentenced after pleading guilty to 16 representative charges of false or misleading representations. The defendant was a company established to manufacture ghee using New Zealand-origin ingredients. However the prosecution had investigated the defendant and discovered that some of the ghee had actually been made using butter imported from India. The defendant had obtained permission to use the Fernmark label to signify that its product was made from New Zealand ingredients. The defendant's permission to use the Fernmark label was subsequently renewed three times, after it provided assurances that all of its product was of New Zealand origin. As well as using the Fernmark label, the defendant's website and product packaging also included claims that the product was made from New Zealand ingredients. During a three-year period, some 23 per cent of the defendant's product was made wholly or partly from imported ingredients, in breach of the Fair Trading Act. The Court was not convinced by the defendant's claims that the offending had been careless rather than deliberate. In any case this wasn't a mitigating factor in offences against the Fair Trading Act, given that the purpose of the Act was to provide consumer protection, that the offending damaged New Zealand's commercial reputation, and that the defendant should have put in place processes and systems to prevent false labelling and advertising. Also it was a strict liability offence, so knowledge and intention were not required. The starting point for fine was $700,000. In mitigation the defendant had pleaded guilty, had no prior convictions and had taken proper remedial action. The final fine was $420,000. Judgment Date: 22 August 2024