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Code for Comparative Advertising

Janauary 2013

Introduction

All advertising shall adhere to the laws of New Zealand and the principles and guidelines set out in this Code. This Code should be read in conjunction with the Code of Ethics, Basic Principles 1-5 and in particular Rules 2, 3 and 8.

Comparative advertising, or advertising that identifies a competing product or service (directly or by implication) should comply in three distinct areas:

It should be accurate and informative;
It should explicitly or by implication make clear the nature of the comparison; and It should not mislead or deceive the consumer, including about other products or services with which comparisons might be made.

It should be noted that it is not required to name a specific competitor in order for an advertisement to be considered under this Code. A comparison could be made with all competition within an industry. It should also be noted that the Trademarks Act provides for the honest use of competitor trademarks in advertising. Please also refer to the Commerce Commission Fact Sheets on comparative advertising and pricing under the Fair Trading Act, see www.comcom.govt.nz/fair-trading-act-fact-sheets/.

In interpreting the Code emphasis will be placed on compliance with both the principles and the spirit and intention of the Code. The guidelines are merely examples, by no means exhaustive, of how the principles are to be interpreted and applied. It is also possible for an advertisement to be in breach of the principle without being in breach of a specific guideline. Upon complaint, the ASCB is vested with discretion to ensure a common-sense outcome. It is important to note that in considering a complaint both the likely audience and media placement, that is when and where the advertisement is broadcast, printed, or displayed, are key factors in determining Code compliance. Please note there may also be guidance notes to assist with Code interpretation for this code.

Principle 1

Comparisons in advertisements should not mislead or deceive or be likely to mislead or deceive consumers. (Obvious hyperbole, identifiable as such, is not considered to be misleading)

Guidelines

1(a)

Comparative elements should be accurate and informative and should offer a product or service on its positive merits.

1(b)

Where an advertisement makes a comparison, whether explicitly or implicitly, it should be clear with what the comparison is being made, i.e. price to price, dimension to dimension, feature to feature.

1(c)

Price comparisons should not mislead by falsely claiming a price advantage.

1(d)

Where appropriate, comparative advertising claims should be supported by documentary evidence which is easily understood by the target audience at which it is directed.

1(e)

If the advertisement refers to a comparative test, such a test should have been conducted or verified by an independent and objective body, using industryaccepted methodology so there will be no doubt as to the veracity of the test. In all cases the results of the test must be current and supportive of all claims in the advertising that are based on the test. Partial results or insignificant differences should not be used.

Principle 2

Advertisements that make comparative claims should fairly and properly identify the competitors and not denigrate them or identifiable products.

Guidelines

2(a)

Trade marks or registered brands or makes can be used for honest comparison but cannot be used to upgrade by association or for passing off purposes, or to mislead or otherwise take unfair advantage of the goodwill associated with the trade name, symbol or brand.

2(b)

Advertisements should not be so similar to a competitorís advertisements in general layout, copy, slogans, visual presentation, music, or sound effects as to be likely to mislead or deceive consumers.

2(c)

The intent and connotation of advertisements should be to inform and not to denigrate competitors, or competing products or services.

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Advertising Standards Authority New Zealand, PO Box 10-675, Wellington 6143. PH (04) 472 7852 FAX (04) 471 1785 Email asa@asa.co.nz