2020 Litigation Forecast - Commerce Commission: Raring to go in 2020
A growing regulator is one to watch and the Commerce Commission is no exception. The Commerce Commission has recently grown significantly both in size as well as functions, powers and duties. This well-resourced and powerful regulator is also looking at changes in nearly all the legislation that it administers. This is set to make a busy 2020.
In addition to the Commission’s enduring priorities that include credit issues, product safety, cartel and anti-competitive conduct and mergers, our predictions are that the Commission will be focused on five hot topics of general application:
- Substantiation claims: in late 2019 we saw the Commerce Commission requiring businesses to demonstrate the basis on which they have made claims in advertising and whether they are able to substantiate this at the time the representations were made. Our pick is that off the back of the first few substantiation cases, the Commission will want to continue to build up a book of case law in this new area.
- Environmental claims: this will be a red button issue for 2020. We predict that we will see greater focus on claims such as ‘biodegradable’ or ‘compostable’ and ‘flushable’. This focus comes after the ACCC, Australia’s competition and consumer regulator, was recently unsuccessful in actions it brought against Kimberly-Clark for claims that its wipes were ‘flushable’ and Woolworths for claims that its ‘W Select eco’ products were ‘Biodegradable and Compostable’. The NZ Commerce Commission has said it will be educating businesses to ensure that claims about the environmental impact of products are accurate and can be relied on by consumers.
- Privacy concerns: 2020 may see the Commission’s focus widening to include privacy issues particularly where agencies do not follow their own privacy policies or where their policies are onerous or unclear. Unfair contract terms are likely to have a key role to play here.
- Consumer credit and responsible lending: the amendments to the CCCFA have now been passed and we expect to see the Commission focusing on making an example out of those directors and senior officers who do not meet the new duties.
- Greater level of co-operation with other regulators: this co-operation will need to be stronger than previously seen given the legislative changes. For instance, the new financial conduct regime will overlap with the CCCFA which will require more significant enforcement co-ordination.