NZ product standards - what you need to know. NZ Entrepreneur Magazine

Have a prototype up your sleeve or an importing opportunity on your mind? If so, there are various product standards you should know about to enable your product to be sold in New Zealand.

The history of invention is littered with many forgotten facts, but perhaps chief among them is the undeniable truth that Leonardo da Vinci had never heard of product standards.

Brilliant, yes, many of his inventions undoubtedly were, but safe? Let’s put it this way, if anyone did make and test da Vinci’s flying machines they certainly didn’t live to talk about it.

Creating a bold new product to meet a gap in the market – or even importing one – is exciting stuff. But you have to keep your feet on the ground (no pun intended).

If you don’t keep New Zealand’s standards regulations in mind when developing your product or checking out an import opportunity, you’ll end up doing a good impression of a Renaissance-era test pilot yourself (i.e. flying without a parachute).

Standards in New Zealand are governed by three pieces of legislation, that all work in tandem, plus product safety standards.

They are:

The Consumer Guarantees Act (CGA)
The Fair Trading Act (FTA), and
The Weights and Measures Act (WMA)

Often, the most important of these for new or imported products is the CGA, which outlines the set of consumer guarantees products and services must meet.

There are many guarantees, with some applying to products and others to services, but they all include things you’d expect when you buy products and services from others.

The guarantees include, for example, that a product is fit for purpose. Say you develop a price-busting household broom, but when you take it market you find the economic lightweight material you use for the handle means it breaks under normal use. In this situation, you’d be in breach of the CGA.

Overall, it’s really common sense stuff. Where businesses often get it wrong is under what kind of products and services the CGA applies to. There are caveats, but the main thing to remember is that if the product or service is designed for business use or as part of a manufacturing process it’s not covered by the Act.

This isn’t to say, however, that if you’re selling consumer goods to a business the Act automatically doesn’t apply. If you don’t have their written agreement to you opting out, you’ll be in breach of the Fair Trading Act and could be fined up to $200,000 in court.

But, crucially, what the CGA states (under a product being ‘fit for purpose’) is that you – as the manufacturer or importer of a product – are responsible for it being safe to use.

In most product categories the CGA is the last word, with expected standards set by the Act’s consumer guarantees, industry and component-specific best practice standards (which you can find online with Standards New Zealand), and market factors, such as the expectations of retailers.

However, there are also mandatory product safety standards in six categories. If your product is a baby walker, children’s nightwear, a child’s toy, a household cot, a cigarette lighter or a pedal cycle go online to the Ministry of Consumer Affairs website to find the standards you need to follow.

If you import a product in one of these categories which doesn’t meet these standards, it simply won’t be allowed through customs.

The best course of action is to seek legal advice from a lawyer with experience in your sector and, if you’re importing a product, to check first on the Ministry of Consumer Affairs website whether it’s banned in New Zealand by an Unsafe Goods Notice.

Importing, selling or even advertising such goods is an offence under… you guessed it, the Fair Trading Act.

The Fair Trading Act keeps coming up for a reason. It’s all about ensuring fair competition between rival businesses and ensuring consumers aren’t misled.

Even if you don’t intend to mislead a consumer, if your actions result in a consumer being misled you could be investigated under the Act by the Commerce Commission, and be separately taken to court by the individual consumer in question.

The Act covers deceptive or misleading activities carried out when promoting goods and services, plus others carried out regardless of whether the parties involved are ‘in trade’ (such as advertising a job in a misleading way).

And then there’s the Weights and Measures Act. If your product needs to be weighed or measured, you also have to consider this Act that outlines the standards and accreditation required to ensure measuring accuracy.

If you plan to sell firewood by the measure, for example, or use a weighbridge to set pricing, then you need to make sure you apply with this Act.

At first glance, product safety standards and the triumvirate of Acts aligned with them, look like a puzzle worthy of The Da Vinci Code. But if you take the time to look into how they work together you’re much more likely to get your business off to a flying start.

Further resources:

Business.govt.nz – for an overview of the standards regulations relating to manufacturing and importing.
Consumer Protection – for more information on the Consumer Guarantees Act, product safety standards and the Weights and Measures Act.
The Commerce Commission – for more information on the Fair Trading Act.