Baa Baa Beads warned over health claims
6 November 2015
Wholesaler and online retailer ‘Baa Baa Beads’ has received a warning from the Commerce Commission after it failed to substantiate its claims about the therapeutic benefits of its Baltic amber products.
The Commission began investigating the company after receiving a complaint about its Baltic amber necklaces for babies. Baa Baa Beads also sells Baltic amber products for adults and pets.
Following changes to the Fair Trading Act last year, it is now illegal for businesses to make claims about goods or services without having reasonable grounds for the representations at the time the claims are made.
Baa Baa Beads was asked to substantiate its website claims relating to therapeutic benefits, composition, and popularity of its amber products, including those promoted as being suitable for treating teething babies.
The research and articles provided by Baa Baa Beads to the Commission focused primarily on Baltic amber’s origin, makeup and its historical use by ancient people. The Commission believes that there was a lack of independent and credible scientific evidence to substantiate the claims made about the health benefits of Baltic amber products.
Some of Baa Baa Beads’ evidence indicated that its Baltic amber products may contain low levels of succinic acid. However, Baa Baa Beads was unable to provide sufficient evidence linking the presence of succinic acid in its products with the claimed health benefits for humans or pets.
Commissioner Anna Rawlings says that consumers should be able to rely on traders having a reasonable basis for claims that they make about their products and services so that they can make informed purchasing decisions.
“In our view Baa Baa Beads’ conduct is likely to have breached the Fair Trading Act as the business could not provide reasonable grounds to support all of the claims it made about its products.”
“We expect representations about the therapeutic benefits of products to be supported by credible and reliable scientific or medical evidence. Baa Baa Beads has since removed or modified a number of representations it made about its products and the Commission has decided to issue a warning in this case.”
The claims that were investigated by the Commission included:
- “For generations it is said when worn on the skin, the amber warms and releases the oil that helps soothes and relieves symptoms”;
- “Recent scientific research has also proved that succinic acid has a very positive influence on the human organism”;
- Succinic acid “strengthens the body, improves immunity”; and
- Succinic acid has been “proven” to be “the equal or better of many commercial drugs and is significantly less expensive.”
The Commission also considered that claims made by Baa Baa Beads about the composition and popularity of products for treating teething babies were at risk of being unsubstantiated. The company was advised to take steps to ensure that it is compliant in the future.
Ms Rawlings says that businesses often promote the particular benefits of their products and services but they must be able to substantiate the claims that they make at the time that they make them.
“Whether the claim is express or implied, businesses should only make claims based upon facts, figures and credible sources of information that support their accuracy. Traders cannot simply rely on general information they find in books and online,” she said.
New laws prohibiting unsubstantiated representations came into effect on 17 June 2014. Read our factsheet.
When considering whether a business has reasonable grounds for a claim, the following factors are taken into account under Section 12B of the Fair Trading Act:
- the nature of the goods or services about which the claim was made;
- the nature of the claim;
- any research steps or other steps taken by or on behalf of the business making the claim, before it was made;
- the nature and source of any information the business relied on to make the claim;
- the actual or potential effects of the claim; and
- compliance with the requirements of any standards, codes or practices relating to the grounds for the claim.