The Australian skincare company, Ego Pharmaceuticals Pty Ltd, has been fined $280,000 in the Auckland District Court; this follows the company's significant claims about the Sun Protection Factor (SPF) of two sunscreen products.
Commerce Commission New Zealand Chair, Anna Rawlings, explained that Ego should have understood that it did not have reasonable grounds to make performance claims about sunscreen products on the market.
“Businesses have an obligation to ensure that representations can be substantiated, and this is an ongoing obligation. If new information comes to light which impacts the claim being made, as it did in the Ego case, a business should reassess the implications of that evidence and revisit its product packaging and promotion if required," said Rawlings.
Ego represented two products in 2019 and 2020: “Ego Sunsense Ultra SPF 50+” and “Ego Sunsense Sensitive Invisible SPF 50+”. These products provided ‘very high’ protection for consumers and were ‘SPF50+’ in accordance with Australian and New Zealand Standard sunscreen products.
Upon their initial release in 2016, Ego had a reasonable basis to make the SPF claims. In August 2019, after an accumulation of adverse SPF lab results, allegations of fraud were made concerning the testing facility on which Ego relied.
Judge Dawson from Auckland District Court stated that deterrence is the fundamental sentencing factor in this court case.
“While none of the harm to persons using the product or commercial competitors can accurately be quantified, its existence needs to be acknowledged in the sentence imposed,” Dawson explained.
These two Ego products have not been distributed in the New Zealand market since December 2019, and Ego issued a withdrawal notice for the products in June 2020.
“This is particularly important because effectiveness claims are difficult, if not impossible, for consumers to be able to verify themselves. We expect representations about the effectiveness of products can be supported by credible and reliable evidence," said Rawlings.
For consumers concerned about sunscreen products from Ego Pharmaceuticals Pty Ltd, the Commerce Commission encourages those to contact the supplier or manufacturer.
