ACCC directs water companies to remove ‘organic’ claims
The Australian Competition and Consumer Commission (ACCC) has directed seven suppliers of bottled water to remove ‘organic’ claims from labelling and marketing material. An eighth supplier has withdrawn its product from sale.
The changes come as a result of negotiations between the ACCC and the manufacturers, and mean enforcement action will be avoided.
Active Organic, Lithgow Valley Springs Organic, Nature’s Best Organic, Organic Australia, Organic Falls, Organic Nature’s Best and Organic Springs have been renamed and new bottles are making their way on to the market.
“Credence claims, which represent that a product possesses a premium attribute, are a priority for the ACCC,” said Delia Rickard, ACCC Deputy Chair. “Particularly those in the food and beverage industry with the potential to influence consumers and disadvantage competitors,” she said.
“Credence claims such as ‘organic’ can be used to justify higher prices and create a competitive advantage for the user. As such it is essential that they are only used correctly,” Ms Rickard said.
The ACCC said consumers were increasingly making purchasing decisions that value the types of claims that “directly affect the integrity of the product”, such as where or how something was made, grown or produced.
“Organic standards acknowledge that water cannot be organic. Any claim that particular water is organic would therefore be misleading or deceptive,” Ms Rickard said.
Can’t hide ‘misleading claims’ in brand names says ACCC
The ACCC said it rejected claims from a number of manufacturers that the word ‘organic’ was not a representation but part of the brand name.
“Manufacturers cannot hide misleading claims in their brand names,” Ms Rickard said.
The manufacturers identified have already begun supplying bottles with amended labels. The ACCC said it expects that organic claims will soon have largely disappeared from the labels of bottled water at retail outlets.
“Consumers who see other brands of bottled water featuring organic claims can contact the ACCC. Retailers who still have stock should contact their distributor,” Ms Rickard said.
The ACCC said it will continue to monitor the progress of the changes and will “engage further with retailers and manufacturers if further work needs to be undertaken”.
Water ‘cannot be organic’
There is no support among Australian authorities for the notion that water can be organic, and a number of standards state that it cannot, including the mandatory standard covering exports. The word ‘organic’ in the context of food and drink refers to agricultural products which have been farmed according to certain practices. The ACCC said water is not an agricultural product, and cannot benefit from such practices so it is “not appropriate to use ‘organic’ to describe it”.
The ACCC’s Compliance and Enforcement Policy lists credence claims (claims that consumers cannot easily verify for themselves) as a new priority area. While in this case there was no indication that consumers paid higher prices for ‘organic’ water than regular bottled water, the ACCC said consumers are often prepared to pay more for products that make credence claims which match their values.
Name changes welcomed by organic certification body
Organic certification body Australian Organic has welcomed the outcome of the ACCC’s negotiations, saying it is “pleased” that the word ‘organic’ will be removed from the bottled water.
“We have put put a number of cases before the ACCC for investigation over the past years, some with success,” said Dr Andrew Monk, Chair of Australian Organic.
“There have been some areas, including water and cosmetics that have fallen through the cracks with the ACCC in the past,” Dr Monk said. “This move sends a clear message to unscrupulous manufacturers who think organics is nothing more than a marketing gimmick to watch their backs.”
Australian Organic owns the certification mark ‘Australian Certified Organic’ and the accompanying ‘Bud logo’. It said that the use of the word ‘organic’ on products prevents consumers from “making informed choices”, especially those consumers who don’t know to look for certification logos on labels.
Brand name changes
The ACCC said the following manufacturers and brands will change:
Manufacturer: Active Organic Beverages
Former brand: Active Organic and Organic Nature’s Best
New brand: Active Original
Former brand: Organic Australia
New brand: Australian Mountain
Former brand: Organic Falls
New brand: Aquatic Falls
Manufacturer: Lithgow Valley Springs
Former brand: Lithgow Valley Springs Organic
New brand: Lithgow Valley Spings
Manufacturer: Mt Aqua Distribution
Former brand: Aqua Organic
New brand: This product has been withdrawn from sale
Manufacturer: Sternwin/First Water Springs
Former brand: Organic Springs
New brand: Original Springs
Manufacturer: Water Wine & Juice
Former brand: Nature’s Best Organic
New brand: Nature’s Best
Manufacturer: Dew South
Former brand: Dew South and Latitude 40°
New brand: Not applicable as organic claims were on website