Charity donation follows ACCC concerns about Golden Circle

Posted by Josette Dunn on 19th March 2010

More than 800,000 cans of Golden Circle fruit and vegetables are on their way to Australian welfare agencies that feed the hungry as part of a response to concerns raised by the Australian Competition and Consumer Commission about misleading country ownership claims.The ACCC has also accepted a court enforceable undertaking from H.J. Heinz Company Australia Limited after it admitted that it engaged in misleading conduct by representing that Golden Circle was ‘Proudly Australian owned’.

Heinz, which is owned by the US company H.J. Heinz Company, acquired Golden Circle in December 2008.

After the acquisition, Heinz continued to sell Golden Circle products with the representation ‘Proudly Australian Owned’ while rolling out new labels. As late as January this year Heinz was manufacturing some Tetra Pak beverages in packaging bearing the Australian owned representation.

The ACCC also identified a number of Australian-owned representations accessible through the Golden Circle website in November 2009, including a statement that its ‘iconic status has been achieved through a commitment to remaining proudly Australian owned’.

ACCC chairman Graeme Samuel said: “The ACCC is pleased that Heinz will donate an estimated $1.8 million worth of canned fruit and vegetables to feed the hungry.

“This is a significant win for consumers and the disadvantaged, with Heinz acting to correct and remove the Australian owned representations, while ensuring that affected stock does not go to waste.

“Consumers will be rightfully concerned that for well over a year after it acquired Golden Circle, the US owned Heinz continued to label a number of Golden Circle products as ‘Proudly Australian owned’.

“While a number of the ingredients in Golden Circle products are sourced locally, it is important that consumers are not misled-Golden Circle is no longer Australian owned.

“News of the Heinz undertaking should also be a warning to all firms involved in acquisitions. Ensuring compliance with trade practices law is vital at every stage of an acquisition, importantly including reviewing and amending representations on product labels.”

The court enforceable undertaking Heinz has offered in response to the ACCC’s concerns requires Heinz to:

* cease supplying Golden Circle branded products with Australian-owned representations
* use its best endeavours to ensure that in store corrective signage continues to appear next to Golden Circle products on supermarket shelves, and
* publish corrective advertisements in major newspapers throughout Australia.