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ASIA PACIFIC: NEW ZEALAND

Dell and Cross Border Sales
Author: Liesl Knox, Hesketh Henry

It is not unusual for a company to have a product which is sold in more than one jurisdiction.  Many companies in such circumstances achieve multi-jurisdictional compliance by producing sector labelling, instruction manuals and warranties which list all of the relevant information in one place, under different country headings.  When however a local promotion is added to the formula it may not at first be apparent that the promotion will require further refinement before it can be utilised in all of the jurisdictions in which it is offered.  Or, more importantly, what steps must be taken if the promotion is not to be offered in a particular jurisdiction.

Dell New Zealand came to the attention of the New Zealand Commerce Commission earlier this year when it promoted an on-line competition which was only available to Australian customers.  The Commission found that Dell had breached the Fair Trading Act 1986 by promoting goods with the offer of prizes which there was no intention to provide in the jurisdiction in which the goods were sold (New Zealand).  This case highlights the need to take prudent steps to ensure that goods designed for more than one market place do in fact comply with all aspects of local legislation. In this case although reference was made to the promotion only being available to Australian customers this was insufficient to avoid a breach of the local legislation.  The underlying point being that New Zealand customers were likely to have been enticed to purchase based on the promotion, which was not in fact available to them.