Recently, the Consumer Protection and Fair-Trade Authority issued a position paper regarding the disclosure obligations businesses must meet when making changes to product characteristics or components. According to the position paper, any material change in a product’s characteristics or components must be clearly and prominently displayed on the product itself, allowing the consumer to make an informed decision regarding the product. This is because consumers typically do not recheck a product’s features or ingredients, when they purchase it regularly.
This new Guideline builds on the Authority’s position issued already five years concerning “Package Downsizing“, which established the requirement to notify consumers when product sizes or weight is reduced.
Changes covered under this new Guideline include various factors such as product color, country of origin, features, scent, caloric content, and any other consumer-perceived attributes. The Guideline also clarifies that a “Material Detail” under Section 2 of the Consumer Protection Law, extends beyond the specific list in the law. A detail that may not be considered material at the time a product enters the market could become material as its consumer position evolves.
According to the new Guideline, the proper disclosure method should allow the consumer to easily notice the change, for example, by displaying it on the front of the product or with a sticker on the front. The disclosure period must be reasonable under the circumstances and should last for at least six months.
It is important to note that the responsibility for implementing this disclosure obligation lies with the manufacturer, the importer, and the retailer.
Failure to provide such disclosure may constitute misleading conduct, considering the broad interpretation of the prohibition on deception enshrined in Section 2 of the Consumer Protection Law, especially when the product’s packaging remains identical or similar.
In light of the above, we strongly recommend that in any case of logistical changes – such as a change in manufacturing plant or supplier – businesses consider providing specific disclosure to customers to ensure full compliance with legal and regulatory requirements, with the aim of mitigating legal risks and maintaining consumer trust.
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