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Effective advertising is essential to your business’s success. However, you cannot mislead or deceive your customers with the contents of your advertisements. This article will outline three guidelines for your business’s advertisements, as well as any disclaimers or fine print.

The Advertisement Cannot Mislead the Reader

In New Zealand, all businesses must not commit misleading or deceptive conduct. This conduct extends to the statements or claims you make in advertisements or on the packaging of your products.

Advertisements will be misleading if a reasonable person with the characteristics of the reader or viewer of the ad would have been misled. If your advertisement is misleading, you may be subject to:

  • criminal legal proceedings;
  • an injunction on the misleading conduct; 
  • a court order; or 
  • a large fine.

To avoid committing deceptive conduct, you may wish to make a disclaimer or include fine print in your advertisement. However, this disclaimer does not necessarily cancel out your misleading statements made in the large print of the advertisement.

You will need to ensure that the main message conveyed in your advertisement is accurate, rather than relying on a disclaimer to correct a misleading statement or claim. This main message will be the dominant theme or ‘general thrust’ that your customer takes from the advertisement. Customers tend to make an overall impression regarding an advertisement’s contents from quickly glancing at it. Even if a consumer later in time comes to appreciate your advertisement’s true message, it will still be misleading if they were drawn into purchasing your product or service by a misleading ‘general thrust’. Regardless of the contents of your disclaimer, you must ensure that your advertisement is not misleading at first glance.

You also cannot include information in a disclaimer or fine print that would contradict your advertisement’s ‘general thrust’. Instead, the small print should elaborate on your advertisement’s dominant message, rather than contradict or qualify it.

A disclaimer will only cancel out deceptive statements or claims if it deprives the advertisement of its misleading character.

Do Not Overlook The Disclaimer

To ensure that your disclaimer does not contradict the ‘general thrust’ of your advertisement, the disclaimer must be easily understood and clearly visible.

Suppose you wish to include a disclaimer that contains qualifying or limiting information in your advertisement. In that case, you must  communicate it in a bold and compelling manner that a viewer could not easily overlook.

In evaluating whether a reader could overlook a disclaimer or fine print, a court will work at:

  • whether the information is linked back to the main message or ‘general thrust’ of the advertisement;
  • the demographic of consumers that the advertisement targets;
  • the external context in which you make the advertising statement or claim;
  • the proximity and prominence of the disclaimer, fine print or qualifying information;
  • whether the disclaimer is sufficiently instructive to remove the risk that the advertisement might mislead or deceive a reader; and
  • whether there is a clear separation between the advertisement’s claim and the qualifying fine print.

For example, it usually will not be sufficient to put a small asterisk linked to a disclaimer after a potentially misleading advertising claim or offer. An asterisk, particularly on a poster or in a short television ad, is not readily accessible and plain for readers and viewers.

The Disclaimer Cannot Impact the Price

It is reasonable for your customers to see an advertised price for your goods or services and assume that this is the full price that they will need to pay. Given this assumption, the fine print in your advertisement should not contain any additional costs or charges associated with a purchase from your business. 

For example, an advertisement would likely be deemed misleading if the fine print clarified that GST was not included in the final price advertised. Any additional costs, such as GST, should be calculated into the final price displayed. 

Key Takeaways

Advertising is an essential way to gain new customers and promote your business. However, you will need to ensure that your advertising does not contain any claims or terms that could amount to misleading or deceptive conduct. A disclaimer or fine print will not be able to save a statement that is misleading at first glance. To ensure that your advertisement meets legal requirements, a disclaimer should:

  • align with and elaborate on the ‘general thrust’ of your advertisement;
  • be clearly visible and easily understood; and
  • not include any additional costs or GST.

If you are unsure whether your business’s advertisement could amount to misleading conduct, our regulatory and compliance lawyers can help. Contact us on 0800 005 570 or complete the form on this page.

FAQs

What is the fine print of an advertisement?

The fine print is a disclaimer included in an advertisement that elaborates on or provides more information about the contents of the ad.

What is misleading conduct?

Conduct will be deemed to be misleading if a reasonable person with the characteristics of the recipient of the conduct, such as a reader of an advertisement, would have been misled.

What is the main message of an advertisement?

The main message is the dominant theme or ‘general thrust’ that your customer takes from the advertisement. Any disclaimer or fine print should align, and not contradict, the main message of an advertisement.

How do I use disclaimers in advertising?

A disclaimer should align with and elaborate on the ‘general thrust’ of your advertisement, be clearly visible and easily understood; and not include any additional costs or GST.

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