The Australian Competition and Consumer Commission has instituted proceedings against a Japanese company, Ixon Japan KK, and a related Australian company, Ikuson Trading Company Pty Ltd alleging misleading country of origin labelling of a honey drink they promoted – the 'Ixon Club Propolis Drink'.
The ACCC alleges that between August 2000 to September 2002:
- Ixon – the Japanese company – marketed and sold the honey drink to customers in Japan who were members of the 'Ixon Club'; and
- Ikuson – the Australian company – on behalf of and at the direction of Ixon, labelled and packaged the honey drink in Australia and supplied the drink from Australia to Ixon Club members in Japan;
- The companies, through product labelling or in promotional brochures, videos or on Ikuson's website represented that the honey drink as:
- a 'Product of Australia',
- 'A gift from Tasmania',
- containing 28 per cent Leatherwood propolis extract and 39 per cent Leatherwood honey, and
- being manufactured and bottled in Australia.
The ACCC alleges that the honey drink contained no Leatherwood propolis, contained only about two per cent Leatherwood honey and about 38 per cent Chinese honey and that the main ingredients in the honey drink were from China where it was both manufactured and bottled.
Accordingly, the ACCC alleges that the companies contravened the following sections of the Trade Practices Act 1974:
- Section 52 which prohibits misleading or deceptive conduct;
- Section 53(a) which prohibits false or misleading representations about the quality or composition of goods;
- Section 53(eb) which prohibits false or misleading representations about the place of origins of goods.
The ACCC is seeking court orders including:
- declarations that Ikuson and Ixon have breached sections 52, 53(a) and 53(eb) of the Act;
- injunctions restraining the companies from representing that any Ixon Club product is from Australia unless the product is wholly or substantially produced or manufactured in Australia and comprises wholly or substantially Australian ingredients;
- injunctions restraining the companies from representing that any Ixon Club product contains a stated percentage of a particular ingredient when in fact it does not contain or contains less than the stated percentage of that ingredient;
- orders that a letter be sent to all members of the Ixon Club between August 2000 and September 2002 informing them of the orders of the Court;
- orders that the companies publish the orders of the Court on the Ixon website; and
- costs.
On 16 December 2003, Justice Wilcox granted leave to the ACCC to effect service outside the Commonwealth on the Japanese company, Ixon, in Japan. A directions hearing has been set down for 5 February 2004 in the Federal Court, Sydney.