ACCC takes action against the Joystick company for alleged misleading e-cigarette “no toxic chemicals” claims

9 September 2016

The Australian Competition and Consumer Commission has commenced proceedings in the Federal Court against The Joystick Company Pty Ltd (Joystick), an online e-cigarette retailer, for alleged false or misleading representations that its products did not contain any toxins or formaldehyde, were “independent from” chemicals found in conventional cigarettes, and had been approved by the ACCC.

The ACCC had previously issued Joystick with three infringement notices as it had reasonable grounds to believe that the company had made a number of false or misleading representations. Joystick did not pay the penalties specified in the infringement notices within the specified payment period. 

The proceedings were commenced after independent testing commissioned by the ACCC indicated that the Joystick’s e-cigarette product tested contained toxic chemicals including formaldehyde, acetaldehyde, and acrolein.

“It is crucial that suppliers have scientific evidence to support claims that their products do not contain carcinogens and toxic chemicals such as formaldehyde and acetaldehyde,” ACCC Commissioner Sarah Court said.

“This is particularly important when, as here, products are designed to be inhaled and are being differentiated from conventional tobacco cigarettes because they are claimed not to contain toxic chemicals.”

“This action against Joystick also reflects the ACCC’s policy that enforcement proceedings will be considered against businesses which do not pay the penalties specified in infringement notices within the payment period,” Ms Court said.

The ACCC has also alleged that the sole director of Joystick was knowingly concerned in the conduct.

The ACCC is seeking pecuniary penalties, declarations, injunctions, orders for an ACL compliance program, publication orders and costs.

Background

The proceedings against The Joystick Company follow the ACCC’s decision to commence proceedings against Social-Lites Pty Ltd and Elusion New Zealand Limited in June 2016, also for alleged breaches of the ACL.

The ACCC’s enforcement actions against these three suppliers follow a survey it conducted of Australian e-cigarette businesses websites. The ACCC will write to other industry participants putting them on notice about their consumer law obligations not to mislead consumers about the composition and safety of the products they are offering for sale.

Notes to editors

Formaldehyde is classified by the World Health Organisation International Agency for Cancer Research as a Group 1A carcinogen, meaning there is sufficient evidence to show it is carcinogenic to humans.

Acetaldehyde is classified as a Group 2B carcinogen by the IARC. That classification is applied to a chemical agent that has been evaluated as being possibly carcinogenic to humans.

Acrolein is classified by the World Health Organisation as a toxic chemical.  It is also listed as a dangerous poison in Schedule 7 of the Poisons Standard of the Therapeutic Goods Act 1989 (Cth).

Infringement notices are designed to provide a timely, cost-efficient enforcement outcome for contraventions of the ACL.

The ACCC may issue infringement notices where it has reasonable grounds to believe that a person has contravened certain consumer protection provisions. Payment of the penalties specified in infringement notices prevents the ACCC from brining proceedings against the person to whom the notice was issued by the ACCC in respect of the contravention specified in the notice. 

More information is available at: Guidelines on the use of infringement notices

 

Release number: 
MR 165/16
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