Update on steel mesh investigations

7 June 2017
Release No. 110

Update on steel mesh investigations

As part of the Commerce Commission’s investigation into steel mesh, 29 charges have been filed against Steel and Tube for making false and misleading representations about their steel mesh product known as SE62.

The charges were filed by the Commission in the Auckland District Court under the Fair Trading Act 1986. They relate to conduct between 1 March 2012 and 6 April 2016.

The charges allege that Steel and Tube made misleading representations on their batch tags, batch test certificates, advertising collateral and website that SE62 was 500E grade steel, when it was not. The charges also allege that false and misleading representations were made by Steel and Tube that SE62 steel mesh had been independently tested and certified, when it had not. This included using the logo of an independent testing laboratory on SE62 test certificates when the product had not been tested by the laboratory.

Charges were also filed earlier this year against Timber King Limited and NZ Steel Distributor Limited in relation to false and misleading representations about 500E steel mesh. These companies have entered guilty pleas and will be sentenced in court in August 2017. The Commission expects to lay charges against one other company, and investigations continue into one additional company.

As this is now before the courts the Commission will not be commenting further at this time.

Background

Our investigation
On 5 August 2015 the Commission received a complaint raising concerns about the validity of claims being made by three companies selling steel mesh in New Zealand. This complaint related to problems with a particular size of 500E mesh, which is ductile steel mesh often used in concrete slabs like house foundation slabs and driveways.

The Australia/New Zealand standard (AS/NZ 4671:2001) (the Standard) mandates various physical characteristics required of steel mesh, and the testing methods that must be applied during their production.
In April and May 2016 the Commission entered into enforceable undertakings with three companies that ensured 500E grade steel mesh could only be sold once it passed specific stringent testing.
In November 2016 the Government made changes to testing requirements, increasing the number of samples which need to be tested, clarifying how that testing is done and requiring testing be done by internationally accredited testing laboratories. The changes were fully implemented on 30 May 2017.

Previous media releases
March 4 2016 – Commerce Commission investigating whether steel mesh complies with standard
April 6 2016 – Update on steel mesh investigation
April 22 2016 – Commission lifts ‘stop’ on Euro Corporation’s steel mesh
April 29 2016 – Update on Commerce Commission steel mesh investigation
June 1 2016 – Commission lifts ‘stop’ on Brilliance Steel’s steel mesh
5 December 2016 – Commission completes steel mesh investigations into five companies

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