Commission lays charges against EuroSteel

Media Release

Issued 23 January 2018

Release No. 87

Commission lays charges against EuroSteel

The Commerce Commission confirms that 59 charges under the Fair Trading Act have been laid against Euro Corporation Limited (EuroSteel) for making false and misleading representations about its steel mesh product known as SE615.

The charges were filed in the Auckland District Court and relate to representations made between 2012 and 2015.

The Commission alleges that EuroSteel represented on product labels, identification tags and its website that its SE615 steel mesh was 500E grade steel when it was not, as it did not comply with the testing and sampling requirements for 500E in the Australian and New Zealand Standard AS/NZS 4671:2001.

From April 2013, EuroSteel represented that each batch of its SE615 mesh was independently tested. The Commission alleges that not all batches were independently tested.

The first appearance was made earlier today and the matter will next be heard at 9am on Tuesday 13 February.

As the matter is before the Court the Commission will not be commenting further.

Background

The Commission has filed charges against a number of companies relating to false and misleading representations about 500E steel mesh.

In 500E the ‘E’ stands for earthquake, and the Standard specifies strength and ductility (elasticity) requirements for steel reinforcing materials.

The Standard also specifies the procedures (ie, sampling and testing) that must be followed to comply including:

manufacturing methods that must be used by steel manufacturers

chemical, mechanical and dimensional requirements of mesh

sampling and testing of each batch of mesh

identification and labelling of different grades of mesh.

To be sold in New Zealand as 500E grade steel mesh, the mesh must be produced in accordance with the requirements of the Standard. If mesh is produced in any other way, it cannot be described as 500E mesh.

Timber King Limited and NZ Steel Distributor Limited entered guilty pleas and appeared for sentencing in December 2017. The Judge reserved his decision until mid-February.

Steel and Tube Holdings Limited pleaded guilty to 24 charges and will be sentenced in March.

In addition to the charges laid against EuroSteel, the Commission has laid charges against a further company, but cannot comment further on that at the moment.

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