NZME fined for selling dangerous magnetic toys

Published26 May 2023

NZME Advisory Limited (NZME) has been fined in the Auckland District Court yesterday for supplying unsafe magnetic puzzle toys, commonly known as buckyballs, which breached product safety laws and caused harm to a child in New Zealand in 2021.

The toys, sold on NZME's previously owned online store GrabOne.co.nz, were made up of small, high-powered magnetic balls. They were supplied between October 2020 and September 2021 in-breach of an unsafe goods notice which bans the supply of any magnets, sold in sets of two or more, that are a particular size and strength.

"The ban exists because if more than one of the magnets are swallowed, they can attract to each other within the body which is extremely dangerous," Commerce Commission's General Manager of Fair Trading, Kirsten Mannix, says.

"Tragically, we are aware of one case in New Zealand where a child did swallow two of the magnets from one of the magnetic toys supplied by NZME, and significant surgery was required to remove them."

Ms Mannix says product safety is a priority area for the Commission, and it is committed to ensuring that businesses comply with their product safety obligations.

"Every year we carry out unannounced visits to retailers engaging with them about the product safety laws in place and checking that the toys on the shelves are compliant. Since 2017 we have prosecuted 30 businesses and issued formal warnings to another 32 businesses, relating to the supply of non-compliant products."

NZME sold 213 of the magnetic toys between October 2020 and September 2021. After being contacted by the Commission, NZME recalled the sets and contacted customers to notify them of the recall.

Under the Fair Trading Act, there are safety standards and unsafe goods notices in place which apply to various products, including toys, bikes, and small high-powered magnets. Businesses must ensure that the products they sell meet the relevant requirements before they are supplied.

"It's vital that businesses take the time to understand their obligations when advertising and supplying products for sale - particularly if they are subject to a product safety standard or an unsafe goods notice," Ms Mannix says.

Ms Mannix says that while the obligation to supply safe toys sits with businesses, this case also provides an opportunity to raise awareness amongst consumers around the risks of small high-powered magnets or other unsafe products.

"If you are concerned that a product is unsafe or doesn't comply with product safety laws, we encourage you to remove it from the household, return to the seller and inform the Commerce Commission."

The Commission is responsible for promoting compliance and enforcement in relation to eight product safety standards and seven unsafe goods notices. There is more information here.

The end penalty for NZME was $87,750. Sentencing notes will be published on the Commission's case register when available.

Background

NZME Advisory Limited
NZME Advisory Limited was founded in 2014 and is a publicly listed group of broadcasting and media companies which owns and operates over 50 of New Zealand's media brands. Prior to October 2021, the Group owned and operated www.GrabOne.co.nz - which marketed itself as having one of the largest "daily deals" websites, and among the largest ecommerce websites, in New Zealand.

Unsafe Goods Notices
The Minister of Commerce and Consumer Affairs may declare any goods (or class of goods) to be unsafe if it appears to the Minister that:

• the goods will or may cause injury to any person
• a reasonably foreseeable use (including misuse) of the goods will or may cause injury to any person.
• There is more information on the Commission's website about the product safety standards and unsafe goods notices here.

Small high-powered magnet sets are unsafe and can't be sold for personal use. The Unsafe Goods Notice came into force in July 2014 and applies to new and second-hand small high-powered magnets that are supplied, or offered or advertised for supply, in sets of 2 or more for personal use.

Personal use includes magnet sets that form part of:

• a toy, game or puzzle
• construction or modelling kits, or
• jewellery that is worn around the nose or mouth.

Read the unsafe goods notice here.

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