Euro Corporation fined $361k for misleading representations about earthquake grade steel mesh products

The Auckland District Court sentenced Euro Corporation on 14 charges for its steel mesh products. Photo / 123rf

A company has been fined $361,000 for making false or misleading and unsubstantiated representations about its earthquake grade steel mesh products.

Euro Corporation Limited (Euro) steel mesh, known as SE615, were the target of a Commerce Commission prosecution under the Fair Trading Act.

The company pleaded guilty to making false or misleading and unsubstantiated representations for SE615, which it marketed and sold as being earthquake grade steel mesh between January 2012 and August 2015.

Auckland District Court Judge M E Sharp sentenced Euro on 14 charges and fined the company $361,000.

It was the final company to be sentenced after a series of investigations into steel mesh by the Commerce Commission in 2015 and 2016. Other corporates to face court action have included Steel and Tube Limited, Brilliance Steel Limited and Timber King Limited and NZ Steel Distributor Limited.

Euro both manufactured SE615 steel mesh in New Zealand and imported it from overseas.

The company, however, failed to comply with the testing procedures set out in the Australian/New Zealand Standard for reinforcing steel when testing locally made steel, the Commerce Commission said in a statement today.

The charges were for about 137,900 sheets of locally manufactured SE615 and 104,900 imported sheets.

In her judgment, Judge Sharp said: "Standards are solutions that are promulgated in order to make buildings, inter alia, safe. Failure to comply with them, can lead to significant prejudice to the consumer public especially where the departure has been such as to render unsafe the use of a product.

"The Commission is correct therefore in suggesting, given that we are dealing here with a product related to earthquake safety, compliance is critical and a deterrent response is appropriate."

Commerce Commission chairwoman Anna Rawlings said standards are in place to give the public confidence that buildings in New Zealand are constructed with materials which meet prescribed requirements.

"Consumers have no choice but to trust and rely on representations that companies make about compliance with standards, at least in part because they cannot verify the performance characteristics of building materials themselves. It is critical that applicable standards are adhered to and properly described to consumers."