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March 4, 2015

NZ Commerce Commission OKs restrictions on formula ads

The New Zealand Commerce Commission has reached a preliminary decision to restrict the advertising and marketing of infant formula.

The New Zealand Commerce Commission has reached a preliminary decision to restrict the advertising and marketing of infant formula. 

The country's Infant Nutrition Council requested approval from the Commission for its Code of Practice, which will place restrictions on advertising activities by INC members. In particular, the restrictions will apply for formula targeting infants younger than six months old.

The Commission said that the Code of Practice may "lessen competition" but added that this would be outweighed by the “public benefits”. 

"Restrictions on marketing and advertising activities typically limit the amount of information available to consumers, reducing competitive pressure and making consumers worse off. In this instance, however, authorising the INC’s Code of Practice is likely to have significant public health benefits," said Commerce Commission chairman Dr Mark Berry.

"In particular, it is widely agreed that there are a variety of health benefits from breast feeding, which could be adversely affected by the unrestricted marketing and advertising of infant formula. Moreover, authorising the INC’s Code of Practice is unlikely to impact the price that consumers pay for infant formula," said Dr Berry.

For these reasons, the Commission’s draft decision is that it should grant authorisation to the INC for its Code of Practice. 

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