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Complex trading laws are not a foolproof means of avoiding harm to consumers. The law of the land seeks to regulate and control the sale and use of dangerous products, but, Courtney Devereux asks, how much responsibility should retailers assume over consumers’ behaviour?

By Courtney Devereux | September 21, 2017 | News

There’s a reason shoppers can’t go down to the corner dairy and buy a gun in the same way they might pick up a candy bar. Alcohol, fireworks, tobacco and tobacco-related products are less obviously dangerous goods, but they, too, can lead to injury or death if used or sold irresponsibly.

Unlike retailers selling more innocuous products, those who stock and sell regulated items can be held partly accountable if they don’t meet their regulatory responsibilities. This means that to make a living, these retailers must work around regular legislative changes designed to minimise harm and, often, to drive down sales.

The dangers presented by heavily-regulated products are clear.

According to gunpolicy.org, from 2000-2010 there were 621 gun-related deaths in New Zealand, of which 478 were suicide.

According to the Ministry of Health, smoking was one of the two leading modifiable risks to health in 2013, accounting for about 9 percent of all illness, disability and premature mortality.

In 2013, there were 442 ACC claims carried out for injuries relating to fireworks, as well as 187 fires reported in which fireworks were the primary cause.

The main laws that affect the sale and supply of regulated items are the Arms Act (1983), the Dangerous Goods Act (1974) and the Smoke-free Environments Act (1990).

Locked and loaded

There are an estimated total number of 1.32m guns held by civilians in New Zealand and 250,000 licenced fire arm owners.

Richard Munt, owner of Auckland based gun store Serious Shooters says the rules and regulations surrounding the sale of guns are decided by the wrong people, and the current system makes business tough.

“It is difficult for us when the goal posts keep moving. Police keep on inventing new rules that they have no legal basis around. They keep coming up with their own idea about how to interpret it when those things are really meant to be set by parliament.”

The Arms Act (1983) was created by Parliament but is regulated and monitored by the New Zealand Police. The act has gone through several changes since its enactment and is now administered by the police in conjunction with the Arms Order (1984) and the Arms Regulations (1992).

Munt says the perceived threat of guns is worse than the reality. By example, he notes that during game season in early May this year, every single gun incident received media attention.

“There is no increase in problems or issues relating back to firearms… None whatsoever. We sell more guns then we ever have, there is more firearms dealers around now then there has been for a while.”

Munt says the price of guns dropped drastically in 1986 when the GST of 10 percent on regulated items replaced sales tax. Now, with two hikes of GST, tax responsibilities are eating into Serious Shooters’ margins.

“On some of our more expensive guns the government actually makes more money on them then we do, some of the margins on firearms are below 15 percent. So we’ll pay for a gun, and the GST on it will be the same as my margin, if not more.”

There are no laws specifically around the sale of firearms in New Zealand that differ from normal trading rules. Munt says if firearms retailers stick to the general rules of advertising they can trade freely.

The process for obtaining a consumer firearms license is long, complicated and expensive. In other words, it’s designed to weed out people the law deems unsuitable to possess a firearm. Even more caution is applied to those seeking to trade in firearms.

“In relation to firearms, dealers’ licences must be renewed annually,” says a New Zealand police spokesperson. “We audit the licence holder and their circumstances as well as the dealer’s firearms stocks and sales.”

Munt says that in his experience, it’s better to place gun restrictions upon the people using the firearms, rather than the supplier.

“Guns needs to be restricted to the people that have shown appropriate skills. Guns are safer than a bow and arrow, more humane than a bow and arrow, yet there are more regulations surrounding their sale.

Our Arms Act has gone through almost 22 different amendments since its creation, but according to a spokesperson for the New Zealand police, another amendment is on the cards.

“We consider that we have a robust firearms licensing regime. But this will be further assisted by the government’s intention to progress the recommendations contained in the April 2017 Law and Order Report.”

The Law and Order report’s main aim is to create tighter rules around the sale of guns to high-risk offenders, and to amend the Arms Act to clearly state that a gang member or prospect must not hold a firearms licence.

“The legal framework for firearms possession and use in New Zealand is built on the concept that firearms ownership is a privilege not a right, and that access is appropriately regulated by the government,” says a spokesperson for the police.

The police say that New Zealand’s low rate of firearms-related crime (around 1.4 percent of violent crime) suggests that, in general the Arms Act is effective in helping limit criminal access to guns.  

Munt feels that the suggested amendments are driven by perceptions that the threat of gun violence is more urgent than it really is. While these amendments will hinder his trading, he doesn’t believe they will have an effect on firearms-related crime.

“People are going to die as time goes by, there is no way around it. They just keep changing the laws surrounding them.”

I’m a firestarter

Despite added layers of legislation, there’s been no shortage of distributors selling fireworks out of everything from converted shipping-container stores to major chains. Environmental Protection Authority figures suggest the number of fireworks brought into New Zealand increased from 1320 tonnes in 2007, before more restrictive laws were put in place, to 1400 tonnes in 2013. The only restriction on customers seeking to buy fireworks is that the purchaser be of 18 years or older.

However, Kiwis consumers don’t seem to be behaving responsibly around fireworks. According to an Australian study undertaken in 2000 titled, Deaths and hospitalisations from firework injuries, New Zealand had higher injury rates than Australia, USA and the Netherlands combined.

The issue with the supply and sale of fireworks in New Zealand is, although they can only be sold three days of the year from November 2-5, they can be set off at any time.

Around early November, popular big-box stores load up on firework bundles for sale. These range from $10-$100 and come in a range of different levels of firepower.

Andrew Piggin, general manager – trading for The Warehouse, says safety of customers and team members is paramount for The Warehouse Group, which means they only promote fireworks in a safe and controlled way.

“All fireworks we sell comply with the New Zealand Code of Practice for Retail Fireworks. We also have trained and certified fireworks handlers in each of our stores to ensure the safe handling and selling of fireworks.”

The Warehouse can trade fireworks only through accordance with the Hazardous Substances (Fireworks) Regulations 2001.

“To inform customers about the safe handling of fireworks, we have numerous safety guidelines displayed through in store signage, as well as on the packaging of every firework we sell,” says Piggin.

Many local councils have passed laws that make firework detonations in a public place illegal, but private places are still able to set off fireworks any time of year.

Piggin says to meet these demands the store offers a range of lower-decibel explosives that can be used while also respecting the council laws in place.

With fireworks, it is important to also look at the sale of fireworks for commercial entertainment as well as personal entertainment. For the most part, these fireworks are used in a more cautious and professional manner. 

Smoke break

Although over 605,000 New Zealand adults still smoke, New Zealand’s Smoke Free Environments Act 1990 is one of the most comprehensive pieces of tobacco control legislation in the world.

May last year saw the Ministry of Health draft a new set of regulations around cigarette products and their packaging. The main effects of the bill included making graphic warnings more apparent, tighter restrictions on branding and prohibitions against the use of marketing on or about tobacco products.

A 2014 study by the New Zealand Medical Journal on the attitude of Kiwi retailers towards the sale of tobacco highlighted that display bans resulted in reduced exposure to tobacco marketing, and lower impulse purchasing.

The new changes also involved a planned series of four 10 percent annual tax hikes implemented in 2016. These are expected to push the price of a 20-pack of cigarettes from around $20 to around $30 by 2020. Although the increased price of tobacco is expected to deter new smokers, Smokefree New Zealand’s site says most long-term smokers are willing to pay upwards of $50 a packet.

New Zealand law states that cigarettes and tobacco shall not be sold to anyone under the age of 18. Smoking under age is also illegal even if purchased by a legal-aged individual. The Ministry of Health states that updated cigarette and e-cigarette rules and registrations are some of the most complained-about within the industry.

“The increase in smoking tax was not well received by those who partake in the consumption of tobacco. In 2015 when the law was passed that stated retailers were required to keep tobacco products in sealed units, many argued the price and difficultly of selling a product with zero visibility.”

As per the New Zealand Medical Journal Study, during the development of laws in the tobacco industry, some retailer groups campaigned against the changes. Arguments presented in opposition to the removal of point of sale displays included that there was a lack of evidence that removing them would be effective. Retailers were concerned they would experience financial losses.

The Ministry of Health’s goal is to limit the marketing, advertising and promotion of tobacco products, making it harder for people to buy. Retailers who go against the laws set out by the Ministry will have charges laid against them and may be banned from selling future products.

Cody Peneamene, owner of Dunedin-based e-cigarette and vape product retailer Vapourium, says the current rules and regulations on his products are easy to comply with as a retailer but pairing e-cigarettes with normal cigarettes is what causes difficulties.

“Unfairly lumping vaping in with cigarettes won’t align with the scientific findings unique to each method. We have had issues around advertising, we are unable to educate people about the benefits of vaping versus smoking, as that would be making a therapeutic benefit about the product.”

Peneamene says the upcoming law changes will cause financial trouble for smaller e-cigarette and vape product retailers.

“We will closely monitor and advise the policy makers where needed. We will follow all laws. I imagine it will cause a bit of trouble with the smaller vendors who don’t have the infrastructure, however we’d be prepared to help them out.”

Education is key

The sale of regulated goods is one that will always involve a tension between the legislators which set restrictions, and the retailers who must comply with them. Tighter restrictions may help cut down on consumer harm, but they can also hurt businesses which feed back into the economy.

The retailers interviewed for this feature agreed that consumer education was key to maintaining a healthy regulatory balance. Many responsible retailers of regulated products not only comply with the law, but go beyond it to take on a custodial role, providing training and additional safety measures to ensure their products cause minimal harm once they leave the store.

After all, nobody wins when there’s no repeat custom.


This story originally appeared in NZ Retail magazine issue 751 August / September 2017

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