The Commerce Commission is taking meal-kit provider Hello Fresh to court for allegedly misleading consumers over subscriptions.
The Commission has filed criminal charges against HelloFresh New Zealand, as it believed the company breached the Fair Trading Act by misleading consumers in cold calls used to “re-activate” customers who had previously cancelled the food delivery service.
Commerce Commission deputy chairperson Anne Callinan said the claim related to conduct between February 2022 and July 2023, when previous HelloFresh customers were offered a discount voucher without it being made clear that acceptance of the voucher would reactivate their subscription.
Callinan said taking payment for services customers aren’t aware they’re buying or have not agreed to purchase was “unacceptable behaviour”.
“We’re concerned some consumers have been misled into paying for services from HelloFresh they didn’t want through the use of misleading wording and processes in cold calls.
“In these calls, it was not made clear to some customers that if they accepted a discount voucher offered, their subscription would be reactivated, and their bank account would be debited,” she said.
She said “buying products online is increasingly a way of life for Kiwi consumers and so the Commission is prioritising action against illegal online sales conduct”.
“Subscription traps are becoming more common as more businesses offer subscription-based services. We’re seeing more complaints about subscription services, the way consumers are being signed up to ongoing service contracts, and difficulties in cancelling subscriptions.”
The Commission started an investigation into HelloFresh after receiving a high number of complaints about its sign-up, cancellation, and reactivation processes.
The charges were filed in Wellington District Court.
HelloFresh responds
In a statement to 1News, a HelloFresh spokesperson acknowledged the Commerce Commission’s decision to commence proceedings related to alleged breaches of the Fair Trading Act.
“This practice fell well short of our standards and should not have happened,” the spokesperson said.
They said HelloFresh had cooperated with the Commission’s investigation, and took remedial action as soon as we became aware of the activities.
“We sincerely apologise to any customers who were impacted or inconvenienced at the time.”
