Ad description
The International Centre for Nutritional Excellence Ltd (ICNE) website, visited on 20 July 2011, stated "ICNE is an independent laboratory specialising in nutraceutical and associated raw material analysis for the Human, Veterinary and Farm Animal Industry".
Issue
COX AGRI challenged whether ICNE's claim to be an "independent laboratory" was misleading, because they understood that ICNE was affiliated with a manufacturer of animal nutrition products.
Response
ICNE stated that it was not owned or affiliated with any manufacturer of animal nutrition products. They said they were set up in 2007 under the suggestion of the director of Tangerine Holdings Ltd (Tangerine Holdings), who believed there was a gap in the market for an independent laboratory to test products in the nutraceutical field. They said they provided an independent testing service which was accessible to any company that required it. They explained that, in order for the laboratory to establish itself, it was given the opportunity to perform all of the testing for Tangerine Holdings, who specialised in the manufacture and sale of animal health and nutrition products. They explained they continued to do this from a rented office and laboratory based at the Tangerine Holdings manufacturing facility. They stated that, although they were currently physically based at this facility, their office and laboratory were completely separate from the operations of Tangerine Holdings and that all transactions between the two companies were carried out at arm’s length. They explained they were wholly owned by a company which was itself owned by one of their directors and they provided information from Companies House which confirmed the ownership status of the company.
ICNE believed that the fact that it was set-up, and physically operated from, a Tangerine Holdings production facility was not relevant to whether they were now an independent laboratory because the company had changed focus under its current ownership. They stated that they had performed a large number of individual tests since July 2011 on a variety of materials for a number of companies in the nutraceutical, cosmetic and feed industries. They said the tests were predominantly one-off, non-study based tests and that they were conducted by their own staff, to their own procedures, using their own equipment which was purchased using their own funds. They stated that they had conducted tests for a number of different companies and they provided a notarised statement from their Director which confirmed that he was in possession of invoices and sales history schedules relating to clients that were not connected to Tangerine Holdings. They stated that laboratory collaboration with third parties was a common practise in the industry which was necessary to assist research, and which did not compromise the independence of the laboratories involved.
Assessment
Upheld
The ASA had previously considered a complaint about an ad in which ICNE claimed that its testing of products, including those produced by a subsidiary of Tangerine Holdings, had been "produced independently". In our adjudication we noted that Tangerine Holdings owned the freehold to the address from which ICNE traded. We also noted that three of Tangerine Holdings subsidiaries operated from the same address as ICNE and that there were a number of connections between directors of Tangerine Holdings and individuals who were at that time directors of ICNE. We therefore concluded that the claim that the report had been "produced independently" was misleading by virtue of the close association between ICNE and Tangerine Holdings.
We accepted that ICNE was not owned by Tangerine Holdings and we accepted that an independently established, owned and operated laboratory could be 'independent' while also collaborating with third parties. However, we considered that its independence would be determined by the nature of its relationships with those collaborators and with its other clients. We noted that ICNE had said their testing was accessible to any company that required it and that they had clients that were not affiliated with Tangerine Holdings, but we considered the notarised statement from their Director was not sufficient evidence to demonstrate this. Furthermore, we noted that only two case studies were shown on their website, and both were for products produced by Tangerine Holdings subsidiaries.
We considered that in certain circumstances ICNE may be able to conduct testing which could be considered 'independent', for example if they were instructed to conduct testing by a company that was not one of Tangerine Holdings subsidiaries. However, we considered that, for the reasons stated above, the two companies were too closely associated for the ad to claim that ICNE was an "independent laboratory". We therefore concluded the claim was misleading.
The ad breached CAP Code (Edition 12) rules 3.1 3.1 Marketing communications must not materially mislead or be likely to do so. (Misleading advertising) and 3.7 3.7 Before distributing or submitting a marketing communication for publication, marketers must hold documentary evidence to prove claims that consumers are likely to regard as objective and that are capable of objective substantiation. The ASA may regard claims as misleading in the absence of adequate substantiation. (Substantiation).
Action
The claim must not appear again in its current form.
