Toy safety rules to be stricter

7 July 2011 Last updated at 11:16 GMT By Kevin Peachey Consumer affairs reporter, BBC News Details of toy safety requirements now run into hundreds of pages Stricter rules on toy safety will come into force this month making it easier for consumers and authorities to trace the origin of toys.

But the EU-wide regulations, which begin on 20 July, could increase costs for small businesses in the trade, an industry body has warned.

Under the new rules, importers will be responsible for ensuring that toys they bring into the EU are safe.

Contact details must also be carried on packaging.

Regulations

The requirements for toy safety have mushroomed over the last 50 years.

In 1968, the safety documentation on a Sindy doll ran to 16 pages. In 2010, the Dance With Me Teletubbies figurine required 1,692 pages of official paperwork.

Now, the new rules will outline specific responsibilities, placing a greater responsibility on importers and distributors.

A dangerous product identified in one EU member country already triggers an alert throughout Europe, but the new rules are aimed at improving the speed with which the source can be traced.

Surprise

The rules will tighten the rules of toys sold with food. Little figures tucked away, unpackaged, in cereal boxes and the like will be outlawed.

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It will be more difficult for start-up businesses to get established, which will lead to a concentration in the market”

End Quote Frank Martin Chief executive, Hornby But toys will be allowed to be contained within food if the toys have their own packaging that cannot be swallowed by a small child.

For example, a Kinder Surprise is a chocolate egg with a toy inside it, and the toy is inside a plastic cover. A spokeswoman for Ferrero, which makes them, said the packaging already complied with the new regulations as it carried a warning on the packaging such as "toy inside, adult supervision recommended".

Under the new rules, toys should also carry details of the manufacturer or importer on the packaging and possibly on the toy itself.

Frank Martin, chief executive of Hornby, said that its toys - which could often be very small - were engraved with a Hornby trademark and contact details were on the packaging.

He expected many small toys and multi-part toys to be marked in the same way.

However, he predicted that the next phase of regulations could be a barrier to entry for some smaller businesses. These rules, which come into force in July 2013 relate to required tests for the chemical content of toys - to protect children with allergies.

"It will be more difficult for start-up businesses to get established, which will lead to a concentration in the market," he said.

Many manufacturers already comply with the new regulations

Jerry Burnie, of the British Toy and Hobby Association, agreed that small businesses could find it tough in what is already a competitive market.

That was because these firms had to pay a testing lab to carry out the checks, unlike larger manufacturers which did the tests in-house. The third-party testing labs were likely to increase charges owing to the greater workload, and so the small manufacturers would be hit "disproportionately".

Wow Toys, a small manufacturer based in London, said it would be facing extra costs because of the higher testing fees, although it was confident of passing the higher standards.

"This new directive, or any upcoming new standard could be very challenging for some companies, but would not be an issue for a responsible or well-prepared one," said its operations manager Lewis Liu.

Other design changes will come into force in 2013, such as regulations on the length of cables for pull-along toys. They will actually be extended to make the toy less likely to be swung around by a small child.

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Debt firms 'face stricter rules'

14 June 2011 Last updated at 12:30 GMT The advice given by some firms was unacceptable, the OFT found Firms offering debt management services to people in financial difficulty will have to abide by much stricter rules or face being closed down.

The Office of Fair Trading (OFT) is consulting on the new rules to make such firms treat their clients fairly.

They will have to make it absolutely clear what services they offer and how much they will charge.

The firms must not use misleading names or adverts, and the advice given must be in the client's best interests.

David Fisher, a director of the OFT, said: "This guidance is designed to leave firms in no doubt about the standards the OFT expects and what they must do to comply with the law."

"The failings identified by our recent review are unacceptable and show that debt management businesses must raise their standards or face enforcement action," he added.

Poor practice

In September 2010, after an 11-month investigation, the OFT threatened to close down 129 firms, and said the industry was blighted by misleading advertising and poor advice to those in debt.

Continue reading the main story Simon Gompertz Personal finance correspondent, BBC News

How can you justify an industry which includes cases of hoodwinking heavily-indebted families into parting with their last reserves of cash?

The Office of Fair Trading goes into shocking detail about the tactics used by some debt management firms.

They fool people into thinking they are charities, trick them into paying extra fees and even make customers use premium rate phone lines to keep track of events.

The better firms have grouped together in trade associations with acceptable codes of conduct, to differentiate themselves from rogue operators.

Meanwhile, the OFT has been shutting down suspect firms when it can.

The aim is to fashion a new-look debt management sector with the next year or two. But it could be hard to banish the rip-off merchants completely.

"Firms are not giving the advice or offering the solution that is in the best interests of the consumer, but instead that which is most profitable to them," it said.

The OFT was referring to the widespread practice of charging fees up front for organising plans such as individual voluntary arrangements (IVAs).

Some firms pretended their services were free, gave fundamentally poor advice to clients, or pretended to be charities or government bodies. the OFT found.

Since then, 43 businesses have given up their consumer credit licences which allow them to operate, and 11 more face action to have their licences taken away.

Last month, the BBC revealed that some firms had held onto their clients' cash, rather than use it to pay creditors immediately, exposing the clients to further losses if the debt management firm went bust.

The Money Advice Trust welcomed the OFT's plans.

"Debt management companies have time and again demonstrated they cannot be trusted to treat customers fairly of their own accord," said Joanna Elson OBE, chief executive of the trust.

"In many cases there is a clear conflict of interest between what generates a profit for the company and what is the best course of action for the individual in debt," she said.

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LVMH rules out offer for Hermes

10 June 2011 Last updated at 09:53 GMT Hermes saw profits surge last year on the back of demand for luxury goods in developing markets Shares in French luxury goods group Hermes have fallen more than 5% after rival LVMH said it had "no intention" of launching a takeover bid.

There had been widespread speculation that LVMH, the world's largest luxury goods company and owner of Louis Vuitton and Moet & Chandon champagne, may make a bid for Hermes.

LVMH's denial was sparked by reports on Thursday that a takeover bid was imminent.

It already owns about 20% of the group.

"The LVMH group has absolutely no intention of making a bid for Hermes," a spokesman for the company said.

Record revenue

Sales at both groups have risen sharply, partly thanks to surging demand in developing economies such as China.

Hermes made a net profit of 421m euros ($610m; ?374m) in 2010, a rise of almost 50% on the previous year, with sales rising by a quarter to 2.4bn euros.

It plans to open 13 new stores this year.

LVMH saw record revenues of more than 20bn euros in 2010, with operating profit up by almost a third.

Earlier this year, the group agreed a 3.7bn euros deal to take over Italian jeweller Bulgari.

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