HelloFresh New Zealand has been convicted on criminal charges and fined NZ$845,000 after admitting it misled former customers into reactivating subscriptions without clear consent. This is one of the first criminal convictions in New Zealand for subscription-related misleading conduct under the Fair Trading Act.

The case stemmed from a Commerce Commission investigation into cold calls made between February 2022 and July 2023, when HelloFresh used discount voucher offers to encourage lapsed customers to return. The problem: customers were not clearly told that accepting a voucher would automatically restart billing and reactivate their subscription accounts.

According to the Commission, HelloFresh made more than 1.2 million outbound calls, with roughly 300,000 answered and over 77,000 reactivations recorded. More than 400 consumers lodged complaints about unexpected charges or difficulty cancelling.

In sentencing, Judge Kathryn Maxwell criticized the company’s sales incentives and cancellation process, describing the setup as “opaque and unfair.” She said customers faced a multi-step online cancellation and limited live support once billing resumed.

The court set a starting fine of NZ$1.3 million, later reduced by 35 percent for HelloFresh’s early guilty plea and cooperation with authorities. The company issued an unreserved apology, stating that it has since ended its third-party call center program and simplified its reactivation and cancellation flows.

The Commerce Commission called the outcome a “landmark case” that reinforces its enforcement focus on subscription traps — misleading marketing or automatic renewals that cause unintended recurring charges. The agency said it will continue targeting subscription businesses that obscure key terms or make cancellation unnecessarily difficult.

Civil vs. Criminal – Why This Fine Matters

In the U.S., most FTC actions against subscription companies are civil enforcement cases. Companies pay penalties or enter settlements but are not convicted of crimes.

New Zealand’s Fair Trading Act allows certain consumer-law breaches to be prosecuted criminally, resulting in a formal conviction and court-imposed fine.

That difference matters:
✅ A civil penalty punishes rule-breaking.
✅ A criminal conviction labels the conduct unlawful and creates a lasting record.

For global subscription companies, this case shows that conduct treated as a compliance infraction in some jurisdictions can constitute a criminal offense in others — potentially affecting future regulatory approvals, licensing, and market operations

INSIDER TAKE

Subscription businesses expanding internationally must audit their reactivation, renewal, and cancellation flows market by market. Transparency and consent aren’t just best practices — they’re increasingly the price of admission in every jurisdiction.

A global warning for subscription marketers

HelloFresh’s conviction sends a clear message: regulators are no longer treating subscription deception as a “marketing issue.” The case aligns with new laws and enforcement priorities across multiple markets — from the FTC’s Click-to-Cancel rule in the U.S. to the UK’s Digital Markets, Competition and Consumers Act and Australia’s upcoming reforms.

Marketing transparency is now compliance

Subscription teams must ensure every incentive, discount, and reactivation script clearly discloses what triggers billing. Incentive-driven reactivation programs and multi-step cancellation paths are no longer gray areas — they’re red flags.

Local laws, global exposure

For global operators, the lesson is consistency with local consumer-law standards. A “voucher reactivation” flow that passes U.S. review could violate the Fair Trading Act in New Zealand or similar rules elsewhere. Legal teams should perform market-specific audits on renewal, reactivation, and cancellation processes.

Bottom line

This case turns a compliance risk into a criminal precedent. For subscription businesses expanding internationally, transparency is no longer optional — it’s the legal baseline.