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Posts Tagged ‘ACCC’

The Australian Competition and Consumer Commission has ruined Christmas for eleven Harvey Norman franchisees accused of misrepresenting consumer rights.  On 19 December, when most people will be counting sleeps til Christmas, the franchisees will be in the Federal Court in Sydney as orders are made for progress of the case.

ACCC says that the eleven retailers gave consumers false information about their rights when goods weren’t up to scratch.  It says that staff rolled out old red herrings like:

• “We only have to replace damaged goods if you return them within 24 hours.”
• “Sorry, this is under the manufacturer’s warranty.  You’ll have to contact them.”
• “No, sir.  That was just a $20 item and we don’t replace or refund for those low cost items.”
• “Yes, we can fix that, but there’s a $75 transport and repair charge.”

Some of these statements can sometimes be valid in some circumstances.  But where goods simply aren’t of reasonable quality when supplied, traders can’t use excuses to push complaining customers away.  Australian law says they have rights to a remedy, and no store can limit or exclude them.

A familiar story

Of course, there have been no adverse findings against any of the eleven yet.  But ACCC’s allegations have a familiar ring.  Just last year, discount computer chain MSY was caught making up its own law on consumer warranties.  According to MSY:

• They did not provide any statutory warranties to consumers in relation to their products.
• They would only provide statutory warranties to consumers in a restricted range of circumstances.
• They required consumers to pay a fee to obtain a warranty beyond that provided by the manufacturer.

According to the Federal Court, they could pay a $203,500 penalty and submit to a five year court restraint for misleading consumers about their rights.

ACCC:  It’s a campaign

ACCC has made no secret of the fact that it has these kinds of misrepresentations in its legal gun sights.  “Consumer Guarantees has been identified as a national priority by ACL Regulators and is a matter of particular concern for the ACCC with more than 16,000 contacts from members of the public to the ACCC’s Infocentre so far this year” said its Chairman Rod Sims this week.  And its website now states that “The ACCC is conducting a number of investigations into other large manufacturers and retailers for alleged misrepresentations of consumer guarantee rights in breach of the ACL.”  And to prove the point, ACCC launched the same kind of legal action last month against Hewlett-Packard Australia Pty Ltd.

A good website or policy is not enough

Many businesses think they can cover off legal risk with paperwork.  It’s true that a well drafted contract or a comprehensive trade practices compliance policy document is a key tool in managing risk.  But they’re almost never enough, if they aren’t backed up in practical ways.

Harvey Norman’s website has clear and accurate information about what remedies consumers are entitled to if goods are not satisfactory.  If ACCC’s case is right, it means that the franchisees were operating in disregard of the information on their own group website.  That would indicate a serious disconnect between what the group’s head office knows (ie that consumers have bedrock rights) and what’s filtered through to staff on the shop floor.  And that kind of disconnect can be very expensive.

Tags: ACCC, ACL, Australian Consumer Law, Trade Practices, Trade Practices Lawyer
Posted in General, IT Law, Trade Practices Law | Comments Off

The ACCC today (14 February 2012) announced that Telstra Wholesale ADSL services are now declared under an interim access determination.

The determination made under the Consumer and Competition Act 2010 has fixed the price Telstra can charge its wholesale ADSL customers, the effect of this is that wholesale customers are now benefiting from lower pricing.

The price reductions will see competitors such as iiNet better able to compete with Telstra’s retail product offering.

This will only serve to bring more scrutiny on NBN pricing and the benefits of cost effective ADSL services in the market place.

Tags: ACCC, telecommunications, telecommunications law, Telecommunications Lawyers, Telstra
Posted in General, ISP and Telco Law, IT Law, Uncategorized | Comments Off

The ACCC has announced that it intends to appeal the recent Federal Court decision which found that Google was not liable for misleading and deceptive conduct in publishing Adwords advertisements.

In its recent press release the ACCC said:

The ACCC alleged that Google had engaged in misleading or deceptive conduct by publishing these advertisements on Google’s search results page where a headline of the advertisement comprised a business name, product name or web address of a business not sponsored, affiliated or associated with the advertiser. When a user clicked the words in the heading of the advertisement associated with the competitor’s business or product, he or she was taken to the advertiser’s website.

Justice Nicholas found that although a number of the advertisements were misleading or deceptive, Google had not made those representations. Google merely communicated representations made by the advertiser. As such, Justice Nicholas ruled that Google had not breached the Trade Practices Act.

On appeal the ACCC has indicated that it will be challenging this finding by the Court with respect to 4 advertisements. The ACCC also indicated:

The ACCC takes the view that Google’s key word insertion system, plus the role of Google staff, were fundamental to the representations being made.

This is a significant case as there is a lack of Australian case law on Google Adwords advertisements, which are now one of the most commonly used advertisement methods for Australian businesses, with some businesses spending thousands of dollars per week.

 

Tags: ACCC, Google, Trade Practices Law, Trade Practices Lawyer
Posted in General, IT Law, Trade Practices Law | Comments Off

The ACCC has failed in its bid to have the Federal Court declare that the manner in which Google differentiates sponsored links to organic search results was misleading and deceptive within the meaning of the Australian Consumer Law.

The ACCC had argued that by failing to adequately distinguish advertisements from search results, Google had engaged in misleading or deceptive conduct.

While the Court failed to agree with the ACCC, Google has since changed the labeling of advertisements from ‘sponsored links’ to ‘Ads’ in line with comments by the Court, that the labeling was unclear, but not misleading and deceptive within the sense of the Australian Consumer Law.

Tags: ACCC, Australian Consumer Law, Google, Trade Practices Law, Trade Practices Lawyer
Posted in General, Trade Practices Law | Comments Off

The Australian Consumer and Competition Commission (ACCC) has released a draft report into the pricing model of fixed line telephony services, proposing radical price reductions, which is likely to see Telstra’s fixed line revenues fall even further.

The ACCC has suggested a move away from the traditional wholesale pricing model based Retail Price less Retail Cost, instead the ACCC has suggested an alternative model:

The ACCC has used a building block pricing model (also known as a regulated asset base, or “RAB” model), which calculates prices based on the assets and costs associated with providing the regulated services. It is consistent with the ACCC’s approach in other regulated industries. All submissions received in response to the ACCC’s December discussion paper supported such an approach.

The new model has suggested an across the board charge of $20 per month for line rental down from the two consumer and business rates that exist, while the ACCC has suggested a reduction of wholesale local call costs from 17c to 7c, a massive drop, which is likely to anger Telstra. Below we have extracted the draft pricing for the period 2011 to 2014:

Draft indicative prices

For ULLS services, the Bands relate to different geographical areas.

• Band 2 covers non-CBD metropolitan areas, where approximately 70 per cent of Australia’s population live.
• Band 4 price for more remote areas is notional, as there is very little demand, significant technological limitations on the copper and no reliable information on which to determine a price using the ACCC’s model. In June 2010, there were only about 144 active ULLS services in Band 4 compared to over 690,000 active ULLS services across Bands 1, 2 and 3.

Summary—Current indicative prices compared with proposed draft indicative prices to apply from 1 January 2011 to 31 December 2014
	Current indicative prices	Draft indicative prices
ULLS access prices with geographically de-averaged prices
Band 1	$6.60	$6.50
Band 2	$16.00	$16.00
Band 3	$31.30	$31.00
Band 4 (notional price)		$100
WLR (per line per month)	$25.57 (Homeline) $26.93 (Businessline)	$20.00 (nationally averaged)
LSS (per line per month)	$2.50	$2.50
PSTN OA and TA (per minute)	1c (headline rate)	1.1c (headline rate)
LCS (per call)	17c	7c

Tags: ACCC, Declared Service, telecommunications law, telecommunications lawyer, Wholesale Call Costs
Posted in General, ISP and Telco Law, Trade Practices Law, Uncategorized | Comments Off