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ACCC going after retailers

June 8, 2011: Outgoing ACCC chairman Graeme Samuel is encouraging consumers to approach the ACCC if they feel their rights under the beefed-up Australian Consumer Law have been infringed by retailers.

Mr Samuel (pictured right) fronted ABC Radio’s PM current affairs program last night (Tuesday, June 7) emphasising that the new laws increase retailers’ – rather than manufacturers’ – obligations.

‘The consumers’ guarantees now effectively provide protection to consumers from retailers, and they come from retailers, that can last for so long as it’s deemed appropriate under the consumer guarantee provisions, and that will depend upon the nature of the product concerned, the nature of its normal use and, importantly, the intended use by the consumer in acquiring the product itself,’ he told the ABC.

‘And so sometimes you’ll see manufacturers’ warranties that may only be for three, six or 12 months in total, whereas the retailers’ guarantee under the consumer guarantees can sometimes extend beyond that, having regard to the nature of the product and its intended use.’

Plasma screens were nominated as an example of a product which may attract a longer period of obligation from retailers:

Reporter: So if your TV breaks after a year and a day you shouldn’t chuck it out, you should still go back to your retailer and push for some kind of action?

Mr Samuel: I think that’s a very good example; that if, say, a plasma screen or a refrigerator, for example, or a washing machine [breaks down out of warranty period], we should go back to the retailer.

– Presumably, well-known brand cameras would also fall into this category – and as Australian retail pricing is at a premium on international pricing, arguing that the product was originally ‘cheap’ may be challenging.

Samuel said the ACCC has so far be focussing on ‘circumstances where retailers are representing to consumers that they have more limited rights than are currently available under the law.

‘…so that they’re not beguiled into believing, or misled into believing through even the lack of information that their only right is that, for example, of the printed manufacturer’s warranty.

‘They have rights now under the Australian Consumer Law. They ought to enforce those rights.’

He said that ‘if we find that a retailer is not honouring the obligations imposed on the retailer under the consumer guarantee provisions of the Australian Consumer Law then the ACCC will take action to deal with those issues.’

He encouraged consumers with any concerns to either contact the Office of Fair Trading in their state or territory or alternatively call the ACCC’s Infocentre line.

The ACCC has already begun to flex its newly-acquired ACL muscle, boasting of some $3.6 million in penalties during the first 12 months of new consumer protection laws.

‘Until a year ago, the ACCC’s ability to penalise a great deal of dishonest conduct amounted to not much more than a slap on the wrist,’ Samuel told the National Consumer Congress annual conference this week.

‘Now the punishments can better match the crime and we can respond in a more timely way.’

The bulk of the $3.6 million in penalties comes from two fines totally $2.7 million, against Yellow Page Marketing and Yellow Publishing Limited.

‘As greater use is made of the new powers and penalties they will become a deterrent to others, thereby increasing compliance with the law,’ he said.

Harvey stores don’t Playsport fair: ACCC

Six West Australian Harvey Norman franchisees have each paid an ‘on rthe spot’ infringement notice for advertising the Kodak ‘Playsport’ pocket video camera when they did not stock the camera.

The ACCC announced this week it had issued infringement notices because it had reasonable grounds to believe the franchisees had engaged in ‘bait advertising’ in contravention of section 56(2) of the Trade Practices Act 1974 by advertising the camera in a catalogue when they were unable to supply the product to consumers.

These infringement notices operate not unlike ‘on-the-spot’ speeding fines, in that the assessment of wrong-doing is made by the enforcement agency rather than the courts.

‘Promotional material must be accurate and there must be adequate stock of the advertised product to meet reasonable demand, otherwise businesses risk bait advertising, which is illegal,’ said Mr Samuel.

The six West Australian Harvey Norman franchisees each paid the infringement notice of $6600 rather than defend the matter.

Once an infringement notice penalty is paid, the ACCC cannot begin court proceedings over the alleged contravention. Even though t.he payment of an infringement notice penalty is not an admission of a contravention of the Act, it’s a way of avoiding the no doubt expensive alternative of meeting the ACCC in court.

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