The Australian Parliament has amended section 53C of the Trade Practices Act 1974 (Cth). It affects advertising pricing of goods and services to consumers in order to tackle the problem of misleading advertising masking hidden fees and charges.
The new changes announced on 11 November 2008, will commence on 25 May 2009 and particularly affect motor dealers and retailers. The amendments, known as ‘Clarity in Pricing’, will prohibit a business from only representing part of the consideration payable for goods and services by imposing that:
1. businesses must display as a single figure the total price of the product that is quantifiable and where the total price is not known, the minimum total price must be disclosed as a single figure; and
2. the total figure must be prominent at the time of making the representation, regardless of the medium used to advertise the price. This means that businesses will not be able to use fine print disclaimers to reveal additional mandatory taxes, fees, levies and other charges, which are commonly hidden by an asterix.
The amendments exclude:
1. transactions between businesses;
2. any financial services transactions which are regulated by the Australian Securities and Investments Commission Act 2001; and
3. delivery or other related charges from supplier to the consumer to be included in the single figure.
Implications for businesses
It is proposed that those businesses that contravene these amendments will commit a criminal offence which carries a maximum penalty of $1,100,000.00.
If you would like further information on how these changes affect your business, please contact us on 9635 8266 or
connect@champion.com.au.
DOROTA BRYKS
LAWYER
COMMERCIAL AND CORPORATE
