Legal

Fast Lane: How unfair contract laws are making small businesses a target for SEO “experts”

Cara Waters /

Have you heard of a business called Publicity Monster?

The Sydney company operates by cold-calling small businesses, pledging to make them appear in Google Places’ top seven search results for chosen keywords.

The small business hands over cash but many are now complaining that Publicity Monster doesn’t deliver the results.

What’s more, they claim Publicity Monster harasses and threatens businesses which do complain.

In NSW, 99 applications have been lodged against Publicity Monster at the NSW Civil and Administrative Tribunal, 20 have been lodged at the Victorian Civil and Administrative Tribunal and another five have been lodged at the Queensland Civil and Administrative Tribunal, according to a report in Fairfax.

The operator of the business tells me Publicity Monster hasn’t cold called for over 18 months and has “thousands of customers” that it optimises and delivers results to.

“Yes, we did grow to quickly and that resulted in some issues but we have worked hard for the last 2 years to rectify this,” he says.

Nevertheless, NSW Fair Trading is currently investigating Publicity Monster and other companies which make similar claims, but the watchdog’s powers are limited because the contracts that small businesses had with Publicity Monster were generally “business to business”.

This means they don’t fall within the scope of the Fair Trading Acts or Australian Consumer Law.

Companies like Publicity Monster can get away with promising the world because unfair contract provisions which apply to contracts between businesses and consumers don’t provide any protection in this sort of situation.

Small Business Minister Bruce Billson is currently looking into the terms of reference for a review of competition law which will consider expanding unfair contract protections.

The problem with such a review is that simply expanding consumer protections to business runs the risk of creating uncertainty in business transactions.

The other problem is that the whole review is progressing very slowly while so-called search engine optimisation “experts” target small businesses.

There’s no easy solution, but what’s clear is that the current laws leave small businesses exposed.

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Cara Waters

Cara Waters is the former editor of SmartCompany. Previously, Cara was a senior reporter for the Financial Times' website and she also worked for The Sunday Times in London.

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