Economy

Federal Court slams another case of misleading advertising

SmartCompany /

The ACCC’s crusade against misleading advertising claims continues, with the Federal Court finding Ray’s Outdoors (owned by private company Harbin) took part in misleading and deceptive conduct during the opening of a South Australian store.

The Australian Competition and Consumer Commission took action against the group when Ray’s Outdoors advertised a Rio Grand barbecue for $99 with a strike-through price of $299.99, suggesting a big discount.

But the Federal Court has found the advertisement misrepresented the product’s price immediately before sale, and that the price paid by customers before the sale was less than the strike-through price.

The court ordered a corrective advertisement to be published, and that Harbin should pay the ACCC’s court costs

ACCC chairman Graeme Samuel says businesses must be clear in product advertising about how much the consumer will save.

“Advertised discounts must be real and not illusory. It is also important that businesses put systems in place to ensure advertising is accurate before it is released,” he says.

“This decision highlights the need for businesses to have a current trade practices law compliance program in place and to continue to review its systems for placing advertising.”

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