With the speed and growth of internet businesses, legislation is scrambling to keep up.
Last year the focus was on privacy and this will be under ongoing scrutiny for reform. This year the ACCC is again looking at consumer protection priorities for 2014.
The new priorities:
1. Telecommunications and energy: The focus is on unlawful door-to-door sales of ‘discounted’ energy and telecommunications plans. There have been too many court cases of no actual discounts once the customers have taken up the plans and unclear actual pricing on bundled plans.
2. Drip pricing: Drip pricing deals usually involve the incremental disclosure of fees when you are making an online booking. This was the recent focus on airline flight bookings that did not always include all taxes and upfront fees in the advertised price. You didn’t find out the actual price until you went to make the final payment at the checkout.
3. Comparator websites: Comparator websites, on the other hand compare similar or identical consumer goods and services from different suppliers to enable consumer to purchase at cheaper rates. They do include the full pricing in most cases, but many of these comparisons are not actual ‘like for like’ products and services and are not clear on this, so many consumers are being misled.
Continuing focus on:
1. Product safety: In particular, safety and standards for low cost imported goods.
2. Consumer guarantees and warranties: Focus on further ensuring consumers are not misled, particularly where they are offered additional paid warranties which are actually already available to them under the law.
3. Identifying and exposing scams: Making consumers aware of scams before consumers get caught. There is a particular focus on businesses who have raised prices in anticipation of the carbon tax, given its upcoming abolition, and have not altered them.
4. Enforcement of unfair contract provisions: The ACCC is now considering taking enforcement action on unfair contract provisions rather than just identification and issuing compliance notices as they did previously.
What do you need to do as a business owner?
- If you own or run a comparative website, you need to ensure that you are providing clear accurate and full information that gives a true ‘like for like’ comparison to ensure consumers are not mislead.
- If you import cheap goods, ensure they meet Australian safety regulations and standards, otherwise you may be asked to recall your products.
- If you are involved in selling directly or indirectly, any telco or energy products or services, you need to review your sales and advertising to ensure you meet the required legal obligations, particularly when describing how any product or service is discounted.
- Make sure your product or service terms and documentation complies with the consumer guarantee requirements regarding rights to repairs, replacements and refunds.
- Check your contract and consumer terms and conditions to ensure they are fair and not one-sided.
It’s a continuing necessity for business owners to keep up with the new requirements particularly if your business is mainly on-line. Regulation will only grow in this area, so it’s better to be on top of it before it hits and affects your business.