Over the past 6 months the ACCC has received over 1000 complaints or enquiries  relating to misleading advertising and false representations including claims that are made to improve the appeal of a product to consumers (“credence claims”).  Credence claims can include country of origin representations, “green” or environmental claims and representations that products are “organic” or “free range”.

The industries that the ACCC reports are generating a high number of complaints  include:

1. Advertising
2. Online retailers
3. Travel agencies
4. Telecommunications

The ACCC has been active in taking action against businesses that engage in misleading and deceptive conduct and has commenced court proceedings against a number of them, resulting in large payments by the infringers. Others have been issued with infringement notices and have paid fines for their allegedly misleading conduct.

All businesses, large and small, have responsibilities to consumers. To be penalised, they don’t have to have intentionally engaged in misleading conduct, and it’s not only their target audience that needs to be considered. I’ts also important to remember that often its a competitor that reports them to the authorities!

So how can a business avoid misleading consumers?

1. Look at what representations are being made. Representations can be a result of direct claims. They can also be made indirectly or be  implied, such as by pictures and logos.
2. Consider what idea consumers will take away from seeing or hearing the advertisement, statement, label etc. Its  not what you mean to say, but what the consumer hears.
3. Understand who in the business is making representations and where. Representations are not only made on labels or in ads. They are made by sales people, in emails and on the website to name a few places.
4. Make sure that anyone in the business who could be in a position to make representations to consumers has some training in trade practices and consumer protection so that they know what they can and can’t say and the legal ramifications to the business and themselves if they get it wrong.
5. Develop guidelines for developing and approving advertisements, websites, sales pitches and other communications with consumers.

These steps form part of a compliance programme. It will cost a company far less in money and time to develop a process before getting into trouble with the ACCC, than waiting until after complaints are made and pursued by the ACCC or the ACCC conducts its own  investigations.