Misleading and Deceptive Conduct
Friday, February 3rd, 2012
It’s difficult for entrepreneurs and small business owners to know where the legal line is in marketing. I really do get that – they’re desperate to make conversions and, along the way, there are probably going to be casualties.
The Limitations on Australian Companies
However, in the modern world everybody should be aware that companies do have limitations on the claims they can make and the manner of selling they undertake to snag new customers. In the modern world it’s not enough to be greedy in business… even if you’re successful. You are going to be held to account for your marketing integrity.
The limitations for an Australian company are spelled out in the Competition and Consumer Act 2010. Prior to 1 January, 2011 this piece of legislation was more widely known as the Trade Practices Act 1974.
Any Australian company should understand what constitutes misleading and deceptive conduct under this legislation. And they should realise that:
No matter how a business communicates with you—whether it is through packaging, advertising, logos, endorsements or sales pitch—you have the right to receive accurate and truthful messages about the goods and services that you buy.ACCC
Legislation that Protects Consumers
When defining what constitutes misleading and deceptive conduct in business the ACCC provides these statements:
There is a very broad provision in the Australian Consumer Law that prohibits conduct by a corporation that is misleading or deceptive, or would be likely to mislead or deceive you.
It makes no difference whether the business intended to mislead or deceive you—it is how the conduct of the business affected your thoughts and beliefs that matters.
If the overall impression left by an advertisement, promotion, quotation, statement or other representation made by a business creates a misleading impression in your mind—such as to the price, value or the quality of any goods and services—then the conduct is likely to breach the law.ACCC
