The Australian Competition and Consumer Commission (ACCC) has issued a stern warning to the caravan industry, emphasizing that the use of deceptive advertising representations is a breach of the Australian Consumer Law. Retailers found using misleading representations in their advertising could face rigorous enforcement action.
Misleading ‘Price Certainty’ Representations
One notable example that caught the ACCC’s attention involved ‘price certainty’ representations made by a small retailer. The retailer had informed multiple customers that the price of their ordered caravans was fixed. However, they subsequently attempted to increase the price, offering customers an alternative option to cancel the contract. This fixed price claim was made despite the retailer having the contractual authority to pass on manufacturers’ price increases.
Inaccurate Caravan Weight Representations
Another concern for the ACCC is allegedly false or misleading representations regarding caravan weights, which were not accurate. Misrepresentations of caravan weights can result in additional costs for consumers who may need a more powerful towing vehicle. Moreover, it poses a safety risk if they unknowingly exceed safe towing limits.
ACCC Investigations and Commitments from Retailers
The ACCC has conducted investigations into the practices of several caravan retailers. In response to these investigations, two smaller caravan retailers have committed to improving disclosures to consumers and ensuring compliance with the Australian Consumer Law.
Warning to Businesses
The ACCC has reminded businesses that they must not mislead consumers concerning prices or contractual terms related to pricing. Businesses must also provide accurate information about important product features, such as the weight of a caravan.
ACCC Commissioner Liza Carver stated, “We are concerned that several small and mid-sized caravan retailers may be failing to comply with their obligations under the Australian Consumer Law, and we will continue to investigate complaints and engage with retailers and caravan manufacturers to ensure compliance.”
Ms. Carver emphasized that businesses of all sizes must understand that they have the same obligations to consumers under the Australian Consumer Law as large retailers.
ACCC’s Caravan Retailing Report
The ACCC’s actions follow issues related to consumer treatment and compliance with consumer law identified in its New Caravan Retailing report, which was published in July 2022. The report highlighted key concerns in the new caravan market and provided guidance to businesses regarding their obligations under the Australian Consumer Law.
Consumer and Supplier Surveys
In November 2021, the ACCC conducted two surveys targeting consumers and suppliers to gain a better understanding of issues in the new caravan retailing market. The ACCC received 2,270 relevant consumer responses and 67 supplier responses. Direct discussions with consumers, suppliers, industry associations, and industry forums also provided valuable feedback.
Advocating for Amendments to Consumer Law
In December 2021, the ACCC submitted a proposal to the Treasury’s Consultation Regulatory Impact Statement (CRIS) advocating for amendments to the Australian Consumer Law. These amendments would introduce prohibitions related to failures to provide remedies, manufacturers’ indemnification of suppliers, and retribution by manufacturers against suppliers seeking indemnification.
