Parliament has abolished the Door to Door Sales Act and replaced
it with new provisions in the Fair Trading Act covering door to
door and telemarketing sales.
The new provisions cover uninvited direct sales where a supplier
approaches a consumer uninvited in their home or workplace or by
phone to try and sell them products or services and an agreement is
entered into for those products or services costing at least $100
(or where the price is uncertain). These changes come into effect
on 17 June 2014.
What is the purpose of the change?
The Door to Door Sales Act was enacted nearly 50 years ago and
did not properly deal with modern sales practices. Telemarketers
are now clearly covered by the new provisions and fines for
breaching the requirements are significantly higher to encourage
Rules for door to door and telemarketing
sales Disclosure requirements
Before the consumer signs the agreement, the salesperson must
verbally advise the consumer of their right to cancel the agreement
and how they can exercise that right.
The agreement must be written in plain language and contain
specified information including:
A clear description of the products or services; and
A summary of the consumer's right of cancellation; and
The supplier's name and contact details; and
The consumer's name and address; and
The total price payable for the products or services or the
method for calculating the price if it is not ascertainable at that
The date of the agreement.
The salesperson must give the consumer a copy of the agreement
when it is entered into or within five working days if the
agreement is made over the phone.
If the products or services are sold on credit and interest
charges or credit fees may apply or a security interest is taken
over the products, the disclosure and cancellation requirements
under the Credit Contracts and Consumer Finance Act will apply
The consumer can cancel the agreement within five working days
after receiving a copy of the agreement or at any time if the
supplier has not complied with the disclosure requirements.
If the consumer cancels the agreement, the supplier must:
Repay any money already paid by the consumer under the
Arrange to collect (or ask the consumer to return) any products
already supplied, at the supplier's expense;
If services supplied have altered or damaged the consumer's
property, reinstate the property if required by the consumer.
The supplier is not entitled to payment for services already
supplied prior to cancellation.
The supplier cannot enforce the agreement and require the
consumer to meet their payment obligations until the cancellation
period has expired and provided the consumer has not given notice
to cancel within that period.
After the cancellation period has expired the agreement can only
be enforced if the supplier has complied with the disclosure
The content of this article is intended to provide a general
guide to the subject matter. Specialist advice should be sought
about your specific circumstances.
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