On 21 May 2012, Federal Labor MP, Steve Georganas introduced a private member's bill in the lower house, which would establish a Do Not Knock Register (the Register). The Do Not Knock Register Bill 2012 (the Bill) is intended to prohibit salespeople from making marketing visits to residential and government addresses listed on the Register.
The introduction of the Bill is the latest development in a series of actions targeting door-to-door sales tactics. As discussed in our recent Focus Papers, the ACCC has already taken enforcement action against companies that used door-to-door sales strategies on two separate occasions in 2011 and earlier this year. In the first instance, the ACCC issued infringement notices against Advance Lifestyle International Retail Pty Ltd, a door-to-door sales company.1 Then on 27 March 2012, the ACCC filed two separate proceedings in the Federal Court against three energy retailers and their marketing companies for their door-to-door sales practices.2
The Bill and the recent ACCC enforcement actions illustrate an increased emphasis on targeting companies that make unsolicited visits to residential homes. Clearly, the objective of the Bill is to scrutinise door-to-door sales companies more closely and to impose further legal obligations on these companies.
Background
Mr Georganas has indicated that the Bill has resulted from complaints made by constituents in his electorate of Hindmarsh, who felt pressure to sign unsolicited consumer agreements (UCAs) presented by door-to-door salespeople.
The Bill is based on the existing Do Not Call Register, which was established in 2006. Mr Georganas views the Register as a natural follow on from the introduction of the Do Not Call Register. It is proposed that the Bill will complement the provisions under Australian Consumer Law (ACL) that regulate unsolicited door-to-door selling. This would result in a dual regime of regulation for door-to-door sales companies.
Relationship with Do Not Knock Stickers
Mr Georganas believes that there is uncertainty as to whether the Do Not Knock stickers that some people put on their doors to discourage sales people are legally enforceable.3 As such, the Register is intended to provide clarity on the law and allow consumers to opt out of marketing visits to their home. This contrasts with the ACCC's arguments in the proceedings against three energy retailers, as discussed above. In the proceedings, the ACCC will argue that the Do Not Knock notices attached to consumers' front doors constitute a request for salespeople to leave under the UCA provisions of ACL.
Proposed Law
Key features of the Bill include:
- setting up a Register to allow individuals to opt out of receiving unsolicited marketing calls to residential and government addresses. The opt-out addresses will remain on the Register for three years when the listing on the Register can be renewed;
- prohibiting the making of unsolicited marketing visits to an address listed on the Register;
- remedies for breaches of the Bill, including infringement notices, civil penalties and injunctions; and
- permitting 'designated marketing calls' from certain public interest organisations and individuals, including government bodies, charities, religious organisations, politicians and political candidates.
The Bill allows any person to make complaints to the Registrar about a contravention of the provisions of the Bill. The Registrar may institute proceedings for civil penalties and injunctions in the Federal Court or the Federal Magistrates Court. Importantly, the Bill provides for penalties of up to $1.1 million for salespeople and companies who visit an address listed on the Register.4
It is uncertain which Australian Government department would administer the Register if the Bill is enacted. At present, the Bill only describes the Registrar as an employee of the Australian Public Service appointed by the Minister. The Bill does not define 'Minister'.
Implications
If the Bill becomes law, there will be profound ramifications for companies that use door-to-door sales practices. For door-to-door sales people and the companies they represent, there will be further legal obligations imposed on the manner in which marketing visits must be made. Specifically, door-to-door salespeople/companies will be obliged to check the status of a residence before their salespeople can enter the property. They will also be required to continuously and consistently monitor the Register for details of new addresses that have been entered. These obligations will be in addition to the UCA provisions already in place under the ACL.
This dual regime of regulation would place further restrictions on door-to-door sales practices. Companies that utilise door-to-door selling techniques would need to take greater care to ensure that their staff are fully compliant with each element of the dual regime. There may also be increased compliance costs in making sure that the provisions under the Bill and the ACL are not breached. Energy and telecommunications companies and their marketing associates would likely be hit hardest if the Bill is enacted as both rely heavily on door-to-door selling techniques.
It is uncertain, at this stage, whether the Bill will be passed. However, Mr Georganas has stated that recent research by the Consumer Action Law Centre found that 85 per cent of respondents were in favour of a do-not-knock register.
Addisons will continue to closely monitor the progress of the Bill and provide updates on significant developments.
Footnotes
1
Knock, knock. Who's there? - ACCC imposes infringement notices
and accepts undertaking from a door-to-door sales company in
respect of misleading representations made during in-home
presentations
2
Australian Competition & Consumer Commission –
Australian Consumer Law – Unsolicited Consumer Agreements
– Door-to-Door Sales – Energy Retailers
– Do Not Knock – Reminder for Direct Selling
Industry
3
http://www.abc.net.au/news/2012-03-21/do-not-knock-register-georganas/3903358.
Accessed on 28 May 2012.
4 Do Not Knock Register Bill 2012 (Cth),
s16(5).
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