The Australian Competition and Consumer Commission
(ACCC) has succeeded in its first claim pursuant
to section 29(1)(e) of the Australian Consumer Law
(ACL), which prohibits the making of false or
misleading representations purporting to be testimonials relating
to goods or services. This prohibition was introduced on 1 January
2011, and exposes companies to potential pecuniary penalties. In
ACCC v P&N Pty Ltd & Ors  FCA 6, three solar
panel suppliers who represented that written and video testimonials
published on their company websites and on YouTube were given by
customers, when in fact they were not genuine customers, were found
by the Federal Court of Australia to have contravened section
29(1)(e) of the ACL. This was also found to be misleading or
deceptive conduct, in contravention of section 18 of the ACL.
The three solar panel suppliers were also found to have
contravened section 29(1)(k) of the ACL, which prohibits the making
of false or misleading representations concerning the place of
origin of goods. The companies had represented to consumers through
the use of the words "Australian Solar Panel", including
in a trading name and logo, that the solar panels they were
promoting were made in Australia, when in fact they were made in
China. Those false or misleading representations were made in
various media, including television commercials, newspaper
advertisements and on their websites. Again, this was also found to
be misleading and deceptive conduct in contravention of section 18
of the ACL.
A director of two of the companies was found to have been
knowingly concerned in, or party to, their contraventions of the
ACL. The Federal Court made orders for the publication of
corrective notices, injunctions, and pecuniary penalties against
the three companies and director totalling $145,000. Our firm acted
for the ACCC in this proceeding.
This case serves as a timely reminder to businesses to ensure
that conduct relating to customer testimonials, reviews and
ratings, especially online and in social media, is not false,
misleading or deceptive.
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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