As new businesses develop and technology advances some
principles still remain the same.
Recently a digital advertising agency was prosecuted by the
Australian Competition and Consumer Commission in relation to the
supply or possible supply of its advertising services. The
advertising was to be done by way of digital displays at various
In May this year, Multimedia International Services Pty Ltd was
fined $230,000 for conduct considered by the Federal Court to be
unconscionable. In that case representatives of Multimedia had:
entered into a contract and a direct debit authority with a
customer on the basis that certain advertising would be shown on a
digital display board at a newsagency in Westfield Hornsby;
failed to draw the customers attention to terms precluding
cancellation of the contract;
debiting over $1,000 from the bank account while not providing
any services at all; and
continuing to accumulate debts and using debt collectors
threatening action and adverse credit ratings to seek to collect an
No service had ever been provided, and indeed it was not able to
be provided for at least seven months after the promised start date
because the digital screen had not been installed.
Another of their customers was promised advertising at another
centre. When the centre confirmed that it would not be hosting such
advertising screens, the customer was advised that they would not
able to get out of the contract and money was taken from the credit
card for the subsequent three months on the basis of multimedia had
unilaterally decided to display the advertisement at an inferior
Conduct of employees
When these matters were drawn to the attention of senior
Multimedia management steps were undertaken to deal with the
conduct of the relevant sales representative and complaints
officers. Substantial steps had already been taken by Multimedia in
relation to trade practices and consumer training, and after the
matter drawn to their attention further programs were put in place
to prevent this type of conduct by its sales agents and complaints
handlers. They cooperated materially in relation to the
Having basically conceded their improper conduct, the principal
issue of concern was the level of penalty to be applied.
Notwithstanding their cooperation, the ACCC sought penalties of
$355,000. Multimedia asserted that $85,000 was more appropriate. In
light of all matters the appropriate penalty was declared to be
The case is a reminder for all businesses to monitor their
employees and ensure that there is ongoing training in relation to
competition and consumer law. In this case the company's
existing training efforts, and their response to the claim, made a
material difference to the penalty ordered.
If such training is required do not hesitate to
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.
To print this article, all you need is to be registered on Mondaq.com.
Click to Login as an existing user or Register so you can print this article.
Businesses should ensure that any promotions do not cross a 'fine line' between acceptable and misleading or deceptive.
Some comments from our readers… “The articles are extremely timely and highly applicable” “I often find critical information not available elsewhere” “As in-house counsel, Mondaq’s service is of great value”
Register for Access and our Free Biweekly Alert for
This service is completely free. Access 250,000 archived articles from 100+ countries and get a personalised email twice a week covering developments (and yes, our lawyers like to think you’ve read our Disclaimer).