A number of online retailers have been reported to the Australian Consumer and Competition Commission (ACCC) over their pricing policies and discounts being represented to consumers.
Jeweller has learned that the Jewellers Association of Australia (JAA) is working closely with the corporate watchdog to help clear confusion and stamp out illegal practice following the two-price advertising case against jewellery retailer Zamel’s.
In that case, Zamel’s was deemed to have made false or misleading representations in contravention of the Trade Practices Act by its use of two-price advertising in catalogues and an advertising flyer. As such, it was fined $250,000 and ordered to publish corrective notices.
Attention has now turned to websites, with JAA board member Colin Pocklington and chair of the Jewellery Industry Code of Practice, telling Jeweller that a large amount of work has been done between the JAA and the ACCC to clarify matters pertaining to Australian Consumer Law and clear up potentially misleading advertising.
The Federal Court decision against Zamel’s is said to be far reaching, and affects every sector of the retail industry. The Code aims to provide jewellery retailers with more detailed guidelines that will assist in complying with fair trading laws.
Many people in the jewellery industry have expressed concern that the ACCC has focused on traditional stores more vigorously than online retailers but Pocklington advised that internet traders would be held to the same standards as brick-and-mortar retailers.
“We’ve had a couple of complaints sent to us about online websites since December – some are Australian-based and some are international,” Pocklington explained.
“We’ve alerted the ACCC that we think that online traders are a major area of concern. A lot of the websites referred to the Code – if not all – appear not to be complying with the Code or even the law.”
The Code sets a conduct benchmark that is more stringent than the law and the JAA board approved an update last week following the Zamel’s case to reflect the areas of concern and provide a clearer framework for members and the wider jewellery industry.
“We have invited the websites that have been referred to us to substantiate the high prices they are advertising. Those that are not Code participants are not obliged to supply us [JAA] with any information; however, if they choose not to work with the Code, our only option is to refer it to the ACCC,” Pocklington said.
Fast tracking complaints
The JAA aims to work with the online retailers to educate them of their obligations under Australian Consumer Law, however should they not be receptive the ACCC has opened a direct avenue specifically for the JAA to refer complaints.
“The Code committee met with a senior representative at the ACCC who is the director for compliance strategies. He has agreed that the Code can refer complaints of a major issue directly to him,” Pocklington explained.
He confirmed that “major issues” included – but were not restricted to – websites that weren’t complying with the law and people who were discounting from valuations.
The processes are still new and will be monitored closely but Pocklington did note that there have been some positive responses.
“We have seen some changes already. There is one Australian-based website that we were alerted to in December. We made contact with them and they have made substantial improvements in respect to the information they give consumers; however, they still need to address a few little areas and so we have referred them to the ACCC.”
It will, understandably, be a work in progress and Pocklington said he expected more complaints in respect to websites in the immediate future.
“There are some international sites out there that actually don’t know about the Zamel’s decision and the local ramifications for two-price advertising,” he explained.
“In some cases, they are not even aware that they are breaking the law, they are simply using practices that may be fine in their local jurisdiction but are not acceptable in Australia.”
The ACCC confirmed that any website displayed in Australia does need to comply with Australian consumer laws, irrespective of where it is hosted or administered.
Code briefings
“We want to be sure other retailers can also find out exactly how the laws are now applied and we are inviting the industry participants attending the Gold Coast fair to attend the briefing to ensure they are aware that their advertising complies with the latest standards,” Pocklington said.
Jewellery retailers and suppliers who wish to attend the briefings should contact the JAA.
Background reading
Major jewellery chains to meet after Zamel’s case
Zamel’s Jewellers loses again