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Jewellers have to be wary of amendements concerning customer testimonials and lay-bys.
Jewellers have to be wary of amendements concerning customer testimonials and lay-bys.

Jewellers urged to note consumer laws shake-up

Jewellers are being urged to take note of new consumer laws that came into effect on January 1, as many may not realise the far-reaching implications of amendments concerning customer testimonials and lay-bys.
The changes are part of the new federal Competition and Consumer Act which replaces the Trade Practices Act. This new Act is applicable to all states as the new federal law replaced separate state laws that applied before January 1.

Under the new testimonials law, jewellers need to exercise caution when quoting customers who have given testimonials. “The onus is now on the [retailer] using the testimonial to provide evidence that is not false or misleading,” according to commercial litigation specialist Paul Hesse of Riordans Lawyers in Melbourne.

“If the retailer cannot provide sufficient evidence when the ACCC asks for it, the retailer has breached the new law,” Hesse added.
If a retailer breaches the new testimonial law, the penalty can be up to $1.1 million for a company and $220,000 for individuals.

The law applies to both retailers and suppliers.

In another change that will substantially affect jewellery retailers, there are now five key terms that stores must adhere to in relation to lay-bys:

  • A lay-by agreement must be in writing and a copy must be given to the consumer
  • A consumer may terminate a lay-by agreement at any time prior to delivery of goods
  • In event of the above, the consumer may have to pay a cancellation charge reflecting the business’s reasonable costs
  • A supplier may only terminate a lay-by agreement under specified circumstances before final payment is received
  • In the event of cancellation by either party, a consumer is entitled to a full refund but the consumer may have to pay a cancellation charge if he or she cancels it, depending on the business’s reasonable costs.
“Retailers will have to make sure their lay-by documents and practices comply with the new law because the penalties for breaching them are significant,” Hesse said.

The penalties for breaches can be up to $30,000 for a company retailer and $6,000 for an individual.

More reading:
New consumer laws to aid jewellers
Do jewellers really understand the Fair Work Act?

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