EXCLUSIVE: The Chairman of the Australian Competition and Consumer Commission has said that Australia does not need mandatory testing of appliances or consumer electronics goods following the recent exposure of LG Australia as a “serial liar” over the energy performance of several of their products.He has also warned both vendors and retailers that in the future they face fines of up to $1.1 million dollars for misleading consumers.
ACCC chairman Graeme Samuel said that Australia already has an excellent process for identifying offenders like LG.
“Firstly we have the vendors who are very quick to come to us re their competitors, then there is the consumers who often complain at a local fair trading level, then we have Choice who are an independent not for profit organisation who are constantly testing products in Australia”.
Samuel acknowledged that it was Choice who recently referred LG to the ACCC for investigation following the discovery that two LG refrigerators were being falsely marketed in Australia and that they did not meet the energy performance criteria specified in LG marketing.
“Nine times out of ten it is a competitor that identifies a problem. This was the case recently when we investigated LED TV sales in Australia. Vendors are doing this because they know it damages the reputation of the industry. We saw this last week with LG. I think LG would rather have headlines talking about the innovation in their products rather than a headline where they are accused of false representation. The vendors are very quick to come to us with complaints about their competitors”.
Samuels said that the ACCC constantly had to evaluate what a consumer was told by a retailer and that in the consumer electronics industry the constant launching of new products by vendors was causing a problem. He also said that going forward the ACCC will be armed with new penalties that could result in a retailer or a vendor being fined up to $1.1 million for a misleading or deceptive conduct offence.
“With smaller retailers the complaint is often dealt at a State Government fair trading level, the ACCC is concentrating more on the mass marketers who operate at a national level. What we now have is new consumer laws which will come into effective from April 14th, they then have to be a sanctioned by State Government and this is currently happening”he said
This means that effective from next year the ACCC will at long last have the capacity to extract fines of up to $1.1 million from Companies that engage in misleading conduct. This means that if a retailer misleads a consumer for example telling them a TV is Full HD when it is not or telling them that a TV is an LED TV when it is in fact a backlight LCD TV will result in them potentially being fined up to $1.1 million dollars.