While Tina Turner may have been able to get away with making this unequivocal representation, extreme care must be adopted when making claims and/or representations about either one’s own products or services or those of a competitor.
Both Consumer Affairs and the Australian Competition and Consumer Commission now have wide-ranging powers to compel both companies and business proprietors to produce documents substantiating claims or representations made by them to either promote their own goods or services or that are made in an attempt to distinguish their goods or services from those sold or supplied by a competitor.
A number of our clients have recently been required to respond to notices issued by both Consumer Affairs Victoria and the Australian Competition and Consumer Commission in connection with claims made by them about their products and services and those of their competitors.
‘Death and taxes’ are the only absolutes
Care must be taken at all times when using terms or phrases that include ‘absolute terms’ such as, for example, ‘most efficient’, ‘fastest’, ‘cheapest on the market’, ‘endorsed by leading industry experts’.
Recently, Compare the Market Pty Ltd claimed in advertising earlier this year in which it claimed: ‘We now compare more health funds than any other website in Australia’ and ‘Compare more health funds than anywhere else’. The ACCC found that there were two other websites that compared more health insurance funds than Compare the Market Pty Ltd. Compare the Market Pty Ltd has paid a fixed penalty of $10,200 and withdrawn the marketing material.
Before any claims of this nature are made, it is imperative that these can be substantiated and that you have copies of or access to, the source documents which support the representations made.
Equally, it is critical that where testimonials are reproduced on your websites or marketing material that the names and contact details of those individuals having provided the testimonials are capable of being produced and provided to either Consumer Affairs or the Australian Competition and Consumer Commission if requested, in order for them to attempt to validate the testimonials provided.
While both Consumer Affairs Victoria and the Australian Competition and Consumer Commission have teams of ‘field officers’ that regularly review the websites and marketing collateral of businesses selling or providing consumer goods and services, equally, your competitors are actively reviewing your marketing material and will (based on actual evidence) report your conduct to both Consumer Affairs Victoria and the Australian Competition and Consumer Commission if they believe they can inflict some “pain and suffering” to competitors.
Before publishing material on your website or your marketing and trade collateral, it should be carefully reviewed to ensure that each of the representations contained in that material is not only accurate but can objectively be substantiated if required.
For more information, please contact either Jeremy Goldman, Principal Lawyer, on (03) 8600 8886 or email@example.com or Daniel Kovacs, Principal Lawyer, on (03) 8600 8859 or firstname.lastname@example.org should you wish to have any of your marketing and trade collateral reviewed from a consumer law compliance perspective.
Note: This update is a guide only and is not intended to constitute legal advice.