The ACCC is warning the caravan industry that the use of misleading representations in advertising is in breach of the Australian Consumer Law and may result in strong enforcement action being taken against retailers.
The consumer watchdog says it recently identified an example involving ‘price certainty’ representations in which a small retailer told a number of customers that the price of the caravan they ordered was fixed, but subsequently sought to increase the price (while also giving the customer an alternative option to cancel the contract).
Another example of concern to the ACCC involved allegedly false or misleading representations regarding caravan weights, which were not thought to be accurate.
The warnings follow ACCC investigations into the practices of several caravan retailers, and commitments from two smaller caravan retailers to improve disclosures to consumers and compliance with the Australian Consumer Law.
“Businesses must not mislead consumers about prices or contractual terms relating to pricing,” ACCC Commissioner Liza Carver said. “Businesses must also ensure they do not mislead consumers about important features of a product, such as the weight, or tonnage, of a caravan.”
She said the ACCC was concerned that several small and mid-sized caravan retailers may be failing to comply with their obligations under the Australian Consumer Law, and said it would continue to investigate complaints and engage with retailers and caravan manufacturers to ensure compliance.
“It’s important that businesses of all sizes appreciate they have the same obligations to consumers under the Australian Consumer Law as large retailers,” she said.
The ACCC’s investigations follow issues in relation to the treatment of consumers and compliance with consumer law identified in the ACCC’s New caravan retailing report.
“Caravans are significant purchases for consumers and when things go wrong the harm can be significant,” Ms Carver said. “We received several complaints from consumers regarding caravans and carefully investigated the issues raised with us,”
The ACCC raised concerns with one smaller caravan retailer about price certainty representations, including where the price had subsequently been increased, and the retailer has now formally committed to not increase prices for relevant consumers.
The retailer has also removed these representations from its website and marketing materials, and committed to arrange training for its staff to improve compliance with the ACL.
The ACCC said it also engaged with another caravan retailer after concerns that the retailer was representing that the advertised weights of its caravans were the precise weights, when for some caravans they were only an estimated reference weight for similar caravans.
Misrepresentations of caravan weights can cause additional costs for consumers who may have to buy a more powerful towing vehicle, and may pose a safety risk if they unknowingly exceed safe towing limits.
The caravan retailer involved has committed to updating website material and developing improved guidance and processes to disclose key caravan weight information to consumers before sale, as well as providing options where actual caravan weights differ from caravan weight estimates.