Electronics marketplace Reebelo has paid $59,400 under infringement notices for representations as to availability of consumer guarantees
Launched in Singapore and headquartered in California, Reebelo Australia (Reebelo) operates as an online marketplace for new and refurbished products including electronic products and home appliances. It acts an intermediary platform where third-party suppliers list products for sale on its website.
Reebelo was issued with three infringement notices by the ACCC (totalling $59,400) for alleged breaches of the ACL by falsely representing that a customer had only 14 days to receive a remedy for:
- faulty or damaged goods
- goods received that were not in a condition that matched the description of the purchased product and
- situations where customers had received a different model of a product than what they had ordered.
The ACL explicitly prohibits false or misleading representations concerning:
- the existence, exclusion or effect of any guarantee or remedy; or
- asserting a right to payment for a contractual right which is wholly or partly equivalent to a right customers have under a consumer guarantee.
As the ACCC Deputy Chair Catriona Lowe noted when announcing the infringement notices, a business cannot contract out of consumer guarantees. If a business fails to meet those guarantees, consumers have a right to a remedy if they return products that do not comply with consumer guarantees within a reasonable time, which may be more than 14 days. It is against the law for a business to mislead consumers about their right to a suitable remedy.
In particular, because the products available for sale on Reebelo are often refurbished high-end electronic products such as laptops or mobile phones, the ACCC was particularly concerned that consumers may have faced financial harm from Reebelo’s conduct.
These infringement notices were issued against the backdrop of the Treasury’s consultation last November on new prohibitions and penalties for failure to provide a consumer guarantee remedy.
In addition to penalties, Reebelo also committed to making amendments to its website, improvements to its online complaints handling processes, and various training and awareness measures to ensure future compliance with the ACL.
Key takeaways for businesses
To avoid breaches of the ACL and reputational damage, businesses should:
- (Ensure their representations on consumer guarantees are not misleading or deceptive): Under the ACL, consumers have basic rights, known as consumer guarantees, to expect certain things when they buy a product or a service. For example, they can expect that the product is of acceptable quality and that any description of a product by a business must be accurate. A supplier cannot make misleading or deceptive representations about the availability of consumer guarantees, such as representations concerning the existence or effect of any consumer guarantees or remedies. Such conduct can be conduct to significant penalties of up to the greater of $50 million, three times the benefit or 30% of a company’s turnover, per contravention. Businesses must avoid taking away or limiting these consumer guarantees, including not to place a time limit on a consumer’s ability to receive a remedy.
- (Consider whether they may meet the definition of ‘supplier’ under the ACL): The definition of supplier in the ACL is broad and can include anyone who ‘supplies goods by way of sale.’ Businesses should consider their role in the ordering, invoicing, fulfilment and customer services functions associated with sales of products carefully. However, any party (supplier or not) will commit an offence if they misrepresent a consumer’s rights under the ACL. Accordingly, all parties who have a role in the supply of consumer products need to be aware of the remedies available to consumers under the ACL to ensure they do not misrepresent them.
Image Credit: Shopping online with bank card by European Commission / Wikimedia Commons / Remixed to B&W and resized
