Endorsement: With increasing advertising and marketing being done on social media and websites, endorsements have become more common. Paid endorsements are legal as long as the individual endorsing it discloses this fact. Otherwise it will become misleading or deceptive conduct.
Enforcement: Enforcement of laws regulating advertising and marketing about businesses and consumers are governed by the ACCC, which has the power to institute proceedings against businesses that are found to have contravened consumer law. See also “ACCC”.
Enforceable undertakings: This is a method the ACCC may use instead of formal proceedings against a business. These undertakings are public and not confidential. A business will have to agree and sign an undertaking which is enforceable by a court, generally about a contravention of consumer law. This could include undertakings relating to:
- Compensating consumers affected by the business’s conduct;
- Running corrective advertisements to correct any misleading conduct.
Erroneous assumption: Also known as a mistake, it is when one party enters a contract by an incorrect assumption. In contrast to misrepresentation, this usually refers to assumptions that a party has induced themselves and not by the other contracting party.
Exaggeration: This is often used by businesses in marketing campaigns. Exaggeration can be an exception to false or misleading conduct if it is exaggerated to the point that no reasonable person could take the claim seriously. For example, a restaurant claiming they make “the best pizza in the world” is not seen to be misleading. See also “puffery”.
Exclusion clauses: This is usually included in a contract to exclude liability for contractual breach. For example, a business may include in their contract an exclusion of vicarious liability for the actions of their employees, or to limit the compensation they will pay in the event of a breach. Note that there are statutory provisions that will limit these exclusion clauses, for example, the Australian Consumer Law explicitly provides that businesses cannot contract out of their consumer guarantees.
Fast-moving Consumer Goods (FMCG): This is the term given to consumer packaged goods that are sold quickly and usually at a low cost. For example, soft drinks and processed foods are FMCGs, whereas products such as kitchen appliances which are replaced every few years are not considered to be fast-moving.
Future matters: Under section 4 of the Australian Consumer Law, a business cannot make misleading representations on future matters. It will be considered misleading if:
- It is a representation about any future matter; and
- The person does not have reasonable grounds for making the representation.
Games of luck: For businesses, this is usually used in the context of trade promotion lotteries or online competitions where the competition is a game of luck – so the winner is chosen at random. There are certain State/Territory regulations surrounding trade promotion lotteries. See also “Lotteries”.
Games of skill: A game of skill refers to where the winner is determined by a skill shown in their submission. This should be understood as opposed to a game of luck.
See also “Games of luck” and “Lotteries”.
Geotargeting: This refers to a method of internet marketing where the location of a web visitor is determined, and different content is then delivered to that visitor. For example, some businesses will have different versions of their website that is specifically geared towards a country, and often it will ask a visitor to confirm their location the first time they visit the site to deliver the correct version.
Gruen Transfer: This is a technique used to influence consumers to make impulse buys. Supermarkets use this constantly by placing products in particular areas so that consumers often leave with more purchases than originally planned.
Guarantees: Consumer guarantees are mandatory under the Australian Consumer Law. This includes guarantees relating to:
- Acceptable quality
- Description of goods must match
- Sample of goods must match
- Repairs and spare parts
- Reasonable time for supply of services
Under the Australian Consumer Law, these guarantees cannot be contracted out of by the business.
Half-truths: These are statements that contain some element of truth but are deceptive in nature. They can be considered misleading and deceptive conduct if used by a business to draw consumers in. See also “misleading & deceptive conduct”.
Injunction: An injunction is an order made by a court which restrains a business from doing a certain act. A court can grant injunctions under section 232 for any conduct that contravenes Chapters 2, 3 and 4 of the Australian Consumer Law. This includes both consumer guarantees and misleading and deceptive conduct.
Innocent misrepresentation: Misrepresentation is not allowed by businesses under Australian law. However, a misrepresentation is considered innocent when the business truly believes that the statement they are making is true and has no intention to deceive the consumer. Innocent misrepresentation maybe used as a defence to misrepresentation.
Knowingly concerned: Under section 75B of the Competition and Consumer Act 2010, the term ‘knowingly concerned’ is a legal term that refers to individuals who have knowledge about a contravention of the Act. Individuals who are ‘knowingly concerned’ about a contravention will also be seen as having been involved in the contravention and may be held liable by the ACCC.
Labelling: There are various labelling requirements set by Australian law and regulations that businesses must follow. Under the Australian Consumer Law, labels cannot mislead or deceive consumers. If the good is a food product, there will be additional labelling laws under the Australia New Zealand Food Standards Code as well as the Imported Food Control Act 1992 for imported food. For all imported goods in general, there are further labelling requirements under the Commerce (Trade Descriptions) Act 1905 and the Commerce (Imports) Regulations 1940.
Landing page: Landing pages can be divided into two types, either “click through” pages or “lead generation” pages. The former encourages visitors to click to another page and take them one step closer to making a purchase while the latter is used to collect visitors’ data, including name and email address. The latter has a more direct effect as it allows the business to connect with the prospective ‘lead’ through their information at a later point in time.
Lay-by: Lay-by agreements allows a customer to purchase a product and pay for it in separate instalments, which includes any deposits paid. The goods are not received by the customer until the full price has been paid. The customer has the right to cancel the lay-by agreement before they receive the goods and the business can cancel the agreement if the customer fails to make payments.