Business Law

The laws against multiple pricing in Australia

Published in: August 2017

When goods are displayed with one price, and the goods supplied are for a price that isn’t the lower price, or not the lowest, or of the displayed price, this practice is referred to as multiple pricing. Section 47(1) of the Australian Consumer Law (ACL) prohibits a person in trade or commerce to supply goods:

  • if the goods have more than one displayed price;
  • supply takes place for a price that is not the lower or lowest of the price displayed.

Section 47(2) of the ACL defines displayed price in the following manner:

 (2)  A displayed price for goods is a price for the goods, or any representation that may reasonably be inferred to be a representation of a price for the goods:

                     (a)  that is annexed or affixed to, or is written, printed, stamped or located on, or otherwise applied to, the goods or any covering, label, reel or thing used in connection with the goods; or

                     (b)  that is used in connection with the goods or anything on which the goods are mounted for display or exposed for supply; or

                     (c)  that is determined on the basis of anything encoded on or in relation to the goods; or

                     (d)  that is published in relation to the goods in a catalogue available to the public if:

                              (i)  a time is specified in the catalogue as the time after which the goods will not be sold at that price and that time has not passed; or

                             (ii)  in any other case--the catalogue may reasonably be regarded as not out-of-date; or

                     (e)  that is in any other way represented in a manner from which it may reasonably be inferred that the price or representation is applicable to the goods;

and includes such a price or representation that is partly obscured by another such price or representation that is written, stamped or located partly over that price or representation.

Section 47(4) sets out the definition of when a price or representation is not the displayed price, and is as follows:

 (4)  Despite subsection (2), a price or representation is not a displayed price for goods if:

                     (a)  the price or representation is wholly obscured by another such price or representation that is written, stamped or located wholly over that price or representation; or

                     (b)  the price or representation:

                              (i)  is expressed as a price per unit of mass, volume, length or other unit of measure; and

                             (ii)  is presented as an alternative means of expressing the price for supply of the goods that is a displayed price for the goods; or

                     (c)  the price or representation is expressed as an amount in a currency other than Australian currency; or

                     (d)  the price or representation is expressed in a way that is unlikely to be interpreted as an amount of Australian currency.

Retraction of price

A person has the right to withdraw an item from sale in the event of a pricing error, or alternatively, retract a price. However, the retraction of a pricing error in advertising or a catalogue, the publication of the retraction must be equivalent to the original catalogue or advertisement where the pricing error occurred, as outlined in s 47(5) of the ACL.

Enforcement and penalties

Any person found to have contravened s 47(1) of the ACL may be liable to pay a civil pecuniary penalty of up to:

  • $1.1 million for a body corporate;
  • $220,000 for other persons.

The following enforcement powers and remedies for multiple pricing contraventions may be used for either a body corporate or other persons:

  • undertakings;
  • substantiation notices;
  • public warning notices;
  • infringement notices;
  • injunctions;
  • damages;
  • compensatory orders;
  • orders for non-party consumers;
  • non-punitive orders;
  • adverse publicity orders;
  • orders disqualifying an individual from managing corporations;
  • orders for the preservation of property.

Criminal liabilities

Section 165 of the ACL sets out multiple pricing offences that are the same as the civil pecuniary penalties. Additionally, a body corporate or other persons committing an offence against s 165 is one of strict liability. Therefore, intent is not a consideration for a person committing the offence.

We can turn to the Secondary Explanatory Memorandum for more context in relation to the offence:

“The strict liability nature of the offence reflects the potential for widespread detriment, both financially for individual consumers and for its effect on the market and consumer confidence more generally, that can be caused by a person that breaches this provision, whether or not he or she intended to engage in the contravention.

Defences against criminal proceedings

Part 4-6 of the ACL provides defences for criminal proceedings, and are as follows:

  • reasonable mistake of fact;
  • an act or default of another person where the defendant can prove that the contravention was due to the act or default of another person, to an accident or to some other cause beyond the defendant’s control, and the defendant took reasonable precautions, and exercised due diligence to avoid the contravention;
  • where an advertiser publishes an advertisement in the ordinary course of business and the defendant did not know, and had no reason to suspect that the publication would amount to a contravention of the provision. 

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