Business Pages Pty Ltd corrects misleading application form
As part of court-enforceable undertakings accepted by the Australian Competition and Consumer Commission, Business Pages Pty Ltd will correct its application form and offer refunds to businesses that may have been misled about the cost of a standard listing in its online directory.
Business Pages Pty Ltd widely circulated an application form to Australian businesses inviting them to take out a listing in its online business directory. The form provided a number of 'tick the box' listing options in addition to the standard listing. A price was detailed for each of the additional options (ranging from $49 to $199), however, no price was specified beside the standard listing.
"The ACCC believes that a person reading the form might conclude there was no charge for a standard listing", ACCC Chairman, Mr Graeme Samuel, said.
"The cost of the standard listing was embedded in the fine print of the application and, in the ACCC's opinion, was not sufficiently drawn to the attention of the reader. The cost of the standard listing was in fact $1449 per year for a minimum of two years.
"After analysing the content and the layout of the form, the ACCC raised concern that the conduct of Business Pages Pty Ltd was likely to contravene sections 52, 53(e) and 53C of the Trade Practices Act 1974. These provisions prohibit a company from:
engaging in misleading or deceptive conduct or conduct that is likely to mislead or deceive
making a false or misleading representation with respect to the price of goods or services, and
representing a price that is less than the total cash price for the goods or services.
"All consumers, individuals or businesses, need to be informed in a clear and transparent manner about the cost of services and goods being offered", Mr Samuel said. "It is unacceptable for costs to be concealed in fine print, obscured or not be readily apparent. Knowing the cost of doing business is a fundamental consumer right".
In providing court-enforceable undertakings, Business Pages Pty Ltd and its director have agreed to:
not use the application form, or a similarly laid out form, which fails to disclose prominently, and in close proximity to the service being offered, the full cost of that service to obtain customers, for any online directory services they offer
ensure any solicitations about the provision of any such online directory services disclose both prominently and in close proximity to the services being offered the full cost of that service
send to any business which has returned a signed application form a letter detailing the concerns of the ACCC that businesses who signed the form may have been misled as to the cost of the standard listing service and advising that businesses who wish to receive the service will be required to make a positive election in writing to do so
refund or return any monies it has received from any business which has:
(i) returned a signed application for registration form
(ii) made any payment in respect of that application
(iii) notified Business Pages that it does not wish to continue with the service, or
(iv) not notified Business Pages within thirty days of receipt of the letter of its intention to take up a standard listing in the Business Pages online directory
within three months of the acceptance of the undertaking implementing a trade practices law compliance program.
"This undertaking enables businesses which signed the application form, as a result of being misled about the full cost of the standard listing, to now make an informed decision about whether or not to take up a standard listing", Mr Samuel said.
"Before taking up an offer for goods or services businesses should carefully consider all the terms of the agreement (not just the cost), including the duration of the agreement and rights of renewal.
"In this case, there was a clause in the terms and conditions which sought to preclude cancellation of the agreement during the subscription period and provide for automatic renewal of the subscription period unless written notice had been given by the client business", Mr Samuel said.
