Pandora Jewelry Pty Ltd, a wholesaler of charms, bracelets and matching jewellery throughout Australia and New Zealand, has entered into an administrative settlement with the Australian Competition and Consumer Commission about Pandora's pricing policy.
In early 2007 Pandora sent its retailers terms and conditions which included clauses requiring stock be sold at the recommended retail price and for prior, written approval for any discounting. Pandora also said stockists would not get product if they failed to adhere to the terms and conditions.
Section 48 of the Trade Practices Act 1974 prohibits a business refusing, or threatening to refuse, to supply retailers unless the retailers agree not to sell below a specified price.
"Resale price maintenance prevents price competition between traders, disadvantaging retailers and consumers," ACCC Chairman, Mr Graeme Samuel said today.
After ACCC contact, Pandora advised that the conduct was inadvertent and that it had taken steps to address it before the ACCC's intervention. A Pandora customer brought the matter to the ACCC's attention. Pandora then sent letters to customer retailers who had signed its terms and conditions revoking and/or altering the offending clauses.
"All businesses have obligations under the Act," Mr Samuel said. "When seeking legal advice on its activities, a business should expressly request an assessment of any proposed conduct/contractual terms with regard to trade practices issues."
Pandora co-operated with the ACCC and will:
write to sales representatives setting out the law in relation to resale price maintenance and outlining that such practices be avoided
discuss resale price maintenance issues at meetings with sales representatives, and
write a letter to its customer retailers informing them Pandora does not have a policy on discounting, and there is no obligation to follow the recommended retail price.
