'Index' was likely to mislead small businesses

A small business register had made false and misleading claims about the necessity of registering with it, the Federal Court, Perth has found. The business, Australian Purchasing and Tender Service Pty Ltd, its director, Suzanne Johnston and another individual, Clinton Andela have been restrained from promoting similar registers. In its action, the Australian Competition and Consumer Commission alleged that in August and September 1997, the Government Purchasing and Tender Index distributed forms to small businesses throughout Australia.

The GPTI form was sent to small businesses in an envelope bearing the letters 'OHMS' which the ACCC claimed misled businesses that the GPTI form was an official Government form. Further, the ACCC alleged that the GPTI form was styled in a manner which presented an official flavour similar to government forms.

The Court found that in distributing the GPTI forms, APTS and its promoters had made false and misleading representations in breach of the Trade Practices Act 1974 that: GPTI was a government body or was affiliated with government, when it was not; the businesses receiving the GPTI form were required by law to register with GPTI, when there was no such requirement; and the businesses would only be able to supply products or services to government departments or other government bodies if registered with GPTI, when this was not the case.

Justice Lee made orders including declarations that APTS had contravened the Act and such contraventions involved Suzanne Johnston and Clinton Andela, injunctions preventing the Respondents from being involved in any form of register or list in the future and payment of the ACCC's costs in the matter.

Leave was also granted to the ACCC to seek further orders which might include requiring that Suzanne Johnston and Clinton Andela attend the Court for examination as to their financial capacity to make refunds. 'This action follows previous proceedings against similar types of small business registers,' ACCC Chairman, Professor Allan Fels said today.

'The result is a good one for small business who are continually the targets of unscrupulous promoters'.