The Australian Competition and Consumer Commission has accepted a court enforceable undertaking from Retail Food Group, owner of Brumby's Bakeries Pty Ltd.
The undertaking relates to comments made by Brumby's to its franchisees suggesting that franchisees link retail price increases to the carbon price.
On 8 June 2012, the managing director of Brumby's distributed a newsletter to approximately 250 Brumby's franchisees which contained the following statement:
"... We are doing an RRP review at present which is projected to be in line with CPI, but take an opportunity to make some moves in June and July, let the Carbon tax take the blame, after all your costs will be going up due to it."
"The ACCC considers that Brumby's carbon price statement may have had the effect of inducing or encouraging Brumby's franchisees to make representations to retail customers linking product price increases to the carbon price without reasonable basis," ACCC chairman Rod Sims said.
"If businesses tell customers that prices have gone up due to the carbon price, or indeed for other reasons, their claims must be truthful and have a reasonable basis, or the business will face potential ACCC action," Mr Sims said.
Retail Food Group has taken a number of prompt actions to redress any impact of Brumby's statement. This includes writing to franchisees and outlining their legal obligations associated with price representations and the effect of the carbon price. Retail Food Group is also developing training for staff and franchisees with further guidance on their legal obligations.
Retail Food Group has cooperated with the ACCC and offered a court enforceable undertaking that neither Retail Food Group nor its subsidiaries, including Brumby's, will engage in similar conduct in the future.
Mr Sims said this outcome reflects the excellent cooperation we have had with the Retail Food Group.
"The ACCC seeks compliance with the law, not to necessarily impose penalties. Indeed most of the ACCC's effectiveness comes from steps that stop short of court action," Mr Sims said.
Earlier in July, the ACCC accepted an informal undertaking from Polaris Solar Pty Ltd and ACT Renewable Energy Pty Ltd for carbon price claims regarding the impact of the carbon price on household electricity prices that the ACCC considered were likely to mislead.
The ACCC has issued Carbon price claims - Guide for businesses which provides guidance to assist business in understanding their rights and obligations when making claims about the impact of the carbon price. The guide also gives practical guidance on specific issues experienced by small businesses and gives examples to illustrate how the guidance applies in practice.
Further information is available on the ACCC website. Complaints can be made on 1300 303 609 or online.
The undertaking will be available on the ACCC's public register at www.accc.gov.au.