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Cash back offer rules
About cash back offers
Cash back offers, also known as rebates, are a form of discounting. Instead of marking down product prices, the manufacturer or retailer offers to return some of the consumer’s money after purchase.
Cash back offers are usually made in advertisements or in-store promotions.
Conditions and limitations should be clear
Any conditions or limitations should be made clear to the consumer before the purchase. It’s against the law for a business to mislead or deceive consumers.
Consumers should read the terms and conditions
Consumers should read the terms and conditions of the offer carefully before deciding to buy the product.
Consumers should check:
- the expiry date of the offer
- waiting times for receiving the offer
- all the steps needed to get the offer.
Consumers should complete the cash back offer carefully
- make sure to complete the application carefully to meet all conditions of the offer. For example, the product serial numbers, bar code and a copy of the receipt may need to be included
- keep copies of all documents as evidence in case something goes wrong.
Example of consumers being misled
Certain cans of deodorant have a shrink-wrap packaging carrying the words ‘$3 Cash Back’.
The offer is limited to one can per customer. The offer expired a week earlier, but this information can only be seen in the fine print after the packaging is opened.
The packaging is misleading because the bold representation of the cash back offer was made without clear mention of the limitations.
Gifts and prizes rules
It's illegal for a business to offer a gift, prize or other free item to promote the sale of goods, services or land if:
- the business has no intention of providing it
- the business fails to provide it as offered
- it isn't provided within the time specified, or
- if no time is specified, within a reasonable time.
A business won't be breaking the law if the failure was due to something beyond its control.
The business and consumer can also agree to a replacement gift or prize.
It's illegal for a business to:
- offer a free gift without telling consumers that they must pay for the delivery of the gift
- tell consumers that if they buy certain goods they will win a prize when all they actually receive is the chance of winning the prize.