The Federal Court, Perth has made orders and noted undertakings designed to stop the issuing of Government Purchasing and Tender Index forms to small businesses prior to a further court hearing.
The orders follow the institution of court action by the Australian Competition and Consumer Commission against the Australian Purchasing and Tender Service Pty Ltd, the promoter of GPTI. The individuals believed to be the promoters of GPTI were also joined to this action.
The ACCC has alleged that in August and September 1997, APTS trading under the title Government Purchasing and Tender Index distributed forms to small businesses throughout Australia.
These forms, under the title of GPTI, invited applications from small businesses to be entered on an index which was purported to be distributed to Government Departments for reference.
The GPTI form was sent to small businesses in an envelope bearing the letters OHMS which the ACCC claims may have created an impression that the GPTI form was an official Government form.
Further, the ACCC alleges that the GPTI form was styled in a manner which presented an official flavour similar to government forms.
The ACCC has alleged that in distributing the GPTI form and envelope, APTS has made false or misleading representations in breach of the Trade Practices Act 1974. The ACCC has alleged that these misrepresentations include that:
GPTI was a government body or was affiliated with a government, whereas it was not; the small businesses receiving the GPTI form were required by law to register with GPTI, whereas there is no such requirement; and the small businesses would only be able to supply products or services to government departments or other government bodies if registered with GPTI.
Justice Lee commented that he believed there was a case to be heard and as such noted the undertakings provided by APTS that it would cease to distribute the said forms or any substantially similar form prior to the next hearing.
Justice Lee also made orders against the company which will provide the ACCC with information of the number of small businesses who had responded to the GPTI form and a full account of the revenue derived from the scheme to date.
The orders made by the Court also prevent the disbursement of any funds received after 9 October 1997 by GPTI in response to the GPTI forms without prior notice being given to the ACCC.
The matter is set down for further hearing on Thursday 23 October 1997. The ACCC will be seeking further orders including:
- declarations that the in distributing the GPTI form and envelope, APTS has contravened the Act;
- injunctions restraining APTS and its promoters from promoting any register, directory or index by making the representations complained of;
- injunctions restraining APTS and its promoters from promoting any register directory or index;
- orders for corrective newspaper advertising as well as corrective letters to all recipients of the GPTI form and to those who have paid monies to APTS; orders for refunds; and
- costs.
This action follows previous ACCC action against the promoters of small business registers and also serves as a timely reminder to small businesses to be wary of schemes seeking their entry onto directories or registers, ACCC Chairman, Professor Allan Fels, said today. 'Small businesses should be sure who they are dealing with and the nature of the services they are paying for.
For further information about this media release: Professor Allan Fels, Chairman (03) 9290 1812 Ms Lin Enright, Director, Public Relations (02) 6264 2808