Freight giant Mayne Nickless has admitted that it misled some of its customers over its air freight business following an investigation by the Australian Competition and Consumer Commission.

The company has admitted in the Federal Court that it represented to some customers of IPEC Air Express (now known as Ipec Priority Express) that their goods would be transported by air when they were actually sent by road.

"The Court has granted two consent injunctions against Mayne Nickless," ACCC Chairman, Professor Allan Fels, said today. "One injunction restrains Mayne Nickless from breaching s.52 of the Trade Practices Act, by representing that goods of Ipec Priority Express customers will be flown, when in fact they will be transported by road. Section 52 prohibits conduct which is misleading or deceptive or which is likely to mislead or deceive. The other injunction restrains similar conduct in relation to advertisements and promotional material.

"The Court also noted that Mayne Nickless has given the ACCC an enforceable undertaking under which it will:

send letters to relevant customers who used the Ipec Priority Express service during the 12 months to June 1996, offering $50 refunds or credits, explaining the offer arrangements and apologising to those customers;

publish notices in newspapers, advising of the conduct, apologising for it, and providing a contact line for queries; and

develop compliance training and educational activities to minimise the risk of future breaches of the Trade Practices Act.

"Ipec has already begun removing references to 'Air' from its vehicles, buildings, stationery, freight satchels, brochures, rate schedules, uniforms etc," Professor Fels said. "The ACCC was impressed by the cooperation shown by Mayne Nickless which acknowledged its conduct must change and also suggested the refund offer to its customers.

"The ACCC recognises that big corporations often have favourable contracts for freight delivery. It was concerned, however, that occasional customers of Ipec Air Express, such as small businesses and private citizens, may have paid a premium for air delivery which never happened. The compensation arrangements favour these consumers. Ipec advises that it will continue to transport express freight by road, especially on east coast routes, but in future customers will not be led to believe it is being flown.

"The ACCC is investigating allegations of similar conduct throughout the industry and expects reform within months."

Mayne Nickless was ordered to pay the ACCC's legal and investigations costs.