Six West Australian Harvey Norman franchisees have each paid an infringement notice for advertising the Kodak 'Playsport' pocket video camera when they did not stock the camera.
The Australian Competition and Consumer Commission issued the infringement notices because it had reasonable grounds to believe the franchisees had engaged in bait advertising in contravention of section 56(2) of the Trade Practices Act 1974 by advertising the camera in a catalogue when they were unable to supply the product to consumers.
ACCC chairman Graeme Samuel said businesses have to be careful when advertising their products via catalogues.
"Promotional material must be accurate and there must be adequate stock of the advertised product to meet reasonable demand, otherwise businesses risk bait advertising which is illegal."
The six West Australian Harvey Norman franchisees which have each paid the infringement notice of $6,600 within the time allowed are:
- Armastore Pty Ltd, which operate the Harvey Norman Armadale computer franchise*
- Avitmont Pty Ltd, which operate the Harvey Norman Belmont computer franchise
- CW Superstore Pty Ltd, which operate the Harvey Norman City West computer franchise
- Ellicom Pty Ltd , which operate the Harvey Norman Osborne Park computer franchise
- Mildlander Pty Ltd, which operate the Harvey Norman Midland computer franchise, and
- Kenstore Pty Ltd, which operate the Harvey Norman Port Kennedy computer franchise.
The iPad is here catalogue advertised the Kodak camera for $218 when these franchisees did not stock the camera to supply to consumers. The iPad is here catalogue was widely distributed in Perth in the 13 November 2010 edition of The Weekend West newspaper.
"Infringement notices increase the remedies available to the ACCC to quickly address this type of conduct and promote compliance with the law," Mr Samuel said.
Once an infringement notice penalty is paid, the ACCC cannot begin court proceedings over the alleged contravention. The payment of an infringement notice penalty is not an admission of a contravention of the Act. The ACCC can issue an infringement notice where it has reasonable grounds to believe a person has contravened certain consumer protection laws.
*Please note at Harvey Norman stores there are separate franchisees operating different business areas. For example there is a computer franchisee which operates that individual section of the store.