Tropical Homes (Townsville) Pty Ltd - s.87B undertaking

In July 1999 Tropical Homes (Townsville) Pty Ltd caused two advertisements to be placed within the Townsville Bulletin on Saturday 24 July 1999 and Saturday 31 July 1999. The respective advertisements made the following representations:

"Beat the GST Offer! With new homes and land due to increase by up to 15%....", and "With prices predicted to rise up to 15% with the introduction of the GST..."

The ACCC formed the view that the representations contained within the advertisements represented that the price of new homes and land would rise by up to 15% once the GST was introduced, whereas the ACCC believes that the actual position would be that the introduction of the 10% GST and the removal of the wholesale tax on various inputs, would be likely to result in an increase in the price of new homes and land by less than 10%.

As such, the ACCC formed the view that Tropical Homes (Townsville) Pty Ltd may have engaged in misleading conduct in contravention of sections 52 and 53(e) of the Trade Practices Act 1974.

In the Undertaking, Tropical Homes (Townsville) Pty Ltd has:

• Provided Undertakings as to future conduct;
• Undertaken to publish a corrective advertisement;
• and Undertaken to institute a trade practices corporate compliance program.