GM Holden Ltd - s.87B undertaking

The Australian Competition and Consumer Commission (ACCC) has accepted a court enforceable undertaking from GM Holden Ltd ACN 006 893 232 (Holden) in relation to alleged misrepresentations to consumers and Holden dealers about their rights and obligations under the consumer guarantee provisions of the Australian Consumer Law (ACL).

Holden designs, manufactures and distributes motor vehicles in Australia through its network of authorised dealers.

The ACCC was concerned that Holden:

• misrepresented to consumers about their entitlements to remedies under the consumer guarantees in circumstances where Holden’s manufacturer’s warranty did not apply or provided for a remedy that was less extensive than that provided by the consumer guarantees
• misrepresented to its dealers that Holden had discretion to determine whether a remedy would be granted after the expiration of the manufacturer’s warranty, and  whether Holden would indemnify dealers for providing remedies to consumers for faults.

The ACCC considered that this conduct was likely to contravene sections 18 and 29(m) of the ACL.

The ACCC has accepted a section 87B undertaking from Holden in which, until 31 December 2020, Holden will:

• refrain from making representations of the kind investigated by the ACCC;
• upgrade its consumer law compliance program, including by engaging an independent third party to conduct an external review;
• upgrade its complaints handling system;
• reiterate to all Holden staff and Holden dealers that they are required to comply with the ACL and require them to undertake training;
• publish on its website a customer service charter;
• notify all new customers by letter of their statutory consumer guarantee rights;
• provide consumers with the ability to obtain information about any issues with their vehicle by contacting Holden and providing their vehicle identification number;  
• amend its dealer policies and procedures to ensure they comply with the ACL;
• appoint a compliance officer to monitor the implementation of the consumer law compliance program and complaints handling system and conduct annual external reviews of these programs;
• undertake a mystery shopping program;
• engage an external reviewer to conduct a review of past complaints since 1 January 2016, and where appropriate provide a remedy; and
• implement a policy whereby a consumer is entitled to a remedy if they experience a defect within 60 days of purchasing their new vehicle that causes it to become immobile and no longer driveable.

On 20 December 2017 the ACCC agreed to Holden amending the 60 day policy to clarify that the policy does not apply where the customer causes damage to the vehicle or the customer has acquired the vehicle for the purpose of re-supply.