Jaggad Pty Ltd - s.87B undertaking

In October 2006, the ACCC raised concerns with Jaggad Pty Ltd (Jaggad) that some of its pricing terms in its Premium Dealer Agreements (PDA) may have amounted to resale price maintenance in contravention of section 48 of the Trade Practices Act 1974 (the Act).

Jaggad which is a manufacturer and wholesaler of Jaggad branded cycling, triathlon and multisport clothing (Jaggad Apparel) distributes Jaggad Apparel through selected independent cycling and sports fitness outlets nationally.

Jaggad, out of its approximate 220 distribution outlets, required 11 of its resellers identified as 'Premium Dealers' to sell Jaggad Apparel at the recommended retail prices set by Jaggad in its PDAs. Jaggad's Premium Dealers were also required to sell Jaggad Apparel during predetermined sales periods at the sales prices set by Jaggad (collectively identified as 'the Conduct').

Despute the Conduct spanning an approximate period from August 2004 until 21 November 2006, Jaggad had not taken enforcement action against any of its Premium Dealers where they sold Jaggad Apparel below the set price. Jaggad's other non-Premium Dealer resellers were also not subject to the specific pricing terms.

Jaggad removed the specific pricing terms in each PDA upon the ACCC raising its concerns and subsequently offered Undertakings pursuant to section 87B of the Act with the terms that Jaggad will:

• not enter into supply agreements containing one or more terms that sets a minimum price below which the goods cannot be sold or advertised
• not otherwise set a minimum price, or make a minimum price known to resellers, below which resellers must not sell or advertise the goods
• publish a public disclosure notice in the Bicycling Trade Magazine to promote general Trade Practices Act compliance
• send letters to its Premium Dealers and other Jaggar resellers advising of the ACCC's concerns and reseller's rights to sell stock at any price, and
• cause Jaggad's Director and National Sales and Marketing Manager to undertake Trade Practices training on Part IV of the Act.