Kirin Direct Marketing Pty Ltd - s.87B undertaking

In May 2002 Kirin Direct Marketing Pty Ltd sent customers who had taken the model kit series Building the Bounty a letter indicating that if they did not wish to receive a new model kit series, Building the Cutty Sark, they should return the form opting out of the new series. The Commission received a complaint from a subscriber to the Building the Bounty series that he had received the first four instalments of the Building the Cutty Sark series and an invoice for the goods received but had not been sent the “opt out” form. 

By sending an invoice for the Building the Cutty Sark series with the first four instalments of the series Kirin Direct Marketing Pty Ltd was knowingly concerning in a demand for payment for unsolicited goods by a foreign corporation, Ediciones Del Prado SA, when it did not have reasonable grounds for believing it was entitled to payment, in contravention of section 64 of the Trade Practices Act 1974. 

Kirin Direct Marketing Pty Ltd has accepted that it was in breach of the Act. Accordingly, it has given the Commission section 87B undertakings in the following terms:

• not to engage in or be knowingly concerned in conduct which breaches section 64 of the Act;
• not send “opt out” letters to customers requiring them to advise the company that they do not wish to receive an item in order to avoid receiving it;
• implement a Trade Practices Compliance Program, in accordance with Australian Standard, AS-3806; and
• refund moneys paid by those customers who received and paid for the first four instalments of the Building the Cutty Sark series after not returning the “opt out” letter.