LivingSocial Provides Undertaking for Misleading and Deceptive Behaviour
Wednesday 4 February 2015 @ 12.02 p.m. | Trade & Commerce
Online buying website LivingSocial has submitted a court enforceable undertaking which the Australian Consumer and Competition Commission (ACCC) have accepted. The undertaking came amidst concerns from the ACCC that LivingSocial had engaged in misleading and deceptive conduct about consumer rights during 2011 and 2012.
Background
LivingSocial is an online group buying site which commenced operation in Australia in 2010. A significant number of complaints have been received by the ACCC and other Australian Consumer Law (ACL) regulators since the online group buying industry emerged in Australia in 2010, and the ACCC and other ACL regulators have worked to improve practices in the industry.
The ACCC said, in its view, LivingSocial engaged in misleading and deceptive conduct on its website about consumers' refund rights. It is believed that LivingSocial had at times made false presentations about the price of certain deals.
It is also alleged by the ACCC that LivingSocial’s terms and conditions contained a term that permitted LivingSocial to make substantive changes to its terms and conditions without notifying its consumers or voucher purchasers. In the ACCC’s view, this was an unfair contract term.
The Undertaking
LivingSocial has acknowledged that its previous representations may have been in breach of the ACL. In the undertaking accepted by the ACCC, LivingSocial has undertaken that it will:
- not make false or misleading representations with respect to price, or rights, remedies or guarantees, including consumer guarantees under the ACL;
- give voucher purchasers refunds in all circumstances where they are entitled to a refund in accordance with LivingSocial’s terms and conditions and/or the consumer guarantee provisions of the ACL;
- display prices of deals inclusive of all mandatory additional fees except for delivery fees, the minimum charge for which will otherwise be specified if known at the time of publication;
- use only comparison pricing statements that are not misleading in representing the savings that could be achieved
- send emails to all LivingSocial subscribers when substantive updates are made to its terms and conditions;
- send an email to all LivingSocial subscribers containing a corrective notice; and
- develop and implement a compliance program.
ACCC chairman Rod Sims said in a statement:
"Businesses selling to consumers online have the same obligations under the Australian Consumer Law as all other businesses, and consumer guarantees, including refund rights, apply when consumers purchase online…Online businesses must ensure that they do not mislead consumers about their consumer guarantee rights, and that the price and any restrictions on a deal being offered are clearly and accurately stated."
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