HomeEntrepreneurAdviceNot made in Oz: Brand damage over false claims

Not made in Oz: Brand damage over false claims

Happiness Road Investment Group Pty Ltd (trading as Koala Jack) learned its lesson the hard way after having its name dragged through the mud by the Australian Competition and Consumer Commission (ACCC).

Between 5 October 2012 and 14 October 2012 the Queensland-based online retailer prominently displayed the green and gold ‘Australian Made’ logo on its site, deliberately misleading customers about the origins of its products.

It was also found that Koala Jack had made other statements on the site that indicated to customers the boots were made locally – all of the boots were in fact manufactured in China.

The Australian Made Campaign Limited (who administers the use of the logo) and the Australian Sheepskin Association provided evidence to the ACCC which confirmed the suspicions.

ACCC Deputy Chair Dr Michael Schaper said false country of origin claims are taken very seriously by the regulator. Schaper said the ACCC closely monitors advertising of this nature to ensure compliance with the Australian Consumer Law. “Businesses need to be aware there are many others out there watching. The chance of being caught out is extremely high,” Dr Schaper said.

“The ACCC considers country of origin claims to be a particularly valuable marketing tool for businesses, as many consumers place a premium on goods that are Australian made,” Schaper said, adding: “This outcome serves as a timely reminder that the ACCC will not hesitate to take action against businesses which mislead consumers about the origin of the goods they are selling.”

As a result, Happiness Road will be monitored and required to:

  • refrain from engaging in the same or similar conduct in the future;
  • offer and pay refunds to consumers who were misled by its conduct; and
  • publish an Adword advertisement on Google which directs visitors to publications on the ACCC’s website regarding misleading claims and advertising.

The undertaking also requires Happiness Road’s sole director, Jason Rey, to undertake trade practices compliance training.

Stephanie Zillmanhttp://www.dynamicbusiness.com.au
Stephanie is the editor-at-large of Dynamic Business. Stephanie brings with her a passion for journalism, business, and new ideas. On her days off, you might find her reading a book on the beach.