Today, the Australian Competition and Consumer Commission obtained interim orders by consent against Advanced Medical Institute Pty Limited (administrators appointed) and AMI Australia Holdings Pty Ltd (administrators appointed) - collectively referred to as AMI.
In proceedings filed on Wednesday, the ACCC alleged that AMI failed to advise existing and potential clients that it is in administration, is insolvent and may not be able to provide goods and services after determination of the administration period.
The ACCC also claimed that AMI had wrongly accepted payments in advance for treatments when there is a real risk that AMI will not be able to continue to supply its treatments, and that clients will not receive refunds claimed by them, after the conclusion of its administration.
Today the ACCC obtained orders by consent that AMI will disclose to clients that:
- AMI is in administration
- AMI is, in the opinion of its administrators, insolvent, and
- there is a real risk that AMI will not be able to continue to supply its treatments to patients and that patients may not receive refunds claimed by them, after the conclusion of its Administration.
The orders also require that AMI:
- over the next two weeks inform all existing clients who entered into or renewed a contract with AMI between 22 December 2010 and today
- post a prominent notice on each webpage which it operates or controls,
- add to each of its contractual documents clear notice of their insolvency and its risks for delivery of goods or services.
In addition, AMI is not permitted to enter into agreement or take any payment for delivery of goods and services beyond the date of administration, which is currently 20 July 2011.
"In these circumstances, the ACCC considered it vital to ensure that potential customers of AMI were clearly informed about the situation the company is in before they bought into any agreements," ACCC chairman Graeme Samuel said.
"This case underlines the fact that companies under administration are not exempt from their obligations under the Competition and Consumer Act."
AMI was placed into administration on 22 December 2010, the day after the ACCC instituted proceedings alleging the companies had engaged in unconscionable conduct towards consumers. Those proceedings are separate and still on foot.