London-based clothing manufacturer and retailer Charles Tyrwhitt LLP (Charles Tyrwhitt) has paid a $10,800 penalty after being issued with an infringement notice by the Australian Competition and Consumer Commission, following an investigation into the company’s ‘was/now’ pricing practices.
Charles Tyrwhitt advertises men’s and women’s shirts and other business clothing and accessories extensively to Australian consumers online and in catalogue and printed newspaper/magazine inserts distributed within Australia.
The ACCC issued the infringement notice because it had reasonable grounds to believe that Charles Tyrwhitt had made a false or misleading representation in relation to the ‘was’ price of a men’s ‘slim fit non-iron micro-spot white’ shirt in ‘was/now’ pricing on its website between February 2016 and March 2016, in contravention of the Australian Consumer Law.
The ACCC considered Charles Tyrwhitt’s ‘was/now’ price representation, with a ‘was’ price of $160 and a ‘now’ price of $69, falsely represented to consumers that by purchasing the shirt there would be a saving of the difference between the ‘was’ and ‘now’ prices when that was not the case because the shirt has not been genuinely offered for a reasonable period at the ‘was’ price. Charles Tyrwhitt had advertised the shirt at the ‘was’ price of $160 for a short period in a section of its website which was difficult to locate, and no consumer had ever purchased the shirt at the ‘was’ price.
“Comparative advertising can be a powerful marketing tool but it is essential that retailers ensure that any advertised savings are real, truthful and accurate,” ACCC Commissioner Sarah Court said.
“Was/now price representations are likely to be misleading if the products have not been sold at the 'was' price for a reasonable period immediately before the sale or ‘now’ price is offered.”
“The ACCC’s enforcement action against Charles Tyrwhitt also serves as a reminder to overseas businesses that if they supply products to Australian consumers, they must comply with the Australian Consumer Law,” Ms Court said.
The payment of a penalty following the issuing of an infringement notice is not an admission of a contravention of the Australian Consumer Law. The ACCC can issue an infringement notice where it has reasonable grounds to believe a person has contravened certain consumer protection laws.
Further information about two-price comparative advertising can be found here: Displaying prices.