AA Machinery Pty Ltd

The Australian Competition and Consumer Commission (ACCC) has accepted a court enforceable undertaking from AA Machinery Pty Ltd (trading as Agrison) and its sole Director, Mr Volkan (Nick) Yokus (Mr Yokus), in relation to representations concerning consumers’ rights under a warranty and the availability of after sales service and spare parts.

Agrison is a supplier of agriculture equipment to Australian consumers, including several models of Agrison branded tractors and wheel loaders.

The ACCC issued proceedings against Agrison on 2 September 2019 in the Federal Court of Australia. The ACCC and Agrison have agreed to resolve the Proceeding by way of consent orders, including declarations that, since 1 August 2017, Agrison made false or misleading representations in breach of sections 18 and 29 of the ACL that:

• its tractors and wheel loaders had a five year nationwide warranty in circumstances where the Warranty was limited to parts only, not all parts were covered for five years or at all and the full cost of all parts was not covered;
• Agrison had a national service network, and therefore customers requiring after-sales service or repair staff could access them throughout Australia in circumstances where Agrison did not have a national service network available to customers throughout Australia; and
• a customer would be able to obtain all necessary spare parts for tractors and wheel loaders within a reasonable time, if and when required in circumstances where Agrison had no reasonable grounds to make such a representation.

The Federal Court also ordered Agrison to pay a pecuniary penalty of $220,000 and pay redress to four consumers totalling $63,947.50. To address the ACCC’s concerns, Agrison also provided the ACCC with a section 87B undertaking that it will, in summary:

• cease and remove all advertising that does not comply with this undertaking;
• set out the limitations that apply, either in time or scope, in respect to any advertised express warranty for tractors or wheel loaders;
• publish limitations of a warranty in advertising in the same font as the reference to the warranty itself;
• include a clear and prominent link to the terms of any warranty that is referenced on a website controlled by Agrison;
• ensure that a full copy of the terms of an applicable warranty is given to a customer before Agrison accepts payment for a new tractor or wheel loader;
• require all Agrison employees and representatives involved in advertising, sales or after-sales support to attend practical training on compliance with the ACL on an annual basis and maintain documents relating to the training;
• create a complaint handling system; and
• report in writing to the ACCC on complaints received within 7 months of the system being set up.

In addition, Agrison’s sole director, Mr Volkan (Nick) Yokus, has undertaken that, for a period of 5 years, he will:

• not be involved (whether as director, manager, or otherwise) in any business that imports or sells tractors or wheel loaders other than the business carried on by Agrison, without the ACCC’s prior written consent; and
• if the ACCC provides written consent, he will take all reasonable steps to ensure the new business complies with each of the undertakings given by Agrison, listed above.

The undertakings provided by Agrison and Mr Yokus last five years from the commencement date.