Mercedes-Benz Australia/Pacific Pty Ltd

The Australian Competition and Consumer Commission (ACCC) has accepted a court enforceable undertaking from Mercedes-Benz Australia/Pacific Pty Ltd (Mercedes-Benz).

This undertaking relates to proceedings instituted by the ACCC in August 2021 against Mercedes-Benz in the Federal Court of Australia, alleging that Mercedes-Benz contravened section 127(1) of the Australian Consumer Law (ACL) as a result of statements made to consumers by Mercedes-Benz Takata Call Centre Staff in relation to the Takata Recall.

In relation to the proceedings, Mercedes-Benz has admitted that it contravened section 127(1) of the ACL on 27 occasions by failing to use attention-capturing, high-impact language in communications with consumers in relation the Consumer Goods (Motor Vehicles with Affected Takata Airbag Inflators and Specified Spare Parts) Recall Notice 2018 (Recall Notice). Mercedes-Benz admits to contravening section 127(1) of the ACL:

• on 23 occasions between 16 July 2018 and 17 March 2020, by making statements to consumers to the effect that Mercedes was undertaking the Recall as a precaution; and
• on 4 occasions between 18 February 2020 and 17 March 2020, by making statements to consumers to the effect that Beta inflators in other manufacturers' vehicles had not had any faults or caused any accidents, injuries or deaths,

and in doing so failed to implement its Communication and Engagement Plan for contacting consumers as required by section 7(1)(a) of the Recall Notice.

The Federal Court ordered Mercedes-Benz to pay penalties totalling $12.5 million, and a contribution of $100,000 to the ACCC’s costs.

In addition, to address the ACCC’s concerns about recall compliance, Mercedes-Benz provided the ACCC with a section 87B undertaking that it will implement compliance steps in relation to recall obligations. The compliance steps involve:

• communicating the outcome of the Federal Court proceedings to all relevant executives and staff, 
• communicating annually with all relevant executives and staff about the importance of complying with Mercedes-Benz’s product safety obligations, particularly in relation to voluntary and mandatory recalls in Australia, and 
• ensuring all executives and staff are briefed on the content and requirements of any mandatory recall, and that call centre materials are reviewed and approved by a senior Mercedes-Benz corporate counsel.