BXT International Limited (BXT International) (Hong Kong CR number 1440086) - s.87B undertaking

The Australian Competition and Consumer Commission (ACCC) has accepted a court enforceable undertaking from BXT International Limited (BXT International) and its director, Santo Julian Ludy in relation to alleged misrepresentations as to the nature and condition of the goods it sold, as well as misrepresentations as to the exclusion or effect of the consumer guarantees contained in the Australian Consumer Law (ACL). BXT International has admitted that its conduct contravened sections 18, 29(1)(a), 29(1)(c), 29(1)(m) and 29(1)(n) of the ACL. Mr Ludy has admitted that he was knowingly concerned in BXT International’s conduct.

Details about the company

BXT International is a company incorporated in Hong Kong. BXT International operates an online retailing business through the website www.becextech.com.au (BecexTech Website) through which it sells electronic goods, including mobile phones and tablet computers. Mr Ludy, a resident of Victoria, Australia, is the sole director of BXT International.

Details about the conduct

BXT International sold through the BecexTech Website refurbished electronic goods, including mobile phones and tablet computers, which it advertised in a manner that was likely to mislead consumers into believing that those products were new, and failed to adequately disclose the fact that those products were refurbished.

Many of the products, both new and refurbished, sold through the BecexTech Website are international, rather than local, versions of those products. This fact was not disclosed to consumers, even when a consumer was likely to regard this as a relevant consideration in their decision to purchase a product.

BXT International also engaged in the practice of pre-selecting additional items to be included in a consumer’s intended purchase, which the ACCC is concerned would be likely to deceive a consumer into purchasing items that they did not intend to purchase.

BXT International made misleading representations to consumers about the exclusions or effect of the consumer guarantees contained in the ACL

• that BXT International was not bound by the ACL because it is a company incorporated in Hong Kong;
• that BXT International’s warranty policy operates to limit or exclude a consumer’s rights under the ACL;
• that refunds for products that sustained major failures could be reduced for subsequent decreases in the ‘market value’ of those products, or superficial damage to those products unrelated to the failure;
• that BXT International was not obliged to include the cost of shipping, including return shipping, in the refund amount for a consumer whose product developed a major failure.

BXT International also made misleading representations in its warranty policy and to individual consumers as to their obligation to pay for rights that were wholly or partly equivalent to rights afforded by the ACL, including by telling consumers that their right to a remedy for a faulty product ended with the expiry of BXT International’s contractual warranty with the consumer.

To address the ACCC’s concerns, BXT International provided the ACCC with a section 87B undertaking to:

• Amend the BecexTech website so as to avoid misleading consumers as to whether a product is new or as to the origin of that product
• Amend its warranty policy to make it clear that the ACL consumer guarantees are not limited or excluded by that policy
• Cease its practice of pre-selecting for purchase additional items
• Publish a corrective notice on the BecexTech Website
• Provide refunds to consumers who were:
  • incorrectly told they did not have a right to a refund for products that had developed major failures;
  • provided only partial refunds for faulty devices; or
  • misled by BXT International into believing they were purchasing a new product when that product had been refurbished
• Establish and implement an ACL Compliance Program

Mr Ludy provided the ACCC with a section 87B undertaking to:

• Ensure that BXT International complies with its undertaking
• Not engage in BXT International’s misleading practices in any other business
• Personally refund any eligible consumer not given redress by BXT International under its undertaking.