West Aust Couriers Pty Ltd trading as Fastway Couriers (Perth) - s.87B undertaking

The Australian Competition and Consumer Commission (ACCC) has accepted a court enforceable undertaking from West Aust Couriers Pty Ltd (WACPL) over concerns it made false or misleading representations regarding future earnings of courier franchisees that were likely to contravene the Australian Consumer Law.

WACPL is the Western Australian regional franchisor of the Fastway Couriers franchise. Between March 2015 and January 2017, WACPL advertised courier franchises for sale with an income guarantee of $1,500 for 30 weeks.

The ACCC considers that some franchisees may have relied on the income guarantee and other statements made at the time of purchase as a representation that $1,500 was the minimum, or at least average, weekly income they could expect to earn at the end of the income guarantee period.

To address the ACCC’s concerns, WACPL provided the ACCC with a s.87B undertaking that, for a period of three years, it will:

• not describe the offered financial or revenue support as an “income guarantee”; and
• provide the following information to prospective franchisees:
  • the average weekly earnings for the past 12 months for the territory the prospective franchisee is considering buying;
  • the total earnings for the past 12 months for the territory the prospective franchisee is considering buying and a breakdown of the proportion of the annual earnings which is derived from deliveries, sales commissions and parcel pick-ups;
  • the KPIs that a franchise is likely to need to meet in order to achieve weekly average earnings equivalent to the “financial support” or “revenue support” when the support period has ceased.