BUS 101 INTRODUCTION TO BUSINESS LAW trimester 3 of 2016

GROUP ASSIGNMENT - CASE STUDY ACCC v TPG

RESPONSES DOCUMENT (which must have a coversheet)

Question 1

1. The first aspect was the bundling condition, ACCC alleged that
TPGs advertisements were misleading because there is an
inconsistency between the prominent headline offering price and
the less prominent terms to qualify for the offer; it is then possible
that an ordinary consumer would be misled to think that there is no
other fees and services that comes with it.

2. The second aspect is that TPGs advertisement was alleged to be

deceptive for the same reason stated above and ask whether an
ordinary and reasonable customer could have assumptions that the
internet service does not have set up charges additional to the price
advertised which was $29.99 per month UNLIMITED.

3. The third aspect, TPG was also alleged that some of the
advertisements violated the Trade Practices Act 1974. It is because
they failed to specify the price for the package or service offered in
a prominent way and as a single figure. So it can be confusing
whether customers could consider the whole advertisement of TPG
even including the small prints and quickly spoken details correct.

Question 2

Statutory provision TPG conduct which breached statutory provision

SECTION 52 of TPA TPG advertisement breached the provision that an
a corporation shall ordinary consumer would think that the Unlimited
not, in trade or ADSL2+ for $29.99 per month is the only thing
commerce, engage that a consumer will pay which makes it
in conduct that is misleading.
misleading or
deceptive or is likely
to mislead or
deceive.
SECTION 53 of TPA TPG violated this provision because in their
A corporation shall advertisement an ordinary customer would have
not, in trade or no idea that is a bundles service and the customer
commerce, in would be obliged to pay another $30.00 per month
connexion with the and pay set up charges to avail the advertised
supply or possible product.
supply of goods or
services or in
connexion with the
promotion by any
means of the supply
or use of goods or
services

Question 3
Bundling- according to the primary judge:
It is found that ordinary consumers would rely on the ads for
info for the price and service they offer because they dont
have any starting assumption if the product is separate or
bundled.
Concluded that the Unlimited ADSL2+ for $29.99 was false
and needed to be clear and prominent to correct the
misleading impression of the message.
It is also found that the revised ads did not meet the said
requirement. On the other hand the judge accepted that the
consumer would read revised brochures more carefully and
would balance the misleading impression.

The setup- according to the primary judge:

It is accepted that setup fees and always charged and
consumers are aware of this but the judged held that the
dominant message gave the impression that there would be
no charges and concluded that it is necessary for it to be clear
for the message in ads.
It is found that there were none of the ads was clear about the
setup fee except the radio advertisement. As to the revised
radio ad, it I held that consumers would be aware of the setup
charge.

Single price- according to the primary judge:

It is then concluded that the single price of $509.89 was not

shown clearly in their advertisements, particularly in the initial
phase on TV, newspaper, and internet with reference to the
regulations of the TPA. ACCC doesnt have any complaint
about this though.