ACCC finds LG Electronics misled consumers

By Craig Zammit

CANBERRA: The Australian Competition and Consumer Commission (ACCC) has obtained consent orders against LG Electronics this week, with the Federal Court declaring that several of its online mobile phone manuals contained false or misleading warranty information.

The court found that the existence and duration of statutory conditions and warranties contained within the online manuals and also the rights and remedies made available to mobile phone consumers were misleading.

“The ACCC will not hesitate to take action against businesses which mislead consumers about their statutory rights,” said ACCC chairman, Graeme Samuel.

“Consumers can be tricked into thinking that they can’t have a faulty item replaced or get a refund, because the manufacturer’s express warranty period has expired, when that may not be so.”

The orders, handed down by consent, follow proceedings instituted by the ACCC in December last year.

They require LG to refrain from making representations to similar effect in the future, implement an upgraded trade practices compliance program, arrange the publication of consumer notices on its website and in all major Australian newspapers, provide each of its mobile telephones retailers with a notice explaining the relevant provisions of the Act and pay the ACCC’s costs.

This most recent run-in with the ACCC is not LG Electronics Australia first. On 6 April, 2005, the ACCC asked LG Electronics to correct misleading representations it made over four models of their washing machines ranging from 7kg to 9kg in capacity.

The ACCC found that between May 2004 and August 2004, LG Australia released certain washing machines for sale claiming they were 4A rated by the Water Services Association of Australia (WSAA). These claims helped the front loading machines attract a $150 Waterwise rebate, but because accreditation had not been granted some consumers had their claims rejected.

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