JV Mobile Pty Ltd meets trouble with the ACCC

By Sarah Falson

SYDNEY: JV Mobile retailers will experience changes in the way they do business with licenser, JV Mobile Pty Ltd, after the Australian Competition and Consumer Commission (ACCC) intervened due to reports the company is in breach of th Trade Practices Act 1974.

According to the ACCC chairman, Graeme Samuel, JV Mobile had undergone business as though it was a franchise, without safeguarding stores that use the JV Mobile name in Melbourne, Sydney, Adelaide and Brisbane, under the Franchising Code.

JV Mobile Pty Ltd provides licenses to JV Mobile retailers to own and operate stores using the name JV Mobile, who sell mobile phone airtime, handsets and accessories obtained through JV Mobile Pty Ltd.

"The ACCC was concerned that JV Mobile had promoted and advertised its business network as a franchise, including in Vietnamese language media, and sought and/or received payments pertaining to a franchise business from JV Mobile retailers  without giving them all the safeguards available under the Franchising Code", said Samuel.

"The ACCC considers that, if JV Mobile was marketing and operating as a franchisor then it must afford franchisees the rights owed to them by the Code. These include, particularly, the provision of a disclosure document, upfront. The disclosure requirement is a key pillar of the code. As such, a failure to comply with this requirement is unacceptable and unlawful conduct".

The ACCC will now ensure that, in accordance with the Franchising Code, JV Mobile Pty Ltd will formally structure all new agreements with its retailers as franchise agreements and provide the opportunity for existing JV Mobile retailers to structure their existing agreements as franchise agreements.

"These undertakings will act to provide greater transparency and certainty for both JV Mobile and JV Mobile Retailers which is consistent with the key principles of the Franchising Code," said Samuel.

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