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Petrol station fined for misleading prices

Petrol station fined for misleading prices

A North Shore petrol station was fined $35,000 in the Auckland District Court today for breaching the Fair Trading Act by misleading their customers about the price of petrol.

Between 1 August 2006 and 26 February 2007 OM Petroleum (NZ) Limited, trading as Challenge Service Station Milford (Challenge Milford), charged customers two cents per litre more than the price advertised on their forecourt for 91 and 95 octane petrol.

Challenge Milford claimed that the additional charge was to cover the cost of providing for 'full service' which included checking oil and water, and that it had signage in-store informing customers of the extra charge. The Commission's investigation found that not only was the in-store signage either not present or obscured from the customer's view, but the 'full service' was not always offered.

In the Commission's view, the in-store signage did not change the fact the price advertised on the forecourt was false. It was also difficult for customers to check the price they were charged for petrol, as Challenge Milford did not display the price per litre at the pump, nor on the dockets given to the customer.

Commerce Commission Chair Paula Rebstock said "Consumers should be able to rely on pricing information supplied to them by businesses when making purchasing decisions. Consumers should not be expected to have to calculate and confirm the actual price they pay for goods and services."

"Motorists often choose where to fill up based on the displayed forecourt price. So to display one price and charge another harms both the consumers who've paid more than they expected, and competitors who have missed out on potential business," Ms Rebstock said.

In sentencing Challenge Milford today, Judge Kiernan said the aggravating features of the offending were "blatant false representations over a period" and that the defendant obtained a "large amount of profit". Further, she said the offending "potentially affected 30,000 customers".


Challenge Milford is an independently owned and operated service station. The petrol and diesel sold under the Challenge brand is supplied by Chevron New Zealand.

Companies found guilty of breaching provisions of the Fair Trading Act may be fined up to $200,000 and individuals up to $60,000. Only the courts can decide if the Fair Trading Act has been breached.


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