Commission uses new enforcement tools
Commission uses new enforcement tools
The Commerce
Commission has used the new enforcement tools granted as
part of the Consumer Law Reform last year to issue
infringement notices for the first time to motor vehicle
dealers in Auckland and Christchurch.
Infringement notices
carry a fine of $1,000 each and can be issued to businesses
by the Commission for breaches of the Fair Trading Act
relating to the failing to disclose certain information to
consumers, such as:
• not disclosing, when selling on
the internet, that they are a trader (rather than a private
seller), for example, on auction sites like Trade
Me
• failing to clearly display a Consumer Information
Notice, or CIN, on used motor vehicles in the car yard and
in adverts for Trade Me auctions, where the car can be
purchased online
• not providing the required
information to customers about laybys, uninvited direct
sales and extended warranties.
“Being able to issue
infringement notices for relatively minor and
straight-forward breaches of the Act is an efficient and
effective way of getting businesses to immediately change
their behaviour and comply with the law. They are an
important part of our enforcement toolkit and we expect to
be using them more in the future,” said Commerce
Commission Chairman Dr Mark Berry.
“We have been given the mandate to issue these notices without the need to go through all the usual steps of our enforcement process, including preparing for possible court action. This means we are able to achieve an appropriate result, like deterring traders from bad behaviour, in a cost-effective and timely way.”
To date, the Commission has issued eight infringement notices to three separate motor vehicle dealers in Auckland and Christchurch for failing to display CINs and not disclosing their trader status when selling online.
CINs document important information about a used car including year, make and model, price, odometer reading and if the car was imported into New Zealand as damaged.
“The requirement to provide a CIN for used cars is crucial for consumers. Without it, they cannot make informed choices about purchasing the car or not. If consumers buy a car from a trader they have legal protections for a reasonable time if there are faults with the vehicle,” said Dr Berry.
The Commission became aware of the missing CINs and non-disclosure of trader status at these motor vehicle dealers through complaints from members of the public.
Information for traders on complying with Consumer Information standards is available on the Commission’s website: http://www.comcom.govt.nz/fair-trading/consumer-information-standards/
ends