Noel Leeming charged over alleged Fair Trading Act breaches
The Commerce Commission announced it had filed criminal charges in the Auckland District Court against the wholly-owned subsidiary of The Warehouse Group Limited, alleging it had breached the Fair Trading Act.
Deputy chairperson Anne Callinan said its "price promise had many limitations and conditions which weren't made obvious to customers".
"For over a decade Noel Leeming has prominently promoted their 'Price Promise,' which is their commitment to match any competitors' price. We believe their price promise claim was misleading and in breach of the Fair Trading Act," she said.
"Price match advertising gives the impression that customers will be able to show up and get a match for competitor's prices. It's crucial that businesses promoting any price match offer factor in the overall impression of the claims they make, and that all information is clear to customers."
The Commission has also filed charges against Noel Leeming regarding promotions where the advertised product or price was different to what could be purchased, and allege the company gave incorrect or misleading information about consumers' rights under the Consumer Guarantees Act when customers complained about faulty products.
Callinan said Noel Leeming had previously been "one of our most complained about traders, and we were concerned about the range of issues consumers raised".
Noel Leeming's chief operating officer Jason Bell said the company was "baffled" by the decision to press charges.
"We firmly maintain that we have committed no offence and will vigorously defend this," he said in a statement.
Bell said "our terms and conditions are fair and presented just like other retailers, and when we can't price match, we often don't get the sale".
"We're perplexed by the Commission's claim that price matches were difficult to obtain, when over 250,000 Kiwis saved money with our Price Promise between 2019-2021.
"Price matching is widely used by the industry, and it helps drive competition, and without it, Kiwis will end up paying more.
He said if the business doesn't get something right, it would work hard to ensure fair resolutions for our customers.
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"Some of the additional matters raised by the Commission occurred during the Covid-19-pandemic, when all businesses experienced unprecedented pressure, and our team went to extraordinary lengths to help Kiwis access the products they needed, handling over ten million transactions.
"It is concerning that significant public resources and time have been spent on this matter for over three years, while overlooking more pressing potential harm to consumers from overseas online retailers operating outside of the rules. The system needs to evolve and hold all retailers selling to New Zealanders to the same standards of care."
Callinan said "price match advertising gives the impression that customers will be able to show up and get a match for competitor's prices.
"It's crucial that businesses promoting any price match offer factor in the overall impression of the claims they make, and that all information is clear to customers."
The maximum penalty for breaches of the Fair Trading Act, is $600,000 per charge for businesses.
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