Electronics marketplace Reebelo has paid $59,400 under infringement notices for representations as to availability of consumer guarantees

Launched in Singapore and headquartered in California, Reebelo Australia (Reebelo) operates as an online marketplace for new and refurbished products including electronic products and home appliances. It acts an intermediary platform where third-party suppliers list products for sale on its website.

Reebelo was issued with three infringement notices by the ACCC (totalling $59,400) for alleged breaches of the ACL by falsely representing that a customer had only 14 days to receive a remedy for:

  • faulty or damaged goods
  • goods received that were not in a condition that matched the description of the purchased product and
  • situations where customers had received a different model of a product than what they had ordered.

The ACL explicitly prohibits false or misleading representations concerning:

  • the existence, exclusion or effect of any guarantee or remedy; or
  • asserting a right to payment for a contractual right which is wholly or partly equivalent to a right customers have under a consumer guarantee.

As the ACCC Deputy Chair Catriona Lowe noted when announcing the infringement notices, a business cannot contract out of consumer guarantees. If a business fails to meet those guarantees, consumers have a right to a remedy if they return products that do not comply with consumer guarantees within a reasonable time, which may be more than 14 days. It is against the law for a business to mislead consumers about their right to a suitable remedy.

In particular, because the products available for sale on Reebelo are often refurbished high-end electronic products such as laptops or mobile phones, the ACCC was particularly concerned that consumers may have faced financial harm from Reebelo’s conduct.

These infringement notices were issued against the backdrop of the Treasury’s consultation last November on new prohibitions and penalties for failure to provide a consumer guarantee remedy.

In addition to penalties, Reebelo also committed to making amendments to its website, improvements to its online complaints handling processes, and various training and awareness measures to ensure future compliance with the ACL.

Key takeaways for businesses

To avoid breaches of the ACL and reputational damage, businesses should:

  • (Ensure their representations on consumer guarantees are not misleading or deceptive): Under the ACL, consumers have basic rights, known as consumer guarantees, to expect certain things when they buy a product or a service. For example, they can expect that the product is of acceptable quality and that any description of a product by a business must be accurate. A supplier cannot make misleading or deceptive representations about the availability of consumer guarantees, such as representations concerning the existence or effect of any consumer guarantees or remedies. Such conduct can be conduct to significant penalties of up to the greater of $50 million, three times the benefit or 30% of a company’s turnover, per contravention. Businesses must avoid taking away or limiting these consumer guarantees, including not to place a time limit on a consumer’s ability to receive a remedy.
  • (Consider if the business meets the definition of a ‘supplier’ under the ACL): Businesses can still be considered a supplier under the ACL even if it is an intermediary marketplace that sells goods from a third-party seller. Whether it is a supplier is not always clear and depends on the circumstances. Some of the factors that are relevant in determining if an entity is a supplier include:
    • whether it owns the products;
    • whether it has a contractual agreement with the customer;
    • whether it issues invoices and receives payments for the products;
    • whether it responds to a customer’s complaint about the products; and
    • whether there are any warranties or guarantees.