First Principles of Business Law
The regulation of undesirable business practices

5. Protection against unfair business practices

5.3. Offering gifts and prizes

 

 

 

A, an Australian retailer of cosmetics, advertises a new brand of expensive skin cream. To promote sales, the advertisement promises that a free 'Eversharp electric ladies razor' worth $100 will be given to any purchaser who buys more than $500 worth of the skin creams. A has no idea how many of the razors he will need and decides that he will order them from the manufacturer as they are required. But when he orders the first batch of 100 razors, he is told that they are no longer being manufactured and that there are only 20 razors left in stock.

Click here to see section 32.

(a) The ACL prohibits, as an unfair practice, the offering of gifts and prizes in relation to the supply of goods or services to consumers.

(b) The ACL does not prohibit the offering of gifts and prizes to consumers as long as the supplier has the intention of providing what is being offered. But there are no excuses for failing to provide what is offered as a gift or prize within a reasonable time.

(c) The ACL does not prohibit the offering of gifts and prizes to consumers provided the supplier has the intention of providing what is being offered. A failure to provide what is offered as a gift or prize within a reasonable time may be excused if the failure is not attributable to the fault of the supplier.

 

 

 

 

 

 

 

  

 

 

 

 

 

 

 

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