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Avoid false claims about products and services

A business must not make false or misleading claims about their goods or services.

This includes the characteristics of the goods or services, such as:

  • their price and usual value
  • the standard, quality or grade
  • their age and history
  • their country of origin
  • the composition (such as ingredients) and model
  • any accessories that are or aren’t included.

They also can’t mislead you about what the goods or services can do for you.

This includes:

  • how the goods or services work
  • what benefits they offer
  • how much you need them (including whether they are legally required)
  • whether they are approved for use
  • whether repair facilities or spare parts are available
  • what guarantees, warranties or conditions are available.

They must also be honest about:

  • testimonials
  • affiliations or approvals
  • sponsored endorsements.

Gifts, rebates and prizes

Businesses who offer gifts, rebates or prizes must actually provide them. They must match their advertised description. False competitions are illegal.

Bait advertising

Businesses need to keep a reasonable supply of any sale items they advertise.

If they sell out, they can’t talk you into buying something similar that’s a higher price or lower quality.

Wrongfully accepting payment

A business must never accept your payment if they:

  • don't intend to give you their goods or services
  • know they can’t offer their goods or services in a reasonable time.

Was/now pricing

Businesses sometimes advertise savings on products by comparing to their pre-sale price, wholesale price, a competitor's price or recommended retail price (RRP).

Was/now pricing, also known as ‘two-price advertising’ or ‘strike through’ pricing, is where a business advertises that a product was a certain price but is now on sale for a lower price.

Businesses must not mislead or deceive you about the savings you may get. Saying that a product ‘was $100 now $50’ or ‘$100 $50’ can be misleading if that product was not sold at $100 for a reasonable period before the sale started.

It can also be misleading if only a small amount of the product’s previous sales were at the higher price before the sale began.

Cash back offers

Cash back offers are a type of discount where instead of marking down product prices, retailers keep the same price but offer to return money after buying. These offers are limited in time and have special application conditions you have to meet to get the money.

It’s against the law for businesses to offer rebates, gifts or prizes without intending to provide them, or not providing them as offered.

If you decide to buy a product and apply for the cash back offer:

  • check the expiry date, waiting times to receive the offer, evidence required and all steps you need to take to get the cash
  • complete the application carefully to meet all conditions
  • keep copies of all documents as proof in case something goes wrong
  • shop around and compare prices before committing to a cash back deal.

There may be extra time or costs like online access, postage or photocopying when making a claim. If something goes wrong, you may also spend time and money on the phone or email chasing up your claim.