Misleading Return Policies: Retail Policy Compliance

Compliance & Consumer Law, Privacy & Data

ACCC Flags Misleading Return Policies on Retail Websites

The Australian Competition and Consumer Commission (ACCC) recently examined over two thousand retail websites across the country and discovered that some businesses may be violating the Australian Consumer Law (ACL) with their terms and conditions by using misleading return policies.

As part of this review, the ACCC assessed the return policies and terms of service on various websites, identifying several that could have misleading returns policies, misleading consumers about their rights to return, exchange, or receive refunds for products.

ACCC Chair, Catriona Lowe said that their sweep found numerous examples of practices that could potentially mislead consumers about their rights on exchanges, refunds or returns of products.

The Australian Consumer Law guarantees basic rights for consumers when purchasing goods and services, known as consumer guarantees. These rights are independent of any warranties a business may offer and cannot be taken away by a company’s terms or actions.

Deceptive Terms in Retail Policies

During the sweep, the ACCC found several potentially deceptive clauses in the terms and conditions of certain websites, including:

  • Setting strict time limits for returning faulty products.
  • Imposing blanket “no refund” policies on sales or custom-made items.
  • Stating that manufacturer warranties were the only option for consumers seeking remedies for faulty goods.
  • Restricting consumers’ rights by declaring delivery charges for faulty items non-refundable or imposing restocking fees for returns of faulty products.

Some of the problematic statements identified included:

  • “Opened or used items cannot be returned or refunded.”
  • “Custom-made items are non-returnable.”
  • “Items on sale are not eligible for a return, exchange, or refund.”
  • “If your item arrives damaged or faulty, please contact us within 30 days of delivery for a replacement.”

Following the findings, the ACCC issued warning letters to several businesses whose return policies or terms were potentially in violation of the ACL.

The ACL prohibits businesses from making certain misleading claims regarding faulty products, including:

  • No refunds allowed under any circumstances.
  • No refunds for sale or custom-made items.
  • Consumers must return items within a very short period to be eligible for a refund.
  • Returns may incur processing, restocking, or repair fees.
  • Opened or used items are never eligible for a refund.
  • Delivery fees are non-refundable.
  • Customers are responsible for the cost of returning items.

 

If you need assistance with making sure your policies and terms and conditions comply, do not hesitate to contact us at or give me a call on 1300 033 934 for a no-obligation quote.