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Australia – TMT News.

29 January, 2014

 

Legal News & Analysis – Asia Pacific – Australia – TMT

 

Penalty Imposed For Misleading Mobile Advertising


Pecuniary penalties were imposed by the Federal Court of Australia shortly prior to Christmas against a supplier of mobile telecommunications services arising out of a breach of section 51AB of the Trade Practices Act 1974 (Cth) in 2009 and 2010. In Australian Competition and Consumer Commission v Excite Mobile Pty Ltd & Ors (No 2) [2013] FCA 1267, the Federal Court had found earlier in 2013 that the respondent had breached section 51AB by adopting a sales and marketing strategy which failed to adequately explain the terms of service or the full extent of the customer charges. The respondent had also represented that a complaints service which it owned and operated was in fact independent. Following a subsequent hearing in November 2013, Mansfield J imposed a range pecuniary penalties under section 76E of the Trade Practices Act, including a penalty of $455,000 on the company.


To view the decision, click here.


Enforceability Of Internet Betting Contract


The Northern Territory Supreme Court has given consideration to the liability of an Australian based sports bookmaker to an overseas customer in relation to website betting services: Centrebet Pty Ltd v Baasland [2013] NTSC 59. Hiley J found that a contract was entered into when the customer opened an account by completing an online registration form in 2004, a process which included a requirement to tick a box acknowledging that he had read and understood the relevant terms and conditions. His Honour held that the online contract was enforceable and that the contract was subject to the law and jurisdiction of the Northern Territory in accordance with its terms. In relation to the substance of the proceedings, the Court concluded that Centrebet had not been negligent under Australian law in permitting the customer to continue gambling activity after losing a substantial sum.
To view the decision, click here.

 

Penalty Imposed For Falsely Representing Existing Supply Contract


Liability may arise under section 18 of the Australian Consumer Law if a product supplier falsely represents to a potential customer that the two organisations already have an existing supply contract in place. This was the scenario arising in Australian Competition and Consumer Commission v Artorios Ink Co Pty Ltd and Ors (No 2) [2013] FCA 1292. The Federal Court was told that the first respondent, which was a company operating a business involving the sale of printer ink cartridges, had engaged in the practice of telephoning potential customers, encouraging the recipients of those calls to believe that there was an existing contract in place for the supply of printer ink cartridges and inviting the placement of further orders. Upon receiving an order in response to the call, the respondent would then make the delivery and demand payment. Mortimer J found that the ACCC had proven contraventions of section 18 of the ACL, along with sections 29 and 40. Her Honour made declarations in respect of the conduct of all three respondents, and imposed penalties of $50,000 on each of two employees who were the second and third respondents.


To view the decision, click here.


How Much Is A Customer Expected To Know?


When technical products or services are advertised, the supplier should not assume that the reader has an intimate background knowledge of the technology or the industry. This is particularly the case where the wording of the advertisement contains a “dominant message” which the supplier expects to be interpreted by readers possessing a certain amount of background understanding. In Australian Competition and Consumer Commission v TPG Internet Pty Ltd [2013] HCA 54, the High Court of Australia overturned a decision by the Full Court of the Federal Court in which the lower court had ruled that an advertisement for broadband internet services was not misleading by failing to make it clear that the advertised price was only available when the broadband service was bundled with a home telephone line at an additional monthly charge. The High Court disagreed that any reasonable customer should have been aware that the services in question were commonly bundled, finding instead that overall the advertisement had a tendency to mislead, “especially where the target audience is left only with the general thrust or dominant message after the evanescence of the advertisement”.


To view the decision, click here.


Telcos Ordered To Stop Unauthorised Customer Transfers


ACMA has issued a direction to Gazal Telecom and Utel Networks for their failure to comply with the Telecommunications Consumer Protection Code (TCP Code) in respect of promoting and obtaining informed consent from customers for the transfer to fixed line services. ACMA also found that Telecomo breached the same provisions of the TCP Code, but only issued a formal warning after Telecomo changed its transfer application process prior to ACMA’s release of its preliminary investigation findings.


A failure to comply with a direction may result in ACMA seeking an order for a pecuniary penalty from the Federal Court, or ACMA issuing an infringement notice with a $10,200 penalty per contravention.

 

To view the ACMA press release, click here.


Telstra Launches Proceedings Against The ACCC And Three ISP rivals


Telstra has commenced proceedings in the Federal Court of Australia against the ACCC and three Internet Service Provider (ISP) competitors, Vocus Fibre, Adam Internet and Chime Communications. The proceeding relates to Telstra’s attempts in 2012 to increase access charges on ISPs requiring access to Telstra’s telephone exchanges and internet ducts. The three ISPs appealed Telstra’s pricing decision to the ACCC. The regulator agreed to arbitrate the dispute.


Telstra has sought the Federal Court to order an injunction restraining the ACCC from arbitrating the dispute, alleging that the ACCC has no power to conduct an arbitration in relation to the matter. Telstra argues that the commercial contract with the three ISPs covers the rise in access charges and is binding. The first directions hearing is set for 13 February 2014 before Justice Jacobson.


Telstra Pays Penalty For Failing To Provide Timely Connections To New Urban Landline Customers


Telstra has paid ACMA a $510,000 penalty for failing to adhere to the Telecommunications (Customer Service Guarantee – Retail Performance Benchmarks) Instrument (No. 1) 2011 (CSG Benchmarks) in respect of timely connections for new urban landline customers. A formal warning was issued for Telstra’s failure to meet the same CSG Benchmark in respect of new remote landline customers. In issuing the penalty and formal warning, ACMA considered Telstra’s positive and cooperative response, and that Telstra’s fixed line network was affected by extreme weather events during the relevant period. ACMA also issued a formal warning for Telstra’s breach of several regulatory requirements in respect of the consultation process for the removal of payphones.


To view the ACMA press release, click here.


Funding To Ensure Kids Access Age-Appropriate Content Online


The South Australian government has announced funding to develop an online “watch list” of video games that contain gambling content. The video games being targeted include online games and mobile apps. The funding also extends to the “Know Before You Go” movie review program, which was established in 2002. Both of these programs are intended to assist parents to determine whether their children are accessing age-appropriate content.
To view the Press Release, click here.

 

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For further information, please contact:

 

Gordon Hughes, Partner, Ashurst
gordon.hughes@ashurst.com

 

Ashurst TMT Practice Profile in Australia

 

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