The fine print*.

We’ve seen advertisements on the backs of buses quoting a seemingly great price for a product or service. We’ve also spotted businesses burying questionable terms and conditions in the small print – well, at least with a magnifying glass.

Just because there’s an asterisk (*) next to a dollar figure doesn’t mean that all is above board according to the Australian Consumer Law (ACL). So, here are 3 commandments regarding the use of fine print:

1. *Thou shalt not mislead or deceive

Advertisements may mislead or deceive when they:

  • are incorrect;
  • omit or obscure material terms; or
  • create false impressions.

A central ‘commandment’ of the ACL is that advertisements must not be misleading or deceptive (or likely to mislead or deceive).[1]

2. *Thou shalt not defy the overall message

A condition in the fine print must not:

  • contradict the overall or dominant message of the advertisement[2]; or
  • be used to correct misleading impressions created by the more prominent words of the advertisement.

3. *Thou shalt not need a magnifying glass

A business qualifying its advertisement with fine print must ensure that any disclaiming statements are prominently displayed and visible. Consumers must be able to notice the fine print and understand the actual offer without a magnifying glass.[3]

In assessing the prominence of the fine print, relevant factors to consider include:

  • the advertisement’s presentation;
  • the context; and
  • use of accompanying imagery.

*Magnifying glass guidelines

If fine print is used in an advertisement, businesses should ensure that:

  • the fine print message does not contradict (read: correct) the overall message of the advertisement;
  • qualifying conditions to an offer are displayed prominently, and not obscurely; and
  • relevant surrounding circumstances are considered.

*Who hath contravened the small print commandments?

The ACCC and the courts have not hesitated in stamping out sinful practices which contravene the ACL’s commandments on small print. Here are some examples of such ‘blasphemy’:

  • Telstra[4]: Telstra’s 2014 phone plan advertisement featured a large image of Apple’s iPhone 6. The ad prominently displayed the cost as $70 per month. However, consumers were also required to pay an additional $11 per month for the handset. The additional payment of $11 (and total monthly cost of $81) was only disclosed in the fine print.
  • iiNet[5]: iiNet’s advertisement for its ‘naked DSL’ product clearly displayed a monthly service fee of $59.95. However, that monthly fee could only be obtained via a 24-month contract, and the total minimum cost was only displayed in the fine print.
  • Harvey Norman[6]: In 2011, Harvey Norman’s catalogues and website implied that its advertised offers would be available at all Harvey Norman stores. However, the fine print in the final pages of the catalogues and ‘Website Terms and Conditions’ link at the bottom of each webpage stated that the advertised products were only guaranteed to be available at the advertised price in 1 specified store in each state.

It is common business practice to see advertisements with disclaimers using an asterisk to limit the audience’s expectations. Fine print is often used in advertisements, labels and signs. However, these ‘blasphemous’ examples serve as a testament to the need for the fine print to be understandable without having to use a magnifying glass!

[1] Competition and Consumer Act 2010 (Cth) sch 2 s 18.
[2] ACCC v TPG Internet Pty Ltd [2013] HCA 54.
[3] Ibid.
[4] ACCC, Telstra pays $102,000 penalty following ACCC infringement notice for iPhone 6 advertisement (16 December 2016)
[5] ACCC, iiNet Limited pays $204,000 in penalties following ACCC infringement notices for Naked Broadband Plan advertisements (3 March 2015)
[6] ACCC v Harvey Norman Holdings Limited [2011] FCA 1407.

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Posted on: 6 June 2017