What are the 4 things the FTA does to achieve it’s purpose?
1) Prohibits certain unfair conducts/practices in relation to trade
2) Promotes fair conduct/practices in relation to trade
3) Provides for the disclosure of information in relation the supply of goods/services
4) Promotes safety in respect of goods/services
What is the FTA?
A statue that outlines the responsibilities of businesses to act in a fair manner when supplying good/services.
What are the two things the FTA regulates?
All advertising and all dealings with consumers.
What is the purpose of the FTA? ( 3 )
1) Protect consumers’ interests.
2) Businesses compete effectively
3) Businesses/Consumers participate confidently.
Who does the FTA apply to?
Anyone in trade.
What can the businesses not do in relation to the FTA unless what?
The businesses may not contract out of their obligations to consumers under the FTA unless, the customer is business. Then some exceptions may be allowed but must be written down.
What can a consumer presume when buying goods/services?
They can presume the business is following the FTA’s requirements.
What can businesses not do under the CGA unless what?
Business cannot contract out of their obligations to consumers under the FTA. Unless the customer is another business,there can be a few exceptions which has to be agreed upon and written down.
What can businesses not do in terms of misleading/deceptive conducts?
They cannot engage in misleading/deceptive conducts or conducts likely to do so. It does not matter whether it was intentional and in some cases, silence/failing to mention relevant information can be considered misleading.
What can businesses not do in terms of claims?
They cannot make a claim about products if they do not have reasonable grounds to believe that the claims are true at that specific time.
What determines reasonable grounds for businesses to make a authentic claim?
When they have info provided by a reputable supplier/manufacturer, info held by the business making the claim. Basically, anything specific should be supported with solid evidence.
What are the 7 types of misleading/false representations?
1) statements that products are something false to attract more customers
2) A false representation that a certain person endorses/uses the product
3) False/Misleading representation where the product/ingredients are from
4) False/Misleading representations about price
5) Hiding additional costs
6) False/Misleading representation about the need for the product
7) False representations created by leaving out relevant information
What are the 7 types of unfair practices which are illegal under the FTA?
1) Offering prize with no intend to supply/ supplying them as offered.
2) Bait advertising
3) False claims about the profitability and risk associated with business operations when seeking people to provide labour/money to the business activity
4) Pyramid - Selling schemes
5) Demanding/Accepting payments without intend to supply the product
6) Demanding payment for unsolicited products
7) Using physical force/harassment or coercion
What is the commerce commission?
A government organisation that enforces the FTA regulations. They advice people on how to comply with laws, issue warnings and take business to court.
What is the difference between a Ponzi scheme and a Pyramid scheme?
A Ponzi scheme is a fraudulent investment operation where returns to earlier investors are paid using the funds from new investors, rather than from actual profits. A pyramid scheme, on the other hand, makes money mainly by recruiting new members instead of selling a genuine product or service.
