Trainer predicts mass business prosecutions before World Cup

RedSeed Limited

Media release April 20, 2011

Trainer predicts mass business prosecutions before World Cup

Many businesses will be prosecuted for breaching sales compliance laws before the Rugby World Cup this year, according to an online sales trainer.

“The Commerce Commission has said it will toughen up on compliance issues during this period, and lots of businesses are breaching the rules without even knowing it,” says Anya Anderson, Managing Director of RedSeed, a Christchurch-based, national sales training company.

She says that’s why it’s vital that anyone selling goods and services understands sales compliance law before they find themselves unknowingly in breach.

“Most sales breaches covered by the media show business people willingly breaking the law, but many are unaware they are doing this.”

Mrs Anderson says there are already lots of prosecutions under the Fair Trading Act (FTA) and most are due to ignorance. One common trap is a failure to clearly state that a quote or advertised price does not include GST, she says.

It is not just small companies that have been bitten by the FTA. The Warehouse pleaded guilty to multiple breaches in 2009 and was fined $209,600.

“The Consumer Guarantees Act is also misunderstood. For example, if a customer asked an assistant for a bathroom heater and was sold one that short-circuited and caused a fire, the shop could be liable for the fire damage. Not many people realise that,” says Mrs Anderson.

“By digging beneath the surface, the Commerce Commission will find masses of breaches, and the businesses they prosecute will be ignorant of their crimes.”

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