The Australian Competition and Consumer Commission (ACCC) has identified potentially misleading terms and conditions in the return policies of numerous online retailers.
Following a review of more than 2,000 retail websites, the consumer watchdog found statements that may misrepresent customers’ rights under the Australian Consumer Law (ACL).
Key Findings from the ACCC Review
As part of its investigation, the ACCC examined return policies and website terms and conditions to determine compliance with the ACL. Several concerning practices were identified, including:
- Imposing time limits for returning faulty products
- Enforcing blanket ‘no refund’ conditions on sale or specialised items
- Stating that manufacturer warranties are the only option for consumers seeking remedies
- Restricting consumers’ rights to a remedy by making delivery fees non-refundable or charging restocking fees on faulty returns
Some of the problematic statements found on retailer websites included:
- “Items that have been opened and used cannot be exchanged or refunded”
- “Made-to-order products cannot be returned”
- “Sale items cannot be returned, exchanged, or refunded”
- “In the unlikely event that your item arrives damaged or faulty, please notify the store within 30 days of delivery to receive a replacement”
Enforcement and Industry Compliance
In response to these findings, the ACCC issued warning letters to several businesses, prompting most to amend their policies to align with ACL requirements.
“Our sweep has found numerous examples of practices that could potentially mislead or deceive consumers regarding their rights to exchange, refund or return a product,” said ACCC Deputy Chair Catriona Lowe.
She emphasised that consumer guarantees exist independently of any warranties offered by businesses and cannot be overridden by a company’s return policy.
“The ACCC is committed to improving business compliance with consumer guarantees and will continue to actively monitor this area, and where appropriate, take enforcement action,” Ms Lowe added.
Implications for Jewellers
Jewellery retailers selling online should review their return policies to ensure compliance with the ACL. Under the law, businesses cannot:
- Deny refunds under all circumstances
- Refuse returns for faulty sale or customised items
- Impose unreasonable time limits on returns for defective products
- Charge restocking or processing fees on faulty goods
- Refuse refunds for items that have been opened or used if they are faulty
- Require customers to cover return shipping costs for faulty items
Additional warranties do not override statutory consumer guarantees, which ensure products meet quality, purpose, and description standards.
Ongoing Regulatory Focus
The ACCC continues to focus on consumer guarantee compliance, particularly in sectors such as consumer electronics and online retail. Recent enforcement actions have resulted in significant penalties, including an $11.5 million fine for Mazda Australia in 2024 and penalties imposed on furniture retailer Koala Living for misleading return policies.
Upcoming legislative reforms may impact compliance requirements, making it important for jewellers to stay informed.
