Definition
Misleading and deceptive conduct refers to business practices that create a false or inaccurate impression that could mislead consumers. Under Australian Consumer Law, businesses must not engage in conduct that is likely to deceive, regardless of whether it was intentional. This applies to advertising, promotions, pricing, and representations about products or services.
An example is when a business advertises a product as discounted from an inflated original price that was never applied. Even if the misrepresentation was accidental, it can still be classified as misleading or deceptive.
Advanced
The legal test for misleading and deceptive conduct looks at the overall impression created, not just individual words. Courts consider how an ordinary consumer would interpret the representation in context. Disclaimers or fine print will not protect a business if the main message is misleading.
Advanced cases often involve digital practices such as influencer marketing without proper disclosure, unclear subscription renewals, or deceptive online reviews. Enforcement is carried out by the ACCC and state regulators, which may issue infringement notices, seek corrective advertising, or take businesses to court. Penalties can include significant fines and orders for compensation.
Why it matters
- Protects consumers from false or misleading claims.
- Ensures businesses compete fairly and honestly.
- Prevents reputational harm and legal penalties.
- Promotes transparency and trust in commercial practices.
Use cases
- Regulating truth in advertising across digital and traditional media.
- Reviewing online pricing claims to prevent fake discounts.
- Enforcing transparency in influencer and affiliate marketing.
- Investigating false claims about product quality or origin.
Metrics
- Number of ACCC investigations and enforcement actions.
- Regulatory fines or penalties issued for breaches.
- Consumer complaint volumes relating to misleading conduct.
- Business compliance rates across industries.
Issues
- High financial penalties for breaching consumer law.
- Damage to brand trust and long-term customer relationships.
- Complex enforcement in digital markets with evolving practices.
- Difficulty managing third-party content such as reviews and promotions.
Example
A travel website advertises holiday packages as "all inclusive" but fails to disclose that meals and transfers are extra. After complaints, the ACCC investigates and requires the company to correct its advertising, refund affected customers, and pay penalties.