The ACCC has accepted a court enforceable undertaking from Happiness Road Investment Group Pty Ltd (Happiness Road), admitting the company had made misleading claims over the country of origin of its ugg boots.
Happiness Road (trading as Koala Jack) is an Australian registered company based in Queensland and sells ugg boots exclusively online. For at least a week in October last year, the company advertised the green and gold Australian Made logo on the home page of their website and made various claims that their ugg boots were made in Australia.
Following the ACCC’s investigation into the claims, Happiness Road admitted that its ugg boots were in fact made in China. The ACCC also discovered that the company was not authorised to use the ‘Australian Made logo’. The Australian Made logo is used under license from the Australian Made, Australian Grown (AMAG) Campaign and companies using the logo must comply with a strict set of criteria as prescribed in the AMAG Code of Practice. The ACCC has been working in conjunction with the AMAG Campaign and the Australian Sheepskin Association to expose any companies displaying such misleading claims.
The ACCC’s Deputy Chair Dr Michael Schaper emphasised the importance of compliance in relation to country of origin claims, stating that the “ACCC considers country of origin claims to be a particularly valuable marketing tool for businesses, as many consumers place a premium on goods that are Australian made.” Similar comments were made in 2001 by the then Chairman of the ACCC, Graeme Samuel, after the Federal Court penalised Marksun Australia Pty Ltd $430,000 for misrepresenting that the company’s ugg boots were made in Australia and for the unauthorised use of the Australian made logo.
The ACCC undertaking requires Happiness Road’s sole director, Mr Jason Rey, to undertake trade practices compliance training and that the company:
- offer refunds to consumers misled by its conduct;
- refrain from engaging in the same or similar conduct in the future; and
- publish an advertisement on Google directing visitors to publications on the ACCC’s website regarding these misleading claims.
Dr Schaper has warned that “while the ACCC will continue to monitor advertising of this nature to ensure compliance with the Australian Consumer Law, businesses need to be aware there are many others out there watching. The chance of being caught out is extremely high.”