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Companies put on notice over price rises

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Wed, 30 Jun 2010 11:13a.m.

Companies that mislead consumers about price increases may be in breach of the Fair Trading Act

Companies that mislead consumers about price increases may be in breach of the Fair Trading Act

Companies that mislead consumers about price increases may be in breach of the Fair Trading Act, the Commerce Commission warned today.

The warning comes ahead of the 2.5 percentage points increase in Goods and Services Tax (GST) which will come into effect in October and possible effects on electricity and fuel prices from the Emissions Trading Scheme (ETS) implemented tomorrow.

"Businesses are not required by law to give reasons when they raise prices. However, when a business does try to justify a price increase to its customers, the reasons they give must be accurate," said Commerce Commission enforcement manager Greg Allan.

A business must take care not to create the misleading impression that GST is the only reason for a price increase if the increase is more than the extra GST, he said.

The commission said it also believed consumers may be misled about the impact of the ETS on electricity and petrol prices.

Major oil companies BP, Shell and Mobil have already announced that petrol prices would rise 3c to 4c from tomorrow but independently owned Gull said it would wait until next week before making any changes.

Some power companies have signalled retail price increases after tomorrow.

The Government has admitted concern at estimated double-digit power price hikes. Prime Minister John Key said hikes should not be more than 5 percent and in most cases would be less than that.

The commission said it could take enforcement action if there was evidence of a breach of the Fair Trading Act but only the courts could decide if there had been a breach. Penalties could be up to $200,000 for a company and $60,000 for an individual.

NZPA

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Comments

30 Jun 2010 11:04p.m.

johnmillan wrote:

V what do you recond,we should strip them (NO NO not of their clothes)but of all their perks and tax payers owned credit cards just for starters,then ship them too china on board a submarine as deck cargo,then make them pay for the water rates.

30 Jun 2010 08:19p.m.

johnmillan wrote:

Lightseeds,are they not the part of drugs that damages the brain cells,and makes you see blue?.Labour thaught about ETS but never introduced it,But this idiot Nat government went by labours Idea and put to practice,so the laugh is on National for being so bloody stupid.

30 Jun 2010 03:49p.m.

Bill wrote:

National warning big business about price gouging is like the people of New Zealand trying to stop this scam called ETS. Key and his corrupt mates are there for big business, and to trample the poor further into the ground. I think it's time Key and all his corrupt mates opened up their secret Trust accounts for scrutiny so the public can see if they have shares in the Trading Scam. I see their lobbyist Lightseed still trying to protect their arses.

30 Jun 2010 01:48p.m.

Lightseed wrote:

of course millian forgets that under labour we would be paying more than double for their ETS. He goes on to claim it has been learned our vehicle registration would rise, ah no, because anyone with a brain knew this for the past 6 plus months. typical brainless labour supporter

30 Jun 2010 01:11p.m.

johnmillan wrote:

Thursday is D day for most New Zealanders,and out out in November 20011 if not sooner for this government.Tomorrow spells higher electricity,petrol,food and commodities,service fees,dairy products,Now it has been learnt our vehical registrations are going to rise.Tax rebates what are those???Is it just a word without a meaning to the National Party.I think myself this government is trying too push out as many Kiwis from New Zealand as it can, so it can be a fully pledged state of Asia,I just dont know the reason for the Maori party to be backing this crowd as it is more of them being hurt.Or have they got a secret agenda that the pakeha does not know about.

30 Jun 2010 12:22p.m.

V wrote:

Forget the FACT that its all a SCAM, The criminals are in charge of this country get rid of them.