From 1 July 2012, the carbon price will come into effect.

You may want to raise your prices around this time to help counter increased costs your business will experience as a result of the carbon price.

Be careful about claims you make in relation to increased prices.  The ACCC will be on the look-out for any contraventions of the Australian Consumer Law (ACL) stemming from carbon price claims.

The ACCC has released a Guide.  It focuses on carbon price issues but is a good reminder of general trade practices issues.

The principles apply equally to the financial services industry.  That industry derives many of its consumer protection obligations from the ASIC Act 2001 rather than the Competition and Consumer Act 2010, of which the ACL is part.

For example, if you choose to explain why your prices have increased, your explanation must be truthful.  If you want to use 1 July 2012 as a convenient time for a price rise you were already planning for other reasons, you will be engaging in misleading or deceptive conduct to say that it is solely due to carbon pricing.

It might be that the carbon price is one among many factors leading you to increase your prices.  In this case, do not claim that it is the sole factor.

Other dangers are:

• claiming that the carbon price will impact your business’s prices before 1 July 2012
• trying to persuade customers to buy before 1 July 2012 on the basis that your prices will be pushed up by the carbon price after that date.

It is acceptable to make a claim where you have a reasonable basis for the claim.  For example, where a key supplier or electricity company has notified you of impending price rises due to the carbon price, this might form part of the basis of your claim.

If the ACCC takes particular interest in a claim you are making about the impact of the carbon price on your prices, your best line of defence will be factual material that provides a basis for your assertions.

Author: Sam Hills 

Carbon pricing, the ACCC and you by Holley Nethercote Commercial Lawyers is licensed under a Creative Commons Attribution-Noncommercial-No Derivative Works 2.5 Australia Licence.

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