Noel Leeming cautioned by the Commerce Commission for violating FTA

The Commerce Commission has issued an official warning to Noel Leeming, a retail chain for making delivery representations of 2 products, for which the retailer did not have reasonable grounds during the coronavirus period.

Noel Leeming is a leading consumer electronics and appliances retailer in NZ.

The Commission has received about 125 complaints about Noel Leeming Group (NLG) that were related to delivery issues and suspected bait advertising as of 26 November.

The enquires came from people who had not got their products within the NLG timeframe of the delivery, problems in informing NLG about delivery delays and not receiving any refunds for delivery delays whenever a request was made.

The retailer was quite fortunate to operate during the lockdown period, providing essential products to people. The Group also experienced an exceptional rise in demand, implying some orders were taking longer to deliver.

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Probable FTA violations by Noel Leeming

NLG has most probably violated the Fair Trading Act, as per the Commission, by acknowledging payment for 37 Amazon Kindle 4GB 2019 products on 5 and 6 April when it ran out of stock to complete these orders. The electronics chain eliminated the product from sale on 6 April informing customers about the situation and offered a refund on 16 April.

The Commission also believes that NLG is likely to have violated the Fair Trade Act on 26 June and 2 July by advertising a DJI Ronin-SC Control Cable with a 1–2 week time framework for expected delivery.

The advertising was done despite having a current outstanding order and not taking any action to identify with its supplier the reasons for the delay, supply of the commodity or planned delivery time frames.

The Commerce Commission had also taken legal action against the Group in 2018, claiming that it misled consumers about policies on faulty goods.

Anna Rawlings Commissioner Chair stated that NLG witnessed unparalleled consumer demand while deliveries were considerably impacted at that stage. Nevertheless, the electronics chain must have headed more cautiously while making representations about product availability and delivery time frame, she added.

Mr Rawlings noted that costumers had lowered their ability to shop for alternative products during changing coronavirus alert levels. Hence, consumers were heavily dependent on representations made by NLG on availably and delivery times.

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