December 3, 2009The Federal Court has declared
Personalised Chocolates 4U and its sole director, Troy Patching, misled franchisees and engaged in conduct in breach of the Franchising Code of Conduct, following legal action by the
Australian Competition and Consumer Commission (ACCC).
ACCC Chairman Graeme Samuel explains the “false and misleading” statements related to promises of software, training and support for prospective franchisees, which PC4U were reportedly unable to provide.
“This outcome reminds all franchise owners that their promotional material must be truthful and accurate, and that it is illegal to accept payment for goods and services that cannot reasonably be provided," Samuel says.
According to ACCC reports, the court has made orders declaring PC4U breached various sections of the
Trade Practices Act 1974 in relation to making false representations and obligations under the franchising code.
The court also declared Patching was knowingly concerned in all of those breaches of the Act and the code.
As a result, PC4U has been ordered to publish a corrective notice on its website, send a letter to former and current franchisees advising them of the court orders, implement a trade practices law compliance program and training, and pay a contribution to the ACCC’s court costs.