AMTA has called on the Federal Government to reconsider its proposed legislation on component pricing because it is concerned that crowded advertisements could lead to consumer confusion instead of the Government’s stated aim of clear price information for customers.

AMTA Chief Executive said AMTA’s Members were concerned that the draft Trade Practices Amendments (Component Pricing and Other Measures) Bill 2008 would add to the industry’s regulatory burden without achieving any demonstrable benefits for consumers.

“AMTA supports the Government’s main objective to ensure clear representation in advertising with consumers readily able to identify the price they will pay for the product,” he said.

“Suppliers not providing clear, unambiguous pricing information can – and should – be penalised for not complying with those regulations. AMTA believes that existing regulation should be properly enforced before any new regulation is considered. Further regulation is excessive and places unnecessary regulatory burden on business.”

Mr Althaus said the requirement for clear price information was already enshrined in Federal, State and Territory regulation as well as telecommunications-specific regulation and the Federal Government deregulation agenda was committed to ensuring new regulation is enacted “only where absolutely necessary and at minimum cost to consumers and business”.

“AMTA is further concerned that, rather than ensuring a simple, clear message for consumers, the draft Bill could in fact lead to increased consumer confusion. The information provided will essentially not change, but the presentation will – leading to crowded and confusing advertisements.”

The draft Bill proposes to replace the existing section of 53C (1) of the Trade Practices Act with a new section which will prohibit corporations from using component pricing when making representations to consumers about the price of a good or service unless the corporation also prominently specifies a single figure, the single price the consumer is required to pay for the good or service.

Mr Althaus said AMTA believed it sufficient for the single price to appear in the disclaimers of an advertisement provided there was a clear link between the disclaimer and the relevant part price representation.

“This established method of informing consumers of the price provides a practical and efficient way for the relevant information to be conveyed. It is simple and well understood by consumers. Providing two different price points (part and single) in the body of the advertisement will lead to cluttered advertising that is not necessarily any clearer to the consumer and could in fact lead to greater confusion,” he said.

“Given the industry’s serious ongoing concerns, I strongly urge the Government to reconsider the current proposed drafting.”