ACCC clamps down on ‘No Contracts’ membership advertising

July, 2014

Following a review of advertising in the fitness industry, the ACCC has warned that gyms using the phrase ‘No Contracts’ in advertising need to consider whether they are misleading their customers. Misleading conduct can carry penalties of up to $1.1 million per contravention of the Australian Consumer Law.

ACCC Deputy Chair, Dr Michael Schaper, said if “a customer sees an offer of ‘No Contracts’, there should be no conditions on terminating the service or further payments required.”

The ACCC considers that it is likely to be misleading for a gym to use the term ‘No Contracts’ in the following circumstances when:

The ACCC is monitoring this issue closely and will be identifying any gyms engaging in potentially misleading advertising of its membership contracts. The ACCC has previously taken action on misleading conduct in the fitness industry against Genesis Fitness Club and Fitness First.

Mills Oakley has substantial experience in all aspects of Australian consumer law. Please contact us if you have any questions on the above or would like assistance with the legal review of your marketing promotions and advertising collateral.

Contact Mills Oakley

daniel-livingstonDaniel Livingston | Partner 
T: +61 3 9605 0965

Warren Scott | Partner
T: +61 3 9605 0984

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