Australian Competition and Consumer Commission v Mazda Australia Pty Ltd (No 3)

In the Federal Court, the Australian Competition and Consumer Commission (ACCC) brought proceedings against Mazda Australia Pty Ltd (Mazda) seeking pecuniary penalties and other orders for breaches of consumer guarantees under the Australian Consumer Law (ACL). The proceedings were a continuation of previous litigation in which the Court found that Mazda had misled consumers about their rights under the ACL and ordered Mazda to pay pecuniary penalties of $21 million. The current proceedings related to additional contraventions of the ACL and sought a further penalty, as well as other orders. The Court found that Mazda had contravened the ACL by misleading consumers about the existence or effect of consumer guarantees and by making false representations that it had reasonable grounds to believe consumers were not entitled to a refund or replacement vehicle at no cost to them. The Court concluded that Mazda had failed to consider the consumer guarantee provisions of the ACL and instead focused on commercial negotiations with consumers. The Court accepted that Mazda had since implemented significant changes to its complaint handling process and that it had shown insight into its failings. The Court imposed a penalty of $11.5 million, having regard to the seriousness of the contraventions and the changes made by Mazda. The Court also ordered Mazda to implement a compliance program, provide disclosure to its dealers, publish a notice on its website, provide redress to affected consumers, and pay 70% of the ACCC’s costs. The Court held that the penalty and orders were appropriate to achieve general deterrence and to ensure Mazda complied with the ACL in the future.