ACCC pounces on Digital Products Group

Consumer watchdog, the ACCC has penalised Digital Products Group for $238, 000 because of resale price maintenance of Topfield branded set-top boxes.

The latest fine comes off the back of Optima and JB HiFi’s problems with the watch dog in early December.

According to the ACCC Digital Products Group Pty Limited, the national distributor of Topfield branded digital set-top boxes, for engaging in resale price maintenance in contravention of section 48 of the Trade Practices Act 1974.

The penalty was imposed by Justice Tracey of the Federal Court following proceedings instituted by the Australian Competition and Consumer Commission.

Digital Products Group had earlier admitted to the court that in its dealings with a Melbourne based retailer it had breached section 48 of the Act by; attempting to induce on two occasions and on 17 occasions inducing the retailer not to advertise certain Topfield digital set top boxes supplied by the distributor at prices less than prices specified by the company.

It also owned up to using a statement of price that was likely to have been understood by the retailer as the price below which the retailer was not to advertise a certain Topfield digital set top box for sale

The contraventions took place between October 2003 and June 2005.

Digital Products Group's sole director, Jai Kemp said he knowingly concerned in 11 of the contraventions and was penalised $42, 000.

The distributors' national sales manager, Mark Dopson also admitted to knowingly concerned in nine of the contraventions and was penalised $17, 500.

As well as imposing these penalties, Justice Tracey ordered injunctions against Digital Products Group, Kemp and Dopson preventing them from engaging in similar conduct in future.

He also ordered that Digital Products Group implement a trade practices compliance program. The orders were made with the consent of the parties.

"It is important that wholesalers understand that they cannot try to prevent retailers from advertising or selling their products below particular prices", said ACCC Chairman, Graeme Samuel.

The cases all demonstrate that wholesalers and their individual representatives that do so face the risk of substantial monetary penalties being imposed against them. The ability of a business to advertise products at a discounted price can assist consumers in getting the best deal and encourages other businesses to compete on price, said Samuels.