ACCC commences fresh sweeps for greenwashing, misleading online reviews

Latest action is part of the regulatory watchdog's compliance and enforcement priorities to hunt down deceptive advertising and marketing practices

Companies claiming environment and sustainability claims they can’t back up are being put on notice by the Australian Competition and Consumer Commission (ACCC) as it commences a fresh sweep of the Internet to scour for misleading online business reviews and marketing.

The latest Internet sweeps are being conducted over coming weeks and form part of the regulatory watchdog’s compliance and enforcement priorities for 2022-2023 to hunt down deceptive advertising and marketing practices.

The two Internet sweeps are expected to canvas at least 200 company websites across a number of targeted sectors including energy, vehicles, household products and appliances, FMCG, cosmetics, clothing and footwear. The ACCC said it’s searching for misleading environmental claims, viewing online content through the lens of the ordinary consumer and what they will interpret such claims to mean.

“As consumers become increasingly interested in purchasing sustainable products, there are growing concerns that some businesses are falsely promoting their environmental or green credentials. Misleading claims about products or services undermine consumer trust and confidence in the market,” ACCC deputy chair, Delia Rickard, stated. “This sweep forms a core part of our work in actively monitoring for ‘greenwashing’ in the market and will help inform what steps businesses can take to improve the integrity of their environmental claims.”

In addition, the ACCC is conducting another sweep to identify fake or misleading online reviews and testimonials, a step in its quest to call out deceptive practices in digital marketplaces. This sweep will be looking at reviews on company websites, Facebook pages and third-party review platforms and plans to encompass at least 100 businesses.

A second sweep will then look for misleading advertising by influencers on social media channels and particularly those that don’t disclose sponsorship or advertising.    

“Unfortunately, consumers are facing an ever-increasing range of manipulative marketing techniques designed to exploit or pressure them, due in part to the huge number of online information sources available. Consumers often rely on reviews and testimonials when making purchases, but misleading reviews can be harmful,” Rickard said.

“Businesses can also be significantly impacted, particularly by negative reviews at the hands of competitors or third-party professional reviewers acting on behalf of a business. Review manipulation of any kind can impact a business’ star or numeric rating, leading to an overall misleading impression of the business.

“We are looking to identify businesses, review platforms or sectors where there is a pattern of misleading online reviews and testimonials that have the potential to cause significant consumer or small business harm. Both positive and negative reviews and testimonials – including those that are incentivised – can be false or misleading, particularly if they are presented as impartial but are not.”

The ACCC said sweeps will be followed up with compliance, education and potential enforcement activities. Findings will be published once sweeps are collated and analysed.

“We also want to improve awareness to enable consumers to make more informed purchasing decisions,” Rickard added.

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