ComCom warns Becextech for breaches against Fair Trading Act

The Commerce Commission has issued a warning to Hong Kong-based technology retailer BXT International, also known as Becextech.

 Bexectech sells technology and electronics such as computers, cameras, mobile phones, and tablets to the New Zealand market.

According to the Commission's warning letter states that Becextech:

1. "Misled consumers into believing that they were buying new mobile phones at a discounted price, when in fact the phones were refurbished.

"In our view, Becextech likely misled consumers by failing to clearly disclose this fact... Consequently, consumers were likely to be misled into believing the product was new.

2. "Sold consumers extended warranties that did not contain the mandatory disclosure information for such agreements."

3. "Made unsubstantiated, false and/or misleading representations about the price of goods."

"Becextech represented certain goods as being available at discounted prices and 'on-sale' without having reasonable grounds to support the level of discount claimed.

"We have reached the view that these representations were likely to be misleading because claiming goods are on sale is commonly understood to mean that the prices have been reduced from what a business normally sells goods for. Becextech does not offer consumers discounts from the prices it normally charges," the Commerce Commission's warning letter states.

The Commission reviewed Becextech's website information and conducted test purchases to investigate the allegations.

According to Commerce Commission chair Anna Rawlings, Becextech must comply with the Fair Trading Act like any business that trades in New Zealand. It must also ensure that it is not misleading the public.

"That includes not giving a misleading impression that products are new if, in fact, they are refurbished, and complying with mandatory requirements when selling extended warranties. It is the Commission's view that Becextech failed to do this.

Becextech has agreed to:

• Add "refurbished" as the first word in relevant product descriptions
• Halt the sale of extended warranties
• Alter pricing practices to ensure that any discount claims made refer to a price recently charged by the company, as well as being able to be substantiated.

"Consumers need to be able to rely on the accuracy of business' claims. Specials and deals need to offer consumers genuine savings when compared with the price they might ordinarily expect to pay and products should not be promoted in ways that entice customers to buy under false pretences," says Rawlings.

Becextech was previously listed as a retailer on PriceSpy, however, it is no longer listed on that website.

Companies that breach the Fair Trading Act could face court-mandated fines of up to $600,000 per offence. Individuals could face fines of up to $200,000 per offence.