ACCC VW investigation to review 'marketing materials' could levy fines of $1.1m per breach

Paul Madill
By Paul Madill | 1 October 2015

The Australian Competition and Consumer Commission (ACCC) has stated it will review marketing materials from beleaguered German automotive brand Volkswagen, as well as look to levy fines of up to $1.1 million per breach should any wrongdoing by unearthed.

“This enforcement investigation is a priority for the ACCC. We are very concerned about the potential consumer and competition detriment from this alleged conduct,” the consumer watchdog's chairman, Rod Sims, said.

“First, using defeat devices is specifically prohibited under the Australian Design Rules, which are picked up as Australian Consumer Law (ACL) mandatory safety standards.

“As the enforcer of the ACL, the ACCC can take action against any corporation that has breached mandatory standards. Secondly, cars are a big purchasing decision and claims that relate to environmental benefits or fuel efficiency can influence consumer choice.

“Businesses must be able to substantiate any claims they make. The ACCC will be seeking marketing materials from VW Group and will not hesitate to take action if consumers were exposed to false, misleading or deceptive representations.”

VW Australia has not confirmed whether its vehicles or parts utilise defeat devices, while the ACCC is also taking into consideration comments made by Audi Australia.

"Volkswagen Group Australia is working closely with all relevant authorities and is continuing to seek further information from its head office in Germany. This is an ongoing investigation," a VW Australia spokesperson told AdNews

The ACCC is also working closely with the Department of Infrastructure and Regional Development to ascertain just what effect this could have on Australian VW customers. 

The scandal has hit Volkswagen in a number of ways. CEO Martin Winterkorn resigned last week despite claiming no culpability or knowledge of the defeat devices, while VW also lost an estimated $10 billion of its brand worth when the ACCC opened the investigation

When the allegations first emerged, the stock market reacted strongly, wiping $22.1 billion off Volkswagen's market cap. 

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