Knowledge Highlights 21 November 2024
Company ordered by court to cease unfair practices in supply of alkaline water filtration systems and maintenance service packages
On 28 March 2023, the Competition and Consumer Commission of Singapore (“CCCS”) issued a media release about the State Courts’ judgment against a company (“TLM”) and its sole director and shareholder (“TJH”) in relation to unfair practices under the Consumer Protection (Fair Trading) Act 2003 (“CPFTA”) in the supply of alkaline water filtration systems and maintenance service packages.
CCCS had applied to the State Courts on 30 November 2022 seeking, among other things, declarations that TLM had made false claims and misled consumers on its alkaline water filtration systems and maintenance service packages. CCCS had investigated TLM following a referral from the Consumers Association of Singapore (“CASE”) in November 2020. CASE had issued company alerts on TLM in February 2021 and in April 2022 to warn consumers of TLM’s unfair practices after receiving a high number of complaints. TLM did not sign a Voluntary Compliance Agreement (VCA) despite being asked by CASE to do so.
In a judgment dated 22 February 2023, the State Courts declared that TLM had engaged in unfair practices under the CPFTA by, among other things, making false claims and misleading consumers on its alkaline water filtration systems and maintenance service packages. The State Courts ordered TLM to stop engaging in such conduct and TJH to stop knowingly abetting, aiding, permitting or procuring TLM to do the same.
The judgment also includes the following orders:
- TLM and TJH are to publish, at their own expense, by 29 March 2023, a full-page public notice with details of the court orders, in the Straits Times, Lianhe Zaobao, Berita Harian, and Tamil Murasu. If they fail to do so, CCCS may publish a notice in any one of these newspapers and claim the cost from them.
- TLM and TJH are to publish, at their own expense, for three years, details of the orders made against them, on the landing page of any platform used to market TLM’s goods or services. TJH is to also publish the details of the court order made against him on the landing page of any platform utilised by him or any businesses controlled/owned by him to market TLM’s goods and/or services and/or similar goods or services as TLM’s.
- TLM must, for three years, before any consumer signs a contract with TLM:
- notify the consumer in writing about the court order; and
- obtain the consumer’s written acknowledgement of receipt of the notice.
- TLM and TJH shall pay costs of the proceedings fixed at S$12,000 to CCCS.
In an infographic published in relation to this matter, CCCS set out the following important information for suppliers:
- Ensure that claims made about goods and services and any accreditation claims in relation to the business are clear, accurate and substantiated.
- Do not entice consumers with promotions or offers which are not genuine.
- Do not accept payment from consumers for goods or services if the supplier knows or ought to know that the goods or services cannot be provided as agreed.
- Conduct due diligence to verify that any health benefit claims made by the supplier are true, accurate and based on credible evidence.
Reference materials
The following reference materials are available on the CCCS website www.cccs.gov.sg:
