Restaurant association furious at ACCC action against cafes on component pricing

The restaurant industry is furious at the Australian Competition and Consumer Commission for taking “action through press release” against four cafes and restaurants which have been charged for allegedly adhering to component pricing regulations.

The owner of one in the restaurants has even denied knowledge of any initial correspondence with the ACCC, saying there was “no warning” before an infringement noticed was sent.

New laws make it mandatory for cafes and restaurants to abide by component pricing laws, which force stores to clearly display extra charges payable on weekends and public holidays.

But Restaurant and Catering Association chief executive John Hart says the action taken by the ACCC is illogical and unfair, and smaller companies shouldn’t be named in lieu of larger, more well-known restaurants.

“The compliance activity being undertaken over the past three to four months has been pretty vicious,” he says.

“The reality is, we detest the way the ACCC goes about these things because they do so through press releases and by naming companies. I understand the reason they do it, because they just don’t have enough officers to round people up, but we still think it’s absurd and totally unfair.”

Yesterday the ACCC said it had instituted proceedings against four cafes and restaurants in Sydney, alleging they had breached the Trade Practices Act. The four companies in question are:

• A.I. Constructions (ACT) Pty Ltd trading as Babar Café and Bar (Woden).
• Helmos Enterprises (NSW) Pty Ltd trading as Georges Bar and Grill (Sydney).
• Le Sands Restaurant and Le Sands Café Pty Ltd trading as Signature Brasserie (Brighton Le Sands).
• Gourmet Goody’s Family Restaurant Pty Ltd trading as Steersons Steakhouse (Sydney).

Hart says there is “no logical way” these four companies could have been picked, and that they are simply being picked to send a message.

“Our board is absolutely furious with the way this has been dealt with, there is so much anticompetitive behaviour and yet so many bigger players get away totally unscathed. Because they won’t pick a fight with them, they go after the smaller players.”

George Vardis, who owns the Georges Bar and Grill named in the ACCC press release declines any knowledge of the initial correspondence or enforcement of component pricing laws.

“There was no warning, and it hasn’t been publicised. It wasn’t publicised through our association, no one called, and we didn’t have any correspondence.”

“All we received was the infringement notice, and they expect us to pay for it now without any warning.”

Vardis declined to comment any further, saying the matter has been referred to the restaurant’s legal defence team.

The ACCC also declined to comment further on the issue, and referred SmartCompany to its press release. In it, the watchdog states these companies have only been targeted because they refused to engage in initial correspondence once a warning was given.

“The ACCC had undertaken a compliance survey that identified a number of cafés and restaurants’ menus the ACCC considered did not comply with the Act.”

“The traders were contacted and the ACCC took no further action against those who responded swiftly. Infringement Notices were issued to those cafés which did not correct their menus despite the ACCC’s concerns.”

Last month, the ACCC took action against gym chain Fitness First for allegedly breaking component pricing regulations. Chairman Graeme Samuel said at the time the regulations have been in place for some time and businesses are expected to comply.

“The component pricing laws have been in place for more than 12 months, businesses that do not comply with the requirement to prominently specify a single price for their goods or services risk enforcement action being taken against them by the ACCC,” he said.