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NZ’s Commerce Commission issues warning on LuxStyle

NZ’s Commerce Commission issues warning on LuxStyle Image courtesy of Stuart Miles at FreeDigitalPhotos.net Featured

New Zealand’s competition enforcement and regulatory agency, the Commerce Commission, has issued an alert, warning the public to be wary when browsing for products online on sites operated by Lux International Sales ApS (LuxStyle), a company based in Denmark.

Luxstyle operates the luxstyle.co.nz website, but also reaches consumers via social media advertisements which direct consumers to online portals.

The website uses a “deliver now, pay later” scheme so that consumers are sent goods without being required to pay for them first.

The Commission says it is concerned that consumers are being misled in circumstances where they do not intend to make a purchase.

According to the Commission, it has received more than 50 complaints about Luxstyle since May 2016, with many consumers apparently unaware that they would be sent the goods before making any payment.

Luxstyle has also been the subject of warnings from other international agencies such as the Australian Competition and Consumer Commission. The Danish Consumer Ombudsman is investigating complaints, including some from New Zealanders.

“Consumers are mostly familiar with the concept of adding items to an online shopping cart.  In general that doesn’t commit you to making a purchase, and you can withdraw from making the order at any time up until you make payment. The LuxStyle portals don’t work that way,” says the Commission’s general manager Competition, Antonia Horrocks.

“Prices for goods are not prominently displayed on the sites and by clicking an 'order now' button consumers find that LuxStyle sends them the goods and an invoice. If they don’t pay, LuxStyle adds fees and threatens debt collection.”   

When contacted by the Commission, LuxStyle denied that it breaches consumer laws.

“Our message to consumers is to be careful about clicking through any site operated by LuxStyle. Be aware that on these sites, if you hit 'Order now' you are not simply adding to the cart, but may receive the goods and a bill for them. DON’T hit the ‘order now’ button if you don’t wish to receive goods from them” said Horrocks.

The Commission has warned that if consumers receive an order confirmation email from LuxStyle for goods they did not intend to order, they should follow the link in the email to cancel the order or contact LuxStyle’s customer service to request a cancellation.

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Peter Dinham

Peter Dinham is a co-founder of iTWire and a 35-year veteran journalist and corporate communications consultant. He has worked as a journalist in all forms of media – newspapers/magazines, radio, television, press agency and now, online – including with the Canberra Times, The Examiner (Tasmania), the ABC and AAP-Reuters. As a freelance journalist he also had articles published in Australian and overseas magazines. He worked in the corporate communications/public relations sector, in-house with an airline, and as a senior executive in Australia of the world’s largest communications consultancy, Burson-Marsteller. He also ran his own communications consultancy and was a co-founder in Australia of the global photographic agency, the Image Bank (now Getty Images).

 

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