Deceptive and Misleading Advertising in Australia: Key Rules

Advertising grows sales and builds your brand - but it also carries legal risks if the message isn’t accurate. In Australia, the Australian Consumer Law (ACL) sets strict rules against deceptive and misleading advertising. Breaches can lead to penalties, costly corrections, reputational damage, and loss of customer trust.

The good news? With the right systems and a clear understanding of your obligations, you can promote your products or services confidently and compliantly.

In this guide, we’ll explain what deceptive and misleading advertising is under the ACL, share common examples, and outline practical steps to reduce risk across your website, social media, emails, influencer campaigns and in‑store promotions.

What Counts As “Deceptive And Misleading” Under The ACL?

The core rule is simple: don’t make statements or create an overall impression that could mislead or deceive customers. This applies to anything you say or imply in ads, on your website, product packaging, social posts, emails, price displays, and even verbal sales scripts.

Section 18 of the ACL is the general “misleading or deceptive conduct” prohibition. It doesn’t require intent - if the representation is likely to mislead the ordinary consumer, it can breach the law even if you genuinely believed it was true. You can read more about this in our overview of section 18.

There are also specific prohibitions for common problem areas (for example, false claims about quality, origin, price or testimonials) under section 29. These rules cover the details often seen in everyday promotions - think “was/now” pricing, “Australian made” labels, or “best on the market” claims.

Misleading Conduct Examples Small Businesses Should Avoid

Here are common scenarios that trip businesses up. If any of these feel familiar, it’s time to tighten your marketing review and approvals process.

• Was/Now or Strike‑Through Pricing Without Real Discounts. Advertising a product as “Now $49 (was $99)” when the higher price wasn’t charged for a reasonable period, or was used only briefly to create a false saving.
• Drip Pricing. Displaying a low headline price but adding unavoidable fees late in the checkout (e.g. “booking” or “service” fees). All mandatory fees should be disclosed clearly up front. See how this ties to advertised price laws.
• Over‑Stating Stock Or Availability. “Only 3 left!” banners when you actually have ample supply. Scarcity claims must be accurate at the time of advertising.
• Unqualified “Free” Claims. Saying a product is “free” when the customer must pay unavoidable costs (like shipping) or commit to ongoing payments, without prominent disclosure.
• Performance Or Results Claims Without Substantiation. “Removes 99% of stains” or “30% more efficient than brand X” requires sound evidence. You must be able to substantiate these claims if challenged.
• Greenwashing. Broad environmental claims such as “eco‑friendly” or “sustainable” without clear, verifiable basis. Qualify the claim and keep the proof.
• Country Of Origin Mistakes. “Australian made” or “locally sourced” claims that don’t reflect your actual manufacturing or supply chain.
• Testimonials And Reviews That Mislead. Editing or curating reviews to hide legitimate negative feedback, or using paid endorsements without disclosure.
• Competitor Comparisons. “Cheapest in Australia” or “better than ” claims without robust, current evidence.
• Warranty And Refund Statements That Limit ACL Rights. Saying “no refunds” or offering a “limited warranty” without acknowledging the customer’s non‑excludable ACL rights, including guarantees and repairs, replacements or refunds where applicable.

Remember: the overall impression matters. Even if each sentence is technically true, the combined message (including images, layout and fine print) can still mislead the average customer.

How To Make Your Advertising Compliant (And Still Effective)

Compliance doesn’t mean bland marketing. It means clarity, evidence and process. These practical steps will help you reduce risk while keeping your campaigns compelling.

1) Build A Pre‑Publication Checklist

• Substantiation: Can you back every factual claim with solid, current evidence? Keep a folder of supporting documents (tests, data, supplier declarations, pricing histories).
• Clarity: Would a reasonable customer misread the headline or hero image? If crucial details sit only in small print, rework the copy so the key conditions are prominent.
• Pricing: Are all unavoidable fees and surcharges disclosed up front? Align your displays with advertised price requirements.
• Comparisons: If you reference a competitor or “market leading” claim, is the basis current, objective and documented?
• Availability: Stock, delivery timeframes and “limited offer” windows must be accurate at the time you publish.

2) Use Plain English And Prominent Disclosures

If there are conditions, state them clearly near the claim - not buried in a footer. For example, if “free shipping” excludes remote areas, say so where the claim appears.

Where possible, avoid asterisks. If you must use them, keep the qualification short, clear and visible on the same screen or signage.

3) Set Ground Rules For Email, SMS And Social Campaigns

Digital channels are powerful but can carry higher risk due to speed and reach. Ensure your campaigns follow the Spam Act and privacy requirements, and train your team on tone, claims and approvals. If you market directly to customers, you’ll likely need a Privacy Policy and compliant processes for collection, use and unsubscribe. Our guide to email marketing laws covers key points for Australian businesses.

4) Manage Influencers, Affiliates And Testimonials Properly

If you use influencers or affiliates, require them to disclose paid partnerships and stick to your approved claims. Provide a clear brief and retain approval rights over content that mentions your brand. Keep records of what was posted and when.

5) Align Website Legal Pages With Your Ads

Make sure your on‑site information matches your promotional claims. Your Website Terms and Conditions should reflect how you sell, deliver and handle cancellations. If you offer warranties, include a compliant Warranties Against Defects Policy and the mandatory ACL wording where required.

6) Keep A Paper Trail

Document your evidence for claims, the sign‑off process, dates of campaigns, and any updates or corrections. If the ACCC or a regulator makes enquiries, your records demonstrate diligence and help you respond quickly.

Pricing, “Was/Now” Deals And The Fine Print

Pricing is one of the most scrutinised areas of advertising. Get these fundamentals right:

• Display The Total Price. If mandatory fees apply, include them in the displayed price or make them unmissable up front (not at checkout). Hidden fees risk being considered “drip pricing”.
• “Was/Now” And “Save” Claims. The “was” price should be genuine - a price you charged for a reasonable period immediately before the sale. Keep pricing history to back up your discount claims.
• Limited Time Or Stock. Don’t create false urgency. Only use “ends midnight” or “last chance” language if it’s true and you intend to stick to it.
• RRP And “Up To” Discounts. If you reference RRP, ensure it is current and commonly used, and that discounts like “up to 50% off” reflect a meaningful portion of products at that level.

If you run frequent promotions, consider a short internal guide that translates these rules into examples your team sees daily (e.g., how to word banners, what counts as prominent disclosure, and when to ask legal for pre‑approval).

Online, In‑Store And Social: Channel‑Specific Risks

Website And E‑Commerce

Ensure product pages, category banners and checkout screens are consistent. Cross‑check your promotional tiles and pop‑ups against stock levels and delivery timeframes. Keep key legal pages current, including your Website Terms and Conditions and Privacy Policy.

Email And SMS

Respect consent rules, make unsubscribing easy, and avoid overly aggressive or misleading subject lines. If you offer a promotion by email, the discount conditions should be clear within the message itself (not only after clicking through).

Social Media And Influencers

Brief your creators on approved claims and require conspicuous disclosure of sponsored content. Monitor comments and follow up on recurring questions about price, availability or features to avoid ongoing confusion.

Competitions And Giveaways

Promotions should have clear terms that match the ad. Outline eligibility, how to enter, prize details and how winners are chosen. Our overview of giveaway laws in Australia explains the essentials and why some states impose extra requirements.

Handling Reviews, Endorsements And User‑Generated Content

Reviews and ratings influence buying decisions - and regulators know it. A few key principles:

• Don’t Post Fake Reviews. Fabricating positive feedback or paying for undisclosed endorsements can breach the ACL.
• Don’t Hide Legitimate Negative Reviews. Moderation should be about removing offensive or irrelevant content, not silencing fair criticism.
• Disclose Incentives. If a reviewer received a benefit (discount, free product, payment), ensure this is disclosed clearly.
• Be Ready To Respond. If a customer raises a legitimate issue in a public review, a prompt, fair response can reduce legal and reputational risk. For disputes about false reviews harming your business, see our guidance on fake Google reviews.

What Happens If You Get It Wrong?

The Australian Competition and Consumer Commission (ACCC) can investigate and take enforcement action. Penalties for contraventions of the ACL can be significant, especially for false or misleading representations in section 29 categories.

Other consequences include enforceable undertakings, corrective notices, refunds or compensation to affected customers, and the cost of re‑running campaigns or re‑labelling products. The reputational impact can outlast the immediate penalties.

If you discover a problem, act quickly: pause the promotion, correct the statement, contact affected customers where appropriate, and document your steps. Early, transparent action can reduce harm and demonstrate good faith.

Essential Legal Documents To Support Compliant Marketing

A few well‑drafted documents help set expectations and keep your advertising aligned with how you actually trade.

• Website Terms and Conditions: Set the rules for browsing, ordering and limitations of liability. Ensure these match your promotions and fulfilment processes. See Website Terms and Conditions.
• Privacy Policy: Explain how you collect and use customer data for marketing, analytics and personalisation. Required if you collect personal information and best practice for all online businesses. See Privacy Policy.
• Warranties Against Defects Policy: If you offer your own warranty, include the mandatory ACL wording and make the terms easy to find. See Warranties Against Defects Policy.
• Supplier And Manufacturing Agreements: Build in accurate product specs, quality standards and labelling obligations so upstream mistakes don’t lead to misleading claims.
• Influencer Or Affiliate Agreements: Require compliance with your brand guidelines, approval rights over content, and proper disclosure of sponsored posts.
• Customer Terms (Online Or Offline): Spell out pricing, promotions, delivery, cancellations and refunds so your sales processes and marketing are perfectly aligned.
• ACL Compliance Support: For complex campaigns or recurring questions, get targeted guidance through our ACL Consultation.

A Simple Compliance Workflow You Can Implement This Month

1. Map Your Risky Claims. List all regular claims (e.g., “Australian made”, “Save X%”, “Best‑seller”, “Eco”). Note the evidence you hold for each and where they appear (site, ads, socials, in‑store).
2. Set Review Triggers. Require pre‑publication review for high‑risk claims, competitor comparisons, major promotions and limited‑time offers.
3. Create Templates. Prepare approved wording for common scenarios (e.g., sale banners, shipping claims, availability statements) to minimise one‑off improvisation.
4. Refresh Your Legal Pages. Align your Website Terms and Conditions, returns info and warranty statements with how you actually trade.
5. Train The Team. Run a short session on the ACL, focusing on real examples and your internal checklist. Include third parties who create ads or content.
6. Monitor And Correct. Track customer queries, returns and reviews for clues about confusing claims. If something isn’t landing, fix it promptly and document the change.

FAQ: Quick Answers To Common Questions

Do Disclaimers Or Fine Print Protect Me?

Only if they’re clear and prominent. If the headline creates one impression and the disclaimer quietly says the opposite, the overall impression can still be misleading. Put key conditions where customers will see them before they decide.

Can I Rely On What My Supplier Told Me?

You’re responsible for claims you make to consumers, even if the information came from a supplier. Build verification and warranties into your supply contracts and keep evidence on file.

What If An Employee Or Affiliate Makes An Incorrect Claim?

Your business can still be liable. Train your team, supervise third parties and use clear agreements. Correct mistakes quickly and keep a record of your response.

Do I Need To Mention Consumer Guarantees In Every Ad?

No, but don’t say anything that contradicts them (e.g., “no refunds” in all caps). Your on‑site returns and warranty statements should reflect ACL rights. If you offer a voluntary warranty, include the required wording in your warranty policy.

Are Email Subject Lines Regulated?

Yes. Misleading subject lines can breach the ACL and the Spam Act. Keep subject lines accurate and consistent with the email content; see our guide to email marketing laws.

Key Takeaways

• Deceptive and misleading advertising is prohibited under the ACL - intent isn’t required if the overall impression is likely to mislead.
• High‑risk areas include pricing (“was/now” and drip pricing), performance claims, environmental claims, origin statements, influencer endorsements and reviews.
• Build a pre‑publication checklist, keep evidence for every claim, use clear disclosures, and align your sales processes with what your ads promise.
• Keep core documents current - your Website Terms and Conditions, Privacy Policy and warranty policy should reflect how you actually trade.
• If something goes wrong, correct it quickly, notify affected customers where appropriate, and document your actions to reduce harm and demonstrate diligence.
• Targeted advice - especially around section 18, section 29 and pricing laws - can help you design campaigns that are both effective and compliant.

If you’d like a consultation on deceptive and misleading advertising compliance for your business, you can reach us at 1800 730 617 or team@sprintlaw.com.au for a free, no‑obligations chat.