Australian Consumer Law treats advertising as a representation a customer is entitled to rely on. If the words, images, price tags, social posts, sales scripts or fine print combine to leave a customer with a wrong impression of what they are buying, the conduct can be unlawful — even if every individual sentence is, in isolation, true. That is the core of the misleading and deceptive conduct regime, and it is one of the most heavily enforced areas of Australian consumer regulation.
This article explains what "misleading or deceptive" actually means in the Australian Consumer Law, walks through the test that courts apply, looks at the specific provisions that businesses most often fall foul of, and grounds it in a worked example. It then sets out where legal input is usually worth getting, and closes with the single principle most worth holding on to.
The two core provisions: sections 18 and 29
The Australian Consumer Law (ACL) sits in Schedule 2 to the Competition and Consumer Act 2010 (Cth). Two provisions do most of the work in advertising disputes.
The general rule is in s 18 of the ACL. It prohibits a person in trade or commerce from engaging in conduct that is misleading or deceptive, or likely to mislead or deceive. There is no need to show intent, no need to show actual loss, and no need to show that any particular customer was actually misled. The provision is forward-looking and objective: would the conduct, judged against the audience it was directed at, be likely to lead a reasonable member of that audience into error?
Section 29 of the ACL sits alongside s 18 and targets specific kinds of representations. It prohibits false or misleading representations about, among other things, the standard, quality, value or grade of goods or services; that goods are new; the existence of sponsorship, approval, performance characteristics, accessories, uses or benefits; testimonials; the price; the country of origin; and the existence or effect of any condition, warranty, guarantee, right or remedy. Most ACCC enforcement actions in advertising touch s 29 because the conduct is usually about a specific factual representation — a price, a quality claim, a green credential, a guarantee — rather than a vibe.
A single piece of advertising can breach both at once. Regulators often plead them in the alternative.
What "misleading" means in practice
The legal test is objective and is built around three ideas that businesses repeatedly underestimate.
Overall impression, not literal truth. The question is not whether each statement is technically defensible if pulled apart sentence by sentence. The question is the impression the advertisement, taken as a whole, conveys to a member of the audience to whom it is directed. The ACCC's own guidance confirms that "fine print and qualifications must not conflict with the overall message". A bold headline that promises one thing cannot be rescued by a footnote saying the opposite.
The audience matters. Conduct directed at sophisticated buyers (say, enterprise procurement teams) is judged against that audience. Conduct directed at the general public is judged against an ordinary or reasonable member of the public. A claim that an expert would discount may still mislead a typical consumer.
Silence can mislead. Leaving out a fact that a reasonable customer would treat as material — that the "sale" price was the regular price two weeks ago, that the headline rate excludes a mandatory fee, that the testimonial was paid for — can be just as much a contravention as an outright lie. Half a story, when the other half is what the customer needs, is misleading conduct.
The other principle worth noting: the business carries the burden of substantiating its claims. If a regulator or a complainant challenges a representation, the business has to be able to produce the evidence on which the claim was based. "We just thought it sounded right" is not an answer.
Where small and mid-sized businesses most often slip
The same patterns recur across ACCC enforcement.
- Price representations. Strike-through "was/now" pricing where the "was" figure was not genuinely offered for a meaningful period. "From $X" pricing where the $X stock is a token allocation. "Free" offers where the cost is recovered through unavoidable add-ons. Drip pricing, where mandatory fees only appear at the final checkout step.
- Superlatives and comparisons. "Best", "number one", "cheapest", "fastest". These are factual claims unless they are obvious puffery. They need current, defensible evidence pegged to the specific market and timeframe the ad implies.
- Testimonials, reviews and influencer content. Paid or incentivised endorsements presented as genuine; cherry-picked positive reviews that misrepresent typical experience; influencer claims the business has not vetted. The business that paid for the campaign carries responsibility for what the influencer says.
- Green and sustainability claims. Terms like "eco-friendly", "sustainable" or "carbon neutral" without a defined, evidenced scope are a major ACCC focus area. Whether the claim covers the product, the packaging, the operations or the whole supply chain has to be made plain.
- Health, performance and outcome claims. "Clinically proven", a specific success-rate percentage, a guaranteed timeframe — each needs evidence that matches the precise wording used.
- Scarcity and urgency. "Only two left" and "ends tonight" prompts must be accurate. False urgency is a representation about availability and is squarely within s 29.
The thread running through all of these is the same: a representation made, an impression created, and either no underlying evidence or evidence that does not match the claim.
A worked example: the "70% off" winter sale
Picture a homewares retailer running a six-week winter sale. The landing page reads "Up to 70% off storewide". A banner across product tiles reads "Was $200, now $60". Checkout adds a $9 "processing fee" only on the final page.
Walk through how the regime treats each element.
The "up to 70% off" claim is a representation about the discount available on the range. If, in fact, only a handful of low-stock lines reach the 70% level and the bulk of the catalogue is discounted at 10–20%, the headline creates a wrong overall impression. It is not saved by a footnote saying "selected items". The substance of s 18 — overall impression on the target audience — is engaged, and s 29 is engaged because the representation concerns the price of goods.
The "was $200, now $60" claim is a representation about pricing history. If $200 was the catalogue price for only a short window before the sale, or was a price the retailer never actually sold at in volume, the strike-through is misleading. The ACCC has run multiple enforcement actions on exactly this point in recent years.
The $9 processing fee appearing only at the final checkout is drip pricing. The total unavoidable price was not displayed up-front, so the prices shown earlier in the journey were not accurate representations of what the customer would pay.
None of these elements requires bad faith on the retailer's part. The legal test does not turn on intent. A well-meaning marketing team chasing a sharper headline can easily walk a business into all three.
The remedy, at the design stage, is structural: build an evidence log that ties every quantified claim to source data, run a sense-check that reads the landing page as a typical customer would (headline plus image plus first paragraph, ignoring the footer until it matters), and require the total unavoidable price to be the first price the customer sees.
Where Artificer Legal usually gets involved
Most ACL advertising work for a small or mid-sized business is preventative rather than reactive. The point at which legal input tends to pay back is before a campaign goes live, or shortly after a regulator letter arrives.
A typical engagement looks like this:
- Campaign review. Reading the proposed creative, pricing logic and landing pages against the s 18 and s 29 framework. Flagging headline claims that need substantiation, fine print that contradicts the main message, and disclosure gaps on testimonials or influencer content.
- Substantiation framework. Helping the business build a lightweight evidence log so that every quantified claim — "saves $200 a year", "99% uptime", "Australia's number one" — has a documented source the business can produce on request.
- Documents that match the ads. Aligning Website Terms, refund policy, warranty wording and influencer agreements with what the marketing actually promises, so the legal documents do not contradict the campaign.
- Responding to ACCC or state consumer-affairs contact. If a regulator issues an infringement notice, asks for a substantiation notice response, or invites the business into an enforceable undertaking, the response strategy and the timing matter. Acting fast — pausing the campaign, gathering evidence, offering remedies to affected customers — usually produces a materially better outcome than a slower response.
- Class action or complaint response. Coordinating customer remediation, internal review and communications when a systemic issue surfaces.
The work is rarely glamorous, but the cost of getting it right at the campaign-design stage is a small fraction of the cost of an ACCC investigation, a pecuniary penalty under the ACL — which for a company can reach the greater of a very substantial fixed amount, three times the benefit derived from the conduct, or 30% of adjusted turnover for the breach period — and the reputational drag that follows a public enforcement outcome.
The single thing worth remembering
If you take one principle from this article, take this one: the law assesses the impression your advertising creates on a typical member of your audience, taken as a whole, before it cares what any individual line says. Headlines, images, price displays, scarcity prompts and fine print are read together. If the bold version of the message overstates the qualified version, the qualified version is not what your customer takes away — and it is not what the regulator will assess you against.
To recap the article: misleading and deceptive advertising sits primarily under s 18 (the general prohibition) and s 29 (specific false or misleading representations about goods or services) of the Australian Consumer Law. The test is objective, audience-relative, and built around the overall impression of the conduct rather than the literal truth of each sentence; silence and omission can mislead just as readily as a false statement. The recurring problem areas are price representations, superlatives, testimonials and influencer content, green claims, health and performance claims, and false urgency. A worked "up to 70% off" example shows how all three of headline overreach, strike-through pricing and drip pricing engage the regime simultaneously. Legal input is most useful before a campaign goes live — designing claims that can be substantiated, aligning documents with promises, and standing up an evidence log — and immediately after any regulator contact, where speed of response materially changes the outcome.