Wellington, January 10, 2018
The Commerce Commission has issued a public alert over online transactions of Lux International Sales Aps (LuxStyle), a Denmark based company.
LuxStyle operates the luxstyle.co.nz website, but also reaches consumers through social media advertisements which direct consumers to online portals.
It uses a “Deliver Now, Pay Later” scheme in the portals so that consumers are sent goods without being required to pay for them online first.
The Commission is concerned that consumers are being misled in circumstances where they do not intend to make a purchase.
More than 50 complaints
The Commission has received more than 50 complaints about LuxStyle since May 2016, with many consumers apparently unaware that they would be sent the goods before they have tendered 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 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,” Commission’s General Manager (Competition) Antonia Horrocks said.
“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 Ms Horrocks.
If consumers receive an order confirmation email from LuxStyle for goods they did not intend to order we recommend they follow the link in the email to cancel the order or contact LuxStyle’s customer service to request a cancellation.