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So a few weeks ago I thought I might sit down and send the Australian Consumer Competition Commission regarding GW's pricing in Australia.

This is there response.

Im not sure if its worth sending a Complaint to the ATO, Would they listen especially considering the ACCC didnt?

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Subject:
Overseas Companies restricting imports & charging GST on goods
Description:
Hi, I was just wondering; is it legal for companies to ban distributors from sending goods to Australia as well as overseas stores of the manufacturer charging GST on goods shipped to Australia but not passing on the revenue raised to the Australian Tax Office?

The company I’m referring to is a little known manufacturer called Games Workshop. Games Workshop UK bans retailers from selling to Australia; but allows shipping from its UK online store for 200 pounds (Its US Store is around $250) - sadly that is not a typo. This is despite the weight and size of the package to be quite small (from about 15cms ling; 4cms deep and weighing about 100-200 grams)

As an example of pricing; a new finecast Thunderfire Cannon. Based on prices from the GW site. For those in the USA it will cost $56 For those in Australia it will cost $94 Currently the US and Australian dollars are about the same so those prices above represent the actual price difference. Why are Australians expected to pay almost 70% more for the same product?

They also add 10% onto the price when purchasing from the Games Workshop US and UK Stores claiming that it’s the charge for the Australian GST, but as I am aware they do not give that revenue to the ATO. I was just wondering; is all the above legal (and part of our living in Australia tax) allowing multinationals to charge Australians through the nose as well as collecting taxes and not forwarding on those funds to the ATO.

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Dear XXX,

Thank you for your email of 21 May 2012 to the Australian Competition & Consumer Commission (the ACCC) regarding retail pricing in Australia and other issues associated with the international sale of games by Games Workshop UK. Your matter has been assigned the reference number XXXXX. We unreservedly apologise for the delay in providing you with a response.

The role of the ACCC is to ensure compliance with the Competition and Consumer Act 2010 (Cth) (the Act), which is designed to encourage fair trading and discourage anti-competitive conduct through a specific set of competition and consumer protection rules.

I observe that you noted three separate issues in your email; overseas companies banning distributors from sending goods to Australia, the differing retail cost of items in Australia relative to international prices, and the failure of companies to pass on to the Australian Taxation Office (ATO) revenue collected for payment of the Goods and Services Tax. I intend to deal with each issue in turn.

With regards to overseas companies instituting bans on distributors sending goods to particular places – including Australia – this would only raise concerns under the anti-competitive provisions of the Act if the denial of supply substantially lessens competition within the market. The market in this instance is not likely to be restricted to this degree, as the width with which markets are construed would be likely to include other forms of similar games and gaming products. Because of the substitutability of one form of game (and associated products) for another, this is not likely to substantially lessen competition in the market, and therefore is unlikely to breach the Act.

With regards to the second major issue of pricing, I understand and sympathise with your concerns about the high prices that consumers pay for some products in the retail market compared to international prices. The ACCC is constrained by the legislation it administers and there are no provisions in the Act that prohibit this type of conduct. The ACCC has no power to set or control prices for goods and services at either the retail or wholesale levels. It does not have a direct role in regulating or setting prices except in the case of products or services that are declared under Part VIIA of the Act. The prices of amusement items, including Games Workshop products, are not declared under Part VIIA. In these circumstances businesses are free to determine their own pricing policies and provided that they do this independently it is unlikely to raise concerns under the Act.

However, I am concerned by the allegations you raise in your email regarding the failure by Games Workshop and other companies to pass on taxation-related revenue to the ATO. While this is not a matter which falls within the ACCC’s purview, if you have any evidence to substantiate these allegations, it would be of significant value to the ATO, and I urge you to pass this information on. The ATO can be contacted on 132 866 or through their website at www.ato.gov.au.

Thank you for contacting the ACCC. I regret that I am unable to be of more assistance to you. If you have any further questions, please do not hesitate to contact us again.

Yours sincerely,

XXX

The first question you need to ask yourself is, what are you trying to accomplish with this? If you are simply mad at GW and want to punish them for something, then this might work. If you want cheaper prices, I don't see how this could possible work to accomplish that.

To break it down to the same 3 points:

1) GW banning distributors in other countries from shipping product to Australia. By the way, this is a very common practice where companies will even sell the rights to distribute their product to specific areas. You will not be able to fix this with Australian law. You are talking about a UK company (GW) putting contractual restrictions on other UK companies (or US companies, German companies, etc.) Contract disputes would have to be fought out in court in their respective country, not Australia. The only way I could think to fight this point would be to have a distributor sue GW over the fact that they can't ship to Australia. They will almost surely lose, because I'm sure this battle has been fought many times with a distributor selling to a competitors region/area and being held in breach of contract. Pursuing this might be a small hassle for GW, but their lawyers have probably fought this battle before and GW will chalk it up to the cost of doing business and won't make any change (if we're lucky) or may see a decrease in profits and will pass the cost of defending against litigation on to customers. I doubt GW would consider this a punishment and this will not change how they distribute to Australia.

2) GW making prices higher in Australia than they are in the UK. The response this is going to get is don't buy their product. If sales drop in Australia, GW will have a decision to make, lower prices or stop selling to Australia. Are there other companies that sell miniatures in Australia? Yes. Are they cheaper than GW? Yes. Clearly GW does not have a monopoly. The fact that people want GW stuff to be cheaper, more in line with what other miniatures are selling for, just means that GW makes a "better" product than the other companies, otherwise people would just buy the other companies product. If anything, I think GW would use this as further proof that they don't need to lower prices.

3) GW collecting taxes from customers but not turning that over to the government. This one, if true, might be a problem for GW. I say might, because how would Australia collect if GW does not have a presence in Australia. They could sue, but who do you serve with the papers? Do you fly to England to serve the paper? Will anyone from GW even show up to court in Australia? If they owe enough, it might be worth it for them to just decide not to ship to Australia anymore. If GW decided to cooperate with the lawsuit from the Australian Tax authority, they would pay the taxes collected and possibly a fine and then they would "fix" their problem to make sure they paid the taxes going forward. Games Workshop would probably feel punished by the process, but this would drive up prices, not lower them.

My only comment is around you saying the ACCC didnt listen, From the above response it seems they replied in kind to the issues you raised, it seems the issue isnt that they didnt listen, but that the reply wasnt the "GW is wrong" response you were looking for. Aside from the 3rd item, the response seems to point to GW not actually doing anything wrong.

Unless of course I've just misunderstood something in the response

Interesting turn of phrase that, "as far as I am aware."

How much research have you done to reach this stage of awareness?

GW has broken no law under 1 and 2.

GW has every right to control its own product and restrict it's own product from being easily sold iN GW. The guy is right... other gaming products are totally unimpated by GWs action so there is no issue.

GW is not food or water or other necessities which means it is impossible to 'price gouge' from a legal definition. While plastic crack may be a needed drug by some, it is not int he eyes of the Australian government.

You made up utter lies about tax doges and he called you on it. Basically 'show proof or GTFO before you get sued.' You have no proof, you have no idea except you think they are charging more for a tax then somehow not paying it.

I feel like this was a very well worded response by someone who actually researched the issues raised and understands what is going on and not just numb mindless response.

GW is not dumb, they would not be breaking all these laws if some guy on the internet could simply taddle on them and have their whole business come crashing down.

In your crusade to be a Internet hero with dreams of bringing GW to its knees and smashing it open like a giant pinata and having cheap Aussie models fall out, you have basically done the legwork to prove GW is doing everything legal and ok and nothing nefarious is going on (aside from their general 'no one cares about Australian' attitude GW has)

Aeon wrote: Would they listen especially considering the ACCC didnt?

They did listen. His answer was quite professional and to the point.

So...is your internet crusade over? Surely not! You MUST beat this dead horse until you win! Think of the chicks you'll get!

Just because it is the answer you don't like doesn't mean that there is hidden wrongdoing.

Build a bridge and get over it.

That was frankly an amazing response from a government agency. Very professional, to the point, and easy to understand.

Admittedly, it boiled down to this: "You accuse them of three things. The first two aren't illegal, even if true. The third is illegal, but we need more than a hunch to chase down."

I admit, professional. 'Didnt Listen' was a poor turn of phrase, rather, and this is similar poor wording, seemed to find reasons not to act (however well researched reasons.)

In regards to allegations of the tax issue, if you purchase from the UK or the US Sites, once you put in that you are from Australia, as well as charging like a wounded bull for postage, it then adds on 10% to the price of the goods (including shipping) the amount of our GST.

I have purchased from both the UK & US and have invoices supporting my claim. A few years ago they started doing this even before the embargo and I believe it may have been raised even here on Dakka.

The goods are not sourced from the local GW as they came direct from whatever country they were purchased from.


Automatically Appended Next Post:
Also, it is a well written response to points one and two that clarifies that it's not illegal. I wrote it after reading one too many threads on forums saying someone should complain. So I did. This is there response (and useful for people in Australia to see a governments agency's response.)

Yep, I was band wagoning with the wingers I admit, but was also influenced by my dealings with them (ie annoyance at having to pay GST from a OS Company that is sent from OS that is under no obligation to charge GST. Similar to the way that Forgeworld does not remove the VAT when sending Overseas and hence pocketing the tax)

I would like to put my two cents in, as both an hobbist and a tax office employee,

gst: when it comes to gst - the company is required to get registered for gst if it needs to claim gst or even charge gst - a simple way to check is to get the abn and look on the abn lookup website. on the monthly bas they will need to report how much gst they have collected during the time. if the fail to provide all gst or even pass on the reported gst to the ato, then yes the ato can take action. gw will have to pay or have intrest generated on a daily bases of 10.66% until the amount it paid in full. if they fail to do so the ato can seize assets, and even take the money from the bank accounts they will have in Australia - with out gw's permission.

The ato will get it's money one way or another!!

Tye_Informer wrote:1) GW banning distributors in other countries from shipping product to Australia. By the way, this is a very common practice where companies will even sell the rights to distribute their product to specific areas. You will not be able to fix this with Australian law. You are talking about a UK company (GW) putting contractual restrictions on other UK companies (or US companies, German companies, etc.) Contract disputes would have to be fought out in court in their respective country, not Australia. The only way I could think to fight this point would be to have a distributor sue GW over the fact that they can't ship to Australia. They will almost surely lose, because I'm sure this battle has been fought many times with a distributor selling to a competitors region/area and being held in breach of contract. Pursuing this might be a small hassle for GW, but their lawyers have probably fought this battle before and GW will chalk it up to the cost of doing business and won't make any change (if we're lucky) or may see a decrease in profits and will pass the cost of defending against litigation on to customers. I doubt GW would consider this a punishment and this will not change how they distribute to Australia.

The reason this one has come up is that the ACCC has been looking into other companies for similar actions, specifically fashion brands.

While I can't disagree with the reasoning that as GW are only a part of the gaming market, restricting their own products doesn't really break any competition rules, I can't help but wonder why that would be any different for a specific clothing label.



Having said that, if enough people contact the ACCC about a given issue, they will generally look into it deeper. So at this point it really comes down to whether enough people care enough to do so.

Aeon wrote:In regards to allegations of the tax issue, if you purchase from the UK or the US Sites, once you put in that you are from Australia, as well as charging like a wounded bull for postage, it then adds on 10% to the price of the goods (including shipping) the amount of our GST.

But does it say that it is sales tax?

It's clear that GW wants Australian sales to be put through it's Australian division, and the 10% surcharge may have nothing to do with tax at all.

As for VAT, it's common practice to charge it when it doesn't need to be added and keep the difference. It's an incentive to exporters. It's legal, it was designed to work that way.

Even if enough people brought it to their attention I doubt the ACCC would be able to do anything about a company in the UK making a decision regarding its local distributors and who they can sell to. They're not breaking Australian law by placing restrictions on non-Australian retailers.

Could they be breaching parts of UK law? I don't know, and that's something someone in the UK would have to look into. Whatever the case though, it doesn't break Australian law, and all the ACCC can do is look at that, not UK law.

insaniak wrote:

Tye_Informer wrote:1) GW banning distributors in other countries from shipping product to Australia. By the way, this is a very common practice where companies will even sell the rights to distribute their product to specific areas. You will not be able to fix this with Australian law. You are talking about a UK company (GW) putting contractual restrictions on other UK companies (or US companies, German companies, etc.) Contract disputes would have to be fought out in court in their respective country, not Australia. The only way I could think to fight this point would be to have a distributor sue GW over the fact that they can't ship to Australia. They will almost surely lose, because I'm sure this battle has been fought many times with a distributor selling to a competitors region/area and being held in breach of contract. Pursuing this might be a small hassle for GW, but their lawyers have probably fought this battle before and GW will chalk it up to the cost of doing business and won't make any change (if we're lucky) or may see a decrease in profits and will pass the cost of defending against litigation on to customers. I doubt GW would consider this a punishment and this will not change how they distribute to Australia.

The reason this one has come up is that the ACCC has been looking into other companies for similar actions, specifically fashion brands.

While I can't disagree with the reasoning that as GW are only a part of the gaming market, restricting their own products doesn't really break any competition rules, I can't help but wonder why that would be any different for a specific clothing label.



Having said that, if enough people contact the ACCC about a given issue, they will generally look into it deeper. So at this point it really comes down to whether enough people care enough to do so.

I'm not even sure they're aware of what GW actually produces to begin with (Firethunder Cannon?) and may have simply just lumped it in with games in general. GW are small in the grand scale of things after all. We also have independents which are allowed to stock their product so it's not like the embargo outright forced everyone to go straight to their stores alone. Though I know not everyone will have that luxury.

Aeon wrote:
Dear XXX,
*snip*

With regards to overseas companies instituting bans on distributors sending goods to particular places – including Australia – this would only raise concerns under the anti-competitive provisions of the Act if the denial of supply substantially lessens competition within the market. The market in this instance is not likely to be restricted to this degree, as the width with which markets are construed would be likely to include other forms of similar games and gaming products. Because of the substitutability of one form of game (and associated products) for another, this is not likely to substantially lessen competition in the market, and therefore is unlikely to breach the Act.
*snip*

So this comment essentially says that GW isn't the only competitor in the market place. Games from other producers are available.
I'd be interested to know, although no-one has been able to give me a straight answer yet, are other games in Aus similarly re-priced for that market? So, for example if someone in Sydney wanted to buy Warmachine or Infinity from a FLGS, would it be twice the price of the same item bought from the EU/US?
Obviously there is no trade embargo from other companies, but how do prices compare when buying from the likes of Maelstrom/Wayland and shipping to Australia?

@Pacific As far as I can see, extremely favorably.

I can't say I am surprised by the response. It is pretty clear there is considerable competition for GW in the Australia @ Oceania market, so the "embargo" should, mainly, be hurting GW itself, in a market that regulates itself rationally. And there is no law against running your own business into the ground.

From what I hear about the games I concentrate on - WM/H and Infinity - both (especially the former) have been experiencing explosive growth since the start of the "embargo" in Oz. This might imply that GW, indeed, are hurting themselves and losing customers.

The only realistic way to have them reconsider the "embargo" is to stop buying GW products to send a message. For the most effective message, this includes buying used products - unsold eBay miniatures will lessen demand for new versions of the same product.

Polonius wrote:That was frankly an amazing response from a government agency. Very professional, to the point, and easy to understand.

Admittedly, it boiled down to this: "You accuse them of three things. The first two aren't illegal, even if true. The third is illegal, but we need more than a hunch to chase down."

As usual, Polonius has been very insightful. I agree that the response you received should be taken as a sign of interest and encouragement, rather than a shoot down. Someone at the agency took the time to read your e-mail, digest it, consider the issues raised, and write a cogent and professional response. That this specific agency could not do much for you right now does not mean that you should no longer look into the matter. In fact, the e-mail suggests to me that the agency is taking your concerns seriously and suggests how you may be able to go forward.

Be careful of going to Government entities...


Other then that, vote with your wallet.

go go go to government entities, this is what they are for.
In regard to GW international price gouging... feth em

For our Austrialian and New Zealand members. Please check out my sig.

As Grot 6 said. "Other then that, vote with your wallet."

I do not buy direct from games workshop so can post to the southern hemisphere.