Component Pricing Laws Catch Fitness First

It took a while but the Australian government has pounced on a franchisor. But not for any abuse of franchising or breach of the Franchising Code of Conduct.

Australia's consumer watchdog has claimed its first scalp under new component pricing laws, which requires companies to include the total cost of goods or services in a single advertised price, with Fitness First under fire for a special discounting joining fee promotion.

The Fitness First "gold coin to join" promotion, which ran during January and February of 2010, said that gym customers could pay a "gold coin" and a special administrative fee to join the gym network, instead of the usual joining fee.  SmartCompany

Perhaps the ACCC saw this as the Al Capone tax strategy. Or perhaps they just felt comfortable with this law.