19 October 2018

ACCC & ASIC given stronger powers over unfair contract terms

Note

Joint media release with
The Hon Josh Frydenberg MP
Treasurer

The Australian Competition and Consumer Commission (ACCC) and the Australian Securities and Investments Commission (ASIC) will have investigative powers to assess whether a term in a standard form contract may be unfair, thanks to measures passed in the Parliament by the Coalition Government yesterday.

This means the regulators will have stronger powers to ensure consumers and small and family businesses are given a fair go and protected from the repeated or widespread use of unfair contract terms.

The new law is one of a series of measures which passed the Parliament yesterday, further protecting consumers, bolstering regulator powers and ensuring the Australian Consumer Law operates as intended.

The Treasury Laws Amendment (Australian Consumer Law Review) Bill 2018 makes amendments to clarify and strengthen consumer protections relating to consumer guarantees, unsolicited consumer agreements, product safety, false billing, unconscionable conduct, pricing as well as unfair contract terms.

The new laws are designed to ensure the Australian Consumer Law delivers effective protection for consumers, while equipping regulators with the tools and teeth they need to address consumer harm.

Another key measure focuses on promoting price transparency for consumers shopping online. This change will require the headline price to include charges automatically applied or pre-selected by the seller, even though the buyer may de-select the charge during the transaction.

For example, if an airline pre-selects a $30 baggage fee for customers booking a $500 flight, this amendment requires the airline to display the headline price as $530 from the beginning of the booking process.

The passage of these measures follows other significant reform to consumer law, with substantial increases in maximum penalties for breaches coming into effect on 1 September 2018. Increased consumer protections are part of the Coalition Government’s plan for a stronger economy and to ensure all Australians get a fair go.