The Federal Government has started a consultation process in relation to the proposed extension of laws relating to unfair contract terms in standard form consumer contracts to contracts with small businesses.
The policy rationale is that small businesses, like consumers, also encounter standard form contracts and can lack the time and legal or technical expertise to critically analyse these contracts, and the power to negotiate. Compared to larger businesses, small businesses may also be less well placed to manage certain contractual risks. The proposal has the potential to impact on an extremely broad range of business to business transactions that are not covered by the current unfair contract terms laws.
The Government’s consultation paper and fact sheet can be accessed here:
The closing date for submissions in response to consultation paper is 1 August 2014.
We will continue to monitor developments.