On Thursday 31 March 2016, the Minister for Small Business and Assistant Treasurer, announced the release of the Australian Consumer Law Review Issues Paper, which marks the next step in the first review of the Australian Consumer Law (ACL) since it was enacted in 2011.
The Issues Paper has a number of frames of reference for assessing the ACL, including:
- The relevance of the objectives of the national consumer policy framework;
- The effectiveness of the ACL and its remedies in achieving its objectives; and
- Whether new rights and protections need to be introduced.
A final report is expected to be revealed by March 2017 and some of the proposed reforms expected to be included in that report include:
- Expanding misleading or deceptive conduct – the Issues Paper notes that one of the points of consideration for the Review is whether to extend the misleading or deceptive conduct provision to prohibit specific forms of ‘unfair’ commercial practice. Additionally, consideration will be had to whether misleading or deceptive conduct should attract financial and criminal sanctions, as is the case with false or misleading representations.
- Clarifying unconscionable conduct – prevailing interpretations in Australia of ‘unconscionable conduct’ require conduct to be against conscience by reference to the ‘norms of society’ for it to be unconscionable. The Issues Paper suggests that the ACL may be amended to clarify this issue, and whether the provision should be extended to protect all businesses, including publicly listed companies.
- Updating consumer guarantees – the Issues Paper also discusses the lack of clarity in relation to a number of terms concerning consumer guarantees, such as what constitutes a ‘major’ failure, and for how long goods should be expected to function. The Paper also discusses issues such as whether to include some goods and services that are currently excluded (eg. financial services), and whether regulators should be able to take representative actions on behalf of consumers.
- Updating penalties – currently, the ACL lists dollar amounts for the maximum penalties that can be applied to companies and individuals. This provision, which is seen by some as being inflexible, is expected to be reviewed, possibly to include ‘penalty units’ which are more easily updated to keep pace with inflation, and variable penalties for companies of different sizes.
You can read the full version of the Issues Paper here.