Transcript Slide 1

Competition & Consumer Act 2010
& the Australian Consumer Law
LCSA Annual Conference 2013
28 August 2013
Michael Jerabek
Education & Engagement Manager (NSW & ACT)
Australian Competition & Consumer Commission
National law enforcement agency responsible for
administering the Competition and Consumer Act
2010, which aims to:
• promote competition and fair trading; and
• protect consumers
Parallel role of NSW Fair Trading
What will I cover today?
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Consumer guarantees
Misleading & deceptive conduct
Unconscionable conduct
Unfair contract terms law
Unfair sales practices
Product safety
Scams
Consumer guarantees
Consumer guarantees apply to:
• goods or services of any type up to $40,000 in value (and...)
• purchased but also leased and hired
• online, over the phone or in person
• both new & second hand
Consumer guarantees do NOT apply to:
• one-off sales (e.g. private sales such as car or garage sale)
• buying to on-sell (e.g. car repairer purchasing parts to be used in repairs)
• If consumers simply change their minds
• If consumers misuse the goods
• If purpose not specified and not obvious from the circumstances
Nine consumer guarantees applying to goods:
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Acceptable quality (acceptable
appearance & finish, free from
defects, safe & durable)
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Voluntary (express) warranties
to be satisfied
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Suppliers guarantee clear title
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Suppliers guarantees
undisturbed possession
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Goods to be free of hidden
securities or charges
Reasonably fit for purpose
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Description is accurate
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Goods match sample
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Reasonable availability of spare
parts & repair facilities for
reasonable length of time
If any of these guarantees are not met, the consumer
has a right to a remedy.
Three consumer guarantees applying to services
A supplier must meet the consumer guarantees of
providing services:
• with due care and skill
• which are fit for any specified purpose
• within a reasonable time (when no time is set)
If any of these guarantees are not met, the consumer
has a right to a remedy.
Consumer guarantees – important concepts
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Major failure
Minor failure
Consequential loss
Rejection period
Trader’s v manufacturer’s responsibility
Consumer guarantees v voluntary warranties
Misleading & Deceptive Conduct
It is unlawful for a business to make statements in trade or
commerce that are:
• misleading or deceptive, or
• likely to mislead or deceive
Including:
• Failing to disclose relevant information
• Promises, opinions & predictions
• Advertisements, promotions, quotations & testimonials
• Representations about quality, price, age, origin, performance etc.
Note:
• ‘Small print’ and disclaimers not necessarily an excuse
• Overall impression considered (can be misleading even if true)
• Take into account special vulnerabilities of specific groups
Unconscionable conduct
• Under the ACL unconscionable conduct covers business to
business transactions as well as business to consumer
transactions
• UC can be described as behaviour which is irreconcilable with what
is right or reasonable and is seen as harsh and/or oppressive
• Usually involves a stronger party exploiting its bargaining
advantage to impose terms or conditions that are unreasonable or
against good conscience towards a smaller or weaker party
Some examples of possible unconscionable conduct
• Failing to disclose important contractual terms
• Not allowing sufficient time for consumer to read
agreement, seek advice, ask questions & decide
• Refusing to deal with legitimate complaints
• Not explaining terms of contract to consumers from
NESB
• Using friends/relatives to influence decision-making
• Refusing to accept ‘No’ for an answer
Unfair contract terms
• ACL enables a court to find a contract term unfair &
declare it to be VOID (treated as if it never existed)
• Applies to standard form contracts including written
and oral – over the phone or face to face
• Contract remains binding to the extent that it can
operate without the unfair term
Unfair contract term test
1. Does the term create a significant imbalance between rights and
obligations of the two parties?
2. Is the term reasonably necessary to protect legitimate interests
of the business?
3. Would the term cause a detriment (financial or non-financial) if the
business tried to enforce it?
Also, how transparent is the term?
Sales Practices
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Unsolicited supplies
Unsolicited consumer agreements/Door-to-Door sales
Pyramid schemes
Multiple & component pricing
Lay-by agreements
Referral selling
Harassment and coercion
Proof of transaction
Product Safety
• Imposing mandatory safety standards
• Product testing
• Issuing public safety warning notices
• Issuing compulsory recall notices
• Banning unsafe products
• Mandatory reporting
www.productsafety.gov.au
www.recalls.gov.au
Scamwatch website
• how scams work,
• latest scams,
• report scams,
• register for email alerts,
• scambuster app,
• educational videos etc.
www.scamwatch.gov.au
• The issue of grant re-sellers…
Further information
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Call the ACCC Infocentre – 1300 302 502
Visit www.accc.gov.au
Visit www.productsafety.gov.au
Visit www.scamwatch.gov.au
Visit www.consumerlaw.gov.au
• ACCC Shopper App
Any questions?
www.accc.gov.au