Each year the ACCC, Australia’s competition regulator, releases a list of priorities and factors to be taken into account when deciding to pursue matters. In 2016 the ACCC has set its sight on consumer guarantees, unfair contract terms, industry codes and the agriculture sector. Increased enforcement against large businesses will take place in order to limit consumer harm, protect small firms and set a benchmark for behaviour and compliance for the rest of the market.
If you are a big business, watch out! The ACCC is more likely to take enforcement against you than against small businesses. You need to make sure you are compliant with the emerging priorities or face heavy penalties.
Emerging Priorities in 2016
Unfair contract terms for small businesses
On 12 November 2015, the unfair contract regime for small business was passed. The ACCC’s focus in 2016 is to lay the groundwork for the new laws and ensure that small business owners are aware of their rights. This legislation will come into full effect on 12 November 2016 and will essentially make unfair contract terms in standard form contracts void. Businesses need to consider the impact of the news laws on their standard form contracts. For more information on how you can comply with this new legislation, see our article titled ‘Take it or leave it: Review your standard contracts or run the risk of them being unenforceable’.
Industry Codes are now a wider priority than just ‘concentrated industries’. There is a focus in 2016 on the Food and Grocery Code of Conduct (implemented March 2015), Franchising Code of Conduct (implemented 1 January 2015) and the revised Horticulture Code of Conduct. The ACCC warns that enforcement action will be taken where necessary and failure to abide the codes could result in large penalties.
This year’s focus is on large retailers and extended warranties, and car retailers and manufacturers.
The ACCC is cracking down on representations made by big businesses about express or extended warranties. Under the Australian Consumer Law, consumers already have rights of repair, replacement or refund (for major faults) for faulty products. This means that the law may protect consumers beyond the manufacturer’s warranty period, without the need to purchase an extended warranty. ACCC Chairman Mr Sims cautioned that large companies should avoid misleading consumers into paying for extra protections that they already have under the law.
The ACCC will be attracted to blunt misstatements of human rights and blanket refusals to consider warranty claims after the expiry of the manufacturer’s warranty without considering the application of consumer law. Companies are encouraged to ensure their returns policies are complaint with consumer guarantees and consumers are encouraged to be knowledgeable about their rights.
There is a priority to ensure that car retailers comply with their obligations under the Australian Consumer Law that vehicles will be fit for purpose, free from defects and as durable as a reasonable customer would expect. The ACCC is calling on vehicle manufacturers and new car retailers to invest in aftersales care.
In 2016, the agricultural sector is a new priority with a primary focus on undergoing specific market studies to enhance understanding of the competitiveness of agricultural supply chains. The ACCC has established a dedicated unit with a new commissioner with responsibility for agricultural issues.
Enduring priorities from 2015
The ACCC has elevated Indigenous consumer protection to an enduring priority area. The ACCC Mr Simms recognises that Indigenous consumers, particularly those living in remote areas, continue to face challenges in asserting their consumer rights.
Vulnerable and disadvantaged consumers
There is continuing priority for the vulnerable and disadvantaged, particularly the elderly and those who have recently arrived in Australia.
Consumer product safety
The ACCC is prioritising safety issues that have the potential to cause serious harm to the consumers, with a continuing focus on the danger of button batteries, quad bikes and Infinity cables.
Competition law: cartel conduct, anti-competitive conduct and misuse of market power
The ACCC continues to take a strong line on cartel conduct, anti-competitive conduct and misuse of market power, with a particular focus on the impact of cartel conduct on government procurement.
Health and medical fields
A continuing priority with a focus on misleading health claims in relation to certain food claims and ensuring that the disclosure practices of health service providers are in line with the Australian Consumer Law.
The ACCC is continuing to work with other agencies to disrupt scams, particularly to help the vulnerable and disadvantaged consumers.
Each year the release of the ACCC’s Compliance and Enforcement priorities is a potent reminder to businesses that you need to comply with not just the priorities but with all Competition and Consumer laws or risk copping regulatory action.
This information is for information purposes only and is not legal advice. You should obtain advice that is specific to your circumstance and not rely on this publication as legal advice. Please contact us if you wish for us to advise you on any issue you may have arising from this publication.