Australian Consumer Law commences

The Trade Practices Amendment (Australian Consumer Law) Bill (No. 1) 2010 received Assent on 14 April 2010 and commenced on 15 April, other than for the unfair contract terms provisions which will commence on 1 July 2010.

UPDATE: Download the Act here.

The ACL gives the ACCC new enforcement powers to protect consumers, including the ability to seek or issue:

  • civil monetary penalties;
  • banning orders;
  • substantiation notices;
  • infringement notices;
  • refunds for consumers, and
  • public warnings.

Under the changes the ACCC can seek financial penalties of up to $1.1 million for corporations and $220,000 for individuals in civil cases for unconscionable conduct, pyramid selling and sections of the law dealing with false or misleading conduct.

The ACCC will be able to deal with ‘repeat or serious offenders’ in cases involving unconscionable conduct, and breaches of various consumer protection and product safety provisions by seeking court orders banning them from managing corporations.

In cases involving misleading conduct, the ACCC will now be able to issue “substantiation notices” to require traders to justify claims they make about products they promote. Examples could include was/now advertising and claims about food, health, environmental impact and business opportunities.

Where the ACCC has reasonable grounds, it may now issue an infringement notice in cases of suspected unconscionable conduct, some false or misleading conduct, pyramid selling and various product safety provisions.

Infringement notice penalties for false or misleading, unconscionable conduct, pyramid selling and breaches of product safety provisions are $6,600 for corporations and $1,320 for individuals.

Financial services
As ASIC has jurisdiction over consumer protection relating to financial products and services under the Australian Securities and Investments Commission Act, the ACL also amends the ASIC Act to give ASIC similar powers to the ACCC.

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