The New Consumer Regime – Trade Practices Act replaced

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“From 1 January 2011 Australia has a national consumer law, known as the Australian Consumer Law. The ACL replaces provisions of the Trade Practices Act 1974 (Cth) and will also replace provisions of the consumer legislation of the various states. This follows the first round of amendments to Australian consumer law that occurred on 1 July 2010.”

On 1 January 2011 the Australian Consumer Law (ACL) was enacted. The ACL is found in Schedule 2 of the Competition and Consumer Act 2010 (Cth) (Competition and Consumer Act). The enactment of the ACL on 1 January 2011 had the effect of making consumer law uniform throughout all Australian jurisdictions.

The most notable change to consumer law is the repeal of the Trade Practices Act 1974 (Cth) (the Trade Practices Act). The Trade Practices Act has been largely replaced by the ACL, however not all provisions from the Trade Practices Act have remained the same in the ACL. There are also additional provisions in the ACL to the provisions of the Trade Practices Act.

Each state consumer act (such as the Fair Trading Act 1987 in NSW) also contains a provision which applies the ACL as the law of that state. The ACL will be enforced by all Australian courts and tribunals and will be administered by the ACCC and each state’s relevant consumer law agency.

Amendments to the Trade Practices Act in July 2010

In July 2010, the Trade Practices Act was amended.  The amendments focused on changes to provisions on unfair contract terms in standard form consumer contracts and enhanced provisions for the ACCC and ASIC as part of the first stage of the new consumer regime.  These amended provisions have now become part of the ACL.

Pre ACL contracts

Contracts formed prior to 1 January 2011 will still be governed by the Trade Practices Act.

Updating Business contracts

While some sections of the old Trade Practices Act remain unchanged in their wording the ACL has resulted in the sections and order of the Trade Practices Act being reshuffled. Therefore old section references no longer apply. Businesses should review their profroma and standard documents and update any old Trade Practices Act references.  Outlined below is a list of some of the key provisions of the Trade Practices Act and where they are now recorded in the Competition and Consumer Act:

Uniform definitions across all jurisdictions

Under the ACL consumers and businesses now have the same protections, rights and obligations across all states and jurisdictions.

This is likely to result in reduced compliance burdens for businesses.

New definition of consumer

Under section 3 of the ACL a consumer is defined as a person acquiring:

• goods under $40,000; or
• goods for personal, domestic or household use; or
• a vehicle for transport of goods.

Conclusion

While some parts of the Competition and Consumer Act mirror the wording of the Trade Practices Act there have been significant changes to the provisions of the Trade Practices Act and substantial changes to the name and numbering of the Act. All consumer agreements should be reviewed to ensure compliance going forward.

Contact details

Melbourne
Howard Rapke, Partner
T: +61 (0)3 9321 9752
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Sydney
Harold Werksman, Partner
T: +61 (0)2 8083 0405
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Brisbane
Paul Venus, Partner
T: +61 (0)7 3135 0613
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