The new Australian Consumer Law and what the recent reforms mean for Northern Territory small business will be the topic of discussion at a breakfast in Darwin tomorrow (Tuesday).
Australian Competition and Consumer Commission deputy chair Peter Kell will speak about the ACCC's approach to its new enforcement powers which include the ability to seek or issue:
- civil monetary penalties
- banning orders
- substantiation notices
- infringement notices
- refunds for consumers, and
- public warnings.
Under the new legislation 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' by seeking court orders banning them from managing corporations. This will now be available in cases involving unconscionable conduct, and breaches of various consumer protection and product safety provisions.
The ACCC will now be able to use substantiation notices to require traders to justify claims they make about products they promote. These will provide a fast-track way to identify if a potentially harmful misrepresentation has been made. 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 notices will enable the ACCC to respond quickly to alleged breaches of these parts of the law and help facilitate a quick resolution of ACCC concerns with traders.
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.
Vulnerable and disadvantaged consumers will particularly benefit from the ACCC's new ability to seek redress through the courts for consumers who are not included in a particular legal action. For example, the ACCC could ask the court to order an unscrupulous trader to provide refunds to consumers affected by misleading conduct.
Unfair contract terms are also covered in the new legislation with provisions applying to standard form consumer contracts. These come into effect on 1 July 2010 and public guidance will be circulated to major business and consumer organisations before then.
The second phase of the ACL reforms were introduced into Federal Parliament on 17 March.
Mr Kell said the ACCC will continue to actively engage with small business and provides a number of resources to assist small business people with their rights and responsibilities under the Trade Practices Act including the new ACL reforms.
A range of publications is available from the small business resource centre available via the For Business section of www.accc.gov.au. The ACCC also has a dedicated small business helpline (1300 302 021), where trained operators can offer assistance, but not legal advice, on small business matters.