Presentation Transcript

1. Competition and Consumer Act 2010

   Consumer Protection Laws

2. Benefits of the Competition and Consumer Act 2010 It incorporates a nationally-agreed set of consumer protections, the Australian Consumer Law (ACL), meaning there’s now consistency in consumer protection strategies across all Australian states. Secondly, it provides much more specific rules regarding perennial annoyances such as telemarketers.
3. Who is a consumer A person is a ‘consumer’ if they acquire goods or services that are priced at less than $40,000.
4. Who is a consumer A person is also a ‘consumer’ if they acquire good or services that are priced at more than $40,000 but they are ‘of a kind ordinarily acquired for personal, domestic or household use or consumption’.
5. Who is a consumer A person who acquires a vehicle for use in the transport of goods on public roads, irrespective of price, is also considered to be a consumer for the purposes of the Australian Consumer Law
6. General protections Part 2.1: Misleading or deceptive conduct Part 2.2: Unconscionable conduct Part 2.3: Unfair contract terms
7. Specific protections Part 3.1: Unfair practices Division 1—False or misleading representations etc. Division 2—Unsolicited supplies Division 3—Pyramid schemes Division 4—Pricing Division 5—Other unfair practices
8. Specific protections Part 3.2: Consumer Transactions Division 1—Consumer guarantees Division 2—Unsolicited consumer agreements Division 3—Lay-by agreements Division 4—Miscellaneous
9. Specific protections Part 3.3: Safety of consumer goods and product related services Division 1—Safety standards Division 2—Bans on consumer goods and product related services Division 3—Recall of consumer goods Division 4—Safety warning notices Division 5—Consumer goods, or product related services, associated with death or serious injury or illness Division 6—Miscellaneous
10. Specific protections Part 3.4: Information standards Part 3.5: Liability of manufacturers for goods with safety defects Division 1—Actions against manufacturers for goods with safety defects Division 2—Defective goods actions Division 3—Miscellaneous
11. Misleading or deceptive conduct General Protections Power Balance “Performance Technology” Improves: strength balance flexibility performance
12. Misleading or deceptive conduct Section 18 of the ACL prohibits a person, in trade or commerce, from engaging in misleading or deceptive conduct.
13. Misleading or deceptive conduct No matter how a business communicates with you, packaging advertising logos endorsements sales pitch you have the right to receive accurate and truthful messages about the goods and services that you buy. There are laws in place to protect you from false, misleading and deceptive selling practices.
14. What is misleading & deceptive conduct? There is a very broad provision in the Australian Consumer Law that prohibits conduct by a corporation that is misleading or deceptive, or would be likely to mislead or deceive you.  It makes no difference whether the business intended to mislead or deceive you—it is how the conduct of the business affected your thoughts and beliefs that matters.
15. What is misleading & deceptive conduct? If the overall impression left by an advertisement, promotion, quotation, statement or other representation made by a business creates a misleading impression in your mind—such as to the price, value or the quality of any goods and services—then the conduct is likely to breach the law.
16. False claims the law also says businesses must not make false claims about: the quality, style, model or history of a good or service whether the goods are new the sponsorship, performance characteristics, accessories, benefits and uses of goods and services
17. False claims the availability of repair facilities or spare parts the place of origin of a good (for example, where it was made or assembled) a buyer's need for the goods or services any exclusions on the goods and services. If a business makes a false or misleading claim or representation about one of the issues on this list, then the conduct is likely to breach the law.
18. Representations about price The price of a good or service is often a good indication of its quality or its availability of supply. Price comparisons can also give you an indication of whether you are getting a good deal or a bargain.
19. Representations about price A business risks breaching the law if it:  makes inaccurate or misleading price comparisons (for example 'was' and 'now' prices) represents that an advertised price is the total price that you will have to pay when in fact it is not services at a specific price when it is, or should have been aware, that it would not be able to supply enough of the good at the price for a reasonable amount of time - This is called bait advertising.
20. What is misleading pricing advertises products at a specific price when it does not have a reasonable supply for consumers to purchase makes inaccurate or misleading price comparisons represents that an advertised price is the total price that you will have to pay when it is not
21. Bait advertising 'Bait advertising' describes the situation when a trader advertises goods at a certain price (usually a 'sale' price) but does not have a reasonable supply. What is a 'reasonable supply' will depend on several things, including the type of product and the way it was promoted or advertised. If a trader has genuinely underestimated the popularity of a sale product, it may not be considered bait advertising.
22. Comparative pricing Comparative pricing is a marketing tool used by traders to compare current selling prices to their former or future prices and must be accurate and must not mislead or deceive consumers. Types of comparative pricing: Was–Now advertising Strike-through pricing Comparisons with the recommended retail price (RRP) Component pricing
23. Was–Now advertising Products or services advertised with a 'was now' price claim should accurately reflect a comparison between the previous price ('was') and the current price ('now') being offered. 59.95 47.96
24. Was–Now advertising The actual previous price must have been offered for a reasonable period prior to the discount offer commencing so that it is a genuine offer and not just a price that has been inflated to make a sale price seem more attractive.
25. Strike-through pricing Strike-through pricing is where the higher price of a product is crossed out and a second lower price is offered.  The trader must have offered these goods at the higher price for a reasonable period of time—that is, it must be a genuine pre-sale price. 309265469 $ 49.95 $39.95
26. Comparisons with the recommended retail price (RRP) Advertising or promotions of 'savings' or 'discounts' on the RRP of goods and services are designed to convince you that you are getting a good deal because the price is less than the RRP. If traders do not normally price their goods at the RRP, it may be misleading to give you the impression that they do.
27. Component pricing When advertising or promoting the price of products or services, traders must specify a single total price that you will have to pay. It is unlawful for traders to represent that an advertised price is the total price when it is not.
28. What is 'puffery'? Is it misleading? Puffery is a term used to describe wildly exaggerated, fanciful or vague claims for a product or service that nobody could possibly treat seriously, and that nobody could reasonably be misled by. Examples of puffery include 'best food in town' or 'freshest taste ever'.  Puffery in advertising is a practice that is generally not prohibited by the Australian Consumer Law.
29. What can a consumer do? Complain to the Australian Consumer Competition Commission(ACCC) or Complain to the Australian Securities and Investment Commission (ASIC) –the consumer protection regulator for financial products Organisation’s can be prosecuted be the commissions
30. What can a consumer do? If the consumer has suffered a loss as a result of a business' misleading or deceptive conduct or misrepresentation, you may have a private right of action under legislation. Courts can order damages, injunctions and other orders against businesses found to have engaged in misleading or deceptive conduct.
31. Power Balance & ACL Power Balance Australia Pty Ltd (Power Balance) claimed that their wristbands and pendants improve balance, strength and flexibility and worked positively with the body’s natural energy field. It also marketed its products with the slogan “Performance Technology”. These claims made by Power Balance were not supported by any credible scientific evidence and therefore Power Balance has admitted that it has engaged in misleading and deceptive conduct
32. Unconscionable conduct General Protections
33. What is unconscionable conduct? Unconscionable conduct is unfair or unreasonable conduct in business transactions that goes against good conscience. This can occur in transactions between businesses or in transactions between businesses and consumers.
34. What is unconscionable conduct? The exact meaning of ‘unconscionable conduct’ is not defined in the ACL. The ACL lists several factors that the court considers when deciding if a party has acted unconscionably. However, the court is able to consider any other matters it believes are relevant.
35. Conduct towards consumers—s. 21 This section applies to transactions between businesses and consumers, for goods bought for household use. The courts may consider the following factors when determining whether unconscionable conduct has occurred - although the court is free to include any factors it thinks are relevant.
36. Unconscionable conduct -factors the relative bargaining strengths of the business and the consumer whether the business required the consumer to comply with conditions that were not reasonably necessary to protect the legitimate interests of the business 
37. Unconscionable conduct -factors whether the consumer understood any documentation that may have been used whether the business used undue influence, pressure, or unfair tactics the price and terms on which the consumer could have acquired the same or equivalent goods elsewhere.
38. How can I avoid acting unconscionably towards my consumers? The most effective way to avoid behaving unconscionably is to treat all consumers fairly. Avoiding harsh or oppressive conduct not only benefits your reputation among consumers, but it also greatly reduces the risk of treating any consumer unconscionably
39. What can happen to me if I engage in unconscionable conduct? If the court determines that you have breached the unconscionable conduct provisions of the ACL, a variety of remedies may be ordered, including: compensation for loss or damage having the contract declared void in whole or in part having the contract or arrangement varied a refund or performance of specified
40. Unfair contract terms General Protections
41. Although businesses may use standard terms in consumer contracts to protect their legitimate commercial interests and improve efficiency, the ‘Unfair Contract Terms’ laws are designed to ‘level the playing field’ in circumstances where consumers may suffer loss or other detriment due to a fundamental imbalance in bargaining power
42. What is a consumer contract? a ‘consumer contract’ is a contract for: the supply of goods or services or the sale or grant of an interest in land to an individual who acquires it wholly or predominantly for personal, domestic or household use or consumption.
43. What is a standard contract? a standard form contract will typically be one that has been prepared by one party to the contract and is not subject to negotiation between the parties Standard form contracts are typically used for the supply of goods and services to consumers in many industries
44. Terms – expressed / implied
45. What is an unfair term? A term in a standard form consumer contract is unfair if: it would cause a significant imbalance in the parties’ rights and obligations arising under the contract; and the term is not reasonably necessary to protect the legitimate interests of the party who would be advantaged by the term; and it would cause detriment (whether financial or otherwise) to a party if it were to be applied or relied on.
46. The whole contract When deciding whether a term is unfair, the court must also consider the contract as a whole, and how transparent the term is within the contract.
47. Consumer Transactions Specific Protections
48. Consumer Guarantees Every time you purchase, lease or hire a good or service, anywhere around Australia, you are automatically given certain rights. These rights are known as consumer guarantees. When you have a problem and one of the guarantees has not been met, you are entitled to a remedy. The type of remedy depends on the circumstances but may include a repair, replacement, refund or having a service performed again. .
49. Consumer Guarantees The consumer guarantees only apply to goods and services purchased on or after 1 January 2011. Purchases made before this time may be covered by the laws that applied before 1 January 2011. Consumer guarantees are different to a warranty, which is a voluntary promise offered by the person or business who sold the goods or service to you, or the manufacturer of the goods. You have consumer guarantees regardless of any warranty you purchase or are given
50. Which consumer guarantees apply to goods? There are nine consumer guarantees that apply to goods you purchase: You will have title to the goods You will have undisturbed possession of the goods There are no undisclosed securities on the goods Goods will be of acceptable quality
51. Which consumer guarantees apply to goods? Goods will be fit for a particular purpose Goods will match their description Goods will match the sample or demonstration model Spare parts and repair facilities will be available for a reasonable time Any express warranties will be honoured
52. Title to goods There is a guarantee that when you buy goods, the ownership rights are passed to you. The seller must tell you when there are other rights over the goods. This guarantee also applies to goods you buy through private transactions but it does not apply to goods that are leased or hired (because you don't expect to own these outright).
53. Undisturbed possession of goods There is a guarantee that no one will try to repossess or reclaim a product you buy. This guarantee also applies to private transactions. For goods that are hired or leased, the guarantee applies only to the period of the hire or lease. If the goods are purchased under a payment plan and you fail to make the agreed payments, the seller may be able to repossess the goods
54. No undisclosed securities on goods There is a guarantee that the goods will be free of any undisclosed securities or charges, unless you are clearly told otherwise before you purchase. This guarantee also applies to goods you buy through private transactions, but it does not apply to goods that are leased or hired.
55. Acceptable quality Goods are of acceptable quality if they: are safe, durable and free from defects are acceptable in appearance and finish do everything that they are commonly used for.
56. Fit for a particular purpose Goods will be suitable for any particular purpose that you make known to the seller before you buy. If you explain to the seller that you want the product for a particular purpose, and you buy it based on their claims or expertise, the seller guarantees that it will meet your particular purpose.
57. Match description Any description of a product—whether made verbally or in writing—must be accurate
58. Match sample or demonstration model If you have chosen goods based on a sample or demonstration model the goods must match in quality, state or condition
59. Express warranties If a seller or manufacturer makes extra promises—either verbally or in writing—about the quality, condition, performance or characteristics of goods, these promises must be met. Common types include money-back guarantees and lifetime guarantees. Express warrantees apply in addition to the consumer guarantees
60. Repairs and spare parts When you purchase a product the manufacturer or importer must provide spare parts and repair facilities for a reasonable time after purchase. This applies even if you did not purchase the goods directly from the manufacturer or importer. How long is 'reasonable' will depend on the type of product. This guarantee does not apply if you are advised at the time of purchase that repair facilities and spare parts will not be available after a specified time.
61. Consumer service guarantees As a consumer, most services you purchase will be covered by the consumer guarantees provisions of the Australian Consumer Law.  You are covered by the law if the services you purchase cost less than $40 000. If the services cost more than $40 000 but are normally used for personal, domestic or household purposes (such as landscape design), the guarantees will still apply.
62. Consumer service guarantees This means the consumer guarantees can apply to purchases that a business might make, for example installation of air conditioning. If you receive the services as a gift, you have the same rights as the person who purchased them.
63. Consumer service guarantees You are also covered when you use 'recreational services' involving physical activities – for example, fitness classes at a gym, working out with a personal trainer, bungee jumping and horse riding. However, people or businesses providing this kind of service can sometimes limit their responsibilities. You should read any terms and conditions in contracts for these services carefully.
64. Which consumer guarantees apply to services? Who guarantees the service? What do they guarantee about the service? Due care and skill Fit for a particular purpose Reasonable time, if no time set
65. Who guarantees the service? The guarantees are made by the person or business that is providing the service. This means the service provider is responsible for fixing a problem when the service does not meet a consumer guarantee.
66. What do they guarantee about the service? There are three consumer guarantees that apply to services. Service providers guarantee to provide services: with due care and skill which are fit for any purpose; and within a reasonable time, when no time is set.
67. Due care and skill Service providers must carry out all services using an acceptable level of care and skill. Their work must be at least as good as what a competent person with average skills and experience would provide. They must also take reasonable steps to avoid loss or damage when providing the service.
68. Fit for a particular purpose Services and any resulting products will be reasonably fit for any particular purpose specified. This guarantee may not apply if it is unreasonable to rely on the service provider's skill or judgment, or if the provider tells you the service or resulting product will not meet your purpose.
69. Reasonable time, if no time set A contract or agreement for the supply of services usually states when the services will be provided and the date they will be completed by. If not, the supplier guarantees to supply the service within a reasonable time. What is 'reasonable' will depend on the nature of the services and other relevant factors such as weather and availability of parts or supply of materials. 
70. Problems when goods and services are linked Consumers often buy related goods and services together as a package, such as home delivery of your newspaper. Sometimes a problem develops with only one part of the package—that is, the good or the service.
71. When the problem is with the goods  If you return unsatisfactory goods due to a major problem, you have the right to cancel any services that were provided in connection with the rejected goods. The supplier does not have to give a refund for any services you received up to the time you rejected the goods. These contracts do not automatically end. When you cancel a linked service contract, you are entitled to a refund or can refuse to pay for any services that you have not yet received.
72. When the problem is with the services If you cancel a contract for unsatisfactory services, you must return any goods connected with the service—even if there is no problem with the goods. If you have paid any money for the goods, the seller must give you a refund. It is your responsibility to return the goods, unless that would involve a significant cost (in which case the seller must collect the goods).
73. When am I entitled to a remedy? If a product fails to meet a consumer guarantee, you may be entitled to a replacement Repair refund other remedy
74. You may not be entitled to a remedy if you: simply change your mind or decide you do not like your purchase damage or use goods in an unreasonable or unintended manner discover you can buy the goods more cheaply elsewhere (unless the seller guarantees that the goods cannot be purchased more cheaply elsewhere)
75. You may not be entitled to a remedy if you: had a defect drawn to your attention before buying (such as goods labelled as seconds with their faults clearly marked) did not rely upon, or unreasonably relied upon, the seller’s skill or judgment when choosing a product.
76. What is the difference between a warranty and a guarantee? You automatically get the consumer guarantees from the person or business when you buy, lease or hire their goods, or buy their services. This is different to a warranty, which is a voluntary promise offered by the person or business who sold the goods or service to you, or the manufacturer of the goods. You have consumer guarantees regardless of any warranty provided by the supplier or manufacturer.
77. Common types of warranty Express warranty These are extra promises a supplier or manufacturer may make about such things as the quality, state, condition, performance or characteristics of goods.  An express warranty is not necessarily about the product breaking, it is about it living up to promises. If the manufacturer or supplier provides an express warranty, they guarantee the goods will satisfy that warranty.
78. Warranty against defects – 'manufacturer's warranty' Suppliers or manufacturers may provide a warranty that promises consumers that: goods or services will be free from defects for a certain period of time defects will entitle the consumer to repair, replacement, refund or other compensation. This is called a 'warranty against defects', also commonly called a 'manufacturer's warranty'.
79. Extended warranty Some suppliers or manufacturers offer extended warranties to lengthen the coverage of their basic manufacturer's warranty. You may be offered the chance to buy an extended warranty after, or at the time, you buy the goods. Extended warranties are optional.
80. Extended warranty Some suppliers or manufacturers may also tell you an extended warranty provides extra protection, which you would not have unless you buy it. This is not necessarily true. The consumer guarantees provide rights that exist despite anything the supplier or manufacturer may say or do.
81. Extended warranty A supplier or manufacturer must not: pressure you to buy an extended warranty tell you that you must pay for any rights equivalent to a consumer guarantee.