The introduction of the Australian Consumer Law was one of the major legislative reforms made in 2010. The reforms included introduction of unfair contract terms, increased powers for the Australian Competition and Consumer Commission as well as major changes to sales practices, unfair business practices, consumer guarantees and product safety.
Whilst most of the reforms took effect throughout 2010 and 2011, there are two changes that took effect on 1 January 2012.
It is very rare that regulation and laws are made less restrictive but the first change is a point in case. The first change removes the prohibition on providing goods that are valued under $500 within 10 business day’s unsolicited sale. That is, during 2011 organisations were prohibited from supplying goods over the value of $100 within 10 business days of an unsolicited sale. This amendment to the legislation lifts the value of goods that can be provided to a consumer directly after an unsolicited sale from $100 to $500. Unfortunately the amendment doesn’t apply to services but it’s a change that’s still worth noting.
The second change relates to the provision of warranties and inclusion of warranties in contracts. From 1 January 2012 organisations must ensure that warranties must be included in a document that is clearly worded and that this documentation must clearly:
- State what the person who gives the warranty will do to honour the warranty
- State what the consumer must to do to be entitled to the warranty
- Include the text “our goods come with guarantees that cannot be excluded under the Australian Consumer Law. You are entitled to a replacement or refund for a major failure and for compensation for any other reasonably foreseeable loss or damage. You are also entitled to have the goods repaired or replaced if the goods fail to be of acceptable quality and the failure does not amount to a major failure’
- State the organisation’s name, business address, telephone number and email address (if any)
- State the period(s) within which a defect in the goods or services can be claimed; the procedures for making a claim; who will bear the expense of claiming a warranty; and that the benefits to the consumer that are in addition to any other rights and remedies under law.
For more information, contact Melina Rohan, Director of Corporate and Regulatory Affairs, ADMA