ACCC to tackle unfair consumer contracts

Standard form consumer contracts containing unfair contract terms have been changed or removed after the Australian Competition and Consumer Commission conducted an industry specific review reports SmartCompany.

The changes apply to contracts in the airline, telecommunications, fitness and vehicle rental industries, in addition to select contracts used by online traders and travel agents.

Ben Hamilton, Partner at Hall and Wilcox Lawyers commented that while Australian Consumer Law changes in 2010 made some provisions for unfair contract terms, the review indicates the ACCC is now considering enforcement.

"The ACCC have engaged with industries where unfair terms and standard term contracts may be more common than in other industries. What it indicates is the ACCC is saying it's finished the engagement phase and is now looking at enforcement."

The ACCC identified eight kinds of contract terms used in standard form contracts which required substantial changes:

• Contract terms which allow the business to change the contract without consent from the consumer.

• Terms which cause confusion about the agency arrangements that apply and that seek to unfairly absolve the agent from liability.

• Terms which unfairly restrict the consumer's right to terminate the contract.

• Terms which suspend or terminate the services being provided to the consumer under the contract.

• Terms which make the consumer liable for things which would ordinarily be outside of their control.

• Terms which prevent the consumer from relying on representations made by the business or its agents.

• Terms seeking to limit consumer guarantee rights.

• Terms which remove a consumer's credit card chargeback rights when buying the service through an agent.

Read the full story here.

TimeBase's Competition and Consumer Point-in-Time Service provides subscribers with premium legal point in time legislation, guaranteed to be accurate and current. Contact TimeBase for a free trial.