When it come to consumer protection, Australian Consumer Law ensures products and services come with guarantees of quality and safety. The law also provides recourse for consumers when these guarantees are not met.
Competition and Consumer Act
The Act aims to protect consumers by:
- prohibiting misleading conduct;
- prohibiting unconscionable conduct;
- voiding unfair terms in a contract;
- providing guarantees for the quality and standard of goods;
- ensuring liability for defective goods.
Schedule 2 of the Act is dedicated to Australian Consumer Law. It governs areas including product safety, unfair practices, false or misleading representations, advertising, manufacturer liability, interim bans, pyramid schemes, penalties, and conditions and warranties.
In dealing with product safety, for example, it contains a range of safeguards for consumers. These include:
- mandatory standards for safety;
- bans on selling products that present a safety risk;
- recalls on products that present a safety risk;
- rights to recourse if a product is unsafe;
- mandatory safety reporting.
For further consumer protection, the Act also allows for the creation of industry codes to regulate the conduct of those in an industry towards consumers and competitors. The codes can be voluntary or mandatory.
Under Australian Consumer Law, businesses must guarantee their products or services, irrespective of other warranties that may be offered. If a business fails to deliver a guarantee, a consumer has a right to a repair, replacement or refund; to cancel a service; and/or to compensation for damages and loss.
Guarantees apply to product and services that cost up to $40,000. They do not apply to products and services:
- used for business and which cost more than $40,000;
- bought in one-off sales by private sellers;
- bought to on-sell;
- where a contract is to store or transport them as part of a business;
- to be transformed during production, manufacturing or repair.
Products must be safe, lasting, have no faults, look acceptable and be fit for purpose. They must also:
- match all descriptions, on packaging and in advertising;
- come with full ownership and undisturbed possession;
- not carry hidden debts or charges;
- meet any extra promises, such as lifetime guarantees;
- have spare parts and repair sites available unless a consumer is told otherwise.
To ensure consumer protection, services must:
- be provided with sufficient care, skill and technical knowledge and avoid loss and damage;
- provide results agreed by the parties;
- be delivered in reasonable time when there is no end date.
Guarantees on products and services also apply to bundled products and services, sale items, online purchases from Australian businesses, and second-hand products from businesses (considering age and condition).
Guarantees do not apply if a consumer:
- received what they asked for but changed their mind, found it cheaper elsewhere, or had no use for it;
- misused the product and caused the failure;
- knew of the failure before they bought the product or service;
- requested a service be done in a way against the advice of the business.
If a guarantee is not delivered, the type of remedy available to a consumer will depend on whether the product or service failure is major or minor. A major failure is when:
- the consumer would not have bought the product or service if they had known about the failure;
- use of the product or service creates an unsafe situation;
- the product or service is significantly different from its description;
- the product is broken and cannot be repaired easily;
- the product or service is not fit for purpose.
In the problem is a major failure, a consumer has the right to ask for a replacement or refund. A replacement product or service must be identical to the original, and a refund should be the amount paid, in the form it was paid. If the problem is a minor failure, a business can choose to offer a free repair instead of a replacement or refund, and the consumer must accept the free repair.
If contacting the business involved does not resolve a problem, a consumer can contact their state or territory’s consumer protection agency to discuss consumer rights and options. Each state or territory also has a small claims tribunal to handle complaints. There are also ombudsmen, commissions or other bodies in some industries, including aged care, building, disability, horticulture, small business and telecommunications, which can help resolve disputes. The ACCC can provide information about consumer rights and possible remedies to a dispute, but it does not help resolve complaints.
If you require advice on consumer protection, or advice or representation in any legal matter, please contact Armstrong Legal.