When you sell a product or service, you are expected to comply with fair trading regulations. When you buy a product or service, you have consumer rights and guarantees. Fair trading laws ensure that trading is fair for your business and your customers.

Ideally, the Australian federal and state laws protect you, your business and your customers from unfair trading practices. These laws, together with industry codes of practice, strive to help your business operate fairly and competitively, and make sure your customers are properly informed and protected.

Have it in mind that it is against the law for businesses to limit or prevent competition. It is imperative that businesses understand their rights and obligations at all times. The ACCC promotes competition and fair trade in markets to benefit consumers, businesses, and the community.

Their primary responsibility is to ensure that individuals and businesses comply with Australian competition, fair trading, and consumer protection laws – in particular the Competition and Consumer Act 2010.

What is the Competition and Consumer Act 2010?

This Competition and Consumer Act 2010 (the Act) is a national law that regulates fair trading in Australia and governs how all businesses in Australia are expected to deal with their customers, competitors and suppliers. The Act also promotes fair trading between competitors while also making sure that consumers are treated fairly.

While the Act is a national law, each state and territory also provides additional consumer protections within their own fair trading legislation. If you sell products or services, make sure you’re aware of your local state or territory legislation. Each state and territory has fair trading departments within their governments that can help you.

What are the Key Principles of Consumer Protection and Fair Trading in Australia?

A “key principle” is the fundamental source or basis of something. Even though the area of consumer rights and consumer laws is complex and huge, there are some common areas of consumer law that everyone must try and familiarise themselves with, as this will make it easier to know what your rights are in the event you fall victim to what you believe could be a breach of consumer rights.

Indeed, when it comes to consumer laws, you can always find plenty of information that may relate to your specific needs and queries from a number of authorities as well as through resources such as online. Nonetheless, understanding some of the basis can be imperative and will help to ensure you’re able to know some common cases of consumer rights breaches.

  1. Misleading Conduct

This happens when traders engage in some form of misleading conduct, commonly in advertising, where they mislead the consumer with the information they provide. In Australia, this is more or less done unintentionally but could still lead the consumer to make a decision in regard to purchasing the goods or services based on misleading claims. For instance, some of the ways in which you could be misled by an organisation include:

  • Claims that the product or service is cheaper than a rival product or service when this is not the case
  • Guaranteeing results about a product or service when there is no proof available
  • Making false statements about the quality or standard of goods and services
  • Making misleading claims about the nature or suitability of products or services
  1. Unfair Practices

Accordingly, there are a number of different, commonly used tactics and methods leveraged by some traders and companies, which are actually unfair. Note that making use of unfair practices is in breach of consumer laws and regulations. Some of the ones you may have heard about or even experienced include:

  • Failing to ensure the consumer understood the terms of any contract, transaction or documentation
  • Using harassment or undue force to make a consumer reach a particular decision or make a payment
  • Failing to provide full details of the products or services the consumer is considering, which could ultimately affect its suitability (an example is payment protection insurance cover, which was sold in the UK to many people who were self-employed even though self-employed workers were not eligible to make a claim on it)
  1. Product Guarantees, Refunds and Failure to Comply with Implied Warranties and Conditions

It is very important to note that the Trade Practices Act and state/territory consumer laws instigate warranties and conditions into consumer contracts, which means that irrespective of any written guarantee or warranty (or lack thereof) the goods or services should last for what is considered to be a reasonable amount of time.

The type of product or service and the amount paid will help to determine just how long a “reasonable” amount of time actually is. Howbeit, if you would like to read more about refunds and product guarantees in Australia, consult a lawyer or an accountant versed in the field.

  1. Failing to Supply Goods of a Merchantable Quality

Note that when you buy any goods, they are expected to be fit for the purpose for which they’re usually bought. This simply entails that they must be of merchantable quality. However, there are exceptions to this rule, which you should bear in mind. The exception in cases such as:

  • If the consumer was made aware of the defects in question prior to actually purchasing the goods
  • If the consumer examined the goods before making the purchase
  • There are also additional consumer rights regulations that relate to services, such as services having to be carried out with due care to achieve the desired result agreed upon prior to the commencement of work.

Conclusion

Indeed, there may be many instances where it is unclear as to whether any breach of consumer rights has taken place. In cases such as these, where there is uncertainty, it is worth checking with the relevant authority, such as the fair trading office in your state or territory.

Always note there are fair trading laws you need to be aware of and how Australian federal and state laws can protect you, your business and your customers from unfair trading practices. The fundamental basis of consumer protection lies within understanding this information and its purpose.

Ajaero Tony Martins