Business of Law

Question: Describe about the Australian Consumer Law. Answer: Introduction Australian Consumer Law provides uniform protection to all consumers as well as to the small businesses in all sectors and jurisdiction. Australian Consumer Law sets out the principles and the standards that a business enterprise needs to observe while carrying out their business transaction with the consumers. It prohibits unfair trade practices in respect of small business as well as the consumers. The Treasury Legislation Amendment (Small Business and Unfair Contract Terms) Bill 2015 amended the Australian Consumer Law and was enumerated in Schedule 2 of the Competition and Consumer Act 2010[1] and the Australian Securities and Investments Commission Act 2001. The primary objective of this Bill was to protect the interest of the small business from unfair trade contracts and by safeguarding its bargaining power in the market. Discussion In Australia, consumers are given adequate protection from unfair trade practices since 2010 whereas, protection towards the small business were quite realized lately by the government. A small business refers to the organization that employs less than twenty employees or has less than prescribed threshold for a multi-year contract of $100,000 0r $250,000[2]. The government selected the transaction value threshold of the small business after consultation with different stakeholders. The purpose was to provide protection to the small business when they engage in day-to-day trade and transact with the consumers. The principles will also encourage the small business to conduct large contract with due care and diligence for the fundamental success of their business[3]. The ACCC plays a significant role in communicating the small business promptly and evidently. It also provides them guidance while dealing with their individual matters. It also advises them on alternative dispute resolution processes. As ACCC has a unique center of attention on small business, franchising, business liaison and business associations, it enables an effective competition in the sector of small business, encourages fair-trading, and strengthens its position in the free economy[4]. The business practices must not limit competitions. The small business must be aware of their rights and obligations when they deal with the whole sellers, other business organizations, and suppliers. The small businesses are protected from anti-competitive behavior and false or misleading claims under the Australian Consumer Law. The ACCC has protected the collective bargaining of the small business by offering a streamlined process for the parties to seek authorization arrangements of collective bargaining. Few such unfair trade practices are to enter into a contract that will permit either of one party to terminate or limit the performance of the contract or penalizing the other party for the breach of any provisions or vary the terms of the contract at its own will without any negotiations or taking due advantage of the bargaining power of the other party[5]. The court is empowered to strike down any terms of the contract that appears to it as unfair. The small business must enter into the contract having standard forms in consistent with the new unfair contract terms laws. Any such unfair contract terms shall be held void in the eyes of the law[6]. However, the small business must not enter into any unfair trade practices and must treat their consumers honestly and fairly. They are not supposed to sell banned products to the consumers. They must meet the requirements as seller under the Australian Consumer Law such as they must not engage in misleading and deceptive trade practices. The business organizations must not engage in unconscionable trade practices particularly, which are unfair and oppressive. The High Court noted that the aim of the law was to protect the competitive process and not protect the interest of a particular person. If any competition is sufficiently proved harmful, then such competitors can be eliminated[7]. It is often seen that small business becomes the victims of misuse of market powers. They face different competitive issues compared to the large business houses. Thus, they are included under the competitive laws and are provided protection from harsh competitions. As the small business lacks the sophisticated modern means to attain information on the trade laws and lacks resources, they are also vulnerable as the consumers. They too need to be protected from unfair trade practices and unconscionable conducts in the marketplace. Thus, they are also protected under the Consumer Law[8]. The small suppliers need to be protected from the big supermarkets so that their legitimate needs are not shadowed. In the competitive market, they must be safeguarded so that the competitive process does not worsen their condition. In ACCC v Coles[9], the Federal Court ordered Coles to pay pecuniary penalties of $10 million for engaging in unconscionable trade practice with the suppliers. Coles is one of the famous supermarkets in Australia. Therefore, it provides good access to the customers. Coles had demanded high payments from the suppliers, which it was not supposed to do. It also withheld money from them illegally. Therefore, the threatening of Coles was alleged to be deliberate, serious and repeated misconduct as it misused the bargaining powers. The conduct was not done in good faith and conscience and was against the accepted standard norms of trade. Conclusion Thus, we see that small business being vulnerable and unconscious of the standard trade practices must be protected in the same ways as the consumers. Therefore, they are protected under the Consumer Laws. As they have weak bargaining power compared to the big business organization, they are often exploited. The Australian Courts imposes heavy penalties as deterrence on those who exploits the small business by inducing unfair trade practices and engaging in misleading and deceptive trade practices. ACCC acts as a watchdog to safeguard the interests of the small business consistently. They also provide valuable advice to the small business so that they can protect themselves from any exploitations. Under any competitive laws reviews the legitimate needs of the small business are always given due consideration. Thus, we can say that the future small businesses are adequately protected and safeguarded under Australian Consumer Law. References ACCC,. "Court Finds Coles Engaged In Unconscionable Conduct And Orders Coles Pay $10 Million Penalties". ACCC,. "Small Business".Www.Accc.Gov.Au. Last modified 2016. Accessed May 31, 2016. ACCC,. "Unfair Contract Terms".Www.Accc.Gov.Au/. Last modified 2016. Accessed May 31, 2016. ASIC,. "Unfair Contract Terms Law".Asic.Gov.Au. Last modified 2016. Accessed May 31, 2016. "COMPETITION AND CONSUMER ACT 2010 - SCHEDULE 2The Australian Consumer Law".Austlii.Edu.Au. Last modified 2016. "Federal Register Of Legislation".Www.Legislation.Gov.Au. Last modified 2016. Accessed May 31, 2016. "SMALL BUSINESS AND THE COMPETITION AND CONSUMER ACT".Www.Accc.Gov.Au. The Conversation,. "Why The Australian Consumer Law Can Help Small Business".Theconversation.Com. "Treasury Portfolio Ministers".Bfb.Ministers.Treasury.Gov.Au/. Last modified 2016. Accessed May 31, 2016.