The Competition and Consumer Act 2010, which came into effect on 1 January 2011, was a significant legal and economic reform that heralded a new era in Australian consumer protection by introducing a single national consumer law and civil penalties, ACCC Chair Rod Sims said today.
Mr Sims spoke via webinar at a Monash University National Commercial Law Seminar hosted at the Federal Court in Melbourne to mark the 10th anniversary of the Competition and Consumer Act (CCA), which incorporates the Australian Competition Law (ACL).
“The ACL’s introduction was a game changer that allowed the ACCC and State and Territory regulators to collaborate much more easily on consumer issues,” Mr Sims said.
“The key change was the introduction of civil pecuniary penalties for consumer law contraventions.”
“These civil pecuniary penalties transformed the ACCC’s armoury when taking enforcement action in the courts against businesses for alleged contraventions of the ACL,” Mr Sims said.
“This in turn has transformed compliance with the consumer law. For laws to be effective, there must be serious and effective consequences for breaches of these laws.”
“The Federal Court has imposed a total of almost $400 million in civil pecuniary penalties in proceedings instituted by the ACCC in the last ten years,” Mr Sims said
The ACL reforms also included giving the ACCC power to issue infringement notices, as well as to issue public warning notices to alert consumers to a suspected breach of the substantive provisions of the ACL where it is in the public interest to do so.
“The introduction of consumer guarantee rights and an unfair contract terms regime were also highly significant reforms, particularly once the unfair contract terms regimes was extended to small businesses,” Mr Sims said.
While the ACCC has made good progress in enforcing the consumer guarantee and unfair contract terms provisions, further reforms are still required to ensure that these provisions can be effectively enforced.
The ACCC is advocating for law change which makes a failure to comply with the consumer guarantee and unfair contracts term provisions a contravention of the ACL and subject to penalties.
The ACCC also continues to advocate for reforms to address key issues impacting consumers and small businesses.
“It is our view there is a need for an unfair trading practices prohibition as it would remove or avoid the need for some intrusive industry-specific regulation and could help lessen the overall regulatory burden,” Mr Sims said.
“We also see a need for a general safety provision to prohibit suppliers from supplying unsafe products.”
Finally, Mr Sims said it was important to remember the benefits the ACL reforms achieved through harmonisation ten years ago.
“This is to caution against divergence in consumer law across jurisdictions in Australia and to emphasise the need for continued, if not increased, cooperation between jurisdictions to meet the challenges of the present and future,” Mr Sims said.