The Federal Government last week released for public consultation a consultation paper entitled The Australian Consumer Law: Consultation on draft provisions on unfair contract terms. The paper and submissions can be found here. I urge every newsagent to download and read these and take an active interest in their passage through parliament. As the consultation paper indicates, the changes include business to business contracts.
The draft provisions on unfair contract terms will apply to business-to-business transactions in the same way as other key provisions in the TPA do, such as those dealing with unconscionable conduct and misleading and deceptive conduct.
The draft national unfair contract terms provision includes that a term is deemed to be ‘unfair’ when it causes a significant imbalance in the parties’ rights and obligations arising under the contract and it is not reasonably necessary to protect the legitimate interests of the supplier – as noted in the press release issued by Chris Bowen, Minister for Competition Policy and Consumer Affairs.
The ramifications of the changes for newsagents could be considerable given the size of each of our businesses compared to the size of suppliers with which we find ourselves in contract disputes from time to time.
The timing of the changes will also be of interest to newsagents given the approaching new contracts for the distribution of newspapers and magazines.
While the deadline for submissions is tomorrow, there will be further opportunity through local members of parliament as the changes are debated.
I’ve had a quick squiz and it looks good.
This could be the break Newsagents and small businesses alike need.
Michael, Thank You!!!!! I was worried that no one had noticed this. This is a BIG DEAL! But newsagents are not talking about it.
I think that this one will struggle to go through as it is now. As it stands it really puts every contract under pressure. What is unfair? Big business will rail against this as they will argue they need certainty. To some dgree they are right. I would however like to see the rulings about unfair pressed so that we (small business) don’t get shafted with these one sided and one size fits all contracts that we are under now.
It will be intersting to see how it plays out, my submission is in.
Mark;
I had a read this afternoon and agree with what Michael is saying.
The lack of discussion surrounding this issue could be as a result of little understanding of consumer law? Let’s face it, the laguage can be a little thick (and boring)
Question; why are we hearing this from the Blog now, and not from the Associations; especially considering the importance (and impact) of some of the contracts in place at present?
Vaughan, Victorian newsagents need to ask that question of VANA and the ANF. They were both in Melbourne on Wednesday at a forum. I am not sure if it was covered.
Brett,
Certainty cannot be expected in any contracts, such is the nature of the laws that govern them. The legislation appears to be designed to put contracts under ressure. There is a reasonably long list of examples in the proposal of terms that may be ‘unfair’.
I am confident that the proposed legislation will pass.
It would also be interesting what effect this could have on contracts for equipment/services such as ATMs and photo kiosks – both of which are notorious for being incredibly one sided.
Given the content of the proposed legislation, our industry partners either need to rush through new contracts soon or substantially revise their contract content. I question the need for contracts at all, why not a standard supply/credit agreement? Perhaps this legislation will lead to that outcome.
This could be a very good thing for Australia and it’s economy. Seeing small business employs 40% approx (I’ve heard) of our population.
I know of a lot of big companies failing to pay small businesses for 30, 60, 90 days. Then invest this money, essentially earning interest of small businesses cash – I hope this is included in some way.
If that cash was available to the “rightful” owners, small business would hopefully boom, earn more cash, employ more people, and pay more tax than what we are now – truely stimulating the economy.