201406.13

State and Territory Ministers support unfair contract extension


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Australian State and Territory Ministers have thrown their support behind an extension of unfair contract term protections to small business at a meeting today in Cairns.

Australian Ministers were joined by the New Zealand Minister for Consumer Affairs, The Hon Craig Foss, and welcomed the release of the Consumer Affairs Australia and New Zealand (CAANZ) consultation paper and the commencement of a 10-week consultation process to explore the issue.

Currently the Australian Consumer Law protects individual consumers from unfair terms in standard form contracts but does not provide such safeguards to small business.

We know small businesses often lack the bargaining power, time and resources to closely review terms in standard form contracts offered by larger businesses and that any unfair term in these ‘take it or leave it’ contracts may be detrimental to the smaller party.

Getting the balance right between protecting small business against unfair contract terms, while at the same time not imposing unnecessary burdens on business, is an important consideration in the current consultation.

Larger businesses have nothing to fear from the extension of consumer protections to small business if they are engaging in fair commercial practices.

The Commonwealth is seeking feedback from state and territory agencies and stakeholders on how best to design protections to support small business and consumers.

Small businesses are also encouraged to share their views and engage in the consultation process and further information on the consultation paper can be found via the Commonwealth’s Treasury website http://www.treasury.gov.au.