Page 63 - Retail World March 2021

WHAT’S ON THE HORIZON FOR 2021? While we all strap in for the ride that will be 2021, a few legislative changes to Australia’s consumer laws are on the horizon, which may require your business, once again, to pivot. By Bird & Bird Partner Lynne Lewis and Special Counsel Megan Edwards. Changes to unfair contract terms provisions In November 2020, the federal government announced that the state and territory consumer affairs ministers had agreed to strengthen the unfair contract terms protections found in the Australian Consumer Law (ACL). This area of law has been on the radar of regulators for some time, and this development means we’re one step closer to legislative change. Currently, the ACL provides that “unfair” contract terms in standard form consumer and small business contracts are void. While, at the time of writing, the terms of the changes to the ACL have not been published, the government has signalled the following likely changes: • Making unfair contract terms unlawful and give courts the power to impose a civil penalty. • Flexibility to allow courts to determine whether unfair contract terms are void or to determine an appropriate remedy (as currently they are automatically void). • A change to the definition of “small business” to provide that one party to the contract must be a business with fewer than 100 employees or annual turnover of less than $10 million. • Further clarity on what is a “standard form contract”, with reference to the repeated use of a template agreement, and whether the other party has an opportunity to negotiate. • A rebuttable presumption that where terms are used by the same company or industry and are found to be unfair, that those terms used in similar circumstances are also unfair. • Remedies available to non-party consumers in the ACL would also apply to non-party small business. • Exemptions for certain contract clauses that meet minimum standards or industry-specific requirements. Watch this space, as the next step will be the release of draft legislative changes that will provide clear guidance as to the changes to come. Changes to the definition of ‘consumer’ A change to the definition of a “consumer” in the ACL will take effect from 1 July 2021, expanding the scope of the goods and services to which the consumer guarantees apply. Currently, the ACL provides that a person is taken to have acquired particular goods as a consumer if: • The amount paid for the goods or services did not exceed $40,000. • If the goods were of a kind ordinarily acquired for personal, domestic or household use or consumption. • The goods are vehicles or trailers acquired for transport of goods. Similar value thresholds apply when considering whether services have been acquired by a consumer. From 1 July 2021, $100,000 will be the new price threshold, replacing the previous $40,000 limit. This means a person can buy goods or services with a price of up to $100,000 which might not ordinarily be considered to be for domestic use (eg, manufacturing equipment) and still fall within the definition of “consumer” and be able to rely on the statutory remedies of the consumer guarantees. Button batteries On 18 December 2020, mandatory safety and information standards for button batteries, and goods that contain button batteries, were enacted. Button batteries, or coin-cell batteries, are flat, round batteries which can be found in a wide range of products, including watches, remote controls, musical greeting cards, home medical devices, and toys. The new standards require products that contain button batteries to meet design and testing requirements and contain certain markings which include a warning. Further, button batteries themselves must be sold in child-resistant packaging and contain a warning. An 18-month transition period allows time to implement any required manufacturing or design changes to products and packaging. This means that, from June 2022, suppliers must comply with the standards or face penalties. Should you need any further information about the implications of these changes for your business, please contact us at Bird & Bird. LEGAL About Lynne Lewis Lynne is a partner in Bird & Bird’s Intellectual Property Group in Sydney. Intellectual property and related consumer and regulatory law is her area of specialty. She works on all aspects of the creation, commercialisation, management, protection and enforcement of IP rights, as well as on retail and consumer law, dealing with the application of the Australian Consumer Law and the complexities of franchise law. About Megan Edwards Megan is Special Counsel with Bird & Bird. She assists clients to traverse the regulatory environment to market and sell their products in Australia, particularly in the technology, telecommunications, gaming and electronics, consumer products and food and beverage industries. About Bird & Bird Bird & Bird is one of the world’s leading international law firms advising industries where technology, regulation and intellectual property are driving change. With its strong Australian presence, clients enjoy global reach across various practice areas. MAR, 2021 RETAIL WORLD 61