COAG Decision Regulation Impact Statement – Legislative and Governance Forum on Consumer Affairs (CAF)
On 6 November 2020, the Legislative and Governance Forum on Consumer Affairs (CAF) agreed to strengthen the existing unfair contract term protections in the Australian Consumer Law. Key reforms include:
- making unfair contract terms unlawful and giving courts the power to impose a civil penalty;
- increasing eligibility for the protections by expanding the definition of small business and removing requirements for contracts to be below certain thresholds; and
- improving clarity on when the protections apply, including improving clarity around the definition of ‘standard form contract’.
These reforms will help reduce the prevalence of unfair contract terms in standard form contracts, and improve consumer and small business confidence when entering into contracts.
The Treasury prepared a Council of Australian Governments (COAG) decision Regulation Impact Statement (RIS) that was provided to CAF to inform its final decision. The RIS was assessed by the Office of Best Practice Regulation as compliant with the COAG Best Practice Regulation requirements.
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