As we approach the peak season for consumer spending, the Australian Competition & Consumer Commission is promoting awareness of your rights when dealing with retailers.

Today’s article highlights some statements made by the ACCC which you need to keep in mind when making your next purchase.

Clothing retailers

After reviewing the online policies of several large Australian clothing retailers, the ACCC has found some retailers may be misleading consumers about their rights under the Australian Consumer Law (ACL) .

The ACCC has received over 750 complaints this year regarding consumer guarantees for clothing purchases.

If customers are looking to return faulty goods after this week’s Click Frenzy online shopping event, the ACL gives them the right to choose between a refund or replacement if a product they have purchased has a major fault.  These rights apply for sale and clearance items.

If a product has a minor fault, retailers can choose to provide a free repair instead of a refund or replacement.

Businesses must ensure the rights of consumers are honoured when they try to return a faulty product.  Retailers must not misrepresent the consumer law and the rights of their customers in the wording and advertising of their returns’ policies.

The ACCC will take further action if a retailer is not fulfilling its legal obligations under consumer law.

Retailers cannot refuse to give you a refund, repair or replacement because you bought the item on sale or at a clearance store unless they brought the fault to your attention before you bought the item.

Signs stating ‘No Refunds’ or ‘No refunds or exchanges on sale items’ are unlawful and do not alter your rights under the ACL or prevent them from applying.

Retailers cannot restrict the period in which you can get a remedy for faulty products. You have a right to a remedy for a reasonable amount of time after buying the item. This period can last longer than any express warranty period given to you when you purchased the item.

Retailers do not have to give you refunds or exchanges if you got what you asked for but simply changed your mind.

Computer retailer

In October 2017, the Federal Court ordered penalties totalling $750,000 against a computer retailer for misrepresenting consumers’ rights to remedies for faulty products.

The Court also made orders including injunctions, a comprehensive Australian Consumer Law compliance training program, publication orders, and payment of ACCC’s costs.

MSY Technology operates 28 retail stores across Australia and online, selling computers, computer parts, accessories and software.

The company admitted that it made false or misleading representations on their website, and in verbal and email communications to consumers about their rights. The company had misrepresented consumers’ rights to a repair, replacement, or a refund where a product developed a fault.

Businesses must ensure their refund and returns policies, and any representations accurately reflect their obligations under consumer law.  Consumer guarantees cannot be excluded restricted or otherwise modified by a seller’s terms or conditions.


Small Business unfair contract terms

The ACCC is continuing to educate business and take enforcement action to ensure that small businesses receive the protections of the new unfair contract terms laws.

The ACCC has taken successful court action against a major waste management company, JJ Richards & Sons Pty Ltd, for unfair contract terms including an automatic five-year rollover clause, a unilateral price variation term and a broad indemnity provision.

The ACCC has also commenced proceedings against serviced office space provider, Servcorp Ltd, alleging that 19 terms in its Service Agreement used with small business clients are unfair.  The matter is currently before the court.

Earlier this year, a number of major traders such as Uber, Fairfax Media, Jetts Fitness, Lendlease Property Management and Sensis amended their standard small business contracts in response to unfair contract terms concerns raised by the ACCC.

Small businesses should look out for common types of terms which may be unfair:

  • automatic renewal terms binding customers to subsequent contracts unless they cancel the contract within a certain timeframe
  • terms allowing a trader to unilaterally increase its prices or alter the terms and conditions of the contract
  • terms that broadly limit a trader’s liability towards a small business, or which require a small business to indemnify a trader in an unreasonably broad range of circumstances
  • terms that allow traders to cancel or terminate an agreement without cause

If small business thinks a contract term is unfair, it should ask the provider to amend or remove the unfair term.  If this is unsuccessful, a small business can contact the ACCC (or ASIC if it relates to a financial service or product) or seek the assistance of  the State’s Small Business Commissioner or ASBFEO.

The ACCC has produced guidance material for businesses about the new laws, including a fact sheet which explains what an unfair term is, and what a small businesses can do if they think they have an unfair term in their contract.



The law applies to a standard form small business contract entered into or renewed from 12 November 2016.  If a contract was varied on or after 12 November 2016, the law will apply to the varied terms.

Contracts covered include those between businesses where one of the businesses employs less than 20 people and the contract is worth up to $300,000 in a single year or $1 million if the contract runs for more than a year.

If standard legal proceedings don’t achieve the desired result, alternate strategies may be considered:


Disclaimer: The above is to be considered as general education. This is not advice and it is not to be acted upon without advice from a qualified professional who understands your personal circumstances.

Copyright © 2017 Wockner Lawyers. All Rights Reserved. Contact Wockner Lawyers – [email protected]. This article may not be used without the prior written consent from the author. See below for more details…

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