S 18 of the Australian Consumer Law within the Competition and Consumer Act 2010 - Coursework Example

Lecturer Assignment Topic Semester One There have been some significant changes to consumer in law in Australia in the last three years. One significant change was to introduce the Australian Consumer Law within the Competition and Consumer Act 2010. In particular was the introduction of s 18 of the ACL and its application to misleading contracts and further to misleading conduct by individuals. Business Law - S 18 of the Australian Consumer Law within the Competition and Consumer Act 2010 (ACL) Introduction The main objective of the Australian Consumer Law is to ensure adequate consumer protection and oversee that only fair trade practices takes place in Australian. The Australian Consumer Law is a state law, territory law and national law, beginning January 1st, 2011; it also contains unfair contract legislation which was enacted on July 1st, 2010. The Australia Consumer law ensures that consumers across the country have equal protection and rights; and also that businesses have equal responsibilities or obligations to consumers in the country. Institutions responsible for regulating this consumer law includes; the Australian Securities and Investments Commission, State Consumer Protection Agencies, and the Australian Competition and Consumers Commission (Bruce, 2013). The Australian Consumer Law is stated in the 2010 legislation, Consumer and Competition Act and it replaced previous commonwealth and state legislations dealing with consumer protection. In order to protect consumers in the financial services sector, some contents of the Australian Law are indicated the Australian Securities and Investments Commission Act of 2011. Discussion The Australian Consumer Law is a national law which is uniformly applied in different ways in Australia. It is firstly applied as commonwealth legislation within the boundaries indicated by the Consumer and Competition Act; and as a law of states or territories through legislation. The states and territories have the obligation to come up with laws which deals with consumer protection issues; this scope is indicated in the Australian Constitution, section 122. In the Australian Constitution, constitutional authority to make consumer laws does not lie with the Commonwealth, but it can make laws concerning interstate trade and conduct of public or private corporations. The commonwealth can also legislate on laws protecting consumers in the financial services sector. As a law of application, the Australian Consumer Law has been written to indicate that it is a law of Commonwealth, law of each State and law of each territory. However, the provisions are drafted to indicate conduct off “persons” instead of “corporations”. Part XI of the Consumer and Competition Act indicates the Australian Consumer Law as a Commonwealth law; and refer to “persons” in the Australian Consumer Law, and to “corporations” in the Commonwealth Law (Pearce & Geddes, 2000). The Consumer and Competition Act of 2010 explain that the Australian Consumer Law is a law applicable to the relevant jurisdiction, the Act; indicates the way consumers can access courts and tribunals of the state, territory or commonwealth; outlines the administrative and judicial review procedures in actions of consumer law regulators; and deals with various enforcement procedures or issues. The Australian Consumer Law is important to the citizens of Australia in various ways. The law; has promoted a competitive market and fair trading methods; acts as a legal instrument of protecting consumers; regulates and guides trade practices which are appropriate; outlines code of ethics in business practices; providing powers to the Director of Consumer Affairs, for example authority to regulate breeches of this act or conciliate disputes related to consumer law; ensure uniformity in consumer laws of different jurisdictions; regulate trade activities of certain businesses; repealing Fair Trading Act 1997; and amending the 1984 Credit Act (Williams, 2014). The Australian Consumer Law is different from previous legislations. For example provisions of the Trade Practices Act of 1974 were changed; through the Competition and Consumer Act of 2007, and the introduction of the consumer law. One important change introduced, to the Trade Practices Act, by the Australian Consumer Law, is the new method of statutory guarantees which changed warranties and conditions previously indicated in consumer contracts through the Trade Act. One of the factors that led to the changes in the Trade Practices Act is that; the Commonwealth Consumer Advisory Council identified, by July 2010, various shortcomings, for example inadequate awareness by corporate and consumers concerning their legislated obligations, rights or responsibilities, also terms used in the Trade Practices act were complex and hence not easily understood by consumers. In addition, the Trade Practices act was changed because it did not guarantee immediate remedies to consumers. The recommendations by the Consumer Advisory Council also explained that the method of implied contractual conditions and warranties be changed to system of clear statutory remedies and guarantees (Sawer, 2003). The new statutory guarantees stated in the Australian Consumer Law are applied in “consumer’ transactions; however, the definition of consumer transaction has not changed. Misleading behavior includes deceptive conduct or in other words misleading conduct. The misleading conduct involves businesses making unlawful statements during trade, for example failure to disclose relevant business information or predictions. Businesses will break the law if it makes a misleading impression on the consumers concerning for example value, quality or quantity of products. A business can also break the law and mislead through silence, or failure to disclose relevant facts to consumers. It is also misleading for businesses to pass information to customers through small prints and disclaimers. Predictions and promises are misleading if the business person knew it was incorrect. Misleading behavior also include false representations. It is illegal for businesses to come up with misleading representations concerning goods or services during supply or promotion of products; or make false business testimonials, testimonials include statements from previous consumers concerning their level of satisfaction with a product. It is also misleading to make false guarantees to consumers concerning a given product, and in making false representations on the terms or conditions of employment. Other false representations involve; failure to provide promotional gifts, companies misleading the public on nature of their business operations, bait advertising where businesses market products but then frail to satisfy demand, and businesses receiving payments for goods or services not delivered. The Australian Consumer Law has several limitations. The major limitation is that it is not 100% perfect, and amending it is complex process which take a long time (months) to sail through. This complex process is described in the amendment procedures discussed as follows: The 2nd July 2009 agreement, the Intergovernmental Agreement for the Australian Consumer Law, provide mechanisms for amendments (Sawer, 2003). The relevant jurisdiction will issue an amendment proposal to the other jurisdictions - state, commonwealth, and / or territory. Commonwealth government thereafter starts consultation process in four weeks time, from the date of receiving the proposal. Consultation involves: Commonwealth Minister writing to the ministers of all the territories and states, the ministers the report in writing within three months; the Common wealth Minister will then ask for vote after the elapse of the three months period; territories and state have 35 days for voting, if they abstain from voting then their votes will be in favor of the proposal; proposed amendment is successful if it is supported by the three states, one territory and Commonwealth Government. Commonwealth Government has authority to make minor amendments in the Australian Consumer Law; as long as it informs other jurisdictions on its intentions. If any jurisdiction objects in 21 days, from date of notice, then a vote must be called by the commonwealth Minister. An amendment which has passed through these stages, and agreed on by the jurisdictions, will be introduced in the Australian Parliament by the Commonwealth Minister as a legislation amending the Australian Consumer Law. The State Law is still applicable in consumer protection in Australia. This is because it is responsible for creating state institutions which ensure the consumer rights are protected. For example state law has ensured creation of The Australian Competition and Consumer Commission in 1995 to oversee the implementation of the Trade Practices Act. The commission strives to ensure free market competition in Australia. Also state law explains the procedures followed when amending legislations dealing with consumer protection (Parkinson, 2007). Common Law is still applicable in consumer protection, for example when ensuring that consumers are not exploited in business transactions. It also ensures adequate mechanisms for compensating consumers in case of poor service delivery or poor quality commodities. Grievances against the unfair trade practices are addressed through the relevant state or territorial courts. Provision indicated in the Australia Consumer Law greatly indicates the issues explained in the common law, though extra protections are added in the consumer law (Rosemary, 2007). In studying the change from “warranties and conditions” in Trade Practices Act, to “guarantees” as discussed in the Australian Consumer Act; it was stressed that the new act must indicate the remedies to breaches of the stated conditions or warranties. The Australian Consumer Act brings in new methods of addressing customer complaints and grievances, enforcement authority and new penalties. The enforcement instruments used include; public warning notice which is given when a person or business fails to honor a substantiation notice; the substantiation notice is given to so as a person or business may answer breaching claims; the notice is in writing and asks for more information on the claim; infringement notice; and enforceable undertaking. The remedies include; injunctions, compensatory orders, civil pecuniary penalties, declarations, disqualification orders, non –parties’ redress, and non-punitive orders (Ellinghaus & Duggan, 2008). A victim of misleading behavior can claim damages, which can be in form of monetary compensation. The measure of damages in the consumers’ law is the same as in tort or contract law. According to the Consumer and Competition Act, people who contribute to the damage or loss suffered will receive less damage amounts if the courts grants it. There is six years limitation duration on damages actions. Breaches of provisions in the Consumer Law can attract penalties reaching $220,000 for individuals or $1.1 million for business organizations; the body responsible for determining the penalties in the ACCC – Australian Competition and Consumer Commission. There are so many other issues concerning the Australian Consumer Laws that are relevant in this research paper. One example deals with institutions that ensure successful implementation of the consumer law. The EIAC, which denotes Education and Information Advisory Committee, is responsible for coordinating information issues relating to the consumer law with relevant stakeholders in Australia (Bryan & Vann, 2006). The PSCC, denotes Product Safety Consultative Committee, is responsible for providing a national platform for discussing safety policy on different products. The CDRAC represents Compliance and Dispute Resolution Advisory Committee, this institution is responsible for ensuring that appropriate dispute resolution mechanisms are in place to address consumer grievances. The PRAC, abbreviates Policy and Research Advisory Committee, it is the institution responsible for making appropriate policies dealing with consumer protection issues in Australia (Kercher, 2005). The MCCA, meaning Ministerial Council on Consumer Affairs, is an institution composed of Ministers representing State Ministers, State Ministers and Commonwealth Ministers; who are responsible for making policies favoring consumer protection in Australia. Conclusion The regulators of Australian Consumer Law use certain guiding principles when undertaking enforcement exercise. The regulators must observe transparency when handling traders or consumers. Enforcement mechanisms must ensure proper governance method which can be reviewed by appropriate public institutions like courts of law; enforcement actions must also be made public. The regulators must also ensure timeliness in re4ceiving complaints and handling consumer versus traders disputes; this assists in preventing costly delays and uncertainty in the trading environment. Regulators also observe confidentiality especially in matters concerning ongoing investigations on consumer grievances. All regulators must ensure accountability to the members of the public; they should be effective in handling consumer law cases (Jeffrey, 2004). Finally, the regulators should demonstrate national awareness by putting the interests of the public first and understanding the impact that their decisions will have on the entire country. The Australian Consumer Law is an important instrument needed to ensure seamless economy where consumers and traders ensure the protection of each other’s rights, in a perfect market economy, leading to economic growth. Works Cited Bryan, M.W. & V.J. Vann. (2006) Equity & Trusts in Australia. Cambridge: Cambridge University Press Bruce A. (2013) Consumer Protection Law in Australia. Melbourne: LexisNexis. Ellinghaus, A. B. & A. Duggan (eds.) (2008) The Emergence of Australian Law Sydney: Butterworths. Jeffrey, W. (2004) "Statutory Interpretation, Law Reform and Sampfords Theory of the Disorder of Law" Part Three 22 Federal Law Review 116. Kercher, L. (2005) An Unruly Child: A History of Law in Australia Sydney: Allen & Unwin. Parkinson, P. (2007) Tradition and Change in Australian Law. Sydney: LBC Information Services. Pearce,D. & R. S. Geddes (2000) Statutory Interpretation in Australia (4th edition, Sydney: Butterworths. Rosemary, B. (ed.) (2007) The Law Handbook. Sydney: Redfern Legal Centre Publishing. Sawer,R. (2003) "The Western Conception of Law" International Encyclopedia of Comparative Law. The Hague: Tubingen. Williams, G. et al. (2014). Blackshield and Williams Australian Constitutional Law and Theory (6 Ed.). Annandale, NSW: Federation Press. Read More