Avoid unfair contract terms in standard form consumer & small business contracts
From November 2023, unfair contract terms carry pecuniary penalties — up to $50M per term.
Who must comply
Any business issuing standard form contracts to consumers or small businesses.
What triggers it
Including or relying on an unfair term in a standard form contract.
When due
Ongoing.
Evidence required
Reviewed contracts, legal sign-off, term-by-term assessment.
Max penalty
$50M, 3× benefit, or 30% of adjusted turnover (corporations); $2.5M (individuals) per term
Summary
Amendments to the Australian Consumer Law and ASIC Act, effective 9 November 2023, prohibit (with penalties) the use of, or reliance on, unfair contract terms in standard form contracts with consumers and small businesses (now redefined to <100 employees or <$10M turnover). Each unfair term can be a separate contravention.
Enforced by
Source legislation
Topics
Source: https://accc.gov.au/business/business-rights-and-protections/unfair-contract-terms. Rules Mate is not a law firm. Always verify against the live regulator source before acting.