Carol Brown (Tasmania, Australian Labor Party, Assistant Minister for Infrastructure and Transport) Share this | Hansard source

The Treasury Laws Amendment (More Competition, Better Prices) Bill 2022 will deliver on the government's election commitments to help ease the cost of living by increasing penalties for breaches of competition and consumer laws, and to provide greater protections for small businesses from unfair contract terms.

Schedule 1 to the bill will increase the maximum penalty for anticompetitive behaviour under the Competition and Consumer Act 2010 as well as breaches of the Australian Consumer Law to ensure the price of misconduct is high enough to deter unfair activity, and to ensure consumers retain a robust level of protection.

In 2018, the Organisation for Economic Co-operation and Development found that the average and maximum competition penalties in Australia are substantially lower than those in other international jurisdictions. As a result, there is a risk that a breach of the existing competition law could be seen as an acceptable cost of doing business by some large firms.

Consumers and small businesses often lack the resources and bargaining power to effectively review and negotiate terms in standard form contracts they are offered by a larger party.

The existing unfair contract terms protections in the ACL and the ASIC Act provide that where a court finds a term is unfair, the term is void.

This approach has not provided sufficient deterrence against the use of unfair terms, which remain prevalent in standard form contracts.

The amendments introduce civil penalty provisions prohibiting the use of, and reliance on, unfair terms in standard form contracts. This will enable a regulator to seek a civil penalty from a court. The existing definition of an unfair term remains unchanged.

The government's expectation is that regulators will continue to take a reasonable and proportionate approach to enforcing the unfair contract terms protections, including affording businesses an opportunity to respond to allegations of unfair terms before commencing any legal proceedings.

The bill includes a requirement to review the reforms two years after commencement, and the government will also welcome feedback from stakeholders ahead of this review. I commend the legislation to the Senate.