Need to know
- In a 2023 CHOICE national survey, more than seven out of 10 Australians said they thought it was a legal requirement for businesses to treat their customers fairly
- But unfair businesses practices – also known as unfair trading – now come in many shapes and forms
- In a critical consumer win, the federal government said it intends to make unfair trading illegal under Australian Consumer Law
They come in many forms, and they've made their way into nearly every nook and cranny of the online consumer marketplace. The worst part is that unfair business practices are not illegal.
You know you've been a victim of one when you find it very difficult to cancel a subscription; or when new charges are sneakily added in right before you pay (drip pricing); a when a website creates a false sense of urgency so you'll hurry up and pay; or when you find it impossible to contact a business you've paid money to.
The list, sadly, goes on, and can also include things like being forced to set up an online account just to make a single purchase, or being subject to dynamic pricing, where the price keeps changing when you're in the middle of trying to buy something.
CHOICE has been calling for a ban on unfair trading tactics in recent years, and we're happy to report that the federal government has finally gotten on board
Some shady businesses, such as the multi-tentacled company Derila, seem to have been founded on the very principles of unfair trading.
That businesses can get away with this has taken a lot of us by surprise. In a 2023 CHOICE national survey, more than seven out of 10 Australians said they thought it was a legal requirement for businesses to treat their customers fairly.
CHOICE has been calling for a ban on unfair trading tactics in recent years, and we're happy to report that the federal government has finally gotten on board. In a recent announcement, the government said it intends to make unfair trading illegal under Australian Consumer Law (ACL) and to make violations of the ACL as it currently stands something businesses can be penalised for.
Flouting the law with impunity
Oddly enough, this is not currently the case. Though the ACL is technically the law, businesses can and do break it with impunity.
The proposed reforms, which are under consultation, would empower the Australian Competition and Consumer Commission (ACCC) and state and territory consumer protection agencies to issue infringement notices or pursue penalties for breaches of the Consumer Guarantee to a repair, replacement or refund when it's legally required.
It signals a potential sea change in the way businesses treat their customers. It's also a case of Australia catching up with regulatory frameworks in many other countries.
Unfair business practices are rife in Australia, tricking people into spending more money, sometimes without their knowledge
CHOICE director of campaigns Rosie Thomas
"Unfair business practices are rife in Australia, tricking people into spending more money, sometimes without their knowledge," says CHOICE director of campaigns Rosie Thomas.
"The proposed ban would save consumers from tricks and traps such as dynamic ticket pricing, gym memberships that are almost impossible to cancel, and costly, pre-checked extras at online checkouts.
"A ban on unfair business practices would also help make sure the law catches up with community expectations."
The final version of this crucial update to consumer law is expected to be released in the first half of 2025.
Stock images: Getty, unless otherwise stated.
