Small Business Report Released by ACCC

Friday 19 February 2016 @ 9.43 a.m. | Legal Research | Trade & Commerce

As reported in a recent ACCC Media Release, the Australian Competition and Consumer Commission (ACCC) is continuing to focus upon misleading and deceptive conduct complaints from small businesses, as revealed in the ACCC’s latest biannual Small Business in Focus report.

Background to the Report

The report, which is the eleventh in the series, highlights some of the ACCC’s key work in the small business and franchising sectors between 1 July and 31 December 2015. It also contains the latest small business and franchising complaints data.

In the last six months the ACCC reported that it had:

  • 456,015 visits to the ACCC business webpages;
  • 11,540 users of the ACCC’s three free online education programs for small businesses, tertiary students and franchises;
  • 9813 views of the ACCC’s business-to-business unfair contract terms videos since their release in November 2015; and
  • $2,284,798 losses report to the ACCC by small businesses from scam activities.

Comment from the ACCC

Commenting on the data contained in the report, ACCC Deputy Chair Dr Michael Schaper said:

“Over the last six months, the ACCC received almost 5,000 complaints from small businesses. Concerns about misleading conduct remain the biggest issue for small businesses. Conduct resulting in substantial small business detriment has been a priority for the ACCC and we want to make it clear that this type of conduct is unacceptable.”

Enforcing Compliance with the Law

The ACCC aims to make markets work for everyone and encourages compliance with the Competition and Consumer Act 2010 (Cth) (the CCA), such as seeking court orders and obtaining undertakings enforceable in court.

Recent ACCC actions have included:

  • In November 2015, the ACCC achieved a significant court outcome when Safety Compliance Pty Ltd was ordered to pay a penalty of $515,000 for making false or misleading representations to small businesses in connection with the supply of safety wall charts and first aid kits; and
  • In December 2015, the Federal Court ordered the franchisor of the Electrodry Carpet Cleaning business was ordered to pay total penalties of $215,000 for its involvement in the publishing of fake testimonials on the internet.

Dr Schaper said:

“While online testimonials can be a useful and genuine marketing tool for businesses to advertise to consumers, deliberately making or inducing false or misleading representations in testimonials breaches the Australian Consumer Law [Sch 2 to the Competition and Consumer Act 2010 (Cth)] and confers an unfair advantage when competing against businesses that do the right thing.”

Highlights of the Harper Competition Policy Review

In November 2015 , the Federal Government released its response to the Harper Competition Policy Review final report.

The Government has announced that it will implement the majority of the Harper recommendations, including:

  • introducing greater flexibility into the notification process for collective bargaining by small business; and
  • encouraging state and territory governments to consider removing remaining restrictions on retail trading hours.

The Government has also committed to retain a small business specific ACCC commissioner who can provide small business insights and experience.

Standard Form Contract Protections

 As previously reported in a TimeBase article, the Commonwealth passed the Treasury Legislation Amendment (Small Business and Unfair Contract Terms) Bill 2015 (Cth) which was assented to on 12 November 2015 and enacted as the Treasury Legislation Amendment (Small Business and Unfair Contract Terms) Act 2015 (Cth) (Act No 147 of 2015.

The law applies to standard form contracts 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.

The report also outlines the ACCC’s recent and upcoming activities to help businesses understand their rights and responsibilities under the new business-to-business unfair contract terms protections. A webinar that the ACCC will be holding will further explain:

  • which contracts and terms are covered by the new law;
  • the types of terms that may be unfair;
  • how to determine if a contract term may be unfair; and
  • what you can do if you receive a contract that you think includes an unfair term.

TimeBase is an independent, privately owned Australian legal publisher specialising in the online delivery of accurate, comprehensive and innovative legislation research tools including LawOne and unique Point-in-Time Products.

Sources:

Protecting small businesses remains high on ACCC's agenda – ACCC Release 12/16

Treasury Legislation Amendment (Small Business and Unfair Contract Terms) Bill 2015 (Cth) - Bill and supporting material as reproduced in TimeBase LawOne Service.

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