Australia: Middletons expert urges businesses to ensure their house is in order to avoid penalties for breaches of the new Australian consumer laws
Last Updated: 10 June 2011

Middletons' head of competition and regulatory, Murray Deakin, says "The ACCC's success in recovering more than $3.6 million in penalties since the new consumer laws came into affect highlights the importance of compliance in this field."

Mr Deakin said, "Traditionally, our specialist practice of trade practices law has focused more upon restrictive trade practices, however the new hefty penalties for breach of consumer laws has justified a much greater emphasis upon ensuring clients do not fall short on the new consumer law requirements."

"The new Australian consumer laws affect all industries and businesses need to quickly adapt to the new changes" said Mr Deakin.

According to ACCC Chairman Graeme Samuel speaking at the Consumers 2011 conference in Sydney, "Until a year ago the ACCC's ability to penalise a great deal of dishonest conduct amounted to not much more than a slap on the wrist," Mr Samuel said. "Now the punishments can better match the crime and we can respond in a more timely way."

"These powers avoid the necessity to take court action and achieve faster outcomes in the interests of consumers," Mr Samuel said.

The ACCC have new powers under the Australian Consumer Law (ACL) to issue infringements notices for less serious offences that attract "on-the-spot fines" of $6,600 for corporations and $1,320 for individuals.

Mr Deakin says "I understand that the ACCC has already issued more than 50 infringement notices since April last year resulting in the payment of fines totalling more than $300,000."

"This now poses a serious risk issue and businesses should have been taking steps before now to ensure that risk is mitigated." said Mr Deakin.

The recent infringement notices includes 27 notices issued against SingTel Optus Pty Ltd which carried $178,200 in fines for what the ACCC considered to be false or misleading conduct in the promotion of mobile phone plans.

For more serious matters where court action becomes necessary, the ACCC is able to seek Court imposed penalties of up to $1.1 million for corporations and $220,000 for individuals that become involved in breaches of the ACL.

The highest penalty received to date was $2.7 million award by the Federal Court against two overseas companies, Yellow Page Marketing BV and Yellow Publishing Limited for sending thousands of misleading faxes and invoices to businesses in an attempt to obtain subscriptions to their online business directories.

"As greater use is made of the new powers and penalties they will become a deterrent to others thereby increasing compliance with the law," Mr Samuel said.

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