The ACCC announced this month that Visy Recycling, Cleanaway and Suez in the waste management industry had agreed to make changes to their standard form contract following an ACCC investigation. The terms that were considered by the ACCC to be potentially unfair and were amended included:
- terms that did not allow a customer the right to terminate the contract if they were dissatisfied with a price increase, and further imposed an early exit fee equal to the average monthly fee multiplied by the remaining months of the contract
- other liquidated damages clauses requiring payment of 30 per cent of the monthly amounts remaining for early termination which the ACCC considered were unilaterally determined by the supplier and not referrable to actual loss.
The ACCC has heralded its intention to continue to push for changes in the law to impose penalties and make compensation orders where businesses fall foul of the unfair contract terms laws. Watch this space, as all businesses who use standard form contracts to transact with small businesses may be affected by this change.
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