From 1 July 2021, amendments to the Australian Consumer Law (ACL) definition of “consumer” will significantly extend consumer protections.
The definition – the current form of which has been in place since 1986 – was, amongst other matters, the subject of 2017’s ACL Review Final Report released by Consumer Affairs Australia and New Zealand (Report).
Currently, a “consumer” is a person who purchases goods or services, and:
- pays up to $40,000 for those goods or services; or
- those goods or services (irrespective of their value) were of a kind ordinarily acquired for personal, domestic or household use or consumption; or
- in the case of goods that are a vehicle, or a trailer – the goods were acquired for use principally in the transport of goods on public roads.
Importantly, a person need only satisfy one of the above criteria in order to meet the definition of “consumer”.
The Report included a recommendation that the definition of “consumer” be adjusted to account for inflation. This was implemented by the Commonwealth in the Treasury Laws Amendment (Acquisition as Consumer – Financial Thresholds) Regulations 2020; from 1 July 2021, a person who spends up to $100,000 on goods or services will be a “consumer” for the purposes of the ACL.
This amendment means that the ACL consumer guarantees (and related remedies) will from 1 July be available in respect of previously exempt supplies of goods and services, which, but for this amendment, would not be “consumer” goods and services.
Ahead of 1 July, suppliers should review their trading terms and consider the impact of clauses that purport to “contract out” of the consumer guarantees.
Interestingly, this change could present remedies for those (potentially, very large businesses – not “consumers” the ordinary sense) that did not have remedies before the change.
~ with Alexandra Culshaw, Graduate at Law