The Australian Consumer Law (ACL) has been amended to increase the maximum penalties that can be handed down for breaching the ACL. The increase came into effect on 1 September 2018.

Previously, companies faced a maximum penalty of $1.1 million per consumer law breach and individuals faced a maximum penalty of $220,000 per breach.

The amendments are as follows:

These amendments align the maximum penalties available under the ACL with the maximum penalties under the competition provisions of the Competition and Consumer Act 2010 (Cth). Thus far, the highest penalty imposed for a breach of the ACL is $10 million, in ACCC actions against Coles and Ford respectively. In recent actions by the ACCC against Heinz and Meriton, two large corporations, the court has handed penalties of $2.25 million and $3 million respectively. In contrast, the highest penalty imposed for a breach of competition law is $46 million against Yazaki. The change in maximum penalties essentially mean that the most serious ACL breaches will now attract similar penalties to the most serious competition law breaches.


How are you affected?

Contraventions covered by the new penalty regime include false or misleading representations, unfair sales practices as well as unconscionable conduct. Compliance has never been more critical than it is now given the increase in penalties and the recent trend indicating that the ACCC is likely to seek larger penalties for breaches of the ACL.

While small and medium companies will also be subject to the new penalties, SMEs may potentially benefit from the amendments, as consumer law protections apply to all goods and services purchased for $40,000 or under.

We recommend that you review your company processes to ensure compliance with the ACL. If you would like to discuss this further, please contact Peter North (Director) on 03 9629 9629.