Ministers support unfair contract extension to small business

Federal Minister for Small Business Bruce Billson has announced that Australian State and Territory Ministers have come together to support an extension of unfair contract term protections to small business at a meeting in Cairns today.

Federal Minister for Small Business Bruce Billson has announced that Australian State and Territory Ministers have come together to support an extension of unfair contract term protections to small business at a meeting in Cairns today. 

Australian Ministers, along with New Zealand Minister for Consumer Affairs Craig Foss, welcomed the release of the Consumer Affairs Australia and New Zealand (CAANZ) consultation paper and the commencement of a 10-week consultation process to explore the issue. Currently the Australian Consumer Law protects individual consumers from unfair terms in standard form contracts but does not provide such safeguards to small business.

Small businesses often lack the bargaining power, time and resources to closely review terms in standard form contracts offered by larger businesses and that any unfair term in these ‘take it or leave it’ contracts may be detrimental to the smaller party. Getting the balance right between protecting small business against unfair contract terms, while at the same time not imposing unnecessary burdens on business, is an important consideration in the current CAANZ consultation. Larger businesses have nothing to fear from the extension of consumer protections to small business – provided they are engaging in fair commercial practices.

The Commonwealth is seeking feedback from state and territory agencies and small business owners on how best to design protections to support both small business and consumers. Small business owners are encouraged to share their views and engage in the consultation process. Further information on the consultation paper can be found via the Commonwealth’s Treasury website.

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