Three new laws you must know about to do business in 2012

Alex_Rhydderch_CVAlex Rhydderch of CBP Lawyers outlines three new laws that came into effect in 2012 that every business owner should know about.

While you were ringing in the new year, governments were ringing in new laws. Here are three that you should know about.

Australian Consumer Law

On 1 January 2012, new laws came into force regulating consumer product warranties. This is related to the introduction of consumer guarantees under the ACL that came into force last year, replacing the warranties implied into consumer contracts under the old Trade Practices Act.

Alex Rhydderch of CBP Lawyers

Product warranties must now include, word for word, the following statement amongst other things:

"Our goods come with guarantees that cannot be excluded under the Australian Consumer Law. You are entitled to a replacement or refund for a major failure and compensation for any other reasonably foreseeable loss or damage. You are also entitled to have the goods repaired or replaced if the goods fail to be of acceptable quality and the failure does not amount to a major failure."

Some recommendations:

  • You need to amend your consumer product warranty documents to include the above statement and to comply with a number of other specific requirements.
  • If your trading terms still refer to the Trade Practices Act, they need to be updated.
  • In certain circumstances, it is possible to cap your liability for a failure to meet a consumer guarantee by limiting the remedy available to "repair or replace".

Personal Property Securities Act

On 30 January 2012, the personal properties securities regime comes into operation. More than 20 Federal and State registers will be consolidated into one single online register, the Personal Property Securities Register (PPSR).

The new regime will also substantively change current law and practice affecting creditors, equipment lessors and retention of title suppliers in particular. For more information on the PPS, please see our earlier article in My Business.

Some recommendations:

  • If you supply goods on retention of title terms or otherwise secure obligations of your customers by taking an interest in personal property (broadly speaking a Grantor), you should be amending your trading terms.
  • Grantors should be amending their processes to conduct checks of potential customers on the PPSR, to capture the necessary information to register a financing statement on the PPSR and to identify collateral, including serial numbered property such as vehicles.
  • Grantors should be registering as a "secured party group" on the PPSR.
  • Grantors should be training relevant staff. It is important to get PPSR registrations correct. Beyond loss of priority in a security contest with another creditor or liquidator, there is risk of a separate penalty for making a misleading or deceptive PPSR entry.
  • Financiers who take fixed and floating charges or other PPSA security interests will need to review their standard documentation. For example, fixed and floating charges will be replaced with "general security agreements".

Work Health and Safety Act

On 1 January 2012, regulations under the new Work Health and Safety Act came into force in NSW.

Formerly, employers or principal contractors had the primary responsibility to ensure the safety of workers. Now, the responsibility is on "a person conducting a business or undertaking" (a "PCBU", pronounced "peekaboo") to ensure so far as reasonably practicable, the health and safety of workers.

The definition of a PCBU is broad and imposes duties on those who have control or influence over the way work is performed. This includes principal and head contractors, subcontractors, franchisors and franchisees amongst others.

There is also now a positive duty on officers to exercise due diligence to ensure that a PCBU is complying with its obligations. Failure to exercise due diligence may result in personal liability.

Some recommendations:

  • Businesses should be educating themselves about the new WHS law. A summary of key changes for NSW is on the website of the NSW WorkCover Authority.
  • Businesses should be updating old OHS documents and procedures.
  • Officers should be insisting on new systems to help demonstrate WHS due diligence.

For more information about commercial contracts and advice, please see the website of CBP Lawyers or contact Alex Rhydderch at This email address is being protected from spambots. You need JavaScript enabled to view it.

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