Businesses are reminded that they must honour the terms and conditions of their contracts with customers.
“As a business, if you are unable to provide goods or services during this time, you have the opportunity to work with your customers to find a mutually agreeable alternative arrangement,” Mr Keogh said.
“This could include providing a partial refund, a credit note or voucher, or rescheduling to supply the services at a later date where this is possible.”
“It is important for small business to understand their obligations when handling requests from consumers. Failure by any business to honour its cancellations or refunds policy may constitute misleading conduct under the Australian Consumer Law,” Mr Keogh said.
In the event of cancellation, can businesses rely on a contractual term that allows them to keep any deposit or upfront payment?
In many circumstances, a term allowing a business to retain the full deposit or payment without having delivered any goods or services may be considered unfair as it may not be reasonably necessary to retain the full amount to protect legitimate business interests. However, this is unlikely to be the case if you are covering the costs incurred.
The ACCC’s guidance for consumers may also be relevant for small businesses, which, under Australian Consumer Law, may be legally defined as consumers when engaging with other businesses.
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