Contemporary and Comparative Constructive Criticism

Question: Discuss about the Contemporary and Comparative Constructive Criticism. Answer: Introduction At the onset, it is imperative to underscore the fact that the Competition and Consumer Law 2010 (Cth)[1] surely marks a watershed and is a compendium for the consumer rights law and the laws that regulate market competition in Australia. The Act has given primary of place to the prevalent idea of market efficiency and market fairness. It is empathic on the prohibition against conduct that defies fair competition rules and contains a special section in its second schedule[2] explaining the consumer protection rules. The provisions of the Act reveal a sustained and rigorous commitment to create a conducive business environment that is in consonance with emerging global standards. This paper thus seeks to contextualize the historical purpose of the Act and analyze the key reforms that were ushered in during its inception. Fundamental to this study is also the general purpose of the Act and the challenges that have been faced in its application. Background/Historical Purpose Prior to the promulgation of the Competition and Consumer Law 2010 most of the consumers in Australia were basking in the rays of injustice for lack of an efficient consumers protection laws. As such there has been a considerable evolution of the consumer and competition laws in Australia. It has been argued that the competition laws and the consumer protection laws were weak and the Australia economy was on the verge of slipping to a comma.[3] There was thus a great need to establish national competition and consumer laws and this lead to the birth of the Restrictive Trade Practices Act 1971[4] and the Trade Practices Act 1974[5] which provided an easy algorithm for resolving market conflicts and challenges.[6] Bradbury contends that the competition law ardently protects the welfare of the consumer and he further notes that since the inception of the Trade Practices Act 1974 there has been incessant pressure to broaden the extent to which the law protect consumers.[7] Small business in Australia were not given sufficient protection by the existing competition and consumer Laws.[8] However, by dint of section 46 of the Trade Practices Act the big established businesses with high market power were enjoined not to take advantage of the small business.[9] The court in Victorian Egg Marketing Board v Parkwood Eggs Pty Ltd[10] remarked that there was a bewildering lack of certainty in the definition of taking advantage in section 46. Conversely, section 51AA buttressed by sections 51AB and 51AC interdicted corporations from the practice of unconscionable conduct in market dealings.[11] It is abundantly clear even that before Trade Practices Act was amended the competition and consumer law protected consumers from unconscionable conduct as is manifested in ACCC v CG Berbatis Holdings Pty Ltd.[12] It bears noting that sections 51AC received a strong dissent from the legal firmament alluding the fact it should have a capacious definition of unconscionable conduct that included unfair and harsh conduct.[13] It is evident that the historical purpose of the competition and consumer laws markedly remains to be preventing the abuse of market power and manipulation that could be perpetrated by corporations for economic expediency. It, however, gives added relevance to note that consumer protection was at the very heart of the cardinal purposes of the historical competition and consumer laws. Changes and Reforms in the Competition and Consumer Law 2010 The principle aim of the Act was to harmonize all the consumer laws that had been entrenched in federal legislations and accord the act the force of a state law.[14] The nerve of the reasoning that informed the reforms was also the acute need to create a system that will be predicated on global best practice. [15] Accordingly, the Act was intended to transform the status quo that had been bequeathed by the state of the market in Australia and the previous law. The changes in the act commenced with the interpretation section where the act introduced new terms and their meaning.[16] The new Act abandoned the old implied conditions and warranties and adopted consumer guarantees. The guarantees explain the rights of the consumers in relation to various products in the market. It is worth noting, however, that the consumer guarantees are guided by the same rules that guide implied conditions and warranties. Even in the face of the reforms and the introduction of the consumer guarantees the case law that was applicable in aiding the interpretation of implied conditions and warranties is still applicable to consumer guarantees.[17] The act has vested in the Australian Competition and Consumer Commission more powers fro enforcement of the competition and consumer laws in Australia. In the old regime that was guided by the Trade Practices Act the ACCC had minimal power and this was manifested by the fact that the commission had no power to initiate cases in its own discretion.[18] However, under the new Act the ACCC may apply to the court for an order to strike out any corporation that it reasonably thinks is contravening the competition and consumer laws. The commission may also apply to the court for an order to solve cases of consumers involving loss or damage. It is instructive to note that a stronger ACCC implies that there will be strict compliance to the competition and consumer laws. One of the most fundamental changes is the introduction of an unfair contract term regime that seeks to declare void any term that is deemed unfair in a contract. The Act suggests that an unfair term is will cause an imbalance between the parties and one party will have an unfair advantage over the other because the contractual obligation are not equal.[19] It is also defined as a term that will have a material detrimental effect on one party to the contract if it was applied to the contract.[20] The court will look at the entire contract objectively before it pronounces that a term in the contract is unfair. The Act also contains new penal provisions such as maximum penalty of $1.1 million will be imposed on corporations and $220,000 on individuals who contravene the provisions of the Previous Act. The Act has given specific provisions from the Trade Practices Act that should not be infringed and hey include unconscionable conduct and misleading and false representations. There has been concerns that the act should introduce criminal penalties that will require a beyond reasonable doubt which is higher than the balance of probability for the civil penalties. Recently the Act has been amended to accord sufficient protection to small business from unfair contract terms.[21] The old provision recognized that it was only the consumers that could be faced with the treat of unfair contract terms. The Act emphatically prohibits the application of any unfair contract terms that will cause the small business to suffer a financial detriment. Conclusion It is a plausible conclusion that the act will promote the steadfast and impartial application of the consumer and competition law. The act should not be viewed as an appendage to the aim of achieving economic injustice but rather it should be regarded as a bastion fro the protection of the consumer rights and the promotion of market fairness and business efficacy. Bibliography Nottage Luke, Consumer Law Reform in Australia: Contemporary and Comparative Constructive Criticism. (2009) Queensland University of Technology Law and Justice Journal https://lr.law.qut.edu.au/article/viewFile/24/23 Competition and Consumer Act (cth) No. 148 of 2010 Restrictive Trade Practices Act 1971 (No. 138, 1971) Trade Practices Act (Cth) No. 51 of 1974 ACCC v CG Berbatis Holdings Pty Ltd [2003] HCA 18 Victorian Egg Marketing Board v Parkwood Eggs Pty Ltd (1978), ATPR 17,789 Australia Consumer Law Consumer guarantees: A Guide for Businesses and Legal Practitioners (2015) https://consumerlaw.gov.au/files/2015/09/consumer_guarantees_guide.pdf Bradbury David, Developments in Competition Policy: Opening Address to Law Council of Australia Competition and Consumer Workshop (2011) https://ministers.treasury.gov.au/DisplayDocs.aspx?doc=speeches/2011/015.htmpageID=005min=djbYear=DocType Casey Liam, Australia: Australian Consumer Law changes Competition and Consumer Act 2010. (2011) https://www.mondaq.com/australia/x/126518/Consumer+Law/Australian+Consumer+Law+changes+Competition+and+Consumer+Act+2010 Organization for Economic Co-Operation and Development, OECD Reviews of Regulatory Reform: Competition Policy 2010 https://www.oecd.org/gov/regulatory-policy/44529918.pdf The Senate Economics References Committee. The effectiveness of the Trade Practices Act 1974 in protecting small business Commonwealth of Australia (2004) https://www.aph.gov.au/binaries/senate/committee/economics_ctte/completed_inquiries/2002-04/trade_practices_1974/report/report.pdf Unfair contract terms.(2016) https://www.accc.gov.au/business/business-rights-protections/unfair-contract-terms