In November of last year, the Australian Competition and Consumer Commission (ACCC)  implemented drastic changes to its penalties relating to unfair contract terms and violations of the Competition and Consumer Act. These reforms come in two main parts, aiming to deter companies from exploiting consumers and competitors.

Heavier Penalties for Competition and Consumer Act Breaches

The ACCC has upped the ante on penalties for companies found breaching certain provisions of the Competition and Consumer Act. The new maximum penalties have soared to greater than $50 million, or three times the value derived from the relevant breach. If the value derived from the breach cannot be determined, the penalty will amount to 30% of the company’s turnover during the period it engaged in the misconduct.

According to ACCC Chair Gina Cass-Gottlieb, these heightened penalties should act as a “strong deterrent” to companies, urging them to compete fairly and refrain from misleading or acting unscrupulously towards consumers. The changes also empower courts to levy fines that are substantial enough to grab the serious attention of business owners and shareholders, instead of being dismissed as merely a ‘cost of doing business.’

Introduction of Penalties for Unfair Contract Terms

Previously, while courts had the authority to deem specific contract terms as ‘unfair,’ they couldn’t impose penalties on companies for including such terms in their standard form contracts. This void has now been filled.

Companies have a 12-month grace period to review and update their standard form contracts before these new penalties kick in. “This will improve small business and consumer confidence,” says Cass-Gottlieb. Furthermore, it will serve as a significant deterrent against big businesses exploiting small businesses through unfair contract terms.

The new protections apply to small businesses employing fewer than 100 persons or having an annual turnover of less than $10 million, regardless of the value of the contract. This is especially significant as it directly addresses a major pain point for small enterprises that often feel they are at the mercy of larger businesses.


The ACCC’s sweeping changes are a pivotal step toward bolstering consumer protection and promoting fair competition. With increased penalties for breaches of competition and consumer laws and the introduction of penalties for unfair contract terms, the message is loud and clear: non-compliance will come at a substantial cost. 

For business owners, navigating these new regulations could be a complex endeavour, making it more crucial than ever to consult legal expertise. We specialise in helping businesses like yours understand and adapt to these significant changes. Ensuring your contracts are fair and your business practices are in line with the new guidelines can save you from severe financial repercussions down the line. Contact us today to secure your business’s future in this new regulatory landscape.

Nicole Wolf