Unfair Business Practices in Australia

Unfair business practice”

Unfair Business practices refer to the use of various deceptive, fraudulent or unethical methods to obtain contracts. Unfair commercial practices include false statements, false advertising or descriptions of goods or services, binding sales, false offers of prizes or free gifts, deceptive pricing island and do not comply with commercial production standards. Such conduct is illegal by law under the Consumer Protection Act, which provides consumers with recourse in the form of compensation or punishment for damages. Unfair business practices are sometimes referred to as “deceptive trade practices” or “unfair trade practices”.

Australian Consumer Law

The ACL works to safeguard Australian consumers and ensure fair business. It is a federal, state, and local law. from the 1st of January 2011 onwards, and contains Legislation prohibiting unjust contract terms enacted on July 1, 2010. Consumers have the right to sue under the ACL. the same safeguards, and firms share the same responsibilities and Duties, from coast to coast in Australia.

Courts and tribunals in Australia (including those of the states and local governments) The ACL can be enforced by territory. The following agencies are in charge of enforcing this law:

  • Competition in Australia and Consumer Protection Commission (ACCC)
  • the Australian Securities and Investments Commission Commission on Investments (ASIC)
  • each consumer in each state and territory protection organisation

Unfair Business Practices

Following are the number of sales practices that are illegal for businesses to engage in when dealing with their customers-

Referral selling

Pyramid system

Unfair contract terms

Unconscionable conduct

Accepting payment without intending to supply

Misleading or deceptive behaviour

Let’s Know what’s unfair

Referral selling

A business can’t induce a client to acquire products or services by promising them benefits if they support the business offer goods or services to other consumers, according to the Australian Consumer Law.


It’s a type of pyramid plan in whichParticipating in a pyramid scheme, or persuading someone else to do so, is prohibited.

Even if the programme incorporates the sale of a product, pyramid schemes make money by recruiting individuals rather than selling genuine products or services. work by requiring new participants to pay a “participation payment” before they can join. Payments are promised to new members in exchange for attracting more investors or players.

Unfair contract terms

In situations where consumers have little or no ability to negotiate with the firm, such as standard form contracts, there exist laws protecting consumers from unjust conditions.

Unfair contract terms law covers the majority of conditions in regular consumer contracts. Consumer contract conditions that determine the price or specify the goods or service being provided, on the other hand, are exempt.

A term’s fairness must be evaluated in the context of the entire contract.

A locating through a courtroom docket that a agreement time period is unfair, and consequently void, manner that the time period is dealt with as though it by no means existed. However, the agreement will preserve to bind the affected events to the volume that the agreement is able to working without the unfair terms.

The following questions allow you to realise a doubtlessly unfair time period:

  • Does the time period reason a large imbalance among your rights and duties and people of the patron’s?
  • Is the time period fairly vital to defend the valid hobbies of the business?
  • Would the time period reason the patron detriment (monetary or non-monetary) in case you attempted to implement it?
  • How obvious is the time period?

Unconscionable conduct

Businesses are prohibited from performing in an unconscionable way in opposition to their clients and in opposition to different agencies. That form of behaviour is called unconscionable behaviour.

Certain behaviour can be unconscionable if it’s miles in particular harsh or oppressive or in which one party knowingly exploits the unique drawback of another. Unconscionable behavior is greater than simply tough business bargaining; it ought to be in opposition to judgment of right and wrong as judged in opposition to the norms of society.

Unreasonable driving bans have been part of Australia’s consumer protection regime since 1986 and have been reformed since. There are currently two sets of provisions addressing unreasonable conduct in the ACL. The predecessor to section 20 was introduced in 1992 to prohibit unreasonable behaviour ‘in the sense of unwritten law’. The ban provides access to legal remedies to deal with behaviour that is contrary to inequality-based equity doctrines, primarily unfair use. The crux of this fallacy is that the respondent gains an unreasonable advantage from the plaintiff’s particular disadvantage (Thorne v Kennedy 2017). Section 20 does not apply where section 21 does, and therefore its scope is now very limited, although, as we will see, the effect of the fair concept of dealing is not argument is still strong in the interpretation of Article 21.

Article 21 of the ACL contains a broader prohibition, which is primarily concerned with this. In its current form, section 21 prohibits conduct “in trade or commerce”, i.e. “under any circumstances”, “unacceptable”.

The regulation units out a listing of things that courts may also recollect whilst finding out whether or not behaviour is unconscionable, including:

  • the relative bargaining energy of the events
  • whether or not the more potent party used undue influence, stress or unfair tactics
  • the volume to which the events acted in precise faith.

Accepting payment without intending to supply

  • You ought to now no longer be given price for items or offerings if:
  • you do now no longer intend to deliver
  • you wish to deliver materially exceptional items or offerings from the ones requested
  • you know, or must have known, you will now no longer be capable of deliver the products or offerings in a well-timed way.

This a part of the regulation isn’t always supposed to have an effect on agencies who simply attempt to meet deliver agreements, for example, if:

  • the failure to deliver changed into because of something past your control
  • you exercised due diligence and took affordable precautions.

Misleading or deceptive behaviour

“Behaviour” includes actions and statements, such as:

  • advertise;
  • Promotions;
  • Quotation
  • Statement; and
  • Statements made by anyone.

 If a business activity creates a misleading overall impression of the price, value, or quality of consumer goods or services in the target audience, it may violate the law.

 What matters is your actions and statements-not your intentions. The business may be false or misleading, rather than intentional.


 The trader’s business name implies an affiliation with a long-established institution. Because of this similarity, the name may be misleading or deceptive. The intention of the trader when choosing the name is irrelevant.


The problem of business systems that systematically target consumers who are vulnerable in order to sell them products that are unsuitable for their needs or budget has led to suggested that the Australian consumer protection law should adopt an unfair trading prohibition modelled after the United Kingdom’s unfair trading prohibition . Consumer purchases of goods and services, tenancy, insurance claims and settlements, and debt collection are all examples of unfair trade practices. Numerous states have enacted similar legislation to protect consumers from unfair trade practices. Consumers who have been mistreated should check their state’s unfair trade practice statute to see if they have a legal claim like, Australia have  Australian consumer law.

Aishwarya Says:

I have always been against Glorifying Over Work and therefore, in the year 2021, I have decided to launch this campaign “Balancing Life”and talk about this wrong practice, that we have been following since last few years. I will be talking to and interviewing around 1 lakh people in the coming 2021 and publish their interview regarding their opinion on glamourising Over Work.


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The copyright of this Article belongs exclusively to Ms. Aishwarya Sandeep. Reproduction of the same, without permission will amount to Copyright Infringement. Appropriate Legal Action under the Indian Laws will be taken.

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In the year 2021, we wrote about 1000 Inspirational Women In India, in the year 2022, we would be featuring 5000 Start Up Stories.

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