29 August 2013
Practice Group(s):
Antitrust,
Competition & Trade
Regulation
Unfair Contract Protection for SMEs
Proposed by Opposition
By Murray Deakin
Video Legal Insight Transcript
MD
The Federal Opposition has recently announced that if elected it will extend the unfair
contract terms regime to small business. At present that regime is confined to
consumers, it applies to individuals who acquire goods or services or an interest in
land predominantly or wholly for personal, domestic or household use or
consumption, so it doesn't presently apply to business to business contracts. If
however the regime is extended to business to business contracts it will enable small
business people to challenge unfair contract terms in business to business standard
form contracts, and that added level of protection will come at a cost.
BRR
On a practical level what would the changes mean for business?
MD
On a practical level it would mean that large business would need to revise all its
standard form business to business contracts, and we have already assisted clients in
this area, those clients facing consumers have had to already revise their standard
form consumer contracts, so we would be well placed to assist businesses who need
their business to business standard form contracts revised in a similar manner and
we've got analytical tools which assist us in that regard.
BRR
And Murray this is unlikely to be popular with big business, would such a plan be
difficult to implement?
MD
It's certainly not going to be welcome by the big business community because it
undermines the certainty and introduces complexities which are currently not there in
commercial dealings. The plan does have some difficulty in terms of its practical
implementation as a revised piece of legislation, one has to identify who is a small
business and that requires some delineation in the legislation between a small
business that is designed to be protected under this new regime and larger businesses
that presumably do not need that level of protection, so there is some complexity in
how one achieves that at a legislative level.
BRR
Well I guess we'll have to wait and see what happens after the election, but Murray
thank you so much for joining us.
MD
Thanks Kate.
Authors:
Murray Deakin
murray.deakin@klgates.com
+61.2.9513.2335
Unfair Contract Protection for SMEs Proposed by
Opposition
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