Competition and Consumer Act 2010

Definition

The Competition and Consumer Act 2010 (CCA) is a significant piece of legislation in Australia that aims to promote fair trading and competition, protect consumers, and provide a framework for regulating businesses and markets. 

What is the Competition and Consumer Act 2010?

The CCA seeks to encourage competitive behaviour in the marketplace. It prevents anti-competitive conduct such as price-fixing, collusion, and market sharing among competitors. These provisions aim to ensure that businesses compete fairly and that consumers benefit from competitive prices, quality, and innovation. These regulations empower consumers to make informed choices and protect them from unfair treatment by businesses.

The CCA includes regulations to address unfair contract terms in standard form contracts. It allows courts to void terms that are deemed unfair or unreasonable, particularly where there is a significant power imbalance between the parties. This aims to protect consumers and small businesses from unfair terms imposed by larger, more powerful organisations.

Additionally, the CCA establishes regulations for product safety and standards to make sure that goods sold in Australia meet minimum safety requirements. It requires regulators to issue product safety recalls and take actions against businesses that fail to comply with safety standards.

The CCA prevents businesses from engaging in price discrimination and misuse of market power. It aims to prevent dominant firms from engaging in actions that harms competition or unfairly disadvantages competitors or consumers.

Example of the Competition and Consumer Act 2010

ABC Electronics launches a marketing campaign promoting its latest smartphone as “waterproof up to 50 metres.” However, numerous consumers complain that their phones were damaged when exposed to water.

Under the Competition and Consumer Act 2010, the matter is investigated, and it is determined that ABC Electronics engaged in misleading actions by making false representations about the waterproof capabilities of the smartphone. 

As a result, ABC Electronics is required to offer refunds or replacements to affected consumers. Additionally, the company faces penalties, including fines, for violating the Act’s consumer protection requirements.