New Laws introduced by the NSW Fair Trading Act 1987 that commenced on 1 January 2021 ensure that NSW businesses must disclose whether a term or condition of their contract substantially prejudices the interests of the consumer; the business is sending or selling consumers information to a third party; or if the business receives a commission or benefit when recommending the consumer buys a good or service from a third party. Additionally, a business which sells consumer goods or services must take reasonable steps to ensure that the consumer is aware of the effect of any term or condition which could prejudice the consumer’s interests.
The new laws respond to the rise in concerns from regulators and consumers that businesses are not adequately protecting consumer’s information, and importantly, they impose a positive obligation on businesses to bring terms against the consumer’s interest to their attention.
Individuals who breach the law will be liable to pay a fine of $22,000, and corporations will be liable to pay $110,000. Businesses that supply goods or services should review whether their consumer contracts have any one-sided terms, assess whether they are selling or providing consumer information to a third party and identify whether they have a financial incentive for referring customers to another supplier of goods and services. Above all, they must disclose these facts.