King & Wood Mallesons

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Class actions and the Australian Consumer Law

By Stephen Ridgeway and Kylie Sturtz

The Australian Consumer Law, introduced as a part of the Australian Competition and Consumer Act 2010 (Cth) in 2011, now provides for the imposition of civil pecuniary penalties for contraventions of certain provisions of that law. The Australian Competition and Consumer Commission (ACCC) is clearly focusing on these penalties as its principal remedy in consumer matters and appears to be showing less interest in administrative settlements and seeking restitution for consumers affected by breaches. This article examines how these developments may increase the likelihood of follow-on representative actions in consumer matters.

The ACCC has a history of vigorous and successful enforcement of consumer protection laws in Australia. Since the introduction of the Australian Consumer Law (ACL) in 2011, a number of legislative changes have further enhanced the ACCC’s consumer protection armoury by expanding the range of enforcement options available to it. In particular, substantial civil pecuniary penalties can now be ordered by the Federal Court for certain contraventions of the ACL.

The ACCC has made extensive use of the new civil penalty regime. In August 2013, the ACCC reported that total penalties of AUD24.4m (£14.3m) had been ordered, in 37 consumer protection and fair-trading proceedings, since the inception of the ACL. These orders include orders for payment of substantial penalties by Optus (AUD3.61m), Hewlett Packard (AUD3m), Apple (AUD2.25m) and Harvey Norman (AUD1.25m)…

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