Snapshot
- A new prohibition on unfair trading practices has been introduced into the Australian Consumer Law. The reforms are designed to capture conduct that may not clearly fall within the existing prohibitions on misleading conduct, unconscionable conduct and unfair contract terms.
- The new regime comprises a general prohibition on unfair trading practices, mandatory disclosure requirements for drip pricing and a suite of obligations governing subscription contracts.
- The general prohibition captures conduct that manipulates a consumer or unreasonably distorts the environment in which they make a decision, and is likely to cause detriment.
- The reforms commence on 1 July 2027 and carry significant penalties for non-compliance.
The Competition and Consumer Amendment (Unfair Trading Practices) Act 2026 (Cth) (‘Act’) represents one of the most significant expansions of Australia’s consumer protection framework in recent years. The reforms respond to ongoing concerns that existing prohibitions on misleading conduct, unconscionable conduct and unfair contract terms may not sufficiently cover certain types of conduct that may be detrimental to consumers. Practices that are manipulative, obscure or cause inconvenience for consumers have not always been clearly captured by those frameworks, particularly in digital environments where interface design, pricing structures and subscription models can be used to pressure or mislead consumers at scale.
The Australian Competition and Consumer Commission (‘ACCC’) highlighted this problem in the final report of its Digital Platforms Inquiry, calling for reform to address conduct that is detrimental to consumers but does not ‘neatly fit under existing consumer laws’ (at 26). The new regime reflects the government’s legislative response to those concerns. It introduces obligations across three distinct areas: a general prohibition on unfair trading practices, mandatory disclosure rules for drip pricing and a suite of obligations governing subscription contracts. Each pillar materially increases compliance requirements and penalty exposure for businesses operating in consumer-facing markets, particularly those that operate online or use subscription models or other complex pricing structures.
