A Practical Guide to Australian Consumer Law

Vivian Nguyen • March 20, 2025

Running a business in Australia means playing by the rules, and a crucial set of rules comes from the Australian Consumer Law (ACL).  Understanding your obligations under the ACL is not just about avoiding penalties; it is about building trust with your customers and creating a sustainable business. 


We will break down the key aspects of the ACL in plain English, relevant to your business, empowering you to operate with confidence and compliance.


What is the ACL?

The Australian Consumer Law is a single, national set of rules that protects consumers and ensures fair trading practices. It applies to almost all goods and services offered in Australia, regardless of whether the seller is a large national corporation or a small local business.  It is a rulebook for a fair marketplace. Compliance with the ACL is not optional; it is a legal requirement.


Who is a Consumer?

If you acquire goods or services:


  • Priced at or less than $100,000: This is a significant increase from the previous threshold of $40,000, meaning more transactions are now covered by the ACL.
  • Of a kind ordinarily acquired for personal, domestic, or household use or consumption: This applies regardless of the price. If the goods or services are typically used for personal or household purposes, you are a consumer even if you are a business buying them.


The definition of "
consumer" is broader than you might think, and it can include businesses in certain situations.


Key Obligations for Businesses Under the ACL

The ACL places several key obligations on businesses, including:



  • Upholding Consumer Guarantees: These are automatic rights that consumers have when they purchase goods or services. Your business must ensure that products are of acceptable quality, fit for purpose, and match their description. Services must be provided with due care and skill.  Understanding your obligations regarding repairs, replacements, and refunds is crucial.
  • Avoiding Misleading or Deceptive Conduct: Your marketing, advertising, and all interactions with customers must be truthful and accurate.  Avoid making false claims about your products or services, and be transparent about pricing and terms.
  • Using Fair Contract Terms: Standard form contracts (like those for subscriptions or service agreements) cannot include unfair terms. An unfair term is one that significantly favours your business and is detrimental to the consumer. Review your contracts regularly to ensure compliance.
  • Adhering to Product Safety Standards: If you sell physical products, you must ensure they meet all relevant safety standards.  This is a critical aspect of protecting consumers and avoiding legal repercussions.
  • Providing Accurate Information: Be transparent with your customers about pricing, terms and conditions, warranties, and any other relevant information.  Clear communication builds trust and reduces the risk of disputes.


A woman is trying on a pair of red high heels in a shoe store.


Understanding Consumer Guarantees in Detail

Consumer guarantees are a cornerstone of the ACL.  Here is a closer look at what they mean for your business:


  • Acceptable Quality: Products must be fit for purpose, free from defects, and safe.  Consider what a reasonable consumer would expect given the product's price and description.
  • Fit for Purpose:  If the consumer tells you they intend to use the product for a specific purpose, you must ensure it's suitable for that purpose.
  • Matching the Description: Products must match any descriptions you provide, whether in advertising, on packaging, or verbally.
  • Services: Services must be provided with due care and skill.


Consequences of Non-Compliance

Failing to comply with the ACL can have serious consequences for your business, including but not limited to:


  • Fines and penalties:  Significant financial penalties can be imposed for breaches of the ACL.
  • Legal action: Consumers can take legal action against your business for breaches of their consumer rights.
  • Reputational damage: Negative publicity and word-of-mouth can severely impact your business's reputation and lead to lost sales.


Tips for Businesses



  • Train your staff:  Ensure all employees who interact with customers understand their obligations under the ACL.
  • Review your contracts:  Regularly review your standard form contracts to ensure they are fair and comply with the law.
  • Be honest and transparent:  Build trust with your customers by providing accurate information and dealing with complaints fairly.
  • Stay informed: The ACL is subject to occasional updates.  Stay informed about any changes to the law by visiting the ACCC website (accc.gov.au).


How can we help? 

We can assist to train your staff, review your contracts, keep you informed and assist jou in navigating any issues if they arise. Our first consultation is free and no obligation. 


Do not wait until a problem arises.  Take proactive steps to ensure your business complies with the Australian Consumer Law. 


Visit the ACCC website (accc.gov.au) for comprehensive resources and guidelines.  Download their free guides for businesses and subscribe to their updates. Invest in training for your staff and seek legal advice when needed. 


Building a culture of compliance is not just good business practice; it is essential for long-term success in the marketplace.  Take control of your compliance today!


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