Stephens Lawyers & Consultants
The Australian Competition and Consumer Commission’s compliance and enforcement priorities for 2025-26 provide important notice and guidance of business activities and industries which the regulator will be focusing on in respect of compliance with the Australian Consumer Law and investigative and enforcement action against businesses.
A business risks incurring high pecuniary penalties and compensation claims for contravention of the Australian Consumer Law including significant reputational damage and loss of business. Businesses cannot afford to be complacent.
Three Major Risk Areas for Businesses – Australian Consumer Law
Three (3) major risk areas for businesses arising out of the ACCC’s 2025-26 compliance and enforcement priorities are :-
- ‘Greenwashing’ and other environmental and sustainability claims,
- Consumer guarantees; and
- Unfair contract terms.
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‘Greenwashing’ – and other environmental and sustainability claims
Does your business use environmental or sustainability claims in marketing and advertising of your goods and services, including on the company’s website?
Then take note that ‘greenwashing’ (and other environmental and sustainability claims) are a key focus for the ACCC during 2025/26, recognising “the substantial impact of this conduct on consumer trust and engagement.”[i] This reflects that many Australian consumers want to reduce negative impacts of their choices on the environment and actively seek and rely on environmental advertising material and claims to decide where and on what goods and services to spend their money – often being prepared to pay more for goods/services which are environmentally sustainable. Investors are also seeking to invest in companies or products that are sustainable.
The Australian Consumer Law prohibits content – including marketing and advertising content – which is misleading or deceptive or likely to mislead or deceive or contains false representations in respect of the goods or services being advertised.[ii]
Failure to ensure that your environmental sustainability marketing claims are accurate can result in legal action being taken by the ACCC and other regulators for false representations and misleading and deceptive conduct exposing the company and its directors to significant penalties and compensation claims.
| Case Study
On 14 April 2025, the Federal Court of Australia ordered Clorox Australia Pty Ltd (Clorox) to pay a total penalty of $8.25 million for making false or misleading representations to consumers that certain GLAD kitchen and garbage bags were partly made of recycled ‘ocean plastic’[iii]. This decision followed court action commenced by the ACCC in April 2024.
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To assist businesses to make clear and accurate environmental claims the ACCC has published the principles-based guidance – ‘Making Environmental Claims: A Guide for Business’.[iv]
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Consumer Guarantees: Improving industry compliance with consumer guarantees
Businesses are on notice that during 2025-26, to address continuing misleading practices and to deter businesses from doing the wrong thing, the ACCC will be actively pursuing enforcement actions against and investigations of businesses that misrepresent consumer guarantee rights under the Australian Consumer Law.
The Australian Consumer Law provides consumers with rights and remedies against suppliers (including on-line retailers) and manufacturers of goods or services acquired by them that do not comply with consumer guarantees[v].
The consumer guarantees provided under the Australian Consumer Law are automatic and cannot be excluded, modified or restricted and are in addition to any manufacturer’s or supplier’s warranty. They are also separate and in addition to any voluntary warranty, manufacturer’s warranty, or extended warranty – so they can last longer than warranty rights.[vi] This also means that businesses cannot restrict (eg. by time limit) or exclude these consumer rights.
Penalties for making false or misleading representations concerning the existence, exclusion or effect of any guarantee or warranty, including a statutory guarantee, in contravention of section 29 of the Australian Consumer Law were recently increased to:
- In the case of a company – to the greater of AU$50 million; or three times the value derived from the relevant breach; or, if the value derived from the breach cannot be determined, 30 per cent of the company’s turnover during the period it engaged in the conduct; and
- In the case of an individual – a maximum of AU$2.5 million.[vii]
| Case Study 1
In June 2025, following receipt of three infringement notices from the ACCC, Reebelo Australia (Reebelo), an online marketplace for new and refurbished electronics, paid penalties in the sum of $59,400 for allegedly making false representations on its website about consumer guarantee rights, in contravention of the Australian Consumer Law. The terms on Reebelo’s website purported to limit a consumers’ ability to access their consumer guarantee rights by putting a 14-day time limit on the following: · A consumer’s ability to receive a remedy for faulty or damaged goods, · A consumer’s ability to receive a remedy for goods received that were not in a condition that matched the description of the purchased product, and · A consumer’s ability to receive a remedy where they had received a different model of a product than what they had ordered.[viii] |
| Case Study 2
In December 2023, the Federal Court of Australia ordered US-based Fitbit LLC (Fitbit) to pay penalties of $11 million after it admitted to making false, misleading or deceptive representations to 58 consumers about their consumer guarantee rights to a refund or a replacement after they claimed their device was faulty.[ix] |
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Unfair Contract Terms: in consumer and small business contracts
Does your business use standard form contracts with its customers? Are they compliant with the strengthened unfair contract terms laws with their high civil pecuniary penalties which came into effect late 2023?
The ACCC has indicated that during 2025/26 it will be focusing on compliance with unfair contract terms laws – particularly, unfair contract terms in standard form agreements used by larger businesses in their dealings with consumers and small businesses and, in particular, the following types of contract terms:-.
- Harmful cancellation terms (including those terms associated with automatic renewals);
- Early termination fee clauses; and
- Non-cancellation clauses.
Standard form contracts are widely used in a wide range of industries and businesses – from digital and on-line retail market-places, franchising, energy, telecommunications, travel, finance, technology, social media services to real estate. While they have the benefit of allowing companies to contract with a large volume of consumers and businesses in an efficient and cost-effective manner, standard form contracts can be problematic where they are presented on a “take it or leave it basis” and where an imbalance of power results in unfair trade practices and terms that are potentially unfair to consumers and small businesses.
The Australian Consumer Law provides that a term in a consumer contract or small business contract will be held to be unfair if:-
- it would cause a significant imbalance in the parties’ rights and obligations arising under the contract; and
- it is not reasonably necessary in order to protect the legitimate interests of the party who would be advantaged by the term; and
- it would cause detriment (whether financial or otherwise) to a party if it were to be applied or relied on.[x]
Significant pecuniary penalties apply for breach of the unfair contract terms laws. In the case of companies, the maximum financial penalties are the greater of AU$50,000,000; three times the value of the “reasonably attributable” benefit obtained from the conduct, if the court can determine this; or if a court cannot determine the benefit, 30 per cent of adjusted turnover during the breach period. In the case of an individual, the maximum financial penalty is AU$2.5 million.
Examples of ‘unfair’ terms
In the recent case of Australian Competition and Consumer Commission v Fujifilm Business Innovation Australia Pty Ltd [xi] (Fujifilm) the Federal Court of Australia declared 38 contract terms in 11 Fujifilm contracts entered (or renewed) with thousands of small businesses to be unfair and void[xii]. The following are some of the terms that the Federal Court declared to be ‘unfair’ in this case[xiii]:-
- Automatic renewal terms– which permitted Fujifilm to renew the small business contract for a further period unless the customer cancelled the contract a certain number of days before the end of the contract term[xiv];
- Unilateral variation and extraneous document terms: which permitted Fujifilm to unilaterally vary some of the terms of the contract, including terms and charges which were contained in documents other than the signed contract[xv];
- Unfair payment terms: being terms which required customers:-
- to pay Fujifilm for software licensed pursuant to the agreement regardless of whether Fujifilm had delivered the software; and
- when goods were purchased, to pay the purchase price prior to delivery[xvi].
- Termination payment terms: being terms that, in the event of termination of the contract, required customers to pay Fujifilm extensive exit fees – some of which could be set unilaterally by Fujifilm[xvii];
- Disproportionate termination terms: which allowed Fujifilm a significantly wider range of circumstances to terminate the contract than the customer was allowed – or no reciprocal termination rights allowed to the customer at all[xviii];
- Limitation of Liability terms: being terms that limited Fujifilm’s liability or required the customer to indemnify Fujifilm without providing the customer with corresponding rights[xix].
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Minimising Risk for your Business
There are steps that businesses can consider implementing to minimise risk of non-compliance with the Australian Consumer Law, including:
- undertaking a comprehensive Australian Consumer Law compliance review of all business documentation – including the following:
- sales contracts and standard form contracts;
- marketing and point of sales material;
- product disclosure statements;
- supply terms and conditions;
- warranty documentation;
- packaging and sales invoices and receipts;
- all website/online material.
- for all online businesses offering and supplying goods and services to consumers in Australia, a review of their website material to ensure it complies with the Australian Consumer Law;
- for all standard form contracts, identifying unfair contract terms and then amending or redrafting the standard form contracts to remove any such unfair contract terms and ensuring immediate use of the revised standard form contracts going forward; and
- regular staff training and education in relation to Australian Consumer Law compliance requirements and risk management generally.
Disclaimer: This legal update is not intended to be a substitute for obtaining legal advice.
© Stephens Lawyers & Consultants. 1 July 2025; Authored by Katarina Klaric, Principal and Rochina Iannella, Consultant, Stephens Lawyers & Consultants.
For further information contact:
Katarina Klaric
Principal
Stephens Lawyers & Consultants
Melbourne Head Office
Level 40, 140 William Street, Melbourne VIC 3000
Phone: (03) 8636 9100
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[i] ACCC Chair Ms Gina Cass-Gottlieb, ACCC’s Compliance and Enforcement Priorities Update 2025-26 address, 20 February 2025 – ‘Continuing focus on environmental claims and sustainability’- – ACCC’s compliance and enforcement priorities update 2025-26 address | ACCC
[ii] Competition and Consumer Act 2010. Schedule 2- The Australian Consumer Law, section 18 and section 29
[iii] ACCC, Media Release ‘Clorox ordered to pay $8.25m in penalties for misleading ‘ocean plastics’ claims about certain GLAD products’, 14 April, 2025 [ https://www.accc.gov.au/media-release/clorox-ordered-to-pay-825m-in-penalties-for-misleading-ocean-plastic-claims-about-certain-glad-products ]
[iv] ACCC, ‘Making Environmental Claims: a Guide for Business’, 12 December 2023, Making environmental claims: A guide for business | ACCC
[v] Competition and Consumer Act 2010. Schedule 2 – Australian Consumer Law. Commenced on 1 January 2011 – Section 29.
[vi] ACCC, Media Release “Broken but out of warranty? Your consumer guarantee rights may still apply” (18 January 2024) – Broken but out of warranty? Your consumer guarantee rights may still apply | ACCC
[vii] The Treasury Laws Amendment (More Competition, Better Prices) Act 2022 increased maximum penalties that apply to a range of offences and civil penalty provisions under the Australian Consumer Law including false and misleading representations.
[viii] ACCC, Media Release “Reebelo Australia pays penalties for alleged false or misleading statements about consumer guarantee rights”, (3 June 2025); Reebelo Australia pays penalties for alleged false or misleading statements about consumer guarantee rights | ACCC
[ix] Australian Competition and Consumer Commission, Media Release “Fitbit to pay $11million in penalties for misrepresentations about consumer guarantee rights” (12 December 2023); https://www.accc.gov.au/media-release/fitbit-to-pay-11m-in-penalties-for-misrepresentations-about-consumer-guarantee-rights
[x] Sec 24 of the Australian Consumer Law
[xi] Australian Competition and Consumer Commission v Fujifilm Business Innovation Australia Pty Ltd [2022] FCA 928
[xii] Australian Competition and Consumer Commission v Fujifilm Business Innovation Australia Pty Ltd [2022] FCA 928 at Par. [1]
[xiii] Australian Competition and Consumer Commission (ACCC), “38 contract terms in 11 Fuji small business contracts declared unfair and void”, ACCC Media Release, 12 August 2022”
[xiv] Australian Competition and Consumer Commission v Fujifilm Business Innovation Australia Pty Ltd [2022] FCA 928 at Par. [1 (b)]
[xv] Australian Competition and Consumer Commission v Fujifilm Business Innovation Australia Pty Ltd [2022] FCA 928 at Par. [1(a), (c)]
[xvi] Australian Competition and Consumer Commission v Fujifilm Business Innovation Australia Pty Ltd [2022] FCA 928 at Par. [1 (j)]
[xvii] Australian Competition and Consumer Commission v Fujifilm Business Innovation Australia Pty Ltd [2022] FCA 928 at Par. [1 (f)]
[xviii] Australian Competition and Consumer Commission v Fujifilm Business Innovation Australia Pty Ltd [2022] FCA 928 at Par. [1 (e)]
[xix] Australian Competition and Consumer Commission v Fujifilm Business Innovation Australia Pty Ltd [2022] FCA 928 at Par. [1 (d)]