A customer emails on Monday morning. They've read about their rights, your returns page says “30-day policy only”, and now they want a remedy for a faulty product you thought was outside your responsibility. If you run a business, manage an NFP trading activity, advise clients, or sell into Australia from overseas, that situation isn't unusual. The core answer is simple. Australian Consumer Law sets the baseline rules for how your business must deal with customers, and many of those duties can't be contracted out of.
Running Your Business Fairly – Is Your Company Meeting its Australian Consumer Law Duties?
By Panbo Ye, CFP® | FCPA | SSA® | Founder, Everglow
The Australian Consumer Law (ACL) is Australia's single national framework for consumer protection and fair trading. It was implemented on 1 January 2011 under Schedule 2 of the Competition and Consumer Act 2010: Treasury overview of the Australian Consumer Law. For business owners, the practical point is that the ACL is not just about retail shops and household goods. It can also apply to business-to-business dealings where the purchase falls within the legal definition of a consumer.
That matters more than many owners realise. From 1 July 2021, the consumer threshold for goods and services not ordinarily acquired for personal, domestic, or household use increased from $40,000 to $100,000, which means more SME purchases may now attract consumer guarantee protections. A supplier selling equipment, software, or advisory services into that range may have obligations that look much closer to retail obligations than traditional commercial contracting.
Who this article is for: business owners, NFP directors and managers, fund managers and AFSL operators, professional advisers, migrant founders, and overseas businesses entering the Australian market.
Currency note: This article reflects Australian rules, thresholds and regulator guidance current as at 07/2026.
If you're reviewing governance more broadly, a useful companion is small business risk management guidance.
What the Australian Consumer Law Means for Your Business
The ACL sits within a broader legal structure. It is not a stand-alone statute floating on its own. It forms part of the Competition and Consumer Act 2010, and it is administered by the Australian Competition and Consumer Commission (ACCC) alongside state and territory consumer agencies.
Who counts as a consumer
In everyday speech, “consumer” sounds like an individual buying for personal use. Under the ACL, the legal meaning is wider. Since 1 July 2021, acquisitions of goods or services up to $100,000 may fall within the definition for items not ordinarily bought for personal, domestic, or household use, replacing the earlier $40,000 threshold: Treasury explanation of the 2021 ACL threshold change.
That change has practical consequences for:
- SME suppliers who sell commercial equipment, software, or packaged services
- Professional firms with standard engagement terms
- NFP operators that sell goods or ticketed services
- Importers and online sellers entering Australia from offshore
A business can be selling to another business and still be dealing with a “consumer” for ACL purposes.
Practical rule: If your sales process assumes “B2B means the ACL doesn't apply”, your contracts and complaint handling may already be out of step.
Why the structure matters
The ACL's national design helps, but it doesn't remove the need for disciplined compliance. Treasury notes that the law created a single national framework, replacing the older fragmented state and territory model. In practice, businesses still interact with multiple regulators across jurisdictions, so consistency in contracts, customer communications, and internal complaint handling matters.
For organisations managing policy updates across teams, regulatory change management is often where ACL compliance either holds together or breaks down.
A sound starting point is to treat the ACL as an operating framework, not a legal footnote. It affects sales scripts, websites, refund wording, invoices, service scopes, and escalation pathways.
Your Core Obligations – Consumer Guarantees and Fair Conduct
The ACL gives consumers automatic rights called consumer guarantees. These aren't optional, and they can't be displaced by internal policies or fine print. A “no refunds” sign doesn't override statutory rights.
Businesses also need to remember a basic administrative rule. If goods or services cost over $75, a receipt must be provided: business.gov.au guidance on Australian Consumer Law obligations.
Consumer guarantees in everyday operations
The details vary by transaction, but the distinction below is a practical starting point.
| Guarantees for Goods | Guarantees for Services |
|---|---|
| Goods should be of acceptable quality. | Services should be delivered with due care and skill. |
| Goods should be fit for any disclosed purpose. | Services should be fit for the purpose the customer made known. |
| Goods should match any description or sample used in the sale. | Services should be supplied within a reasonable time if timing is not fixed by contract. |
| Rights to repair, replacement, or refund may arise depending on the problem and circumstances. | Remedies may apply if the service falls short of the statutory guarantee standard. |
For many businesses, the operational challenge isn't understanding the idea. It's aligning the website, point-of-sale messaging, customer service training, and template terms so they don't contradict the law.
Misleading conduct is broader than many people think
Section 18 of the ACL prohibits conduct in trade or commerce that is misleading or deceptive, or likely to mislead or deceive. Section 29 prohibits specific false representations about matters such as quality, price, origin, or warranties: ACCC guidance on false or misleading statements.
That reaches much further than obvious fraud. In practice, risk often arises from ordinary business habits such as:
- Outdated website copy that still describes features no longer included
- Sales shorthand that overstates suitability or performance
- Refund wording that implies statutory rights are narrower than they are
- Origin claims that blur imported goods and local branding
- Warranty language that creates confusion about what the customer is entitled to by law
A well-drafted policy can still mislead if the surrounding sales process tells a different story.
Standard contracts often create the problem
Many businesses adopt standard form terms copied from a platform, supplier, or old adviser precedent. That's where ACL friction often begins. Clauses that let the business rewrite scope, raise price unilaterally, avoid responsibility for defects, or make complaints practically unusable may create compliance risk.
The test is not whether the clause helps your administration. The key question is whether the term is balanced, necessary, and fair in the customer context. If your service agreement says the customer bears almost all downside while you keep broad discretion, that should be reviewed before a dispute makes the clause visible.
Are Your Business Contracts Fair and Compliant?
Wei is a new migrant professional in Sydney who starts an online business selling imported tech accessories to Australian customers. He uses a standard set of online terms copied from an overseas supplier and adds a short returns policy that sounds tidy and commercial. It says all returns must be made within 30 days, all faults must be taken up with the manufacturer, and Wei may change prices or product specifications at any time without notice.
On paper, that looks efficient. In practice, several parts may create problems under Australian settings.
Where standard terms go wrong
A risky term often has three features. It creates a strong imbalance in rights, it isn't reasonably necessary to protect the business's legitimate interests, and it would cause detriment if the business relied on it. That's the practical lens many directors and owners should use when reviewing standard contracts, online terms, membership forms, and recurring service agreements.
For Wei, examples of terms worth revisiting include:
- Unilateral change clauses that let the seller alter price or product features after purchase
- Excessive cancellation penalties that punish the customer beyond a genuine commercial need
- Liability carve-outs that try to avoid responsibility for the seller's own conduct
- Manufacturer-only remedy clauses that shift responsibility away from the supplier dealing directly with the customer
Why this matters for small operators
Small online sellers often assume compliance risk sits with large retailers. That's a mistake. If you trade in Australia, your terms and customer communications need to fit Australian rules, even if your stock is sourced elsewhere or your template came from another jurisdiction.
A constitution won't solve contract fairness issues, but governance discipline still matters. If your entity documents and decision rights are being refreshed at the same time, company constitution support can help align authority, approval settings, and accountability.
The contract that feels commercially convenient at setup is often the contract that causes the most trouble once a customer pushes back.
A Practical Example of the Australian Consumer Law in Action
Wei's side business is now operating from inner Sydney, and a customer in Brisbane emails him about a $250 device charger that stopped working after two months. Wei's website says “30-day returns only”, and his overseas supplier tells him faults are a factory issue. He's tempted to point the customer offshore and move on.
That approach may create avoidable risk. The customer dealt with Wei's business, not the overseas manufacturer. A store policy can set an internal process, but it doesn't override the statutory guarantee framework if the product isn't of acceptable quality.
What a better response looks like
Wei would generally be better placed to:
- acknowledge the complaint promptly
- ask for basic evidence of the fault
- assess whether the goods failed to meet the expected standard
- offer a remedy that fits the circumstances, which may include repair, replacement, or refund
The commercial lesson is straightforward. If you import, brand, or retail goods into Australia, your customer-facing business remains responsible for handling the complaint properly. Passing the problem upstream may still be part of your supplier recovery process, but it usually shouldn't be your first answer to the customer.
Why escalation risk is real
ACL compliance is not only about keeping customers happy. It can also become an enforcement issue. The maximum civil pecuniary penalty is AUD 50 million for corporations and AUD 2.5 million for individuals per contravention, and between 2011 and 2021 the Federal Court imposed nearly AUD 400 million in civil pecuniary penalties in cases instituted by the ACCC: Australian Consumer Law penalties and enforcement overview.
For a small operator, the practical consequence usually appears first as complaint cost, time drain, payment disputes, reputational friction, and platform issues. But the legal environment makes one point clear. Customer remedy processes should be treated as a governance matter, not just an inbox problem.
Navigating Complaints Penalties and Enforcement
Most ACL issues are first encountered as complaints. A confused invoice, a rejected refund request, a service that didn't match the promise, or a website statement that oversold the offer can all move quickly from customer service into compliance.
What a workable internal process usually includes
The ACL environment rewards businesses that resolve matters early, clearly, and consistently. In broad terms, a sound process usually includes a documented intake channel, prompt acknowledgement, a fact-based assessment, and a remedy decision that matches the legal position rather than the staff member's preference on the day.
The same enforcement overview notes that 82% of consumers who experienced a problem took action to resolve it, 84% of resolved cases were settled directly between the consumer and trader, and 50% of consumers reported satisfaction with the result: consumer dispute resolution data in the Australian Consumer Law overview. That supports a practical point. Internal resolution matters.
Strong complaint handling does two jobs at once. It reduces escalation risk and gives management a live view of where the business may be overpromising or underdelivering.
The regulator and the business model issue
For SMEs, NFPs, and boards, the deeper question is whether complaints reveal a one-off problem or a structural one. If the same issue appears in multiple channels, your sales wording, terms, refund scripts, or fulfilment process may need attention.
For fund managers and AFSL operators, there is an additional boundary. The ACL expressly excludes financial services and claims relating to financial products. Those areas are governed under the ASIC Act 2001, not ACL consumer guarantees: Law Council discussion of the ACL boundary with financial products and services.
That distinction matters because businesses can waste time responding under the wrong framework. A refund dispute over financial advice or a claim involving a financial product should be assessed through the ASIC regime, your AFSL obligations, and your internal dispute resolution settings, not through ACL guarantees designed for goods and ordinary services.
For organisations tightening board oversight around these issues, governance and compliance advisory is often where complaint patterns become visible before they turn into regulator attention.
Sector-Specific and Cross-Border Considerations
Generic ACL articles often stop at shops and refunds. In practice, the harder questions come from mixed-purpose organisations, licensed financial businesses, and overseas sellers entering Australia.
NFPs and trading activities
An NFP doesn't get a free pass because its purpose is charitable or community-based. If the organisation runs commercial activities such as ticketed events, op-shop sales, training programs, or fee-for-service delivery, ACL obligations may still apply to those dealings.
Boards should be especially careful where operational staff rely on informal wording like “donation only”, “credits only”, or “no refunds under any circumstances”. The label on the activity doesn't decide the issue by itself. The substance of what is being supplied matters.
Fund managers and advisers
This is one of the most misunderstood edges of the ACL. If the issue concerns financial services or a financial product, the ACL is not the right primary remedy framework. The ASIC regime applies instead. That matters for disclosure, complaint handling, and the language used with clients when something has gone wrong.
A frequent error is assuming all “consumer rights” language works the same way across advice, funds, and ordinary commerce. It doesn't. If you advise on investments or operate under an AFSL, your liability map and dispute settings need to reflect that separate legislative regime.
Overseas businesses entering Australia
If a Chinese company, offshore platform seller, or overseas professional service business is carrying on business in Australia or selling to Australian customers, ACL exposure can still arise. From a practical compliance perspective, being physically offshore doesn't make customer-facing promises irrelevant.
That has implications for:
- Website wording used for Australian offers
- Returns and remedy processes for imported goods
- Customer support staffing that may not understand Australian standards
- Template contracts copied from foreign jurisdictions
- Marketing statements translated into English without legal review
Businesses hiring staff in Australia or expanding local operations should also keep adjacent compliance settings aligned. Employment controls, customer-facing scripts, and governance often overlap. For broader operational risk, employment law compliance guidance may also be relevant.
Small but important operational rules
Some ACL issues are simple and still commonly mishandled.
- Receipts: A receipt must be provided for goods or services costing over $75, as noted earlier in the business.gov.au guidance.
- No refund signs: A sign or policy can't remove statutory consumer guarantee rights.
- Cross-border sales: If you are selling into Australia, customer-facing terms should be reviewed for Australian compliance rather than assumed to work because they worked elsewhere.
If your policy sounds cleaner than the law, the law wins.
The practical takeaway is this: Australian Consumer Law reaches further than many businesses expect, but it does not cover everything. You need to know both where it applies and where it stops, especially in financial services and cross-border trading.
Frequently Asked Questions about the Australian Consumer Law
Does Australian Consumer Law apply to business-to-business sales?
Yes, it may. The legal definition of consumer is broader than ordinary usage. Since 1 July 2021, certain goods and services acquired for up to $100,000 can fall within the ACL framework even where the buyer is a business. That means some SME purchases may carry consumer guarantee rights depending on the transaction.
Can my business use a no refunds policy?
You can state a policy about change-of-mind returns, but you can't use a policy to take away statutory rights. If goods or services fail to meet consumer guarantee standards, the customer may still have access to a remedy. Policy wording should be reviewed carefully so it doesn't mislead.
Do I have to give customers a receipt?
Yes, if the goods or services cost over $75. That rule applies broadly, including to overseas entities selling in Australia. It's a basic compliance point, but it also helps if a dispute later turns on what was purchased, when it was supplied, and which entity made the sale.
Does the ACL cover financial advice and investment products?
Not in the usual consumer guarantee sense. A key boundary is that financial services and claims relating to financial products are excluded from the ACL framework and instead sit under the ASIC Act 2001. For advisers, fund managers, and AFSL operators, that distinction is central to complaint handling and risk management.
If I import products, can I send customers to the manufacturer?
That may be part of your supplier recovery process, but it usually shouldn't be your first customer response. If your business sold the goods to the Australian customer, your business is generally the frontline party for handling the complaint properly. Importer and retailer responsibilities should be documented clearly in your process.
What is the biggest ACL mistake small businesses make?
Usually, it's not one dramatic breach. It's the accumulation of small inconsistencies. A website says one thing, staff say another, the contract says something else, and the complaint script tries to narrow rights further. That combination can create misleading conduct risk and make an ordinary complaint much harder to resolve.
The short answer for most businesses is this. Australian Consumer Law is part of the everyday operating environment in Australia, not a specialist issue to look at only after a complaint arrives. The right response depends on what you sell, who you sell to, whether the customer falls within the statutory definition of consumer, and whether another regime, such as the ASIC framework, applies instead.
If you would like clarity on how these principles may apply to your own circumstances, contact Everglow on 1300 913 929 or email contact@everglow.au.
To book directly: Book a meeting with Panbo.
WordPress tags: Australian Consumer Law, business compliance, ACCC, fund managers, NFP governance, cross-border business, SME risk management
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