Key Risks of Outdated Terms
- Unfair Contract Terms (UCTs):
- From November 9, 2023, using unfair terms in contracts with consumers or small businesses is explicitly illegal under ACL.
- Examples of unfair terms include:
- Allowing one party (typically the business) to unilaterally vary, renew, or terminate the contract.
- Excessively limiting liability for the business while increasing burdens on the customer.
- Automatic renewal clauses without adequate opt-out options
- Misleading or Inaccurate Information:
- Outdated terms that misrepresent policies, such as refunds, cancellations, or warranties, can breach ACL provisions against misleading or deceptive conduct.
- Penalties for Non-Compliance:
- Penalties have increased substantially. Businesses may face fines up to the greater of $50 million, 30% of turnover during the breach period, or three times the benefit gained from non-compliance
.
- Data Privacy Implications:
- If privacy clauses are outdated or fail to align with current Privacy Act standards, they may lead to further legal liabilities.