Recent legislative amendments have introduced tougher penalties for breaches of certain provisions of the Australian Consumer Law (ACL) as follows:
- the new maximum penalty for individuals is $500,000
- the new maximum penalty for companies is the greater of:
- (a) $10 million; or
- (b) 3 times the value of the benefit directly or indirectly obtained by the company (and any related companies) which is reasonably attributable to the offence; or
- (c) if the value of the benefit cannot be determined, 10% of the annual turnover of the company (and any related companies) from the 12 month period leading up to the offence
The previous maximum penalties were $220,000 for an individual and $1.1 million for companies.
The new maximum penalties will apply to each contravention, so companies and individuals could potentially face massive fines if they commit multiple contraventions of the ACL.
We anticipate that the ACCC will more aggressively pursue companies for breaching consumer laws in 2019 and onwards.
Given the larger penalties that now apply, companies and directors need to always be vigilant about compliance and, amongst other things, urgently review their business practices and terms of trade to ensure they are compliant.