From:To:
Subject:
Date:

MG Consumer Law
Submission re: Unfair trading practices - Consultation Regulation Impact Statement
Wednesday, 22 November 2023 12:09:59 PM

Director
Consumer Policy and Product Safety Unit
Market Conduct and Digital Division
Treasury
Langton Cres
Parkes ACT 2600
Dear Director
I am a professor at Sydney Law School specialising in consumer and business law. I also
am an honorary senior fellow at Melbourne Law School co-teaching a Masters course in
consumer protection law. With Prof Jeannie Paterson there I have presented seminars forAustralian government officials on the ACL regime and cutting-edge issues. Therein andin my ACL Review submission I have elaborated why I think our law should be amended
to add a general prohibition on unfair commercial practices.
I am therefore pleased to see this Consultation RIS and I favour Option 3, based on the EU
Directive so consumers, suppliers and regulators alike can benefit from very long andwidespread experience particularly with its Article 5. Option 1 (do nothing) is untenablegiven the evidence of market-distorting behaviour - below I give yet another case study of
how the existing ACL does not seem sufficient, re the practice of making it very hard to
get out of subscriptions entered into online. Option 2 (amend unconscionable conduct
provisions) is not compelling because the legislators have kept trying this over many years,
but the courts quite understandably default to equity law focus on exploiting vulnerable
persons, which does not hone in on unreasonable business models targeting behaviouralbiases and heuristics within wider groups. Option 4 (adding also specific prohibitions) may
enhance consumer protection but could lead to much disputation, depending on thewording of the specific prohibitions, and impose extra costs on the economy which are notjustified by the extra benefits. Accordingly this Option could be reexamined if enactmentof an EU-style Option 3 is seen as unsuccessful.
If even Option 3 is considered to be too burdensome, at least initially a sub-option would
be to restrict its protections to consumers (as defined more narrowly/typically in Europe
and many parts of Asia etc as individuals transacting for non-business purposes). This
would also reduce the risk of individual consumers cross-subsidising businesses. However,the (somewhat unique) trend in Australian consumer law has been to extend protection
widely, and allowing that also for at least "small business" has some socio-economic andindeed political benefits.
In any event, whichever substantive law reform is implemented, there should be enactment
as proposed by this federal Labor Government of a UK-style super-complaints mechanism
whereby peak consumer groups can provide prima facie evidence of widespread consumer
detriment, triggering a public response from regulators within a specified period. For moredetails and references, see: Nottage, Luke R. and Kozuka, Souichirou, Consumer Law
Redress and Administration, Product Safety Regulation and Contracts in Japan andAustralia (May 26, 2023). Competition and Consumer Law Journal, forthcoming early
2024, Available at SSRN: https://ssrn.com/abstract=4459890
The case study below provides another illustration of the problems under the current law. Isubscribed online very easily and at a discount last year for a 12-month subscription to The
Economist magazine. However, fearing it might auto-renew at the higher rate, I tried tologin via the "Manage Subscription" or similar option on the interface provided to me. It
was not easy to navigate but clicking through to "Cancel Subscription" ended up with a
webpage saying it was not possible to do online, unlike renewals etc, but rather I had tocall a number to speak with someone. That number was hard to reach someone on, andthey tried to dissuade me from cancelling / not renewing, by offering a discount etc. I
declined and told them orally and by emails that I thought The Economist website set-up
and business method involved misleading conduct and potentially unfair terms under theAustralian Consumer Law.
I was not satisfied by their responses so complained online to the ACCC. I received ageneric response from "" reproduced below, saying my complaint was noted andsuggesting I contact the NSW OFT, along with my response arguing this was inadequate. I
then eventually received a further email from her Team Leader "", also reproduced
below. Since that communication five months ago, I have heard nothing further from the
ACCC. I suggest you/Treasury ask them if the ACCC contacted The Economist andwhether the latter's website / practice has been improved (and/or, assuming some Treasury
officials subscribe to The Economist, perhaps try logging in to see if they allow now online
cancellation as well as changes/subscriptions). If nothing has improved, this suggests theexisting ACL provisions are inadequate, if even a reputable international magazine
supplier engages in such practices.
Best regards-Dr Luke Nottage
Special Counsel
Williams Trade Law
Professor of Comparative and Transnational Business Law
Co-Director, Australian Network for Japanese Law
Sydney Law School
Room 647, Building F10, Eastern Avenue, University of Sydney, NSW 2006______

﻿

From: Infocentre Public Mailbox <Date: 19 June 2023 at 1:28:45 pm NZST
To: Luke Nottage <Subject: ACCC Response (Reference:>>) [SEC=OFFICIAL]

Dear Luke
I refer to your recent correspondence to the Australian Competition andConsumer Commission (ACCC) in relation to your subscription to the Economist.
Your report has been escalated to me as a Team Leader for consideration andresponse. Please accept my apology for the delay in responding to you.
I understand that you are concerned about the conduct of the Economist in
making it difficult for consumers to cancel their subscription. I note your views

that this conduct amounts to misleading and deceptive conduct, and an unfair
contract term, and falls within the ACCC’s current priorities.
As
previously advised, we have recorded the information you haveprovided and we thank you for alerting us to this issue. As
also noted, the
ACCC generally does not comment on the direct actions we take in relation to theinformation provided in specific reports. However, we can advise that we usereports from the public, as well as other sources of intelligence, to inform ourenforcement work. We use such information to not only inform our decision
making on what enforcement action we may take, but also what complianceactivities we may undertake, ranging from consumer or business education, toindustry engagement, to advocacy and research. We consider both point in timedata, but also regularly review data received over longer periods of time to inform
our overall compliance and enforcement work.
While we appreciate you submitting your report, we cannot tell you whether wewill take further action. The ACCC does not generally comment on its
enforcement investigations unless it is in the public interest. Any statement wemake in the future as to any investigation, or what action (if any) we may take,will be made publicly, such as through a media release on our website, rather
than via direct replies. There are a range of factors that limit our ability tocomment on investigations such as ensuring fairness to individuals, companies
and businesses being investigated, or the potential to jeopardise investigations
through the untimely release of information. You can find more information on our
approach in our media code of conduct.
As you are aware, one of the ACCC’s 2023 – 23 compliance and enforcement
priorities is consumer and fair trading issues relating to manipulative or deceptive
advertising and marketing practices in the digital economy. This priority area
includes a focus on design choices or ‘dark patterns’ that exploit behaviouralbiases and distort consumer choice. These include subscription traps whichmake it difficult to opt out of a service and practices designed to get consumers
to agree to unfair or unfavourable contract terms.
As you have noted, some of these practices may fall within the current provisionsof the Australian Consumer Law (ACL), such as the provisions relating tounconscionable conduct, misleading or deceptive conduct or unfair contract
terms. As you are aware, the ACCC is advocating for a new economy-wide banon unfair trading practices to address these practices. This is because the ACCC
is also seeing conduct that, while harmful, is unlikely to breach the ACL because
it does not reach the thresholds for unconscionable or misleading conduct orconstitute an unfair contract term.
However, regardless of whether or not the conduct you have complained about
constitutes a potential breach of the ACL, the information you have provided isvaluable information that helps to assist the ACCC’s work.
I appreciate you were seeking a more definitive response from us, but I hope theinformation provided today helps to clarify our position
Yours sincerelyTeam Leader | Infocentre
Australian Competition and Consumer Commission
23 Marcus Clarke Street Canberra 2601 | www.accc.gov.au
T: 1300 302 502

@acccgovau

ACCCConsumerrights---------- Forwarded message --------From: Luke Nottage <Date: Thu, 20 Apr 2023 at 14:55
Subject: Re: ACCC Response (Reference:
To: Infocentre Public Mailbox <Cc:<>) [SEC=OFFICIAL]
>
>

Dear
I am lodging specific allegations of misleading conduct etc by The Economist (which
operates inter/nationally, not just in NSW) re them making it difficult to not renew / cancel
subscriptions, which your own boss has identified recently as a priority concern for the
ACCC so I expect you to do more than “make a record” of this complaint - please contact
The Economist as they brushed me off and otherwise they will just keep misleading
potentially thousands of Australian consumers.
3500.jpg

ACCC boss wants new powers to crack down on
online businesses that make it hard to cancel
subscriptions
theguardian.com

Prof Luke Nottage
University of Sydney Law School
Sent from my iPhone
Apologies for any typos or perceived tersenessOn 20 Apr 2023, at 10:07 am, Infocentre Public Mailbox<> wrote:﻿
Dear LukeI acknowledge that you are reporting broader concerns about the conduct of The
Economist and have made a record of this. However, we can also offer you
information about your consumer rights and how to resolve a dispute with abusiness, if you wished to pursue an individual remedy.

Your next steps
If you’re unable to resolve your dispute by speaking with a business, write them acomplaint letter. That way they’re clearly aware of the problem, what you want,
and you have a record of your contact. We have a complaint letter tool on our
website to help you get started.
If writing to the business doesn’t resolve your dispute, we would suggest you
contact NSW Fair Trading. Unlike the ACCC, which focuses on broad andnational issues, your local consumer protection agency may be able to help
resolve your dispute by negotiating an outcome. Find out more about how tomake a complaint to NSW Fair Trading on its website.
If they’re unable to help, you may need to take your complaint to your state or
territory small claims tribunal.

Your rights: accurate information
The Australian Consumer Law provides consumers with the right to truthful andaccurate representations when buying a product or service. This means thatbusinesses must not mislead you with statements that are incorrect or likely togive you the wrong impression. This rule applies to information that a businessprovides you in any medium, including when talking to a sales representative, on
packaging, in online shopping forums or social media.
If a business misleads you, and you experience loss, you might be entitled to a
remedy.
You can read more about false or misleading claims on our website. Our
advertising and selling guide is also a handy resource for businesses to ensure
their advertising complies with the law.

Your report: what the ACCC does with this information
The ACCC uses reports from the public, as well as other sources of intelligence,
to inform our enforcement work. You can read more about how we prioritise ourwork on our website.
Please note, the ACCC generally does not comment on our work or what we dowith the information we receive from reports. We will only contact you again if we
require further information.
To keep up-to-date on public announcements from the ACCC, you can subscribe
to our email alerts.
We hope the information we have provided is helpful.
Yours sincerely

Public Information Officer | Infocentre
Australian Competition and Consumer Commission
23 Marcus Clarke Street Canberra 2601 | www.accc.gov.au
T: 1300 302 502@acccgovau

ACCCConsumerrights

P Please consider the environment before printing this email

--IMPORTANT: This email from the Australian Competition and Consumer
Commission (ACCC), and any attachments to it, may contain information thatis confidential and may also be the subject of legal, professional or otherprivilege. If you are not the intended recipient, you must not review, copy,
disseminate, disclose to others or take action in reliance on, any material
contained within this email. If you have received this email in error, please let
the ACCC know by reply email to the sender informing them of the mistakeand delete all copies from your computer system. For the purposes of theSpam Act 2003, this email is authorised by the ACCC www.accc.gov.au-Dr Luke Nottage
Special Counsel
Williams Trade Law
Professor of Comparative and Transnational Business Law
Co-Director, Australian Network for Japanese Law
Sydney Law School
Room 647, Building F10, Eastern Avenue, University of Sydney, NSW 2006
- Selected papers: http://ssrn.com/author=488525---------- Forwarded message --------From: Luke Nottage <Date: Thu, 20 Apr 2023 at 14:55
Subject: Re: ACCC Response (Reference:
To: Infocentre Public Mailbox <Cc:>) [SEC=OFFICIAL]>Dear
I am lodging specific allegations of misleading conduct etc by The Economist (which
operates inter/nationally, not just in NSW) re them making it difficult to not renew / cancel
subscriptions, which your own boss has identified recently as a priority concern for the
ACCC so I expect you to do more than “make a record” of this complaint - please contact
The Economist as they brushed me off and otherwise they will just keep misleading
potentially thousands of Australian consumers.
3500.jpg

ACCC boss wants new powers to crack down on
online businesses that make it hard to cancel
subscriptions
theguardian.com

Prof Luke Nottage
University of Sydney Law School
Sent from my iPhone
Apologies for any typos or perceived tersenessOn 20 Apr 2023, at 10:07 am, Infocentre Public Mailbox<> wrote:﻿
Dear LukeI acknowledge that you are reporting broader concerns about the conduct of The
Economist and have made a record of this. However, we can also offer you
information about your consumer rights and how to resolve a dispute with abusiness, if you wished to pursue an individual remedy.

Your next steps
If you’re unable to resolve your dispute by speaking with a business, write them acomplaint letter. That way they’re clearly aware of the problem, what you want,
and you have a record of your contact. We have a complaint letter tool on our
website to help you get started.
If writing to the business doesn’t resolve your dispute, we would suggest you
contact NSW Fair Trading. Unlike the ACCC, which focuses on broad andnational issues, your local consumer protection agency may be able to help
resolve your dispute by negotiating an outcome. Find out more about how tomake a complaint to NSW Fair Trading on its website.
If they’re unable to help, you may need to take your complaint to your state or
territory small claims tribunal.

Your rights: accurate information
The Australian Consumer Law provides consumers with the right to truthful andaccurate representations when buying a product or service. This means thatbusinesses must not mislead you with statements that are incorrect or likely togive you the wrong impression. This rule applies to information that a businessprovides you in any medium, including when talking to a sales representative, on
packaging, in online shopping forums or social media.
If a business misleads you, and you experience loss, you might be entitled to a
remedy.
You can read more about false or misleading claims on our website. Our
advertising and selling guide is also a handy resource for businesses to ensure
their advertising complies with the law.

Your report: what the ACCC does with this information
The ACCC uses reports from the public, as well as other sources of intelligence,
to inform our enforcement work. You can read more about how we prioritise ourwork on our website.
Please note, the ACCC generally does not comment on our work or what we dowith the information we receive from reports. We will only contact you again if we
require further information.
To keep up-to-date on public announcements from the ACCC, you can subscribe
to our email alerts.
We hope the information we have provided is helpful.
Yours sincerely

Public Information Officer | Infocentre
Australian Competition and Consumer Commission
23 Marcus Clarke Street Canberra 2601 | www.accc.gov.au
T: 1300 302 502@acccgovau

ACCCConsumerrights

P Please consider the environment before printing this email--IMPORTANT: This email from the Australian Competition and Consumer
Commission (ACCC), and any attachments to it, may contain information thatis confidential and may also be the subject of legal, professional or otherprivilege. If you are not the intended recipient, you must not review, copy,
disseminate, disclose to others or take action in reliance on, any material
contained within this email. If you have received this email in error, please let
the ACCC know by reply email to the sender informing them of the mistakeand delete all copies from your computer system. For the purposes of theSpam Act 2003, this email is authorised by the ACCC www.accc.gov.au