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TREASURY LAWS AMENDMENT (MORE COMPETITION, BETTER PRICES) ACT 2022 (NO. 54, 2022) - SCHEDULE 2

Part 1 -- Prohibition of unfair contract terms

Division 1--Amendment of the Competition and Consumer Act 2010

Competition and Consumer Act 2010

1  After subsection 23(2) of Schedule 2

Insert:

          (2A)  A person contravenes this subsection if:

                     (a)  the person makes a contract; and

                     (b)  the contract is a consumer contract or small business contract; and

                     (c)  the contract is a standard form contract; and

                     (d)  a term of the contract is unfair; and

                     (e)  the person proposed the unfair term.

Note:          A pecuniary penalty may be imposed for a contravention of this subsection: see section 224.

          (2B)  A person who contravenes subsection (2A) commits a separate contravention of that subsection in respect of each term that is unfair and that the person proposed.

          (2C)  A person contravenes this subsection if:

                     (a)  the person applies or relies on, or purports to apply or rely on, a term of a contract; and

                     (b)  the contract is a consumer contract or small business contract; and

                     (c)  the contract is a standard form contract; and

                     (d)  the term is unfair.

Note:          A pecuniary penalty may be imposed for a contravention of this subsection: see section 224.

Division 2--Amendment of the Australian Securities and Investments Commission Act 2001

Australian Securities and Investments Commission Act 2001

2  After subsection 12BF(2)

Insert:

          (2A)  A person contravenes this subsection if:

                     (a)  the person makes a contract; and

                     (b)  the contract is a consumer contract or small business contract; and

                     (c)  the contract is a standard form contract; and

                     (d)  the contract is either a financial product or a contract for the supply, or possible supply, of financial services; and

                     (e)  a term of the contract is unfair; and

                      (f)  the person proposed the unfair term.

          (2B)  A person who contravenes subsection (2A) commits a separate contravention of that subsection in respect of each term that is unfair and that the person proposed.

          (2C)  A person contravenes this subsection if:

                     (a)  the person applies or relies on, or purports to apply or rely on, a term of a contract; and

                     (b)  the contract is a consumer contract or small business contract; and

                     (c)  the contract is a standard form contract; and

                     (d)  the contract is either a financial product or a contract for the supply, or possible supply, of financial services; and

                     (e)  the term is unfair.

Subsection 12BG(1)

Omit "subsection 12BF(1)", substitute "section 12BF".

Subsection 12BH(1)

Omit "subsection 12BF(1)", substitute "section 12BF".

Part 2 -- Remedies

Division 1--Amendment of the Competition and Consumer Act 2010

Competition and Consumer Act 2010

5  Section 137D

Repeal the section, substitute:

137D   Compensation orders etc. arising out of unconscionable conduct or unfair contract term

                   In determining whether to make an order under subsection 237(1) or 238(1) of the Australian Consumer Law in relation to a contravention of a provision of Part 2-2 or 2-3 of the Australian Consumer Law, the court may have regard to the conduct of the parties to the proceeding referred to in that subsection since the contravention occurred.

6  Paragraphs 137F(2)(b), (c) and (d)

Repeal the paragraphs, substitute:

                     (b)  an application under section 232 of the Australian Consumer Law for an injunction against the person in relation to a contravention of a provision of Chapter 2, 3 or 4 of the Australian Consumer Law; or

                     (c)  an action under subsection 236(1) of the Australian Consumer Law against the person in relation to a contravention of a provision of Part 2-1 or 2-3, or of Chapter 3, of the Australian Consumer Law; or

                     (d)  an application for an order under subsection 237(1) or 239(1) of the Australian Consumer Law against the person in relation to a contravention of a provision of Chapter 2, 3 or 4 of the Australian Consumer Law.

7  Paragraph 137H(1)(b)

Omit "or 239(1)", substitute ", 239(1), 243A(1) or 243B(1)".

8  Paragraph 157(1AA)(b)

After "237(1)", insert ", 243A(1) or 243B(1)".

Subsection 2(1) of Schedule 2 (definition of declared term )

Repeal the definition, substitute:

"declared term " : see sections 239(1)(a)(ii), 243A(1) and 243B(1).

10  Subsection 2(1) of Schedule 2 (paragraph (b) of the definition of enforcement proceeding )

Omit "and 239", substitute ", 239, 243A and 243B".

11  Before subparagraph 224(1)(a)(ii) of Schedule 2

Insert:

                           (iia)  section 23(2A) or (2C) (which is about unfair terms in standard form consumer or small business contracts);

12  Subsection 224(3) of Schedule 2 (before table item 2)

Insert:

2A

section 23(2A) or (2C)

the greater of the amounts mentioned in subsection (3A)

$2,500,000

13  Subsection 224(3A) of Schedule 2

After "items 1,", insert "2A,".

14  Subsection 232(3) of Schedule 2

Repeal the subsection.

15  Subdivision A of Division 4 of Part 5-2 of Schedule 2 (heading)

Repeal the heading.

16  Paragraphs 237(1)(a) and (b) of Schedule 2

Repeal the paragraphs, substitute:

                     (a)  on application of a person (the injured person ) who has suffered, or is likely to suffer, loss or damage because another person has engaged in conduct in contravention of a provision of Chapter 2, 3 or 4; or

                     (b)  on the application of the regulator made on behalf of, and with the consent in writing of, one or more such injured persons;

17  Subsection 237(1) of Schedule 2 (notes 1 and 2)

Repeal the notes, substitute:

Note:          The orders that the court may make include all or any of the orders set out in section 243.

18  Subsection 237(3) of Schedule 2

Repeal the subsection, substitute:

             (3)  An application under subsection (1) may be made at any time before the end of 6 years from the day on which the cause of action accrued that relates to the conduct referred to in that subsection.

19  Subsection 238(1) of Schedule 2

Repeal the subsection, substitute:

             (1)  If:

                     (a)  a proceeding is instituted in a court under a provision of Chapter 4 or this Chapter (other than this section); and

                     (b)  the court finds that a party to the proceeding (the injured person ) has suffered loss or damage, or is likely to suffer loss or damage, because another person has engaged in conduct in contravention of a provision of Chapter 2, 3 or 4;

the court may make such order or orders as it thinks appropriate against the other person, or against a person involved in that conduct.

Note:          The orders that the court may make include all or any of the orders set out in section 243.

20  Subdivision B of Division 4 of Part 5-2 of Schedule 2 (heading)

Repeal the heading.

21  Subsection 239(1) of Schedule 2 (notes 1 and 2)

Repeal the notes, substitute:

Note:          The orders that the court may make include all or any of the orders set out in section 243.

22  Subdivision C of Division 4 of Part 5-2 of Schedule 2 (heading)

Repeal the heading.

23  Section 242 of Schedule 2

Repeal the section.

24  Sections 244 and 245 of Schedule 2

Repeal the sections, substitute:

243A   Orders made in favour of party to contract containing unfair term

             (1)  If a declaration has been made under section 250 in relation to a term (the declared term ) of a contract, a court may:

                     (a)  on the application of a party to the contract; or

                     (b)  on the application of the regulator made on behalf of, and with the consent in writing of, one or more parties to the contract;

make against a party (the respondent ) to the contract who is advantaged by the declared term such order or orders (other than an award of damages) as the court thinks appropriate:

                     (c)  to redress, in whole or in part, loss or damage that has been caused to any person by the declared term; or

                     (d)  to prevent or reduce loss or damage that is likely to be so caused.

             (2)  Without limiting subsection (1), the orders that a court may make against the respondent include all or any of the following:

                     (a)  an order declaring the whole or any part of the contract, or of a collateral arrangement relating to the contract:

                              (i)  to be void; and

                             (ii)  if the court thinks fit--to have been void ab initio or void at all times on and after such date as is specified in the order (which may be a date that is before the date on which the order is made);

                     (b)  an order:

                              (i)  varying the contract, or such a collateral arrangement, as specified in the order; and

                             (ii)  if the court thinks fit--declaring the contract or arrangement to have had effect as so varied on and after such date as is specified in the order (which may be a date that is before the date on which the order is made);

                     (c)  an order refusing to enforce any or all of the provisions of the contract, or of such a collateral arrangement.

             (3)  An application under subsection (1) may be made at any time before the end of 6 years from the day on which the declaration under section 250 was made.

243B   Orders made on application of the regulator to prevent and remedy unfair contract terms

             (1)  If a declaration has been made under section 250 in relation to a term (the declared term ) of a contract, a court may, on the application of the regulator, make against a party (the respondent ) to the contract who is advantaged by the declared term such order or orders (other than an award of damages) as the court thinks appropriate:

                     (a)  to prevent a term (a similar term ) that is the same, or substantially similar, in effect to the declared term from being included in any future contract:

                              (i)  to which the respondent is a party; and

                             (ii)  that is a consumer contract or small business contract; and

                            (iii)  that is a standard form contract; or

                     (b)  to redress, in whole or in part, loss or damage that has been caused, or to prevent or reduce loss or damage that is likely to be caused, to any person by a similar term that is included in any existing contract:

                              (i)  to which the respondent is a party; and

                             (ii)  that is a consumer contract or small business contract; and

                            (iii)  that is a standard form contract;

whether or not the future or existing contract is identifiable when the court makes the order or orders.

             (2)  Without limiting subsection (1), the orders that a court may make against the respondent include all or any of the following:

                     (a)  an injunction restraining the respondent from making any future contract that is of the kind referred to in paragraph (1)(a) and includes a similar term;

                     (b)  an injunction restraining the respondent from applying or relying on a similar term of any existing contract that is of the kind referred to in paragraph (1)(b);

                     (c)  an order declaring the whole or any part of any existing contract of the kind referred to in paragraph (1)(b), or of a collateral arrangement relating to such a contract:

                              (i)  to be void; and

                             (ii)  if the court thinks fit--to have been void ab initio or void at all times on and after such date as is specified in the order (which may be a date that is before the date on which the order is made);

                     (d)  an order:

                              (i)  varying such an existing contract, or such a collateral arrangement, as specified in the order; and

                             (ii)  if the court thinks fit--declaring the contract or arrangement to have had effect as so varied on and after such date as is specified in the order (which may be a date that is before the date on which the order is made);

                     (e)  an order refusing to enforce any or all of the provisions of such an existing contract, or of such a collateral arrangement.

             (3)  An application under subsection (1) may be made at any time before the end of 6 years from the day on which the declaration under section 250 was made.

             (4)  An order made under this section against the respondent binds a person affected by the order, even if the person is not a party to the proceedings in which the order is made.

245   Interaction with other provisions

             (1)  An application may be made under section 237(1), 239(1), 243A(1) or 243B(1) even if an enforcement proceeding in relation to the conduct or term referred to in that section has not been instituted.

             (2)  A court may make an order under a provision of this Division whether or not the court:

                     (a)  grants an injunction under Division 2; or

                     (b)  makes an order under any other provision of this Division or under section 236, 246, 247 or 248.

             (3)  Nothing in this Division limits the generality of Division 2.

25  Paragraph 247(1)(a) of Schedule 2

After "Part 2-2", insert "or 2-3".

26  After subparagraph 248(1)(a)(i) of Schedule 2

Insert:

                            (ia)  a provision of Part 2-3 (which is about unfair contract terms);

Division 2--Amendment of the Australian Securities and Investments Commission Act 2001

Australian Securities and Investments Commission Act 2001

27  Subsection 12BA(1) (definition of enforcement proceeding )

Omit "section 12GNB", substitute "sections 12GNB, 12GNE and 12GNF".

28  Before paragraph 12GBA(6)(a)

Insert:

                    (aa)  a provision of Subdivision BA;

29  Subsection 12GD(9)

Repeal the subsection.

30  Subsection 12GF(1)

After "a provision of", insert "Subdivision BA (sections 12BF to 12BM),".

31  Section 12GG

Repeal the section, substitute:

12GG   Finding in proceedings to be evidence

             (1)  In:

                     (a)  a proceeding against a person under section 12GF or 12GFA; or

                     (b)  an application under subsection 12GM(2), 12GNB(1), 12GNE(1) or 12GNF(1) for an order against a person;

a finding of any fact by a court is prima facie evidence of that fact if the finding was made in proceedings:

                     (c)  under section 12GBA, 12GBB, 12GBCC, 12GD, 12GLA or 12GLB; or

                     (d)  for an offence against section 12GB;

in which that person was found to have contravened, or to have been involved in a contravention of, a provision of this Division.

             (2)  The finding may be proved by production of a document, under the seal of the court, from which the finding appears.

32  Paragraph 12HB(1)(b)

Omit "or 12GNB(1)", substitute ", 12GNB(1), 12GNE(1) or 12GNF(1)".

33  Subsection 12GLA(4) (before paragraph (a) of the definition of contravening conduct )

Insert:

                    (aa)  contravenes a provision of Subdivision BA (sections 12BF to 12BM); or

34  Paragraph 12GLC(1)(a)

After "Subdivision", insert "BA,".

35  Paragraph 12GLD(1)(a)

After "Subdivision", insert "BA,".

36  Subsection 12GM(10)

Repeal the subsection.

37  Paragraph 12GN(1)(c)

After "a provision of", insert "Subdivision BA (sections 12BF to 12BM),".

38  Subsection 12GN(9)

Repeal the subsection.

39  Subparagraph 12GNB(1)(a)(i)

After "Subdivision", insert "BA,".

40  After section 12GND of Schedule 2

Insert:

12GNE   Orders made in favour of party to contract containing unfair term

             (1)  If a declaration has been made under section 12GND in relation to a term (the declared term ) of a contract, the Court may:

                     (a)  on the application of a party to the contract; or

                     (b)  on the application of ASIC made on behalf of, and with the consent in writing of, one or more parties to the contract;

make against a party (the respondent ) to the contract who is advantaged by the declared term such order or orders (other than an award of damages) as the Court thinks appropriate:

                     (c)  to redress, in whole or in part, loss or damage that has been caused to any person by the declared term; or

                     (d)  to prevent or reduce loss or damage that is likely to be so caused.

             (2)  Without limiting subsection (1), the orders that the Court may make against the respondent include all or any of the following:

                     (a)  an order declaring the whole or any part of the contract, or of a collateral arrangement relating to the contract:

                              (i)  to be void; and

                             (ii)  if the Court thinks fit--to have been void ab initio or void at all times on and after such date as is specified in the order (which may be a date that is before the date on which the order is made);

                     (b)  an order:

                              (i)  varying the contract, or such a collateral arrangement, as specified in the order; and

                             (ii)  if the Court thinks fit--declaring the contract or arrangement to have had effect as so varied on and after such date as is specified in the order (which may be a date that is before the date on which the order is made);

                     (c)  an order refusing to enforce any or all of the provisions of the contract, or of such a collateral arrangement.

             (3)  An application under subsection (1) may be made at any time before the end of 6 years from the day on which the declaration under section 12GND was made.

12GNF   Orders made on application of ASIC to prevent and remedy unfair contract terms

             (1)  If a declaration has been made under section 12GND in relation to a term (the declared term ) of a contract, the Court may, on the application of ASIC, make against a party (the respondent ) to the contract who is advantaged by the declared term such order or orders (other than an award of damages) as the Court thinks appropriate:

                     (a)  to prevent a term (a similar term ) that is the same, or substantially similar, in effect to the declared term from being included in any future contract:

                              (i)  to which the respondent is a party; and

                             (ii)  that is a consumer contract or small business contract; and

                            (iii)  that is a standard form contract; or

                     (b)  to redress, in whole or in part, loss or damage that has been caused, or to prevent or reduce loss or damage that is likely to be caused, to any person by a similar term that is included in any existing contract:

                              (i)  to which the respondent is a party; and

                             (ii)  that is a consumer contract or small business contract; and

                            (iii)  that is a standard form contract;

whether or not the future or existing contract is identifiable when the Court makes the order or orders.

             (2)  Without limiting subsection (1), the orders that the Court may make against the respondent include all or any of the following:

                     (a)  an injunction restraining the respondent from making any future contract that is of the kind referred to in paragraph (1)(a) and includes a similar term;

                     (b)  an injunction restraining the respondent from applying or relying on a similar term of any existing contract that is of the kind referred to in paragraph (1)(b);

                     (c)  an order declaring the whole or any part of any existing contract of the kind referred to in paragraph (1)(b), or of a collateral arrangement relating to such a contract:

                              (i)  to be void; and

                             (ii)  if the Court thinks fit--to have been void ab initio or void at all times on and after such date as is specified in the order (which may be a date that is before the date on which the order is made);

                     (d)  an order:

                              (i)  varying such an existing contract, or such a collateral arrangement, as specified in the order; and

                             (ii)  if the Court thinks fit--declaring the contract or arrangement to have had effect as so varied on and after such date as is specified in the order (which may be a date that is before the date on which the order is made);

                     (e)  an order refusing to enforce any or all of the provisions of such an existing contract, or of such a collateral arrangement.

             (3)  An application under subsection (1) may be made at any time before the end of 6 years from the day on which the declaration under section 12GND was made.

             (4)  An order made under this section against the respondent binds a person affected by the order, even if the person is not a party to the proceedings in which the order is made.

12GNG   Interaction with other provisions

             (1)  An application may be made under subsection 12GNE(1) or 12GNF(1) even if an enforcement proceeding in relation to the declared term referred to in that subsection has not been instituted.

             (2)  The Court may make an order under section 12GNE or 12GNF whether or not the Court:

                     (a)  grants an injunction under section 12GD; or

                     (b)  makes an order under any other provision of this Division (other than section 12GND).

             (3)  Nothing in this Division limits the generality of section 12GD.

Part 3 -- Determining what is a standard form contract

Division 1--Amendment of the Competition and Consumer Act 2010

Competition and Consumer Act 2010

41  Before paragraph 27(2)(b) of Schedule 2

Insert:

                   (ba)  whether one of the parties has made another contract, in the same or substantially similar terms, prepared by that party, and, if so, how many such contracts that party has made;

42  At the end of section 27 of Schedule 2

Add:

             (3)  A contract may be determined to be a standard form contract despite the existence of one or more of the following:

                     (a)  an opportunity for a party to negotiate changes, to terms of the contract, that are minor or insubstantial in effect;

                     (b)  an opportunity for a party to select a term from a range of options determined by another party;

                     (c)  an opportunity for a party to another contract or proposed contract to negotiate terms of the other contract or proposed contract.

Division 2--Amendment of the Australian Securities and Investments Commission Act 2001

Australian Securities and Investments Commission Act 2001

43  Before paragraph 12BK(2)(b)

Insert:

                   (ba)  whether one of the parties has made another contract, in the same or substantially similar terms, prepared by that party, and, if so, how many such contracts that party has made;

44  At the end of section 12BK

Add:

             (3)  A contract may be determined to be a standard form contract despite the existence of one or more of following:

                     (a)  an opportunity for a party to negotiate changes, to terms of the contract, that are minor or insubstantial in effect;

                     (b)  an opportunity for a party to select a term from a range of options determined by another party;

                     (c)  an opportunity for a party to another contract or proposed contract to negotiate terms of the other contract or proposed contract.

Part 4 -- Contract thresholds

Division 1--Amendment of the Competition and Consumer Act 2010

Competition and Consumer Act 2010

45  Paragraph 139G(2)(aa)

Omit "businesses employing fewer than 20 persons", substitute "persons who carry on a business and employ fewer than 100 persons".

46  Paragraph 139G(2A)(a)

Omit "businesses employing fewer than 20 persons", substitute "persons who carry on a business and employ fewer than 100 persons".

47  Subsections 23(4) and (5) of Schedule 2

Repeal the subsections, substitute:

             (4)  A contract is a small business contract if:

                     (a)  the contract is for a supply of goods or services, or a sale or grant of an interest in land; and

                     (b)  at least one party to the contract satisfies either or both of the following conditions:

                              (i)  the party makes the contract in the course of carrying on a business and at a time when the party employs fewer than 100 persons;

                             (ii)  the party's turnover, worked out under subsection (6) for the party's last income year (within the meaning of the Income Tax Assessment Act 1997 ) that ended at or before the time when the contract is made, is less than $10,000,000.

             (5)  In counting for the purposes of subparagraph (4)(b)(i) the number of persons that a person employs:

                     (a)  a casual employee is not to be counted unless employed on a regular and systematic basis; and

                     (b)  a part-time employee (including a part-time casual employee counted under paragraph (a) of this subsection) is to be counted as an appropriate fraction of a full-time equivalent.

             (6)  For the purposes of subparagraph (4)(b)(ii), a party's turnover for a period is the sum of the values of all supplies the party made during the period, other than the following:

                     (a)  supplies that are input taxed;

                     (b)  supplies that are not for consideration (and are not taxable supplies under section 72-5 of the A New Tax System (Goods and Services Tax) Act 1999 );

                     (c)  supplies that are not made in connection with an enterprise that the party carries on;

                     (d)  supplies that are not connected with the indirect tax zone.

             (7)  Expressions used in subsection (6) that are also used in the A New Tax System (Goods and Services Tax) Act 1999 have the same meaning as in that Act.

48  Paragraph 250(2)(a) of Schedule 2

Omit "a business of the kind referred to in", substitute "covered by".

Division 2--Amendment of the Australian Securities and Investments Commission Act 2001

Australian Securities and Investments Commission Act 2001

49  Subsections 12BF(4), (5) and (6)

Repeal the subsections, substitute:

             (4)  A contract is a small business contract if:

                     (a)  the upfront price payable under the contract does not exceed $5,000,000; and

                     (b)  at least one party to the contract satisfies either or both of the following conditions:

                              (i)  the party makes the contract in the course of carrying on a business and at a time when the party employs fewer than 100 persons;

                             (ii)  the party's turnover, worked out under subsection (7) for the party's last income year (within the meaning of the Income Tax Assessment Act 1997 ) that ended at or before the time when the contract is made, is less than $10,000,000.

             (5)  For the purposes of paragraph (4)(a), in working out the upfront price payable under a contract under which credit is provided or is to be provided, disregard any interest payable under the contract.

             (6)  In counting for the purposes of subparagraph (4)(b)(i) the number of persons that a person employs:

                     (a)  a casual employee is not to be counted unless employed on a regular and systematic basis; and

                     (b)  a part-time employee (including a part-time casual employee counted under paragraph (a) of this subsection) is to be counted as an appropriate fraction of a full-time equivalent.

             (7)  For the purposes subparagraph (4)(b)(ii), a party's turnover for a period is the sum of the values of all supplies the party made during the period, other than the following:

                     (a)  supplies that are input taxed;

                     (b)  supplies that are not for consideration (and are not taxable supplies under section 72-5 of the A New Tax System (Goods and Services Tax) Act 1999 );

                     (c)  supplies that are not made in connection with an enterprise that the party carries on;

                     (d)  supplies that are not connected with the indirect tax zone.

             (8)  Expressions used in subsection (7) that are also used in the A New Tax System (Goods and Services Tax) Act 1999 have the same meaning as in that Act.

Note:          This section applies to Insurance Contracts Act insurance contracts in addition to the Insurance Contracts Act 1984 (see paragraph 15(2)(d) of that Act).

50  Paragraph 12BH(2)(aa)

Omit "businesses employing fewer than 20 persons", substitute "persons who carry on a business and employ fewer than 100 persons".

51  Paragraph 12BL(3)(a)

Omit "businesses employing fewer than 20 persons", substitute "persons who carry on a business and employ fewer than 100 persons".

52  Paragraph 12GND(2)(a)

Omit "a business of the kind referred to in paragraph 12BF(4)(a)", substitute "covered by paragraph 12BF(4)(b)".

Part 5 -- Terms and contracts excluded from rules about unfair contract terms

Division 1--Amendment of the Competition and Consumer Act 2010

Competition and Consumer Act 2010

53  Subsection 26(1) of Schedule 2

Repeal the subsection, substitute:

             (1)  Section 23 does not apply to a term of a contract to the extent, but only to the extent, that:

                     (a)  the term defines the main subject matter of the contract; or

                     (b)  the term sets the upfront price payable under the contract; or

                     (c)  the term is required, or expressly permitted, by a law of the Commonwealth or of a State or Territory; or

                     (d)  the term is included in the contract, or is taken to be so included, by operation of a law of the Commonwealth, or of a State or Territory, that regulates the contract; or

                     (e)  inclusion of the term has either or both of the following results:

                              (i)  one or more other terms are included in the contract, or are taken to be so included, by operation of a law of the Commonwealth, or of a State or Territory, that regulates the contract;

                             (ii)  such a law requires one or more other terms to be included in the contract.

Example:    A State law provides that, if a retail lease contains a provision for termination on the ground of proposed demolition of the building containing the leased premises, then provisions set out in the State law are taken to be included in the lease.

                   Paragraph (d) covers the provisions that are set out in the State law and taken to be included in the lease. Paragraph (e) covers inclusion of the provision for termination, since it has the result that the provisions set out in the State law are taken to be included in the lease.

54  At the end of section 28 of Schedule 2

Add:

             (5)  This Part does not apply to a contract:

                     (a)  that establishes, contains or incorporates rules governing the operation of a payment or settlement system approved under section 9 of the Payment Systems and Netting Act 1998 ; or

                     (b)  that is made in the course of, or for the purposes of, operating such a system.

55  At the end of Part 2-3 of Schedule 2

Add:

28A   This Part does not apply to certain contracts connected with financial markets

             (1)  This Part does not apply to a contract:

                     (a)  that exists because of:

                              (i)  section 793B of the Corporations Act 2001 (legal effect of operating rules of a licensed market); or

                             (ii)  section 822B of that Act (legal effect of operating rules of a licensed CS facility); or

                     (b)  that is made under, or in accordance with:

                              (i)  the operating rules of a licensed market; or

                             (ii)  the operating rules of a licensed CS facility.

Note:          A licensed CS facility is a clearing and settlement facility whose operation is authorised by an Australian CS facility licence.

             (2)  This Part does not apply to a contract between:

                     (a)  the operator of a licensed market; and

                     (b)  any of the following:

                              (i)  an entity included in the market's official list;

                             (ii)  the responsible entity for a registered scheme that is so included;

                            (iii)  the operator of a foreign passport fund that is so included;

to the extent that the contract consists of, or includes, listing rules of the licensed market.

             (3)  An expression has in paragraph (1)(b) and subsection (2) the same meaning as in Chapter 7 of the Corporations Act 2001 .

Division 2--Amendment of the Australian Securities and Investments Commission Act 2001

Australian Securities and Investments Commission Act 2001

56  Subsection 12BI(1)

Repeal the subsection, substitute:

             (1)  Section 12BF does not apply to a term of a contract to the extent, but only to the extent, that:

                     (a)  the term defines the main subject matter of the contract; or

                     (b)  the term sets the upfront price payable under the contract; or

                     (c)  the term is required, or expressly permitted, by a law of the Commonwealth or of a State or Territory; or

                     (d)  the term is included in the contract, or is taken to be so included, by operation of a law of the Commonwealth, or of a State or Territory, that regulates the contract; or

                     (e)  inclusion of the term has either or both of the following results:

                              (i)  one or more other terms are included in the contract, or are taken to be so included, by operation of a law of the Commonwealth, or of a State or Territory, that regulates the contract;

                             (ii)  such a law requires one or more other terms to be included in the contract; or

                      (f)  if the contract is an Insurance Contracts Act insurance contract--the term is a transparent term and:

                              (i)  is disclosed at or before the time when the contract is made; and

                             (ii)  sets an amount of excess or deductible under the contract.

57  At the end of section 12BL

Add:

             (4)  This Subdivision does not apply to a contract:

                     (a)  that establishes, contains or incorporates rules governing the operation of a payment or settlement system approved under section 9 of the Payment Systems and Netting Act 1998 ; or

                     (b)  that is made in the course of, or for the purposes of, operating such a system.

58  After section 12BL

Insert:

12BLA   Replacement life insurance contracts to which this Subdivision does not apply

             (1)  This Subdivision does not apply, and is taken never to have applied, to a contract made on or after 5 April 2021 that constitutes a life policy within the meaning of the Life Insurance Act 1995 and:

                     (a)  replaces as mentioned in subsection (2) of this section:

                              (i)  a contract that constitutes a life policy within the meaning of that Act and was made before 5 April 2021; or

                             (ii)  a contract to which this Subdivision does not apply because of one or more previous applications of this section; or

                     (b)  links, as mentioned in subsection (3) of this section, 2 or more contracts, each of which is a contract of a kind referred to in subparagraph (a)(i) or (ii) of this subsection; or

                     (c)  is one of 2 or more contracts that unlink, as mentioned in subsection (4) of this section, a contract of a kind referred to in subparagraph (a)(i) or (ii) of this subsection.

Note:          5 April 2021 is the day on which Schedule 1 to the Financial Sector Reform (Hayne Royal Commission Response--Protecting Consumers (2019 Measures)) Act 2020 commenced.

             (2)  For the purposes of paragraph (1)(a), a contract (the replacement policy ) replaces another contract (the previous policy ) if:

                     (a)  the replacement policy reinstates the previous policy and is issued at the request of the owner of the previous policy after the previous policy lapses; or

                     (b)  the replacement policy is a reissue of the previous policy to correct an administrative error in the previous policy; or

                     (c)  the replacement policy is issued, at the request of the owner of the previous policy, for one or more of the following reasons:

                              (i)  to change the ownership of the policy;

                             (ii)  to extend or vary, in accordance with a term of the previous policy, the cover provided under the policy;

                            (iii)  to change the terms relating to premiums paid under the policy.

             (3)  For the purposes of paragraph (1)(b), a contract (the replacement policy ) links 2 or more contracts (the previous policies ) if the only differences between the terms and effect of the replacement policy and those of the previous policies taken together are attributable to linking the cover under the respective previous policies to form the cover under the replacement policy.

             (4)  For the purposes of paragraph (1)(c), 2 or more contracts (the replacement policies ) unlink a contract (the previous policy ) if the only differences between the terms and effect of the replacement policies taken together and those of the previous policy are attributable to unlinking elements of the cover under the previous policy to form the cover under the respective replacement policies.

12BLB   Renewed life insurance contracts to which this Subdivision does not apply

             (1)  If a contract covered by subsection (2) or (3) is renewed, or was renewed on or after 5 April 2021, this Subdivision does not apply, and is taken never to have applied, to the contract as renewed.

Note:          5 April 2021 is the day on which Schedule 1 to the Financial Sector Reform (Hayne Royal Commission Response--Protecting Consumers (2019 Measures)) Act 2020 commenced.

             (2)  This subsection covers a contract that:

                     (a)  constitutes a life policy within the meaning of the Life Insurance Act 1995 ; and

                     (b)  was made before 5 April 2021; and

                     (c)  either:

                              (i)  is guaranteed renewable; or

                             (ii)  the insurer guarantees not to cancel in response to a change in the risk.

             (3)  This subsection covers a contract to which this Subdivision does not apply because of one or more previous applications of this section.

12BLC   This Subdivision does not apply to certain contracts connected with financial markets

             (1)  This Subdivision does not apply to a contract:

                     (a)  that exists because of:

                              (i)  section 793B of the Corporations Act 2001 (legal effect of operating rules of a licensed market); or

                             (ii)  section 822B of that Act (legal effect of operating rules of a licensed CS facility); or

                     (b)  that is made under, or in accordance with:

                              (i)  the operating rules of a licensed market; or

                             (ii)  the operating rules of a licensed CS facility.

Note:          A licensed CS facility is a clearing and settlement facility whose operation is authorised by an Australian CS facility licence.

             (2)  This Subdivision does not apply to a contract between:

                     (a)  the operator of a licensed market; and

                     (b)  any of the following:

                              (i)  an entity included in the market's official list;

                             (ii)  the responsible entity for a registered scheme that is so included;

                            (iii)  the operator of a foreign passport fund that is so included;

to the extent that the contract consists of, or includes, listing rules of the licensed market.

             (3)  An expression has in paragraph (1)(b) and subsection (2) the same meaning as in Chapter 7 of the Corporations Act 2001 .

Part 6 -- Provisions referring to non-party consumers

Division 1--Amendment of the Competition and Consumer Act 2010

Competition and Consumer Act 2010

59  Subsection 2(1) of Schedule 2

Insert:

"non-party " means:

                     (a)  in relation to conduct--a person who is not, or has not been, a party to an enforcement proceeding in relation to the conduct; or

                     (b)  in relation to a term of a contract--a person who is not, or has not been, a party to an enforcement proceeding in relation to the term.

60  Subsection 2(1) of Schedule 2 (definition of non-party consumer )

Repeal the definition.

61  Division 4 of Part 5-2 of Schedule 2 (heading)

Omit " non-party consumers ", substitute " non-parties ".

62  Subdivision B of Division 4 of Part 5-2 of Schedule 2 (heading)

Omit " non-party consumers ", substitute " non-parties ".

63  Section 239 of Schedule 2 (heading)

Omit " non-party consumers ", substitute " non-parties ".

64  Section 239 of Schedule 2

Omit "non-party consumers" (wherever occurring), substitute "non-parties".

65  Section 240 of Schedule 2 (heading)

Omit " non-party consumers ", substitute " non-parties ".

66  Section 240 of Schedule 2

Omit "non-party consumers" (wherever occurring), substitute "non-parties".

67  Section 241 of Schedule 2 (heading)

Omit " consumer ".

68  Section 241 of Schedule 2

Omit "consumer" (wherever occurring).

Division 2--Amendment of the Australian Securities and Investments Commission Act 2001

Australian Securities and Investments Commission Act 2001

69  Subsection 12BA(1) (definition of non-party consumer )

Repeal the definition, substitute:

"non-party " means:

                     (a)  in relation to conduct--a person who is not, or has not been, a party to an enforcement proceeding in relation to the conduct; or

                     (b)  in relation to a term of a contract--a person who is not, or has not been, a party to an enforcement proceeding in relation to the term.

70  Section 12GNB (heading)

Omit " non-party consumers ", substitute " non-parties ".

71  Section 12GNB

Omit "non-party consumers" (wherever occurring), substitute "non-parties".

72  Subsection 12GNB(9) (heading)

Omit " consumer ".

73  Subsection 12GNB(9)

Omit "consumer" (wherever occurring).

74  Section 12GNC (heading)

Omit " non-party consumers ", substitute " non-parties ".

75  Section 12GNC

Omit "consumer" (wherever occurring).

Part 7 -- Application

Division 1--Application of amendments of the Competition and Consumer Act 2010

76  Application

The amendments of sections 137D and 137F of the Competition and Consumer Act 2010 made by Schedule 2 to this Act apply in relation to a contract to the same extent as the amendments of Schedule 2 to that Act made by Schedule 2 to this Act apply in relation to the contract.

Note:       For application provisions for the amendments of Schedule 2 to that Act made by Schedule 2 to this Act, see section 305 of Schedule 2 to that Act.

Division 2--Application of amendments of the Australian Consumer Law

Competition and Consumer Act 2010

77  Subsection 303(2) of Schedule 2

Omit "a services", substitute "services".

78  At the end of Part 7 of Chapter 6 of Schedule 2

Add:

305   Application of amendments relating to unfair contract terms

             (1)  This section applies to the amendments of this Schedule made by Schedule 2 (the amending Schedule ) to the Treasury Laws Amendment (More Competition, Better Prices) Act 2022 .

             (2)  The amendments:

                     (a)  apply in relation to a contract made at or after the commencement (the relevant commencement ) of the amending Schedule; and

                     (b)  do not apply to a contract (an existing contract ) made before the relevant commencement, except as provided in this section.

             (3)  If an existing contract is renewed at or after the relevant commencement, the amendments apply to the contract as renewed, on and from the day (the renewal day ) on which the renewal takes effect, in relation to conduct that occurs on or after the renewal day.

             (4)  If an existing contract is varied at or after the relevant commencement by varying or adding a term and subsection (3) has not already applied in relation to the contract:

                     (a)  the amendments apply to the term as varied or added, and so apply:

                              (i)  on and from the day (the variation day ) on which the variation of the contract takes effect; and

                             (ii)  as if the contract as varied had been made on the variation day; and

                            (iii)  in relation to conduct that occurs on and after the variation day; and

                     (b)  section 23(2A)(e) applies in relation to a person proposing the varied or added term, whether before, at or after the relevant commencement; and

                     (c)  subsection 23(2), and section 27, as in force at and after the relevant commencement, apply to the contract.

             (5)  If a contract is made or renewed at or after the relevant commencement, section 23(2A)(e) applies in relation to a person proposing a term of the contract, whether before, at or after the relevant commencement.

             (6)  Despite subsections (3) to (5) of this section, the amendments do not apply to a contract, or a term of a contract, to the extent that the operation of the amendments would result in an acquisition of property (within the meaning of paragraph 51(xxxi) of the Constitution) from a person otherwise than on just terms (within the meaning of that paragraph of the Constitution).

Division 3--Application of amendments of the Australian Securities and Investments Commission Act 2001

Australian Securities and Investments Commission Act 2001

79  In the appropriate position

Insert:

Part 39 -- Application provisions relating to the Treasury Laws Amendment (More Competition, Better Prices) Act 2022

   

342   Amendments relating to unfair contract terms

             (1)  This section applies to the amendments of this Act made by Schedule 2 (the amending Schedule ) to the Treasury Laws Amendment (More Competition, Better Prices) Act 2022 , except item 58 of that Schedule.

             (2)  The amendments:

                     (a)  apply in relation to a contract made at or after the commencement (the relevant commencement ) of the amending Schedule; and

                     (b)  do not apply to a contract (an existing contract ) made before the relevant commencement, except as provided in this section.

             (3)  If an existing contract is renewed at or after the relevant commencement, the amendments apply to the contract as renewed, on and from the day (the renewal day ) on which the renewal takes effect, in relation to conduct that occurs on or after the renewal day.

             (4)  If an existing contract is varied at or after the relevant commencement by varying or adding a term and subsection (3) has not already applied in relation to the contract:

                     (a)  the amendments apply to the term as varied or added, and so apply:

                              (i)  on and from the day (the variation day ) on which the variation of the contract takes effect; and

                             (ii)  as if the contract as varied had been made on the variation day; and

                            (iii)  in relation to conduct that occurs on and after the variation day; and

                     (b)  paragraph 12BF(2A)(f) applies in relation to a person proposing the varied or added term, whether before, at or after the relevant commencement; and

                     (c)  subsection 12BF(2), and section 12BK, as in force at and after the relevant commencement, apply to the contract.

             (5)  If a contract is made or renewed at or after the relevant commencement, paragraph 12BF(2A)(f) applies in relation to a person proposing a term of the contract, whether before, at or after the relevant commencement.

             (6)  Despite subsections (3) to (5) of this section, the amendments do not apply to a contract, or a term of a contract, to the extent that the operation of the amendments would result in an acquisition of property (within the meaning of paragraph 51(xxxi) of the Constitution) from a person otherwise than on just terms (within the meaning of that paragraph of the Constitution).

343   Application of sections 12BLA and 12BLB

             (1)  Sections 12BLA and 12BLB have effect despite section 325 as inserted by Schedule 1 to the Financial Sector Reform (Hayne Royal Commission Response--Protecting Consumers (2019 Measures)) Act 2020 .

             (2)  However, neither of sections 12BLA and 12BLB applies to the extent that its operation would result in an acquisition of property (within the meaning of paragraph 51(xxxi) of the Constitution) from a person otherwise than on just terms (within the meaning of that paragraph of the Constitution).

Part 8 -- Review of operation of provisions amended by this Schedule

80  Review of operation of amended provisions

(1)       The Commonwealth Minister must cause a review to be undertaken, in accordance with this section, of the operation of:

                     (a)  the provisions of Schedule 2 to the Competition and Consumer Act 2010 that are amended by this Schedule, as those provisions are applied under Subdivision A of Division 2 of Part IX of that Act; and

                     (b)  the provisions of the Competition and Consumer Act 2010 (other than Schedule 2) that are amended by this Schedule; and

                     (c)  the provisions of the Australian Securities and Investments Commission Act 2001 that are amended by this Schedule.

(2)       The review must relate to the operation of those provisions, as so amended, during the 2 years from the commencement of this Schedule.

(3)       The review must be completed, and a report on the review must be given to the Minister, within 6 months after the end of those 2 years.

(4)       The Minister must cause a copy of the report to be tabled in each House of the Parliament within 15 sitting days of that House after the Minister receives the report.

 

 

 



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