Consumer Protection / Misleading Conduct

Time to split up the Trade Practices Act

The Trade Practices Act (TPA) – soon to be re-named the Competition and Consumer Act 2010 – is too big and too complicated.

The Government has introduced phase II of their two-phase plan to implement a new Australian Consumer Law which will bulk up the Act even further (the first Bill, which has passed through both Houses, ran to 84 pages – this was bad enough, but the current Bill runs to more than 388 pages (although admittedly part of this involves repealing most of the content of the first bill and replacing it with the same content in a slightly different spot – it’s all very logical)).  This adds to the additional 90 pages of statutory text generated by the recent passage of the criminal cartel act.

It cannot go on … the annotated acts are bursting at their seems. So what can be done to stem the flow of dense legislative supplements to what was once a neat little Act (the original 1974 Act comprised a little over 38,000 words of text; the current consolidation contains more than 305,000 words)? The answer is probably nothing. It is unlikely there will be any substantive legislative repeals or genuine attempts at simplification, although this would be desirable, and the problem is likely to get worse with current inquiries into creeping acquisitions and the meaning of ‘understanding’ in part IV of the Act likely to generate more legislative content in the near future. Another answer is needed.

The new Bill will change the name of the TPA to the ‘Competition and Consumer Act 2010’ to  ‘better reflect its purposes of promoting competition and empowering consumers’. Although, as a bit of a traditionalist, it hurts me to part with the term ‘Trade Practices Act’, of which I am now very fond (parting with s 52 of the TPA which will now become s 18 of Schedule 2 of the CCA hurts me more), the proposed name change might present an opportunity. While in the process of changing the Act’s name why not split it up? Let’s divide it into a consumer act (‘Consumer Act 2010’ perhaps) and a competition act (‘Competition Act 2010’?). These are two separate fields of law and policy (even if there may be some overlapping objectives) – they need not be married together in this legislative jungle.  The change would be  consistent with the approach adopted in many other jurisdictions.

While we’re in the process of splitting up the Act let’s also re-number it. A multitude of additions and alterations over the years has led to an absurd numbering system. The last part of the Act is Part XIII. You might deduce from this that the Act has 13 parts. You would be wrong; it in fact has 28 parts and a schedule (this will change with the passage of the new Act which repeals Parts IVA, V, VA and VC, making the Act even less comprehensible). Parts include IIIAA, XIAA, XIB etc. All very logical! The section numbering is even better. The new cartel laws begin with section 44ZZRA and end with section 44ZZRV. Why? Because the government wanted to slip them in between sections 44ZZR and 45 (Again, very logical and easy to follow for business trying to adhere to the law – and this is not the worst of it. This bizarre numbering is scattered throughout. We have s 51ACAA (I kid you not, although this will soon be repealed), s 44AAGA, s 75AZQ, s 87CAA, s 95AZEA (seriously!), s 10.01 (yes, in Part X the numbering system completely changes – we go from s 119 to s 10.01 – 10.91 then we jump to s 150A at the start of Part XIA – there are no sections 120-150 in the Act) and my personal favorite, s 151BUAAA. The introduction of the new consumer legislation will move all the consumer protection legislation from Parts IVA, V, VA and VC into a new Schedule 2 of the Act.  So our beloved s 52 (dealing with misleading and deceptive conduct) will now be cited as s 18 of Schedule 2 (you can’t just call it section 18 because there is another s 18 in the main body of the Act).  It is simply absurd. So, with the re-naming of the Act we can also begin a re-numbering system. Nobody really loves s 151BUAAA or will be sorry to see it go. Lets put what we want in the Act (or Acts), then start the re-numbering the parts and sections from scratch. No doubt future amendments will mess this up a little, but the Act cannot continue on it’s current numbering trajectory. There are, of course, more serious issues than poor structure and numbering of the Act. It is highly complex and, as a result, inaccessible for many of those parties to whom it is directed (consumers and business). But a simplified structure (one that clearly separates consumer and competition legislation and policy) and a logical numbering system would, at the very least, be a good start.

This is an updated version of a blog I posted last year.

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5 thoughts on “Time to split up the Trade Practices Act

  1. Yes, there has always been a lot of controversy over the scope of the Trade Practices Act. It is so broad that in some circumstances it has been seen to overtake the scope of the doctrine of misrepresentation in contract law. Is has under some interpretations outgrown the scope of the Contracts Review Act in New South Wales as well. For this reason, a lot of litigation has resulted from the uncertainty created.

  2. Sydney Lawyer, in nearly all cases it has replaced misrepresentation at common law – but I think that’s a good thing. I don’t think s 52 (soon to be s 18, sch 2) is generating too much uncertainty (some, but nothing terribly troubling – and certainly no more uncertainty that exists in relation to common law misrepresentation). Nor do the cases in which it overlaps with the Contracts Review Act. The consumer provisions have been much less uncertain than the competition provisions, but my main gripe now is finding anything in the legislation rather than the provisions themselves (although some uncertainty is likely to be generated by the proposed changes) – throwing everything in a schedule just seems very odd to me – better to create a new act for the Australian Consumer Law than some warped modification of existing legislation (which they’re going to rename anyway!)

  3. Is has under some interpretations outgrown the scope of the Contracts Review Act in New South Wales as well. For this reason, a lot of litigation has resulted from the uncertainty created.

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