Reforms to the unfair contract terms regime passed: what businesses should do now

On 27 October 2022, the proposed reforms to the unfair contract terms regime were passed by both Houses of Parliament. The reforms set out in Schedule 2 to the Treasury Laws Amendment (More Competition, Better Prices) Bill 2022 (Cth) (TLA Bill 2022) strengthen protections for consumers and small businesses relating to unfair contract terms in standard form contracts, in particular by prohibiting the use of unfair contract terms and introducing significant civil pecuniary penalties. This update provides an overview of the key changes and practical tips for what businesses can do now to ensure compliance with the reforms.