What to do now
Official national explainer: ACCC, Contracts (unfair contract terms). Soft cite: Competition and Consumer Act 2010 (Cth) Schedule 2 (Australian Consumer Law) on the Federal Register of Legislation. NSW plain-English page: Unfair contract terms (NSW.gov).
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Check coverage today. Is this a standard form contract (pre-written, little real chance to negotiate)? Are you a consumer, or a small business under the post-9 November 2023 thresholds (fewer than 100 employees, or less than $10 million annual turnover)? The ban on proposing, using, or relying on unfair terms covers contracts made or renewed on or after that date, and terms varied or added on or after that date.
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Write to the business. Identify the clause, say why it looks unfair under the three-part test below, and ask them to remove or change it and confirm they will not rely on it. Keep a dated copy.
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If they refuse, contact your state or territory consumer agency for help on options (examples below). The ACCC explains the law and can take broader enforcement action, but it does not investigate individual complaints or give legal advice.
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Court or tribunal can declare a term unfair and void. Soft-cite filing fees via the official court or tribunal fee finder for your state. Do not guess dollar amounts.
This is legal information about Australian Consumer Law unfair contract terms, not personal legal advice.
Who is covered
Consumers in standard form contracts for goods, services, or an interest in land for personal, domestic, or household use.
Small businesses in standard form contracts for goods, services, or land. From 9 November 2023, for new or varied standard form contracts, ACCC guidance treats a business as covered if it has fewer than 100 employees, or makes less than $10 million in annual turnover. Earlier contracts (before those reforms) used tighter employee and upfront-price thresholds until renewed or varied. Soft cite: ACCC Contracts page.
Financial products and services (loans, insurance sold as a financial product, advice, and similar) sit with ASIC under a parallel unfair terms regime, not the ACCC ACL page alone. Soft cite: ASIC unfair contract terms reforms. For unresolved disputes with a financial firm, check whether AFCA can take the complaint.
What is a standard form contract
Usually pre-written, take-it-or-leave-it terms used for many customers. A court looks at bargaining power, who prepared the terms, whether you could only accept or reject them, whether you had a real chance to negotiate, and whether the terms were tailored to you (ACCC / NSW.gov).
There is a presumption it is standard form; the party that prepared it must prove otherwise. From 9 November 2023, how often the business used the same or very similar contracts also counts. Minor tweaks, picking from the business's menu of options, or someone else negotiating a different deal does not automatically stop it being standard form.
When is a term unfair
All three must be met (ACCC / NSW.gov framing):
- it causes a significant imbalance in rights and obligations under the contract
- it is not reasonably necessary to protect the legitimate interests of the party who would gain from it
- it would cause detriment (financial or otherwise) if applied or relied on
The court looks at the contract as a whole and whether the term is transparent (plain language, clear, not hidden). Other terms can offset unfairness.
Examples the law flags as ones that may be unfair (context still matters): only one side can avoid or limit responsibilities, end the contract, penalise the other for breach or early exit, or change the terms (including unilateral price rises with no clean exit).
ACCC broadband example: a three-year plan that lets the provider raise price mid-term with no penalty-free exit is likely unfair. The same price-change clause is less likely unfair if another clause lets you leave without penalty when the price rises.
What the law does not cover
Unfair contract terms rules do not apply to (ACCC / NSW.gov):
- terms required or expressly permitted by another law
- terms that set the upfront price payable
- terms that define the main subject matter of the contract
- company constitutions
- commercial contracts for shipping goods by sea
Only a court makes the final call that a term is unfair. If it is, that term is void (treated as if it never applied). The rest of the contract continues if it can work without that term.
Where to complain or escalate
- The business (ask them to drop or rewrite the term).
- Your state or territory consumer agency, for example NSW.gov unfair contract terms, Consumer Affairs Victoria, or Queensland Fair Trading.
- Court or tribunal for a declaration that the term is unfair and void. Soft-cite fees on that forum's official fee schedule.
- ACCC guidance (not individual case decisions): Contracts.
Related ACL paths: Cancel a door-to-door or cold-call sale and Faulty goods: major vs minor problems and refunds.