Recent policy submissions
Federal parliamentary inquiry into the operation and effectiveness of the Franchising Code of Conduct
On 22 March 2018, the Senate referred an inquiry into the operation and effectiveness of the Franchising Code of Conduct (‘the Code’) to the Parliamentary Joint Committee on Corporations and Financial Services for completion by 14 March 2019.
Throughout 2018, we provided written and oral submissions based on our wealth of experience in advising franchising participants, offering dispute resolution and contributing to various State and national reviews and inquiries into the Code and sector.
The submissions reiterated our view that, as franchising often involves national brands operating across jurisdictions, the sector should remain wholly regulated at federal level.
We believe an enhanced national regulatory framework, based on easy access to education and advice, comprehensive and up-to-date disclosure, inexpensive and swift dispute resolution, and strong, effective enforcement by the regulator (the Australian Competition and Consumer Commission), would address ongoing concerns in the sector and restore faith in the franchising business model as a generally successful form of enterprise in Australia.
Review of unfair contract term protections for small business
In late 2018, we provided written and oral feedback to the Federal Treasury regarding its review of the unfair contract term protections for small business contained within the Australian Consumer Law (ACL).
We outlined the following points:
- Small businesses are likely to be just as vulnerable as individual consumers in terms of knowledge and access to money and resources in pursuing their legal rights.
- While the unfair contract term protections should be available to as many small businesses as possible, the current definition of small business and the monetary thresholds contained in the ACL limits its applicability.
- Current consequences for including an unfair term in a small business standard form contract do not act as a strong deterrent or disincentive, therefore there is a need to attach civil financial penalties to limit their use and change the behaviour of larger businesses.
Modernising business registers program
During August 2018 we provided a submission to the Federal Government’s proposal to modernise the Australian Business Register and the Australian Securities and Investments Commission (ASIC) business register onto a whole-of-government platform.
We strongly supported a proposal to reduce the number of business registers and improve the user experience. We have been critical of the proliferation of business registration systems; there are now more than 30 legislated business registers operating nationally.
In December 2018, we also submitted comments to the Federal Government’s consultation paper Review of Registry Fees, examining the structure and size of fees to be charged under the modernised business registry system.
We support the proposal to review business registry fees in line with the principles of making them simpler, easier to understand, equitable to registrants and those accessing information, and that they should be structured so that they don’t disproportionately impact small businesses.
Telecommunications industry consumer safeguards review
The Federal Government is reviewing Australia’s telecommunications consumer safeguards to prepare the framework for a post-2020 environment (the anticipated date of NBN completion). Public consultation for Parts A and B has finished, we provided submissions to both. Consultation on Part C is expected in the first half of 2019.
Part A – Consumer compensation and complaints handling
We argued that small businesses can be particularly vulnerable to business complaints and legal disputes, and that having access to rapid, independent means to resolve disputes is critical. As such, dispute resolution bodies like the Telecommunications Industry Ombudsman (TIO) are critical to ensure small businesses in dispute (in this case with telecommunications providers) can seek redress swiftly and at low-cost (or in the TIO’s case, free).
Our submission offered strong support for the ongoing role of the TIO and the belief that, given the significant disruption within the industry through new technologies and rollout of the NBN, this isn’t the time to disrupt the existing and successful complaint resolution service provided by the Ombudsman.
Part B – Reliability of services
Our submission supported the main thrust of the proposed changes to ensure reliability of services and the introduction of safeguards to better protect small businesses.
However, we did express concern that these proposals wouldn’t be implemented until the completion of the NBN rollout in 2020. As the reliability of services is a significant current and ongoing issue facing small businesses, we urged the reviewers to consider whether implementing the safeguards before completion of the NBN rollout may be appropriate to address persistent problems faced by consumers and businesses.