According to a new report by the Australian Competition and Consumer Commission (ACCC) small businesses are falling prey to “unfair contract terms, misleading conduct and scams”.
The ACCC’s most recent edition of its Small Business in Focus report has revealed that these are among some of the weightiest issues affecting small businesses in the country, with the most commonly reported problem being “misleading or deceptive conduct, closely followed by enquiries about customer guarantees.”
Unfair contract terms are also a pressing problem, with the ACCC revealing that in the past six months alone it has “taken action” against several businesses regarding “potentially unfair contract terms.”
“We have many more investigations under way and further actions on unfair business-to-business contracts will take place soon,” ACCC Deputy Chair Mick Keogh said.
Scams also pose a widespread problem for businesses, with thousands of reporting losses of more than AUS$2.3 million ($1.6 million/€1.4 million) so far this year.
“Small businesses continue to lose money to sophisticated scams. Businesses need to be very careful about business email scams. These are where scammers pretend to be a supplier of a small business, or even someone within the business like the CEO or CFO, and intercept payments by emailing new payment details,” Mr Keogh said.
The ACCC goes on to explain that it is responsible for enforcing industry codes, which are vital for providing “important protections” for small businesses.
“At the beginning of the year, we named our priority focus areas to ensure small businesses have a level playing field to compete. We are honing in on unfair terms in business-to-business contracts and making sure industry codes are working in the way they are intended to offer small businesses protection where it is needed,” Mr Keogh said.
“There has deservedly been a spotlight on issues impacting the franchising industry. We have been involved in the Parliamentary Joint Committee inquiry into both the Franchising Code and Oil Code. We submitted 10 recommendations such as increased penalty provisions and more meaningful disclosure relating to franchisees’ costs which we think will improve the outcome for franchisees.”
“We are committed to ensuring that Australia’s 2.2 million small businesses have a fair go. We have a range of regulatory powers available to us, and will continue to leverage these get the best outcomes for small business, franchises and agriculture companies,” Mr Keogh said.
