Australia's Competition & Consumer Amendment (unfair Trading Practices) Bill 2026, What Businesses and Directors Need to Do Now

Last updated: 24 June 2026

The Unfair Trading Practices Bill Australia, formally the Competition and Consumer Amendment (Unfair Trading Practices) Bill 2026, was introduced into Parliament on 5 May 2026 and represents the most significant expansion of the Australian Consumer Law (ACL) in over a decade. Drawing on an earlier Treasury exposure draft that proposed a commencement date of 1 July 2027 if passed, the Bill inserts a broad, principles-based prohibition on unfair trading practices into the Competition and Consumer Act 2010 (CCA). For in-house counsel, compliance officers and company directors, the window between now and commencement is the critical period for gap analysis, policy overhaul and board-level governance action.

This guide delivers the practical compliance playbook that most law-firm alerts leave out, covering the legal test, ACCC enforcement powers, director liability exposure, a 90-day remediation roadmap and an investigation-response playbook.

Executive Summary, What Directors and Senior Management Must Know Now

The Bill creates a general prohibition against unfair trading practices in trade or commerce, enforceable by the ACCC through civil pecuniary penalties, injunctions and compensation orders. It sits alongside, and does not replace, the existing prohibitions on misleading or deceptive conduct (s 18 ACL) and unconscionable conduct (ss 20–22 ACL). According to the Parliamentary Bills Digest published on 5 May 2026, the centrepiece is a two-limbed test that asks whether conduct is contrary to professional diligence and materially distorts, or is likely to materially distort, the economic behaviour of consumers.

Top 5 immediate actions for boards:

1. Commission a gap analysis, map every consumer-facing practice against the new two-limbed test and identify high-risk areas (lead generation, subscription traps, dark patterns, aggressive debt-collection).
2. Update the compliance program, revise or create an ACL-specific business compliance program that addresses the unfair trading practices prohibition and document the board’s approval of the update.
3. Brief the board, schedule a board agenda item and record detailed minutes showing that directors have been informed of the Bill’s scope, potential penalties and the company’s response plan.
4. Review contracts and T&Cs, insert supplier warranties, marketing-approval clauses and consumer-facing disclosures that align with the new prohibition.
5. Appoint a response team, designate a cross-functional team (legal, compliance, commercial, communications) with authority to manage an ACCC inquiry from day one.

What the Unfair Trading Practices Bill Australia Changes, Legal Summary

The Australian consumer law amendments introduced by this Bill are designed to close a recognised gap: conduct that falls short of the high threshold for unconscionability under the existing ACL, yet still causes widespread consumer harm. The Law Council of Australia’s submission on the exposure draft acknowledged the gap while urging precision in drafting to avoid over-capture of legitimate commercial practices. The Bill addresses this by inserting a new Part 2-4 into the ACL.

The New Prohibition, The Legal Test

The prohibition is principles-based and constructed around two cumulative limbs. First, the conduct must be contrary to the requirements of professional diligence, meaning it falls below the standard of skill and care that a trader could reasonably be expected to exercise toward consumers, consistent with honest market practice and good faith. Second, the conduct must materially distort, or be likely to materially distort, the economic behaviour of consumers, including causing a consumer to make a transactional decision they would not otherwise have made. Both limbs must be satisfied for a contravention to be established. This mirrors the unfair commercial practices framework used in the European Union and the United Kingdom but is adapted to the Australian statutory context.

Specific Conduct Captured

While the prohibition is general, the Treasury exposure draft and explanatory materials identify several categories of conduct as squarely within its scope:

• Lead generation and comparison services that present themselves as independent but steer consumers toward paying partners without adequate disclosure.
• Dark patterns and subscription traps, user-interface designs that exploit cognitive biases to make cancellation difficult or to nudge consumers toward unintended purchases.
• Aggressive or coercive selling tactics that do not meet the current threshold for unconscionability but still impair free and informed decision-making.
• Drip pricing, presenting a headline price and then incrementally adding unavoidable fees during the purchasing process.

Scope, Coverage and Commencement, Who Is Caught and When

The Bill applies to conduct in trade or commerce, the same jurisdictional gateway used by the existing ACL. This means that any business supplying goods or services to consumers in Australia, including online and cross-border suppliers, falls within scope. There is no turnover threshold or small-business exemption. Sectors that industry observers expect the ACCC to prioritise include e-commerce platforms, fintech and buy-now-pay-later providers, energy retailing, telecommunications, lead-generation affiliates and businesses operating in the regulated financial services sector where conduct may not be caught by ASIC’s parallel powers.

Businesses operating through crypto and digital-asset platforms in Australia should pay particular attention, as the Treasury exposure draft identifies digital markets as a priority enforcement area.

Commencement Timeline and Practical Milestones

The practical effect is that businesses have approximately twelve months from today to achieve full compliance, assuming the Bill passes without material amendment. Early indications suggest bipartisan support for the core prohibition, meaning the commencement date is unlikely to be delayed significantly.

Enforcement and Penalties, What the ACCC Can Do Under the Unfair Trading Practices Bill Australia

The Bill extends the ACCC’s existing ACL enforcement toolkit to cover the new prohibition. This means ACCC unfair trading enforcement will draw on the same suite of remedies that the regulator already uses in misleading-conduct and unconscionability cases, but applied to a broader category of conduct.

ACCC New Tools and Expected Enforcement Focus

The ACCC will be empowered to seek:

• Civil pecuniary penalties, calculated using the same formula as existing ACL contraventions, which for corporations means the greater of $50 million, three times the benefit obtained from the contravention, or 30% of adjusted turnover during the contravention period.
• Injunctions, restraining orders preventing a business from continuing or repeating the offending conduct.
• Compensation and redress orders, directing a business to compensate affected consumers.
• Adverse publicity orders, requiring the business to publish corrective statements.
• Compliance program orders, court-imposed programs that a business must implement and report on.

Industry observers expect the ACCC to use the new prohibition strategically, targeting high-profile sectors first to establish judicial precedent and send a market-wide compliance signal. The Financial Counselling Australia submission urged the ACCC to prioritise vulnerable-consumer industries, including payday lending, energy retailing and aged-care services.

Penalties for Unfair Trading, At a Glance

Importantly, a robust, pre-existing compliance program is treated by the courts as a mitigating factor when determining penalty amounts. This gives businesses a tangible financial incentive to act now rather than wait for enforcement action.

Director Duties and Corporate Governance Implications Under Consumer Law

The intersection of the new unfair trading prohibition with existing director duties under the Corporations Act 2001 creates a distinct governance risk. Directors have a duty under s 180 to exercise their powers with the degree of care and diligence that a reasonable person in their position would exercise. Where a board is aware, or should reasonably be aware, that the company’s trading practices may contravene the new prohibition, a failure to take adequate steps could expose directors personally.

When Directors Could Be Personally Exposed

Director duties under consumer law require particular attention in the following circumstances:

• Accessorial liability, a director who has been “knowingly concerned” in a contravention may be personally liable under s 236 of the ACL.
• Failure to supervise, where a contravention results from a systemic compliance failure and the board has not taken reasonable steps to implement adequate oversight systems.
• Ignoring red flags, where consumer complaints, internal audit findings or regulatory correspondence put the board on notice of potential non-compliance and no corrective action is documented.

Businesses undergoing structural changes such as insolvency or restructuring face heightened exposure, because governance scrutiny intensifies during those periods.

Board Reporting and Evidence Obligations

Sample board minute language: “The Board received and considered a briefing from [General Counsel] on the Competition and Consumer Amendment (Unfair Trading Practices) Bill 2026. The Board noted the proposed new prohibition and the company’s exposure to the two-limbed test. The Board approved [the compliance remediation plan / updated compliance program] and directed management to report on implementation progress at the next Board meeting.”

Practical Compliance Program Changes, A 90-Day Roadmap to Comply With the ACL

Knowing how to comply with the ACL after the Bill commences requires a structured, time-bound program. The following 90-day roadmap is designed for compliance teams managing business compliance under the ACL and can be adapted to businesses of any size.

Days 1–30: Gap Analysis and Risk Assessment

• Map every consumer-facing practice, sales, marketing, pricing, onboarding, cancellation, complaints, against the two-limbed test.
• Identify high-risk practices: lead generation, comparison tools, drip pricing, auto-renewal subscriptions, aggressive upselling.
• Review existing compliance program documentation and assess whether it addresses the new prohibition.
• Obtain legal advice on specific practices that are borderline under the new test.
• Brief the board and obtain approval for the remediation plan (using the sample minute language above).

Days 31–60: Policy Updates, Contract Revisions and Training

• Update internal policies: consumer-facing conduct policy, marketing approvals policy, complaints-handling policy.
• Revise contracts with suppliers, affiliates and marketing partners to include unfair-trading warranties and audit rights.
• Update consumer-facing terms and conditions and website disclosures to remove or remediate practices identified in the gap analysis.
• Develop and deliver training modules for front-line staff, marketing teams and senior management.

Days 61–90: Monitoring, Testing and Board Sign-Off

• Implement a monitoring dashboard: complaint volumes, refund rates, subscription cancellation friction metrics, marketing-approval audit logs.
• Conduct a compliance test, mystery shopping, user-journey audits, and sample reviews of lead-generation partner outputs.
• Report results to the board and obtain formal sign-off on the completed compliance program.
• Schedule the next review date (recommended: within six months, or immediately upon any ACCC guidance publication).

Template Language and Contract Clauses

Three sample clauses that compliance teams should consider integrating into relevant agreements:

• Supplier warranty clause: “The Supplier warrants that all goods and services supplied under this Agreement, and all marketing and promotional activities undertaken in connection with them, comply with the Australian Consumer Law, including the prohibition on unfair trading practices inserted by Part 2-4 of the ACL.”
• Marketing and lead-generation oversight clause: “The Partner must not engage in any conduct that would constitute an unfair trading practice within the meaning of Part 2-4 of the ACL. The Company reserves the right to audit the Partner’s consumer-facing practices and to terminate this Agreement immediately if a breach is identified.”
• Consumer-facing terms disclosure: “We are committed to fair trading. If you believe any aspect of our service does not meet this standard, please contact us at [complaints address]. We will investigate and respond within [X] business days.”

Businesses navigating regulatory change across multiple frameworks, including trust tax changes in Australia, should consider integrating ACL compliance reviews into broader governance calendars to avoid duplication of effort.

ACCC Investigation Playbook, How to Respond to Inquiries and Litigation

Even businesses with robust compliance programs may receive ACCC inquiries. The following playbook outlines the recommended response protocol for unfair trading practices Australia investigations.

Step 1: Preserve documents immediately. Issue a litigation-hold notice to all relevant business units. Ensure that electronic records, communications, marketing materials, customer complaints and internal audit reports are preserved.

Step 2: Assert legal professional privilege. Ensure that all internal communications about the inquiry are marked as privileged and routed through legal counsel. Do not disclose privileged material to the ACCC without specific legal advice.

Step 3: Appoint a response team. The team should include General Counsel, the Compliance Officer, a senior commercial representative and an external communications adviser. Designate a single point of contact for all ACCC correspondence.

Step 4: Assess exposure and remediation options. Determine whether the conduct in question is ongoing or historic. If ongoing, cease the conduct immediately and document the remediation. The ACCC treats voluntary, prompt remediation as a significant mitigating factor.

Step 5: Engage with the ACCC constructively. Where appropriate, enter into co-operative discussions with the ACCC about enforceable undertakings or consent orders. Courts have consistently recognised co-operation as a penalty-reduction factor.

Practical Scenarios

• Scenario 1, Lead-generation complaint: The ACCC receives consumer complaints that a comparison website is directing consumers to a single provider without disclosing the commercial relationship. Recommended action: Immediately audit all affiliate arrangements, update disclosures, notify the board, and prepare a remediation timeline to present to the ACCC.
• Scenario 2, Subscription cancellation friction: Internal data shows that the online cancellation process requires seven steps and results in a significantly lower cancellation rate than the telephone process. Recommended action: Simplify the online cancellation flow to match the telephone process, document the change as a compliance improvement, and brief the board.
• Scenario 3, Aggressive upselling by third-party agents: Mystery-shopping results reveal that third-party sales agents are using high-pressure tactics at point of sale. Recommended action: Invoke the contractual audit clause, retrain or terminate the agents concerned, and report the findings and corrective steps to the board with timestamped documentation.

Where an ACCC investigation escalates to litigation, businesses may also need to understand the broader framework for challenging government action in Australian courts, including judicial review principles and procedural requirements.

Conclusion and Next Steps for the Unfair Trading Practices Bill Australia

The Competition and Consumer Amendment (Unfair Trading Practices) Bill 2026 is not a distant prospect, it is live legislation moving through Parliament with broad support. Businesses that begin compliance work now will benefit from reduced penalty exposure, stronger governance records and the operational advantage of having systems in place before enforcement begins. The principles-based nature of the new prohibition means that every consumer-facing practice must be assessed against the two-limbed test of professional diligence and material distortion.

Boards should ensure that their next meeting agenda includes a formal briefing on the Bill, approval of a remediation plan, and documented minutes of the discussion. Compliance teams should initiate the 90-day roadmap outlined above without delay. For businesses seeking tailored advice, the Global Law Experts lawyer directory connects you with competition and consumer law specialists across Australia who can guide your organisation through every stage of preparation.

Sources

1. Parliament of Australia, Competition and Consumer Amendment (Unfair Trading Practices) Bill 2026
2. Parliament of Australia, Bills Digest (5 May 2026)
3. Treasury, Exposure Draft Consultation Page
4. ACCC, Australian Consumer Law Enforcement Resources
5. Law Council of Australia, Submission on Unfair Trading Practices Exposure Draft
6. Gilbert + Tobin, Australia Cracks Down on Unfair Trading Practices
7. Norton Rose Fulbright, Exposure Draft Bill Released to Enhance Protections Against Unfair Trading Practices
8. Financial Counselling Australia, Protecting Consumers from Unfair Trading Practices