ASIC administers and enforces a range of legislation.
We administer the following legislation:
We also administer parts of the following legislation:
A digital copy of each Act can be obtained from the Federal Register of Legislation.
Since 1 July 2010, ASIC has administered the law dealing with unfair terms in standard form consumer contracts for financial products and services. The unfair contract terms law was extended to cover standard form small business contracts from 12 November 2016 and insurance contracts for consumers and small businesses from 5 April 2021.
The law gives courts a power to find that a term is 'unfair'. If a term is found to be unfair, it will be void – which means it is not binding. The rest of the contract will continue to bind the parties if it is capable of operating without the unfair term.
The unfair contract terms law helps ASIC perform our role in promoting investor and financial consumer trust and confidence, and ensuring fair, orderly and transparent markets.
The unfair contract term protections for consumers were introduced as part of the broader national Australian Consumer Law, which was fully implemented from 1 January 2011. Aspects of this law, including the unfair contract term protections, are also reflected in the Australian Securities and Investments Commission Act 2001.
The unfair contract terms law applies to a term in a contract if:
For standard form consumer contracts of insurance, the unfair contract term protections apply to contracts entered into, or renewed, on or after 5 April 2021. If a term of a contract entered into before 5 April 2021 is varied on or after 5 April 2021, the protections will apply to that term but not to the rest of the contract.
Like consumers, small businesses have limited market power and a reduced ability to vary 'take it or leave it' contracts. In recognition of this, the unfair contract terms law also provides protections for small businesses.
The unfair contract term protections apply to standard form small business contracts entered into, or renewed, on or after 12 November 2016, where:
For standard form small business contracts of insurance, the unfair contract term protections apply to contracts entered into, or renewed, on or after 5 April 2021, where the above criteria are met.
If a term of a small business contract entered into before 12 November 2016 is varied on or after 12 November 2016, the protections will apply to that term but not to the rest of the contract. If a term of a small business contract of insurance entered into before 5 April 2021 is varied on or after 5 April 2021, the protections will apply to that term but not to the rest of the contract.
