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Trade Practices Amendment (Australian Consumer Law) Bill (No. 2) 2010

Schedule 4 Enforcement of industry codes

   

Trade Practices Act 1974

1  Before section 51ACA

Insert:

Division 1 Preliminary

2  Subsection 51ACA(1)

Insert:

related contravention : a person engages in conduct that constitutes a related contravention of an applicable industry code, if the person:

                     (a)  aids, abets, counsels or procures a corporation to contravene the applicable industry code; or

                     (b)  induces, whether by threats or promises or otherwise, a corporation to contravene the applicable industry code; or

                     (c)  is in any way, directly or indirectly, knowingly concerned in, or party to, a contravention by a corporation of the applicable industry code; or

                     (d)  conspires with others to effect a contravention by a corporation of the applicable industry code.

3  Before section 51AD

Insert:

Division 2 Contravention of industry codes

4  After section 51AD

Insert:

Division 3 Public warning notices

51ADA   Commission may issue a public warning notice

Commission may issue a public warning notice

             (1)  The Commission may issue to the public a written notice containing a warning about the conduct of a person if:

                     (a)  the Commission has reasonable grounds to suspect that the conduct may constitute:

                              (i)  if the person is a corporation—a contravention of an applicable industry code by the corporation; or

                             (ii)  in any case—a related contravention of an applicable industry code by the person; and

                     (b)  the Commission is satisfied that one or more persons has suffered, or is likely to suffer, detriment as a result of the conduct; and

                     (c)  the Commission is satisfied that it is in the public interest to issue the notice.

Notice is not a legislative instrument

             (2)  A notice issued under subsection (1) is not a legislative instrument.

Division 4 Orders to redress loss or damage suffered by non-parties etc.

51ADB   Orders to redress loss or damage suffered by non-parties etc.

Orders

             (1)  If:

                     (a)  a person engaged in conduct (the contravening conduct ) that:

                              (i)  if the person was a corporation—constituted a contravention of an applicable industry code; or

                             (ii)  in any case—constituted a related contravention of an applicable industry code; and

                     (b)  the contravening conduct caused, or is likely to cause, a class of persons to suffer loss or damage; and

                     (c)  the class includes persons ( non-parties ) who are not, or have not been, parties to a proceeding (an enforcement proceeding ) instituted under Part VI in relation to the contravening conduct;

any court having jurisdiction in the matter may, on the application of the Commission, make such order or orders (other than an award of damages) as the court thinks appropriate against a person referred to in subsection (2) of this section.

Note:          The orders that the court may make include all or any of the orders set out in section 51ADC.

             (2)  An order under subsection (1) may be made against:

                     (a)  the person mentioned in paragraph (1)(a); or

                     (b)  a person involved in the contravening conduct.

             (3)  A court must not make an order under subsection (1) unless the court considers that the order will:

                     (a)  redress, in whole or in part, the loss or damage suffered by the non-parties in relation to the contravening conduct; or

                     (b)  prevent or reduce the loss or damage suffered, or likely to be suffered, by the non-parties in relation to the contravening conduct.

Application for orders

             (4)  An application may be made under subsection (1) even if an enforcement proceeding in relation to the contravening conduct has not been instituted.

             (5)  An application under subsection (1) may be made at any time within 6 years after the day on which the cause of action that relates to the contravening conduct accrues.

Determining whether to make an order

             (6)  In determining whether to make an order under subsection (1) against a person referred to in subsection (2), a court may have regard to the conduct of:

                     (a)  the person; and

                     (b)  the non-parties;

in relation to the contravening conduct, since the contravention occurred.

             (7)  In determining whether to make an order under subsection (1), a court need not make a finding about either of the following matters:

                     (a)  which persons are non-parties in relation to the contravening conduct;

                     (b)  the nature of the loss or damage suffered, or likely to be suffered, by such persons.

When a non-party is bound by an order etc.

             (8)  If:

                     (a)  an order is made under subsection (1) against a person; and

                     (b)  the loss or damage suffered, or likely to be suffered, by a non-party in relation to the contravening conduct to which the order relates has been redressed, prevented or reduced in accordance with the order; and

                     (c)  the non-party has accepted the redress, prevention or reduction;

then:

                     (d)  the non-party is bound by the order; and

                     (e)  any other order made under subsection (1) that relates to that loss or damage has no effect in relation to the non-party; and

                      (f)  despite any other provision of this Act or any other law of the Commonwealth, or a State or Territory, no claim, action or demand may be made or taken against the person by the non-party in relation to that loss or damage.

51ADC   Kinds of orders that may be made to redress loss or damage suffered by non-parties etc.

                   Without limiting subsection 51ADB(1), the orders that a court may make under that subsection against a person (the respondent ) include all or any of the following:

                     (a)  an order declaring the whole or any part of a contract made between the respondent and a non-party referred to in that subsection, or a collateral arrangement relating to such a contract:

                              (i)  to be void; and

                             (ii)  if the court thinks fit—to have been void ab initio or void at all times on and after such date as is specified in the order (which may be a date that is before the date on which the order is made);

                     (b)  an order:

                              (i)  varying such a contract or arrangement in such manner as is specified in the order; and

                             (ii)  if the court thinks fit—declaring the contract or arrangement to have had effect as so varied on and after such date as is specified in the order (which may be a date that is before the date on which the order is made);

                     (c)  an order refusing to enforce any or all of the provisions of such a contract or arrangement;

                     (d)  an order directing the respondent to refund money or return property to a non-party referred to in that subsection;

                     (e)  an order directing the respondent, at his or her own expense, to repair, or provide parts for, goods that have been supplied under the contract or arrangement to a non-party referred to in that subsection;

                      (f)  an order directing the respondent, at his or her own expense, to supply specified services to a non-party referred to in that subsection;

                     (g)  an order, in relation to an instrument creating or transferring an interest in land (within the meaning of section 53A), directing the respondent to execute an instrument that:

                              (i)  varies, or has the effect of varying, the first-mentioned instrument; or

                             (ii)  terminates or otherwise affects, or has the effect of terminating or otherwise affecting, the operation or effect of the first-mentioned instrument.

Division 5 Investigation power

51ADD   Commission may require corporation to provide information

             (1)  This section applies if a corporation is required to keep, to generate or to publish information or a document under an applicable industry code.

             (2)  The Commission may give the corporation a written notice that requires the corporation to give the information, or to produce the document, to the Commission within 21 days after the notice is given to the corporation.

             (3)  The notice must:

                     (a)  name the corporation to which it is given; and

                     (b)  specify:

                              (i)  the information or document to which it relates; and

                             (ii)  the provisions of the applicable industry code which require the corporation to keep, to generate or to publish the information or document; and

                     (c)  explain the effect of sections 51ADE, 51ADF and 51ADG.

             (4)  The notice may relate to more than one piece of information or more than one document.

51ADE   Extending periods for complying with notices

             (1)  A corporation that has been given a notice under section 51ADD may, at any time within 21 days after the notice was given to the corporation, apply in writing to the Commission for an extension of the period for complying with the notice.

             (2)  The Commission may, by written notice given to the corporation, extend the period within which the corporation must comply with the notice.

51ADF   Compliance with notices

                   A corporation that is given a notice under section 51ADD must comply with it within:

                     (a)  the period of 21 days specified in the notice; or

                     (b)  if the period for complying with the notice has been extended under section 51ADE—the period as so extended.

51ADG   False or misleading information etc.

             (1)  A corporation must not, in compliance or purported compliance with a notice given under section 51ADD:

                     (a)  give to the Commission false or misleading information; or

                     (b)  produce to the Commission documents that contain false or misleading information.

             (2)  This section does not apply to:

                     (a)  information that the corporation could not have known was false or misleading; or

                     (b)  the production to the Commission of a document containing false or misleading information if the document is accompanied by a statement of the corporation that the information is false or misleading.

Division 6 Miscellaneous

5  Application provision

Division 4 of Part IVB of the Competition and Consumer Act 2010 , inserted by this Schedule, does not apply in relation to contravening conduct that occurred before the commencement of this item.