Reminder: Understanding Consumer Guarantees for Your Business

If your business provides a product or service, it’s crucial to understand your obligations and responsibilities under Australian Consumer Law. Consumers have rights, known as consumer guarantees, which apply to certain products and services. These guarantees ensure that consumers receive the product they paid for and that it performs as expected.

Obligations for Businesses:

• Meeting Guarantees: If a product or service fails to meet a guarantee, you may need to provide a remedy such as a replacement, repair, or refund. The type of remedy depends on whether the failure is major or minor.
• Accurate Signage: Ensure all signs in your business accurately represent consumer rights. It is unlawful to mislead consumers by displaying signs such as:
  • ‘No refunds’ at all, or after a certain number of days
  • ‘Exchange or credit note only for the return of sale items’
  • Consumer guarantees apply regardless of whether an item is on sale and have no set time limit.

Handling Change of Mind:

• Refunds and Exchanges: You are not required to provide a refund if a customer simply changes their mind. However, if your store policy offers a refund, exchange, or credit note for change of mind, you must adhere to that policy. Ensure these policies are clearly displayed at the point of sale or on your website.

Proof of Purchase:

• Requirements: When customers need to exchange or return purchases, you can ask for proof of purchase. If they cannot provide proof, you may refuse to offer a remedy.
• Acceptable Proofs: Proof of purchase can include:
  • Credit or debit card statement
  • A receipt or reference number for phone or internet payments
  • A copy or photograph of the receipt

Small Businesses as Consumers:

• Consumer Rights: Your business also has consumer rights when purchasing products or services from other businesses if the purchase meets at least one of the following conditions:
  • Costs less than $100,000 including GST
  • Is commonly bought for personal, domestic, or household use
  • Is a vehicle or trailer used mainly to transport goods on public roads
• Exceptions: Consumer guarantees do not apply when the product is purchased:
  • For resupply
  • For use or transformation in production or manufacturing
  • To repair or treat other goods

For more details and guidance about consumer guarantees, visit the ACCC website.

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