Chris Evans (WA, Australian Labor Party, Leader of the Government in the Senate) Share this | Hansard source

I indicate on behalf of the government that we will not be supporting these two amendments from Senator Xenophon. As I indicated earlier, the government consulted on the exposure draft of the unfair contract terms provisions during May 2009. The original draft provisions were expressed to apply to business-to-business contracts. The inclusion of business-to-business contracts gave rise to considerable business concern about the ambit of the proposed provisions and the potential effects on business activity in Australia. The government considered the approach suggested by Senator Xenophon—that is, to apply a monetary limit to the contracts that the provisions would apply to. After further consideration, the government responded to these concerns by removing the application of the unfair contract terms provisions from all business-to-business transactions.

Upon the introduction of this bill into the parliament, the Minister for Competition Policy and Consumer Affairs announced that provisions relating to the relationship between businesses would best be dealt in the context of the government’s responses to the Senate Economics References Committee’s review of the statutory definition of ‘unconscionable conduct’ and the review by the Parliamentary Joint Committee on Corporations and Financial Services of the franchising code of conduct. On 5 November 2009, the Minister for Competition Policy and Consumer Affairs announced the government’s responses to these reviews. Those responses include legislative amendments to the unconscionable conduct provisions of the TPA. In the context of business-to-business contracts, a general notion of unfairness that is subject to interpretation by the courts may have the effect of increasing risk and costs faced by business and by small business in particular. In the government’s view, this would undermine the position of small businesses. So, as I said, the government will not be supporting Senator Xenophon’s amendments.