Nick Xenophon (SA, Independent) Share this | Hansard source

I do not think so, Senator Canavan. I am just making the obvious point that Minister Billson has been doing a lot of very good work and he should be congratulated for the energy and the diligence that he has put into the work that he has been doing. I disagree with him in one respect about the effects test, in terms of section 46 of our competition laws. The proposed changes—which seem to have been sidelined or put on hold or in cryogenic freeze by the coalition party room, or the Liberal Party room in particular—should go further. Having a substantial lessening of competition fettered to the proposed changes would, I think, render that cause largely ineffective.

These changes in terms of small business and unfair contract terms are definitely welcome. The genesis of these changes, the background to this bill, was in May 2009. I will refer to the Senate Economics Committee report. I did not participate in that particular committee report. With Senator Edwards as Chair of the Economics Legislation Committee—and he is deputy chair of the references committee—as usual, the committee did a very good and thorough job of analysing the legislation, more than ably assisted by a very capable secretariat, of course. The committee report says:

In May 2009 then Minister for Consumer Affairs, the Hon Chris Bowen MP—

in the Rudd government—

issued draft legislation to prohibit unfair contract terms. The proposed law, which ultimately became the Australian Consumer Law, covered business to business as well as consumer to business contracts.

I am referring here to paragraph 1.21 of the committee report. It goes on:

In relation to business to business contracts, the then Minister said:

Standard-form contracts are used by parties irrespective of the legal status or nature of the party to whom the contract is presented, and without any effective opportunity for that party to negotiate the term. In such cases, it would be invidious to suggest that the same term, which may be considered unfair in relation to a contract entered into by a natural person, would not be similarly unfair in relation to a business, where neither of them is in a position to negotiate the term.

However, disappointingly, the former government put that to one side, put it in the too-hard basket, for a number of reasons. I do not want to be unduly critical of them but I think they made a mistake by not including the protections for business-to-business contracts, because that is essential. It is not a level playing field when a small business is negotiating with a multibillion dollar corporation. When a business that might have a turnover of a few million dollars a year is negotiating with a big company, if there is a dispute, there is no level playing field.

So these changes are welcome. I do have some reservations in respect of some parts of the bill. I worry that the definition of 'small business' is—