Consumer law is changing in New Zealand and some of the changes have already taken effect. In early December 2013, the long awaited Consumer Law Reform Bill went through its final reading in Parliament and on 17 December 2013 was passed into law by way of six separate amendment Acts.
The law reform has been designed to update consumer law in New Zealand and harmonise it with Australian law to further the Government’s agenda of a single economic market. The widespread changes are intended to provide stronger consumer protection, so that consumers can transact with greater confidence and to promote competition, innovation and growth.
The most significant changes are the amendments to the Fair Trading Act 1986 and the Consumer Guarantees Act 1993. There are also changes to other enactments, such as the Carriage of Goods Act, Weights and Measures Act, Secondhand Dealers and Pawnbrokers Act as well as a new Auctioneers Act.
The CGA protects consumers by providing certain guarantees from suppliers and manufacturers when goods are acquired. The amendments to the CGA introduce new guarantees for the delivery of goods, as well as for the supply of electricity and gas. The CGA will also be extended to cover goods ordered over the internet or by telephone, and goods sold at auction or tender.
The FTA protects consumers by prohibiting unfair conduct and trade practices. It provides for the disclosure of information relating to goods and services, and promotes product safety. The changes to the FTA introduce new restrictions relating to unfair contract terms, unsubstantiated representations, extended warranties, unsolicited goods, product safety and recalls, and internet sales and auctions. The Commerce Commission has also been granted extended powers.
Some of the changes took effect from 18 December 2013. These include changes to new product safety requirements, collateral credit contracts and the increased powers of the Commerce Commission. Most of the key changes, however, only come into effect on 17 June 2014. These include changes relating to unsubstantiated representations, extended warranties, unsolicited goods, internet sales, and delivery guarantees. The six month delay is intended to give businesses the time to change their practices. Further changes relating to unfair contract terms will not come into force until March 2015.
No, not if you are in the business of providing goods or services to consumers. The amendments to the FTA and the CGA now make that clear. The only exception to this rule, which the amendments to both Acts seek to align, is where one business is contracting with another. To successfully exclude the requirements, both parties must be in trade, they must agree in writing, and the exclusion must be fair and reasonable. What is fair and reasonable in the circumstances will depend on a number of different factors.
If you are a consumer you can learn more about the new protections and changes on the Commerce Commission and Consumer Affairs websites. You can also talk these changes through with your lawyer.
Individuals and businesses in trade are particularly advised to consult with their lawyers before 17 June 2014 in order to assess the impact the changes to the law may have on their current business practices. The changes are widespread and significant, which is why the six month lead-in time has been put in place.