Breaking down the draft Unfair Trading Practices Bill: what the changes could mean for your business
On 9 February 2026 the Federal government published the draft Competition and Consumer Amendment (Unfair Trading Practices) Bill 2026 (Cth) (Draft Unfair Trading Practices Bill) for feedback.
The proposed bill makes three notable amendments to the Competition and Consumer Act 2010 (Cth) relating to unfair trading practices, drip pricing and subscription contracts. If passed, the changes would come into effect from 1 July 2027.
Various submissions have been made in respect of the Draft Unfair Trading Practices Bill which may result in some amendments to the Bill.
This article discusses the major proposed changes and some of the feedback that has been provided in relation to the draft bill.
Unfair Trading Practices
Under the proposed section 28B titled ‘Unfair trading practices towards customers’ a supplier must not engage in conduct that either:
does, or is likely to unreasonably manipulate or distort the environment in which the consumer makes or is likely to make a decision; or
causes or is likely to cause detriment, whether financial or otherwise (such as wasted time), to the consumer.
While these provisions are quite ambiguous, the draft bill provides three examples of conduct that may contravene the prohibitions, being:
interference with the consumer’s ability to exercise legal rights, or seek remedies, in relation to the supply;
failure to disclose material information, or complex or ineffective disclosure of that information, to the consumer; and
creating an environment which places the consumer under unreasonable pressure in relation to making or fulfilling their decision or obstructs the consumer from making or fulfilling their decision.
These provisions would not apply to business-to-business transactions.
Comments on the draft bill
The concept of protecting consumers from the above conduct is not controversial. However the manner it is presently drafted has caused some elements of the proposed draft bill to be adversely critiqued.
The vague and ambiguous phrasing of the general unfair trading practices prohibition is a key area of critique. It is suggested that this vague drafting is likely to create significant uncertainty for businesses navigating compliance.
Likewise, the ambit of the new provision is likely already captured by the misleading or deceptive conduct and false or misleading representations provisions of the Australian Consumer Law arguably leading to duplicative proposed prohibitions.
Drip Pricing
The Draft Unfair Trading Practices Bill includes a new prohibition on drip pricing with relation to offers to supply goods or services that are of a type ordinarily acquired for personal, domestic or household use or consumption.
The effect of this wording is that the prohibition may apply to some business-to-business transactions where the goods or services are of a type ordinarily acquired for personal, household or domestic use, however the section does not apply where the offer is exclusively made to a body corporate.
Drip pricing is the practice of revealing one price which is later compounded by additional, unanticipated fees.
The proposed bill mandates that, where a supplier discloses a base price for any of the goods or services, they must also disclose, at the time of disclosing the base charge, any other transaction based charges that may be incurred should the initial fee be accepted.
Specifically, a supplier must disclose:
the amount of the transaction based charge (if it can be calculated) or the method of calculating the charge;
the fact that the charge is a per transaction charge;
the fact that the charge will or may apply to the transaction; and
whether or not the base price disclosed includes the transaction based charge.
Notably, some fees are specifically excluded from the provisions, including optional fees, surcharges, delivery fees and taxes.
Comments on the draft bill
The proposed drip pricing requirements are quite narrow and targeted in their application, given the excluded fees and the limited disclosure requirements.
Should the drip pricing prohibitions pass, it is unlikely that they will have a major impact on internal franchise operations, given the exclusion of dealings exclusively with a body corporate. However, franchisees and franchisors should be aware of these proposals and tailor any marketing and contracts accordingly.
Subscription Contracts
The draft bill also seeks to impose disclosure obligations with respect to subscription contracts, being those contracts where a party subscribes to receive goods or services over a specific term.
The proposed section 48B would require that supplier to a subscription contract must provide a statement at the time of making an offer, outlining that the contract would, where applicable, be a subscription, cover a fixed or indefinite term and include a free trial period or promotional (discounted) period.
Furthermore, the supplier must also disclose information regarding:
any liabilities that a party to the contract (other than the supplier) may incur;
the period of the contract;
renewal of the contract;
any notice required before a party (other than the supplier) can end the contract; and
how a party to the contract (other than the supplier) can end the contract.
Finally, if passed, the proposed bill would require that a supplier to a subscription contract provides a way for the subscriber to end the contract that is easy to find, straightforward, only requires the subscriber to take reasonably necessary steps which protect their interests. Further, if the subscriber entered the contract online, they must be able to end the contract online.
Comments on the draft bill
Whether the subscription contract provisions will apply to franchise agreements is presently unclear, given that franchise agreements often feature recurring liabilities.
Accordingly, an express exclusion for franchise agreements is considered necessary especially in light of the already comprehensive pre-contractual disclosure obligations under the Franchising Code of Conduct, which in many cases are substantially more detailed than the provisions in the Draft Unfair Trading Practices Bill.
Key Takeaways
The impact of the Draft Unfair Trading Practices Bill, if implemented, would be felt by many suppliers.
The present proposal would clearly impose obligations on how franchisors and franchisees market and contract with consumers and possibly also with each other.
Both franchisors and franchisees should consider the impact that the proposed unfair trading practices and drip pricing prohibitions would have on their business and whether amendments to external business practices will need to be made to ensure compliance.
The present draft subscription contract provisions have the capacity to impose significant regulatory burdens on franchisors. Whether franchise agreements are included within the ambit of the subscription contracts provisions is currently unclear, however franchisors should start considering whether any changes ought to be made to their franchise agreements to avoid regulatory action.
It will be necessary to review the final version of this bill to ascertain if any changes have been made in light of the submissions received.
Should you wish to discuss the impacts of these proposed changes on your business or otherwise have any queries or concerns, please contact us.
Alicia Hill
Principal
T: +61 3 9611 0180 | M: +61 484 313 865
E: ahill@sladen.com.au
Charlie Cooper
Law Clerk
E: ccooper@sladen.com.au
