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As a business, you may be required to enter into standard form contracts with other businesses for goods (e.g. equipment, stock) and services (e.g. internet, banking, search engine optimisation services). 

It’s in your interest to carefully review any contracts provided to you before signing. Make sure you understand the key parts of the contract (cost, how long the contract will run for, etc) and check standard form contracts for any unfair terms. Speak to other businesses if you have questions and get independent legal advice where appropriate.

You may also choose to use standard form contracts when dealing with your customers.

Under the Australian Consumer Law (ACL), it is unlawful to propose, include, rely on, or enforce an unfair contract term in a standard form contract with a consumer or small business. If a court decides that a term is unfair, it will be ‘ void’. This means it will no longer apply to the parties to the contract.

There are 3 main questions you need to think about when determining if a contract contains an unfair term:

1. Is the contract a standard form contract?
2. Is the contract with a small business or consumer?
3. Does the term meet the criteria for unfair?

Only a court or tribunal (not the ÌÇÐÄÔ­´´) can decide that a term is unfair. A court can impose significant financial penalties if a contract entered into or renewed after 9 November 2023 contains an unfair term. 

This program will help you to understand the unfair contract terms law and provide general guidance for identifying and removing potentially unfair terms from your contracts. Learn more about unfair contract terms. 

Watch our video to learn simple steps to protect yourself when purchasing from another business.