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Subscription services

I have membership to a gym which has closed or a food delivery supplier that has stopped service. Do I have to continue making regular payments?

You do not have to make payments while the gym is closed, or the delivery of food has stopped.

The Australian Consumer Law prohibits businesses from taking payments for goods or services when there are reasonable grounds to believe the goods or services won’t be supplied.

This applies even if your contract does not allow you to suspend payments.

If payments have been deducted, you should contact the business to have the payments refunded.

What if I’ve paid upfront for the closure period?

If you’ve made an upfront payment that covers the period of the closure, you should receive a refund or other remedy such as a credit note or voucher for the period of the closure.

However, if the service has been suspended due to government restrictions, this impacts your rights to a refund under the consumer guarantees in the Australian Consumer Law.

Check the terms and conditions of your contract with each supplier.

Some contracts may have a clause on pandemics and force majeure clauses (sometimes called ‘act of God’ events) covering specific events outside of the control of the consumer and supplier.

These clauses may allow parties to pause or terminate the contract when it can no longer be performed due to circumstances outside their control.

If there is no clause, term or condition about pandemics to determine what should happen, but the contract has been affected by the pandemic or restrictions, it may be a frustrated contract.

A frustrated contract may happen when an event outside the control of the parties to the contract has occurred, such as restrictions imposed by COVID-19, and as a result, the contractual obligations cannot be met.

If the trader is unable to fulfil their obligations due to COVID-19 restrictions, we recommend the parties try to reach a resolution so neither party is unfairly advantaged or disadvantaged.

You should contact the business directly to request a refund or other remedy such as a credit note or voucher.

We encourage all businesses to work with their customers and treat consumers fairly in these exceptional circumstances.

Determining whether a force majeure clause applies, whether the contract has been frustrated and the appropriate legal remedy can be complex.

It will depend on the terms and conditions of the contract, your circumstances and the applicable law.

If you are unable to resolve the issue with your supplier, you may need to obtain independent legal advice to understand your legal rights.

Why are my rights different when cancellation is due to government bans?

Your rights under the Australian Consumer Law may be different when cancellation is due to a government ban because government bans may make it unlawful for the supplier to supply the goods or services.

However, suppliers are required to take reasonable precautions and exercise due diligence to ensure that supply will not be affected by a ban before they agree to supply goods or services.

Will I receive a refund owed to me if the business shuts down as a result of the COVID-19 government ban?

We suggest trying to contact the business to discuss a possible remedy.

In certain situations, you would have to register as a creditor.

More information is available on the Australian Securities and Investments Commission website.

Pricing increases

Can businesses increase prices for other products that are in high demand because of COVID-19, such as face masks, toilet paper or food?

NSW Fair Trading does not set prices and cannot prevent or take action to stop excessive pricing.

In some limited circumstances, excessive pricing may be unconscionable under the Australian Consumer Law, for example where the product is critical to the health or safety of vulnerable consumers.

If a business makes misleading claims about the reason for price increases, it will be in breach of Australian Consumer Law.

The NSW Minister for Better Regulation and Innovation may also publicly name businesses who engage in excessive pricing of essential items during the COVID-19 pandemic without a legitimate business reason.

Customers can contact us on 13 32 20 to make an enquiry or complaint about excessive pricing, misleading conduct or unconscionable conduct by businesses.

Can hand sanitiser or face masks be sold at unreasonable prices?

On 30 March 2020, the Commonwealth Minister for Health made a Determination that prohibits price gouging when reselling specific essential goods that help prevent the transmission of COVID-19.

This applies to any of these goods purchased in a retail transaction on or after 30 January 2020:

  • disposable face masks
  • disposable gloves
  • disposable gowns
  • goggles, glasses or eye visors
  • alcohol wipes
  • hand sanitiser

The Determination stops individuals or businesses that purchase goods directly from supermarkets, pharmacists, chemists or other retail stores from reselling, or offering to resell them, for more than 120% of the price they originally paid.

For example, hand sanitiser that was purchased in a retail transaction in February for $10 cannot be resold for more than $12.

Any reasonable shipping costs that were incurred as part of the original retail transaction are not considered when calculating the 120%.

The Determination does not apply to manufacturers or major suppliers (who generally purchase goods wholesale) that are vital to maintaining Australia's supply chains

You can report price gouging of essential goods to the Australian Federal Police.

Stock availability

My order is taking a long time to arrive because COVID-19 is impacting delivery times. Can I request a refund or replacement of goods ordered and not received?

Goods should be supplied within a reasonable time.

How long is ‘reasonable’ will depend on the type of product.

We recommend you speak with the retailer and discuss your concerns.

My TV repair is delayed because the parts are from a country affected by COVID-19. Can I get a refund?

There is a guarantee that when you purchase a product the manufacturer or importer must provide spare parts and repair facilities for a reasonable time after purchase.

This applies even if you did not purchase the goods directly from the manufacturer or importer.

How long is ‘reasonable’ will depend on the type of product.

This guarantee does not apply if you are advised at the time of purchase that repair facilities and spare parts will not be available after a specified time.

Payment methods

Can a business refuse cash payments?

There is no law preventing a business from either refusing or insisting on cash payments.

We advise businesses to clearly display their preferred payment method, so customers are fully aware before their purchase.

Payment must be made in Australian currency, unless otherwise agreed.

More information is available on the Reserve Bank of Australia website.

Business closures

Will I receive a refund owed to me if the business shuts down as a result of the COVID-19 government ban?

We suggest trying to contact the business to discuss a possible remedy.

In certain situations, you would have to register as a creditor.

More information is available on the Australian Securities and Investments Commission website.

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