Andrew Leigh and Labor announce beefed up ACCC

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Today at a media conference with Labor’s Andrew Leigh, Consumer Action Law Centre’s Gerard Brody called out current penalties under the Australian Consumer Law as “inadequate”.

The following comments are attributable to Gerard Brody, CEO of Consumer Action Law Centre:

“It’s clear that the current maximum financial penalties under the Australian Consumer Law are inadequate, particularly in respect of breaches by very large corporations. The recent Nurofen case is the perfect example. The multinational owner, Reckitt-Benckiser, has annual sales of $15 Billion, yet was only fined $1.7 million for a serious breach of the Australian Consumer Law, misleading Australians over pain relief, a serious breach of trust.”

“It’s common sense that increased fines will deter companies from breaking the law. Companies and their boards should not be able to view penalties as just the cost of doing business. Labor’s announcement today would simply bring penalties relating to consumer law into line with competition law breaches. We’ve long seen no basis for the current chasm in penalties – a difference of over 9 times. All Australians are consumers and deserve equal protection under the law from unfair behaviour in the market.”

“Penalties should also include prison time for repeated or egregious breaches. Jail time is available for breach of consumer laws in many OECD nations including Canada (up to 14 years), the United Kingdom (up to 2 years), Japan (up to 5 years), and Korea (up to 3 years). Imprisonment can act as an important deterrent and may particularly work to prevent consumer harm caused by businesses engaging in repeated consumer law contraventions.”

“Market studies are an important way to identify and take action on unfair and systemic consumer problems.  A rolling process of market studies can serve to prevent consumer harm or law breaches – the regulator can address consumer detriment and make sure our markets are functioning well. Funding cuts have hurt the regulators’ ability to do their job. An increased litigation budget for the ACCC will ensure it remains the strong consumer cop on the beat.”

Video of the media conference is available here.

Media Contact: Jonathan Brown, 0413 299 567, media@consumeraction.org.au

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