What are consumer guarantees?
Businesses must comply with the consumer guarantees when selling goods or services. These guarantees are minimum rights for consumers under the Australian Consumer Law. This article explains the law of consumer guarantees to help keep your business compliant.
What are the consumer guarantees?
The consumer guarantees are a set of minimum rights for consumers under the Australian Consumer Law. The guarantees apply automatically to any sale of goods and services, and cannot be excluded by your business through any means. For example, you cannot exclude the guarantees by:
- Displaying a ‘no refunds or repairs’ sign
- Saying you are not responsible if something is wrong with a product or service
- Requiring a customer to sign a document which excludes their rights under the guarantees.
Who is covered by the consumer guarantees?
The guarantees cover both individual and business consumers. Individuals or businesses are covered by the guarantees when they purchase goods are services:
- valued at under $100,000; or
- bought for domestic, household or personal use or consumption; or
- that are commercial vehicles or trailers, mainly bought for transporting goods on public roads.
Accordingly, the consumer guarantees are applicable to many B2B and B2C transactions.
What are the guarantees for goods?
The guarantees for goods include that goods must:
- Be of acceptable quality and appearance, safe, durable, defect-free and suitable for their usual purpose.
- Be fit for any purpose which has been stated or advertised
- Match any description of the product
- Match any sample or demonstration of the product
- Meet any express warranties about the quality, condition, performance or characteristics of a product
What are the guarantees for services?
The guarantees for services include that services must:
- Be carried out with due care and skill
- Be fit for any stated or advertised purpose
- Provided within a reasonable time
What remedies must be provided for breach of consumer guarantees?
If you fail to meet your consumer guarantee obligations, the consumer is generally entitled to a repair, replacement or refund. Importantly, consumers are not entitled to a remedy if:
- They got the goods or services they asked for but simply changed their mind
- The problem was caused by misuse of the goods or services by the consumer
- They knew there was an issue with the goods or services but bought it anyway e.g. second-hand goods bought ‘as-is’
Key takeaways
- The consumer guarantees are a set of minimum rights for consumers under the Australian Consumer Law.
- The guarantees apply automatically to any sale of goods and services, and cannot be excluded by your business through any means.
- Consumers are generally entitled to a refund, repair or replacement for any breach of the consumer guarantees.
Gladwin Legal are experts in consumer and compliance law and have extensive experience in advising businesses. If you require assistance in drafting or reviewing your policies or understanding your legal obligations please contact us at or 1300 033 934.
This article was written by Ruth Ong.