Australian Consumer Law: Guarantees, Refunds and 2026 Changes

The Australian Consumer Law is a single national law, set out in Schedule 2 of the Competition and Consumer Act 2010 (Cth), that gives every Australian consumer the same statutory guarantees, refund rights and protections against unfair contract terms, enforced by the ACCC and each state and territory regulator.

For the full national picture, including who counts as a consumer and the maximum penalties courts can impose after the March 2026 increase, see the Australian Consumer Law explained.

This hub covers the Australian Consumer Law (ACL), the single national consumer protection statute that applies to consumer transactions across every Australian state and territory. It does not cover state-based tenancy law, financial products regulated by ASIC, or motor vehicle "lemon" registers run separately by some states. Follow the links throughout this guide to the detailed spokes on each topic.

What is the Australian Consumer Law

The Australian Consumer Law is not a stand-alone Act. It is Schedule 2 to the Competition and Consumer Act 2010 (Cth), applied as the law of each state and territory through mirroring application legislation, so the same rules govern a purchase in every part of the country. It replaced a patchwork of separate state and territory fair trading laws when it commenced on 1 January 2011, and it covers misleading conduct, unfair contract terms, consumer guarantees, unsolicited sales, product safety, and unfair practices such as bait advertising and referral selling. This guide focuses on the parts of the ACL that generate the most disputes: consumer guarantees, remedies for faulty goods and services, unfair contract terms, and warranties.

The consumer guarantees: goods and services

When a business supplies goods or services to a consumer in trade or commerce, a set of statutory guarantees automatically applies. They exist regardless of what any receipt, sign or contract says, and they sit on top of, not instead of, any manufacturer or store warranty. For goods, sections 51 to 59 of the ACL guarantee title, undisturbed possession, freedom from undisclosed securities, acceptable quality, fitness for any disclosed purpose, correspondence with description, correspondence with sample or demonstration model, availability of repairs and spare parts for a reasonable period, and compliance with express warranties. For services, sections 60 to 62 guarantee due care and skill, fitness for a particular disclosed purpose, and supply within a reasonable time. Section 63 is often miscited as part of that guarantee list; it is not a guarantee at all, but a scope-exclusion provision that removes certain freight, storage and insurance-related services from Subdivision B altogether. See consumer guarantees in Australia for the full detail on each guarantee, and consumer rights for services for the services guarantees specifically.

Major or minor: who chooses the remedy

The single most useful thing to understand about the ACL is that the size of the problem decides who is in charge of fixing it. Section 259(2) applies when a fault with goods can be fixed and is not major: the consumer may require the supplier to fix it within a reasonable time, and under section 261 the supplier can comply by repairing, replacing or refunding. If the supplier refuses or fails, the consumer can have the fault fixed elsewhere and recover the reasonable cost or, subject to section 262, reject the goods. Section 259(3) applies when a fault cannot be fixed, or is a major failure under section 260: the consumer, not the supplier, chooses whether (subject to section 262) to reject the goods for a refund or replacement, or keep them and claim compensation for the reduced value. Either way, section 259(4) allows a claim for reasonably foreseeable consequential loss on top of the primary remedy. A retailer who tells every customer "we only offer repairs" is only correct when the fault is genuinely minor. See faulty goods and your right to a refund for the full major-versus-minor test in section 260 and how the remedy choice actually works.

Guarantees cannot be excluded by a contract term

Section 64 makes any contract term void to the extent it purports to exclude, restrict or modify a consumer guarantee, or a consumer's right to a remedy for breach of one. A "no refunds" sign, a store policy, or a clause buried in terms and conditions cannot remove these rights for an ordinary consumer purchase. A narrow exception in section 64A allows some contracts for goods or services not ordinarily bought for personal or household use to limit liability to the cost of repair, replacement or re-supply, but this exception never applies to the title, possession or undisclosed-security guarantees in sections 51 to 53, and does not apply if the buyer establishes that it is not fair or reasonable for the supplier to rely on the limitation, a question a court decides having regard to the parties' relative bargaining strength and other factors in section 64A(4).

Warranties against defects are extra, not instead of

A "warranty against defects" (commonly called a manufacturer or extended warranty) is a separate, voluntary promise, defined in section 102(3) as a representation that a business will repair, replace, resupply or compensate if goods or services turn out defective. It cannot replace or reduce the statutory guarantees; it can only add to them. Under section 102, any document evidencing a warranty against defects must meet requirements prescribed by regulation, and a business that gives a non-compliant warranty document, or represents that goods carry a compliant warranty when they do not, contravenes section 102(2), carrying a penalty under section 224 of up to $50,000 for a body corporate or $10,000 for an individual. See warranties against defects vs statutory guarantees for how the two interact.

Who counts as a "consumer"

Not every purchase, including business purchases, is automatically covered. Section 3 of the ACL defines when goods or services are acquired "as a consumer." One path is price: the amount paid or payable must not exceed a threshold set in section 3(1)(a). The section's own text still reads $40,000 at subparagraph (i), but subparagraph (ii) lets a greater amount be prescribed, and a greater amount has been prescribed: $100,000 (including GST), confirmed on the ACCC's own guidance. The second, separate path applies regardless of price: goods or services of a kind ordinarily bought for personal, domestic or household use are covered no matter what they cost. For goods, a vehicle or trailer acquired mainly to carry goods on public roads is also covered regardless of price. Goods acquired for resupply, or to use up or transform in production, manufacture or repairs, are not acquired as a consumer. A business buying a $500 air conditioner for office use, or a $90,000 delivery van, can be a "consumer" under the ACL even though neither purchase looks like typical household shopping.

Unfair contract terms

For contracts made on or after 9 November 2023, older contracts once renewed, and terms varied or added in older contracts on or after that date (section 305), using or relying on an unfair term in a standard form consumer or small business contract is itself unlawful under section 23(2A) and (2C), not merely a term that a court can strike out. Each unfair term proposed or relied on is treated as a separate contravention under section 23(2B). A small business contract now covers a business with fewer than 100 employees or turnover under $10,000,000 in its last income year. Because the maximum penalties for this kind of contravention sit in the same high-penalty tier as the ACL's most serious prohibitions, the practical incentive for large standard-form contract drafters to review their terms has increased sharply. See unfair contract terms in Australia for the full test in section 24 and the examples in section 25.

Penalties for breaching the ACL

Penalties for the most serious categories of ACL contravention, including unconscionable conduct, unfair practices such as false or misleading representations, and unfair contract term breaches, are set out in section 224. For a body corporate, the maximum is the greater of $100,000,000 and, where the court can determine the benefit obtained from the contravention, three times its value or, where it cannot, 30% of adjusted turnover during the breach period. This corporate figure doubled from $50,000,000 under the Treasury Laws Amendment (Doubling Penalties for ACCC Enforcement) Act 2026, effective 28 March 2026; it applies to conduct on or after that date, so $50,000,000 remains the maximum for earlier conduct. The individual maximum, $2,500,000, was not changed by that amendment. Lower-tier contraventions, such as failing to give a compliant proof of transaction or warranty document, carry much smaller fixed penalties (for example, $50,000 corporate and $10,000 individual for a non-compliant warranty against defects document under section 102).

Enforcement: the ACCC and state and territory regulators

The Australian Competition and Consumer Commission (ACCC) enforces the ACL nationally, but it shares that role concurrently with a dedicated regulator in every state and territory: the Office of Fair Trading in Queensland, NSW Fair Trading, Consumer Affairs Victoria, Consumer Protection (within the Department of Local Government, Industry Regulation and Safety) in Western Australia, Consumer and Business Services in South Australia, NT Consumer Affairs, Consumer, Building and Occupational Services in Tasmania, and Access Canberra in the ACT. The ACCC does not resolve individual disputes or award compensation; it focuses on systemic enforcement, guidance and, where warranted, court action. For an individual dispute, the state or territory regulator, and ultimately a tribunal or court, is usually the right starting point. See who to complain to about a consumer problem for the full escalation path.

Where to take an unresolved dispute

Most consumer disputes are resolved directly with the business, or with help from the relevant state or territory regulator. Where that fails, several states and territories run a low-cost tribunal or court list for consumer claims: QCAT in Queensland, NTCAT in the Northern Territory, NCAT in New South Wales, the Magistrates Court in Western Australia, and VCAT in Victoria. Monetary limits, filing fees and the exact forum differ by jurisdiction, and using the wrong one can cost a consumer time and a filing fee. See small claims tribunals across Australia for a jurisdiction-by-jurisdiction breakdown of what is currently confirmed.

Debt collection, statute-barred debts and credit defaults

The ACL also governs how debts are collected. Section 50 prohibits physical force, undue harassment and coercion in connection with the payment of goods or services, mirrored for financial services by section 12DJ of the ASIC Act, and the ACCC and ASIC publish a joint debt collection guideline setting out expected contact hours and frequency. See debt collection laws in Australia for those rules and the complaint route, statute-barred debts for what happens when the limitation period on a debt has run, and credit reporting and default listings for how a default reaches your credit file and how to dispute one.

Online shopping is covered the same way

The ACL applies to online purchases from an Australian business exactly as it applies to purchases made in a physical store; the consumer guarantees, unfair contract terms protections and remedy rules described throughout this hub do not weaken because a purchase happened on a website or through an app. Overseas sellers who deliberately sell into the Australian market are also bound by the ACL, though practical enforcement against a business with no Australian presence is often limited. See online shopping rights in Australia for how these rules apply to deliveries, cancellations and digital purchases specifically.

Changes coming

As at 29 September 2026, two changes that affect consumers have been legislated or decided but are not part of the rules described above.

The Competition and Consumer Amendment (Unfair Trading Practices) Act 2026 (No. 64 of 2026, assented to on 6 July 2026) commences on 1 July 2027. From that date it will add a general prohibition on unfair trading practices towards consumers (new section 28B, aimed at conduct that manipulates the consumer or unreasonably distorts the environment in which the consumer decides, and causes or is likely to cause detriment), a requirement to display per-transaction charges with the base price for household-type goods and services (new section 48A, often called drip pricing), and new rules for subscription contracts (new Division 4A of Part 3-1). The prohibition does not apply where the consumer is a body corporate or the supply is in the course of the consumer's business. Read the Act on legislation.gov.au; until 1 July 2027 none of these provisions is in force.

Separately, the Reserve Bank of Australia has concluded that it is in the public interest to remove surcharging on the designated card networks (eftpos, Mastercard and Visa) from 1 October 2026. The change applies only to surcharges added because a customer pays by card; it does not apply to weekend or public holiday surcharges, or to booking or service fees. The RBA also notes that American Express, UnionPay and PayPal have decided to remove surcharging from the same date. See the RBA's questions and answers for the detail.

This page provides general legal information about consumer rights under the Australian Consumer Law. The consumer guarantee remedies, section 64A, the section 3 consumer definition, unfair contract term timing and section 224 penalties were rechecked on 29 September 2026 against Compilation No. 167 of the Competition and Consumer Act 2010, and the other points were last verified on 21 July 2026. It is not legal advice about your own purchase or dispute. For advice on your situation, consult a legal practitioner admitted in the relevant Australian state or territory.

Explore each topic in detail: consumer guarantees in Australia, faulty goods and your right to a refund, unfair contract terms in Australia, warranties against defects vs statutory guarantees, small claims tribunals across Australia, consumer rights for services, online shopping rights in Australia, and who to complain to about a consumer problem. For cars, see lemon laws and used-car dealer warranties in Australia.

Frequently Asked Questions

What is the Australian Consumer Law?

The Australian Consumer Law (ACL) is Schedule 2 to the Competition and Consumer Act 2010 (Cth). It is a single national law applied uniformly in every state and territory, covering consumer guarantees, unfair contract terms, unfair practices and product safety.

Do all products and services come with a guarantee?

Goods and services supplied by a business in trade or commerce to a consumer automatically carry statutory guarantees under sections 51 to 62 of the ACL. These exist regardless of any store policy, and generally cannot be excluded by a contract term.

Who decides whether I get a refund or a repair?

It depends on whether the fault is major or minor. For a minor, fixable fault, the consumer first requires the supplier to fix it within a reasonable time under section 259(2), and the supplier can comply by repairing, replacing or refunding (section 261); if it refuses or fails, the consumer can have it fixed elsewhere and recover the reasonable cost, or, subject to the limits in section 262, reject the goods. For a major or unfixable fault, the consumer chooses under section 259(3): reject the goods (subject to section 262) for a refund or replacement, or keep them and claim compensation for the reduced value.

Is the consumer guarantee threshold $40,000 or $100,000?

Section 3(1)(a)(i) of the ACL still literally reads $40,000, but section 3(1)(a)(ii) allows a greater amount to be prescribed, and $100,000 (including GST) has been prescribed as that greater, currently operative figure. Goods and services ordinarily bought for personal or household use are covered regardless of price, as is a vehicle or trailer bought mainly to carry goods on public roads.

Can a business exclude the consumer guarantees in its terms and conditions?

No. Section 64 of the ACL makes a term void to the extent it tries to exclude, restrict or modify a consumer guarantee for an ordinary consumer purchase. A narrow business-to-business exception exists under section 64A, but it never covers the title, possession or undisclosed-securities guarantees, and it does not apply if the buyer establishes that it is not fair or reasonable for the supplier to rely on the term.

What penalty can a business face for breaching the ACL?

For the most serious contraventions, including unfair contract terms and unconscionable or misleading conduct, a body corporate faces the greater of $100,000,000 and, where the court can determine the benefit obtained, three times its value or, where it cannot, 30% of adjusted turnover during the breach period, under section 224. An individual faces up to $2,500,000. The corporate figure doubled from $50,000,000 on 28 March 2026.

Who enforces the Australian Consumer Law?

The ACCC enforces the ACL nationally, alongside a dedicated regulator in every state and territory, such as NSW Fair Trading, Consumer Affairs Victoria and WA Consumer Protection. The ACCC generally does not resolve individual disputes; state and territory regulators and, ultimately, tribunals handle those.

Does the ACL apply to online purchases?

Yes. Purchases made online from an Australian business are covered by the same consumer guarantees and unfair contract terms protections as in-store purchases. Overseas businesses that actively sell into Australia are also bound by the ACL, though enforcement against a business with no Australian presence can be limited in practice.