This strategic brief discusses the Unfair Contract regime that will be introduced into Australia in 2010 and the effects it will have on the financial sector. The brief is divided into four sections. The opening section will give an overview of the new Australian Consumer Law. The second section will analyze the broad effects that the unfair contract regime may have on the banks, the economy and consumers. The third section will give an overview of specific aspects of the regime which banks have explicitly expressed concern and confusion about. The final section will then discuss the legal ramifications for banks under the regime.
Highlights
Over the past year Australian banks have undergone much scrutiny, with a severe decline in consumer confidence and a freeze in the availability of credit. Governments and banks have put measures in place to mend these problems. However by placing banks under the regulation of unfair contract terms such problems are likely to return, as consumer confidence would decline as a result of extra costs and paperwork, and investor confidence would also decrease leading to a reduction in the availability of credit.
Reasons to read this report - The influences from the consumer services market - The effects on the economy, banks and consumers under the unfair contract regime - Regulation and Legal Consequences for banks under the regime
