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Changes to the Consumer Guarantees Act are good news for consumers

By Claire Mansell - 23 Jan 2014

Many of us have taken advantage of the sales over the summer holidays. But what happens when the bargain of the century turns out to be a lemon? Changes to the Consumer Guarantees Act which come into force in June will provide further protection for consumers but may pose challenges to business owners.

Firstly, the new law will ban retailers from making unsubstantiated representations about their products/services. A retailer can't make a representation about a product or service without reasonable grounds. This will apply regardless of whether or not the representation is false or misleading.

Secondly, standard consumer contracts can no longer include unfair terms. This will apply to standard consumer contracts where the consumer has no opportunity to negotiate terms. Unfair terms are terms that:

  • would cause significant imbalance in the parties' rights
  • are unnecessary, and
  • harm the consumer. 

It is important to note that only the Commerce Commission will have the power to prosecute wayward businesses under these provisions.

Contact us if you've recently been dealt a lemon and would like advice on how to enforce your rights under the Consumer Guarantees Act.


Claire Mansell


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