HASS Test Business and Economics

Consumer

A person who purchases goods/services to satisfy needs & wants.

Business

• Organisation / individual that sells goods & services to consumers.

•Aim to make a profit.

Legislation

= means a law that has been passed by Parliament.

•In Australia, main legislation is the Competition and Consumer Act 2010 (Cth).

•Commonwealth (federal) = applies across all of Australia.

ACL (stands for..)

Stands for Australian Consumer Law

•The ACL is part of the CCA.

•Schedule 2

Why do we need legislation? (purpose)

•Protects consumers → gives them legal rights when they purchase G&S.

•Protects businesses → ensures they compete fairly & honestly.

•Creates a marketplace where buying and selling is safe, honest and competitive.

Who enforces the legislation/law?

•Australian Competition and Consumer Commission (ACCC) = at a federal level.

•WA Consumer Protection
= at a state (WA) level.

Consumer rights

The right to consumer guarantees.

Right to consumer guarantees

= is an automatic legal promise that goods and services sold to consumers must meet certain standards.

•12 guarantees = 9 goods, 3 services

•Because they are created by law, a business cannot remove or limit them.

Right to a remedy

Remedy= an action taken to fix a problem.

•3Rs (repair, replacement, refund)
In some cases + compensation.

•Remedy depends on whether the problem is minor or major.

Major vs. minor failure

Minor- Small problem that can be fixed quickly and easily.

Major-Serious problem that:

1)cannot be fixed easily

2)makes the product unsafe, OR

3)does not do the job it is supposed to do.

Exceptions to consumer guarantees

•Change of mind

•Misuse / damage by customer

•Customer knew of the fault before buying.

•Private sales

•Asked for a service to be done against the advice of the business.

Warranty

•Extra promise made by business

•Voluntary = they don’t have to

•May provide additional protection beyond what the law requires.

Consumer responsibilities

•Not set out in the CCA 2010

Legal:

Before purchase

- learn about the product & read terms and conditions

After purchase

-take care of product

-read & follow instructions

-contact seller with questions

-keep receipt

-be honest when making a claim

Consumer responisbilities

Social (ethical)

-Consume less

-Buy local

-Research the business

-Look for certification

Business rights

1)Receive payment

2)Refuse to provide a remedy if the consumer is not legally entitled under the law.

Business responsibilities

1)Comply with consumer guarantees

2)Provide the correct remedy when required

3)Not mislead or deceive consumers

4)Sell safe products

Product safety recalls

•When a business removes a product from sale and asks customers to return it because it has a safety defect.

•Purpose = prevent further injuries & provide a remedy.

•Business must provide 3Rs.

What is the ACCC

•Australia’s national regulator

•Independent government agency

•Enforcing the CCA 2010.

Role of ACCC

1) Protect consumers

•Monitors businesses to ensure they comply with ACL.

•Deals with widespread issues, not individual consumer disputes.

•May investigate complaints & issue penalties $$$ and court orders.

2) Promote fair competition between businesses

•ACCC works to prevent anti-competitive behaviour.

Strengths of ACCC

•Can take legal action and issue fines / penalties against businesses that break the law.

•Creates a fair marketplace by monitoring businesses to prevent anti-competitive behaviour.

•Works with businesses to remove unsafe products → reducing the risk of injury to consumers.

Limitations of ACCC

1)Limited resources

The ACCC cannot investigate every complaint because it has limited staff, funding and time.

2) Cannot resolve individual disputes

Only focuses on widespread or serious breaches of the law