New sting in the tail of penalty provisions

Published On 15/05/2017 | By James Corrigan | Consumer protection, Enforcement, Litigation, Reform

Penalty units increasing

Penalty units are set to increase from their current value of $180 to $210 from 1 July 2017. This follows recent penalty unit increases in 2012 ($110 to $170) and 2015 ($170 to $180).

The change was effected by the Crimes Amendment (Penalty Unit) Act 2017 (Act), passed by Federal Parliament on 11 May 2017. In addition to increasing the value of the penalty unit, the Act also delays the first automatic CPI adjustment of the penalty unit (previously set down for 1 July 2018) until 1 July 2020, with indexation to occur every three years following that date.

The increase was originally announced as part of the Mid-Year Economic and Fiscal Outlook in December last year. The measure is described in the Act’s Second Reading Speech as apt to “strengthen courts’ ability to impose appropriate punishments on serious offenders.” The increase is also estimated to result in increased revenue to the Commonwealth of $80 million over the next four years.

Penalty units and the Competition and Consumer Act (“CCA”)

Penalty units are used to determine the amount payable for fines under many Commonwealth laws. Fines are calculated by multiplying the value of one penalty unit by the number of penalty units applicable for a particular offence under the relevant legislation.

Most substantive offences in the CCA (which includes the Australian Consumer Law) are not set by reference to penalty units. The increase will, however, result in an increase to the amounts payable associated with:

  • penalties attaching to infringement notices under section 134C for breaches of various provisions of the Australian Consumer Law; and
  • a number of procedural offences, including a refusal or failure to comply with a request for information, documents or evidence issued by the ACCC, or giving false or misleading information or evidence in response to such a notice, under section 155.

Further increases to penalties under the Australian Consumer Law?

Separately, the Productivity Commission (in its report on consumer law enforcement and administration) and Consumer Affairs Australia and New Zealand (CAANZ) (in its review of the Australian Consumer Law) have both recently recommended large increases in the maximum penalties applicable to a breach of the Australian Consumer Law.

See here for further information on the Productivity Commission’s report and here for further information on CAANZ’s review.

Picture: Flickr / Christopher Evans (resized and colour change) CC 2.0

About The Author

is a Solicitor in the Melbourne office at King & Wood Mallesons

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