ACCC now targeting Unfair Contracts

Apr 07, 2017

The new unfair contract terms law is a priority for the ACCC in 2017. It will ensure small businesses, including those which are farms, receive the right type of protection.

We have been advised that the ACCC will be taking enforcement action against a number of companies across a range of industries over business-to-business unfair contract terms this year.

For the past six months, ADF together with State Member Dairy Organisations and Processor Members of the ADPF have been working on the Code of Practice for contractual agreements between farmers and processors. The development of this code is instrumental in protecting dairy farmers from unfair clauses and protecting our processors from incurring millions of dollars in fines. Now with full industry support, the Code of Practice is due to be finalised shortly.

The ACCC has reinforced the importance that if you operate a small business, you may be required to enter into standard form contracts with other businesses for goods and services. All dairy farmers should check the contracts they have with suppliers of inputs, like grain, to ensure they conform to the new legislation. The Australian Consumer Law now prohibits unfair terms in most of these contracts.

In their communications, the ACCC stated that it was no secret that traders (typically larger businesses) put potentially unfair clauses in their agreements, such as terms that give them:

  • an unreasonable ability to cancel or terminate an agreement
  • broad and potentially unreasonable powers to protect themselves against loss or damage
  • the ability to unilaterally change the terms of the contract
  • unilateral discretion to reject or downgrade produce
  • an unreasonable ability to limit or prevent small businesses from exiting their contracts. 

To be 'unfair', a term must:

  • cause a significant imbalance in the parties' rights and obligations
  • not be reasonably necessary to protect the legitimate interests of the party advantaged by the term, and
  • cause financial or other detriment (such as delay) to a small business if it were relied on. 

If you come across terms in a standard form contract you have been offered or you have entered into, and which you think may be unfair, you can report it to the ACCC Infocentre

For more information, including the definition of a small business and the meaning of 'unfair' contract terms, please see the ACCC website

John McQueen

Interim ADF Chief Executive Officer

 

Making the most of Canberra

Mar 31, 2017

On Wednesday, Australian Dairy Farmers (ADF) were in Canberra to discuss a range of issues with Ministers and Members of Parliament.

Throughout the day, ADF had the opportunity to discuss what is working well within the industry and to discuss what else needs to be done.

Our advocacy and policy work is at the heart of everything we do and is essential to ensuring Australian dairy remains competitive and well aligned for growth.

These meetings give us the opportunity to pursue important industry policy priorities and to reaffirm relationships with Ministers.

The main issues discussed included:

  • The progress on the draft Code of Practice;
  • The impact of technical barriers to trade (TBT) on the Australian dairy industry’s international trading opportunities;
  • Access to overseas workers to fill our workforce labour gaps;
  • Pathways to permanent residency for New Zealand born dairy farmers; and
  • Reiterating our support for the Effects Test currently before Federal Parliament. 

ADF continues to advocate for policies which will support the industry and we will continue to seek Government support to help drive innovation, which increases productivity and profitability.

We’re committed to ensuring the voice of the dairy is heard by highlighting the issues to Government and working with them on important reforms.

John McQueen

Interim ADF Chief Executive Officer


 

 

Australia, we are in good hands

Mar 24, 2017

This week, ADF President, Terry Richardson, took part in his first Animal Health Australia (AHA) industry forum in Canberra.

The meeting was called to discuss a range of topics including the management of the Emergency Animal Disease Response Agreement (EADRA), a unique contractual arrangement between Australia’s governments and industry groups to collectively reduce the risk of disease incursions and manage a response if an outbreak occurs.

Based on his first impression, Mr Richardson said the familiarisation and training offered to industry in the event of an outbreak is second to none.

“It is reassuring that as a collective we can come together with a shared goal of enhancing on farm bio-security practices and regulations.

“The degree of expertise and good management of our animal health and welfare issues means we are able to respond to any situation and manage any diseases to minimise their impact on farmers.

“This high level of preparedness is vital to show just how fast we, as an entire commodities industry, are able to respond to any outbreak should an issue arise”, said Mr Richardson.

Mr Richardson also took part in training for the National Management Group who have overall management responsibility in the event of an exotic disease incursion in Australia.

“The spread of the white spot virus in the SE Queensland prawn industry really highlights the threat posed to all agriculture from failing to maintain Australia’s strict biosecurity defence capabilities.

“It is important that we have adequate resources at the national and state levels, or we risk great (and increasingly) severe consequences.

“A large outbreak such as Foot and Mouth Disease would have significant repercussions and cost our economy up to $16 billion”, Mr Richardson said.

ADF has strong group of staff and farmers who are well prepared to respond to the threat of disease to safeguard the dairy industry and Australia’s reputation as a producer of safe, clean food.

In addition, resourcing of biosecurity remains a high priority for ADF and all industry bodies including AHA Industry Forum are encouraged to continue to pressure all governments in recognising this as a priority in the national interest.

John McQueen

Interim ADF Chief Executive Officer

 

What a gas

Mar 03, 2017

It is no secret that gas prices are on the rise.

An essential resource, gas is used to pasteurise milk and produce the heat needed for our driers to create milk powder.

Gas is already a significant input cost for dairy processors in Australia. Based on reports, gas prices are forecast to rise between 50-100 per cent by 2019. This will impact the processing of dairy and increase the manufacturing costs of milk products. The impact of any gas price rises can and will be felt by dairy farmers through their processors.

The rise in gas prices are due to supplies being diverted to meet international liquefied natural gas supply contracts, low levels of exploration and forecast production, restrictions on onshore exploration and development in some states and territories, and infrastructure constraints. Tighter gas supply translates to higher gas prices.

As the laws of supply and demand would suggest, Australians, sitting on bountiful gas reserves, should be enjoying cheap gas prices. But that’s not the case as a high percentage of our gas is being exported overseas.

Further to this, last year, the Victorian Government with bipartisan support banned unconventional gas exploration, including the controversial process of hydraulic ­fracturing (fracking), and extended a morat­orium on onshore conventional gas exploration until the end of the decade.

New South Wales and Tasmania also have various bans on onshore gas exploration and development in place. This means that the competition by domestic and international consumers for gas from existing fields will intensify, which will drive up prices further.

There are surely many policy levers that can be considered in this environment. One such lever was implemented more than 30 years ago, and formalised in 2006, as the North West Shelf offshore gas production was being developed. The WA Government implemented a policy of domestic reserve of 15 per cent to ensure their domestic market was not adversely impacted from the development of export markets.

It is understandable why many communities and farmers are concerned with hydraulic ­fracturing (fracking), and why there was bipartisan support to ban this type of unconventional gas exploration. However, we support onshore conventional gas mining which currently has a moratorium and, according to the Australian Competition & Consumer Commission, is needed as insufficient reserves exist for domestic and international demand.

In response, the COAG Energy Council will be implementing a package of reforms. Even so, there is still uncertainty whether sufficient gas will be available to meet future domestic demand.

The dairy industry along with other manufacturers are concerned about the policy failures in Australia when it comes to gas availability and prices. We need to add our voice to the growing list of industry groups who are calling for urgent action to address the shortage of gas on the domestic market.

John McQueen

Interim ADF Chief Executive Officer

 

Select Tags