New disclosure obligations are now in place which will change the way NSW businesses (including intermediaries such as agents and brokers) communicate to their customers before completing a sale. The obligations aim to improve transparency for consumers without overly burdening businesses.
The new obligations that came into effect 1 July 2020 require businesses to disclose:
What changes do I need to be aware of?
Before supplying goods or services, a business must take reasonable steps to make customers aware of terms and conditions that may impact consumers. This includes at least the following:
Intermediaries (i.e. agents, wholesalers, distributors and retailers)
Intermediaries must also take reasonable steps to make customers aware of any commission or referral arrangements where the business receives a financial incentive from another supplier.
Meaning, customers will need to be informed that an arrangement exists, however intermediaries do not need to disclose the nature or value of the financial incentive.
Consumers should be aware that these changes are now law, although an educational rather than enforcement approach will be adopted for the first six months (1 July 2020 to 1 January 2020).
What businesses will be most impacted?
The obligations aim to improve transparency for consumers without overly burdening businesses.
Examples of businesses that will be affected by these new obligations will include banks and lenders, real estate agents, telecommunication companies, etc.
Real estate agents in particular may need to consider whether they are required disclose any arrangements relating to commission or referral arrangements.
How do I action these changes?
Businesses and Intermediaries are expected to take reasonable action to inform consumers of these terms and conditions. The best way to do this is to be clear, upfront and automatic by drawing consumer’s attention to the terms and conditions and providing an explanation.
Examples of how a business or intermediary might disclose this information include:
For more information and FAQs go to the NSW Government Fair Trading website.
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(Source: NSW Government Fair Trading)