You’re planning a long‑awaited break in Port Douglas and start browsing online for resorts. Almost immediately, the same prompts appear beneath the glossy photos:

• “Only 3 rooms left at this price”
• “12 people are viewing this property right now”
• A soft countdown ticking beside a bright “Book now” button.

Taken together, these cues convey a clear message, namely that delaying a booking carries a real risk of missing out.

The concern with practices like this is that the accumulation of subtle “nudges” and persistent “nags” can push consumers to enter into transactions more quickly than they otherwise would. Individually, each element may be defensible; however together, they can create a decision‑making environment that pressures or steers behaviour in ways the consumer may not have intended.

It is the increasing prevalence of practices like these (particularly in online and digital markets) that has driven the push for reform. The Government’s proposed Unfair Trading Practices (UTP) laws are intended to address conduct that may not neatly breach existing Australian Consumer Law (ACL) prohibitions, but nonetheless distorts consumer choice or exploits behavioural biases, filling perceived gaps in the current ACL framework.

In this article, we examine how the proposed UTP laws came about and explain the general prohibition on unfair trading practices. We also briefly touch on the specific measures proposed for subscriptions and drip pricing, which will be explored in more detail in our next follow‑up article.

HOW WE GOT HERE

The proposed UTP laws have been quite a few years in the making. The process began with Treasury’s Consultation Regulation Impact Statement (CRIS) on Unfair Trading Practices, released in August 2023, which sought views on whether the ACL should be expanded to address conduct and practices that were seen as harmful but not clearly addressed by existing prohibitions in the ACL. That consultation highlighted growing concern about manipulative digital design (such as those described in our Port Douglas holiday example), subscription practices and pricing transparency.

In response to the concerns identified in the 2023 consultation, Treasury undertook a further consultation in 2024 focused on the design of a potential unfair trading practices regime. That process considered how any new regime should be structured, in particular, whether reform should take the form of a general, principles‑based prohibition or alternatively targeted, prescriptive prohibitions for specific practices (or a combination of both).

Feedback from regulators, consumer groups and industry during that design phase consistently favoured a combined approach. Submissions emphasised that while a general prohibition was needed to address evolving and novel forms of manipulation, specific, prescriptive rules were also necessary to deal with recurring high‑risk practices (such as subscription traps and drip pricing) where clearer obligations would provide greater certainty and protection.

That design work culminated in November 2025, when Consumer Ministers agreed to introduce new, economy‑wide unfair trading practices laws as part of broader ACL reforms. Treasury’s subsequent Decision Regulation Impact Statement, published in December 2025, confirmed that direction. In February this year, Treasury released the Exposure Draft Bill to implement that agreed policy position.

CONSUMERS AND SMALL BUSINESSES – WHO IS COVERED?

While the general unfair trading practices prohibition in the February Exposure Draft is framed around consumer dealings, the subscription‑specific provisions go further. Those rules expressly apply where a subscription contract meets either the consumer requirement or the small business requirement.

In simple terms:

• a contract meets the ‘consumer requirement’ where an individual acquires goods or services wholly or predominantly for personal, domestic or household use; and
• a contract meets the ‘small business requirement’ where it is a standard form contract for the supply of goods or services and the subscriber is a business that employs fewer than 100 people or has annual turnover of less than $10 million (for their last financial income year that ended at or before the time the contract is made).

As a result, the proposed subscription rules capture not only consumer subscriptions, but also standard‑form subscription contracts with small businesses that meet the small business requirement noted above. This reflects the Government’s view that subscription traps present similar risks in both consumer and small‑business contexts, particularly in digital markets. The Government has also indicated, through earlier consultations and public statements, that extending the broader unfair trading practices prohibition to small‑business dealings remains a live policy consideration, even though that extension is not included in the current Exposure Draft.

THE GENERAL PROHIBITION

Under the Exposure Draft, a business would contravene the ACL if its conduct:

1. unreasonably manipulates a consumer, or unreasonably distorts the environment in which the consumer makes a decision; and
2. causes, or is likely to cause detriment (financial or otherwise).

Examples of such conduct given in the proposed legislation are as follows:

3. interference with the consumer’s ability to exercise legal rights, or seek legal remedies, in relation to the supply;
4. failure to disclose material information, or disclosure of material information in a complex or ineffective way, to the consumer; and
5. creation of an environment which places the consumer under unreasonable pressure in relation to, or obstructs the consumer from, making or fulfilling the consumer’s decision.

The prohibition is proposed to sit alongside existing ACL provisions (e.g., s 18 misleading or deceptive conduct; s 21 unconscionable conduct; s29(1) misleading or false statements; s24 unfair contract terms), rather than replace them.

THE SPECIFIC UTP LAWS (IN BRIEF)

Alongside the general UTP laws, the Exposure Draft proposes two targeted reforms designed to address recurring high‑risk practices. Here’s the short version (we’ll examine each in more detail, in a follow‑up article).

1. Subscription contracts (addressing “subscription traps”)
   1. The specific subscription‑related reforms are aimed at avoiding “sign‑up easy, cancel hard” models. These traps often involve free trials rolling into paid periods without adequate warning, or renewal processes that rely on friction, complexity, or buried disclosures to keep customers subscribed.
   2. In practice, the proposed rules require:
      • Reminder notices ahead of renewals and before a free trial converts into a paid subscription.
      • Cancellation pathways that are at least as easy as sign‑up, meaning businesses cannot require a consumer to call to cancel if sign‑up occurred online.
      • Point‑of‑offer disclosures about price, renewal terms and post‑trial charges before a consumer signs up.
   3. These obligations aim to eliminate design choices that obscure key information or place unnecessary pressure or effort on consumers seeking to end a subscription.
   4. These provisions are intended to apply to both consumers and small businesses, which follow the definitions in the UCT regime.
2. Drip pricing (hidden or late‑revealed fees)
   As we noted in an earlier article, the ACL already prohibits misleading pricing, including where mandatory fees are omitted or add‑on charges are only revealed at checkout. While ss 47 and 48 regulate what must be disclosed (the single price and price inclusions) the new UTP laws add prescriptive standards for how, where and when the full price must appear across the journey, requiring a lot more transparency for consumers.

WHAT PENALTIES ARE INTENDED TO APPLY TO BREACHES OF THE UTP PROVISIONS?

The prohibition will carry significant penalties in line with other similar ACL breaches (up to $50 million, or higher turnover‑based alternatives), enforceable by the ACCC, state/territory regulators and private litigants.  In addition, the ACCC will also have the power to issue infringement notices.

WHAT’S NEXT?

In our next article, we’ll examine these specific prohibitions in detail, including how the subscription rules and drip‑pricing obligations work, and the practical system and changes businesses will need to implement ahead of the proposed 1 July 2027 commencement date.

HOW CAN WE HELP YOU?

We have a dedicated Consumer and Contracting Law team that can assist you with understanding your obligations in relation to the Australian Consumer Law.

This article was written by Teresa Torcasio, Partner and Caitlyn White, Special Counsel.