The Australian Parliament is due to resume on 22 July 2025 for the first time since the Labor Government was re-elected for a second term in the May 2025 federal election.
In its first term, the Government implemented several significant reforms to Australia’s competition and consumer laws, including raising penalties for breaches of the Competition and Consumer Act 2010 (Cth) (CCA) and Australian Consumer Law (ACL), banning unfair contract terms, and legislating a mandatory, suspensory merger clearance regime.
Looking ahead to its second term, the Government has committed to a number of competition reforms including an ex ante digital competition regime, a ban on non-compete clauses and revitalising national competition policy. The Government has also proposed a range of new consumer protection measures to address pricing practices, unfair trading practices, scams, and AI-enabled goods and services.
In this insight, we summarise the proposed reforms to look out for in this term.
Competition Law Reforms
Merger Reforms
In its previous term, the Government passed legislation to reform the merger clearance regime. Under the new regime, ACCC clearance will become mandatory for certain transactions meeting monetary thresholds (or other specific industry thresholds).
The new merger clearance regime commenced on a voluntary basis on 1 July 2025. Mandatory notification requirements will commence on 1 January 2026.
For further details and to stay up to date with the latest developments, visit KWM’s merger clearance regime webpage.
Digital Competition Regime
In February this year, the Treasury finalised consultation on its Options Paper (published December 2024) that sets out the Government’s proposed new digital competition regime. The regime seeks to promote competition in digital platform markets by addressing conduct that is anti-competitive, creates barriers to entry, or exploits market power to harm Australian users of digital platform services.
The new regime will introduce upfront (ex ante) rules for certain ‘designated’ digital platforms that hold a critical position in the Australian economy. The framework will be established through amendments to the CCA with key features including designation, obligations and enforcement and subordinate legislation providing detailed, service-specific obligations.
Non-compete Clauses
In the 2025-26 Budget prior to the election, the Government announced that it would introduce a statutory ban on ‘non-compete’ clauses for workers earning less than the high-income threshold in the Fair Work Act 2009 (Cth) (currently $183,100) which will take effect from 2027.
The Government also announced that it would close loopholes that allow businesses to fix wages by making anti-competitive arrangements to cap workers’ pay and conditions, and ‘no-poach’ agreements which prevent staff from being hired by competitors.
The Government is consulting on the changes, including on exemptions, penalties and transition arrangements. It will also consult on other possible changes such as non-solicitation clauses for clients and co-workers, and non-compete clauses for high-income workers.
For more information, see our previous insight: ‘Encouraging aspiration, unlocking opportunity, lifting real wages’ – the proposed ban on non-compete clauses - KWM.
National Competition Policy
In November 2024, Commonwealth, state and territory treasurers signed two agreements to revitalise National Competition Policy: the Intergovernmental Agreement and Federation Funding Agreement Schedule. These agreements revamp the National Competition Principles established in the Competition Principles Agreement 1995.
The new agreements set out the first tranche of reforms for a 10-year reform program, supported by a $900 million National Productivity Fund. This first tranche of reforms will focus on alleviating cost-of-living pressures, while future reform tranches are planned for later this year through to mid-2030.
For more information, see our previous insight: ‘Managing Government Business – Australia's New Competition Agreement’ - KWM.
Consumer Law Reforms
Unfair Trading Practices
After introducing penalties for unfair contract terms in its previous term, in October 2024, the Government announced that it will introduce a prohibition on unfair trading practices. The prohibition is designed to protect both consumers and small businesses from a range of business practices that the ACCC has identified as causing consumer detriment but may not be neatly caught under existing consumer law protections. Business practices that will be targeted by the proposed prohibition include subscription traps, drip pricing, dynamic pricing, online account requirements, and barriers to customer support.
In November 2024, the Treasury published a Consultation Paper seeking stakeholder feedback on the design elements of the proposed general and specific prohibitions on unfair trading practices, building on stakeholder feedback that the Treasury received on its initial Consultation Regulation Impact Statement published in August 2023. Consultation closed in December 2024.
The proposed prohibition would be introduced as an amendment to the ACL, with the Treasury flagging that it will consider extending the protections to financial products and services regulated under the Australian Securities and Investments Commission Act 2001 (Cth).
Supermarket Sector
A key focus area of the Government’s consumer law reform efforts to address cost of living pressures has been the supermarket sector. Key reform proposals include:
- Addressing shrinkflation. In October 2024, the Government announced it would take action to address shrinkflation in the supermarkets and retail sectors. This will take place by strengthening the Unit Pricing Code to make it easier for consumers to make accurate and timely price comparisons and introducing substantial penalties for breaching this Code.
- ACCC Supermarket Inquiry Final Report. In March 2025, the ACCC published its Supermarket Inquiry Final Report. The Government has expressed in-principle agreement with the ACCC’s recommendations which include planning and zoning changes to reduce barriers to entry, enhanced information requirements for discounts and unit pricing, and greater supply chain transparency. As a starting point, the Government announced $2.9 million in funding over three years for fresh produce industry associations to deliver targeted education programs to assist suppliers to understand and enforce their rights against large supermarkets under the Food and Grocery Code.
- Banning supermarket price gouging. In March 2025, the Government promised to introduce legislation to ban supermarket price gouging by the end of 2025. This would involve setting up a taskforce to advise on introducing an ‘excessive pricing regime’ for supermarkets with penalties for contraventions and enforcement by the ACCC.
- Mandatory Food and Grocery Code of Conduct. In April 2025, the Food and Grocery Code of Conduct became mandatory. The Code governs how supermarkets and wholesalers negotiate and contract with their suppliers. The ACCC will now be able to issue infringement notices and take court action seeking penalties against businesses that contravene the Code.
Scams Prevention Framework
The Scams Prevention Framework Bill 2025 was passed by Parliament on 13 February 2025, amending the CCA to establish a regime imposing obligations on entities in designated sectors to take actions to protect consumers from scam activity involving their services.
The Scams Prevention Framework establishes a legislative framework requiring entities in designated sectors to take actions to protect consumers from scam activity in relation to their services. It introduces overarching principles and sector-specific mandatory codes. It also provides for civil penalties for contraventions, enforcement through a multi-regulator model (with the ACCC as the key regulator), and internal and external dispute resolution mechanisms for victims.
Banks, certain digital platforms (including social media) and telecommunications providers will be the first sectors required to comply with the SPF. The next step is for the Treasurer to designate sectors and draft SPF rules and SPF codes for those sectors.
Artificial Intelligence and the ACL
In October 2024, the Treasury published a Consultation Paper as part of its Review of AI and the Australian Consumer Law, seeking stakeholder feedback on whether the ACL is fit for purpose to deal with AI-enabled goods and services.
The Consultation Paper identifies examples of AI-enabled goods and services, including smart phones (with AI features such as facial recognition, voice assistants and photo enhancements), wearable devices (with AI features to monitor health and fitness), online telehealth services with AI, web analytics with AI, and ride-sharing apps using AI for route optimisation and dynamic pricing.
The Consultation Paper sought views on the following issues:
- how well adapted the ACL is to support Australian consumers and businesses to manage potential consumer law risks of AI-enabled goods and services;
- the application of well-established ACL principles to AI-enabled goods and services;
- the remedies available to consumers of AI-enabled goods and services under the ACL; and
- the mechanisms for allocating liability among manufacturers and suppliers of AI-enabled goods and services.
Consultation closed in November 2024. The Consultation Paper states that the Review will complement other policy work in progress in relation to the consumer protection framework, and insights from the Review will inform broader work such as mandatory guardrails for AI in high-risk settings.
Prohibitions for Breaches of Consumer Guarantees and Supplier Indemnification Provisions
In October 2024, the Treasury published a Consultation Paper seeking stakeholder feedback on reforming the following ACL provisions:
- Consumer guarantee provisions. The ACL contains a set of guarantees that apply to consumers who purchase goods and services from Australian suppliers, importers and manufacturers (e.g. guarantees as to acceptable quality and being fit for purpose). Where a product or service fails to meet a consumer guarantee, a consumer is entitled to a remedy (e.g. refund, repair, replacement, compensation or cancellation of contract), depending on whether there is a minor or major failure.
- Supplier indemnification provisions. The ACL requires suppliers to provide consumers with a repair, replacement or refund where there has been a failure under the consumer guarantees, and manufacturers are liable for indemnifying suppliers for the cost of providing the consumers with a remedy where the manufacturer is at fault.
Currently, it is not a contravention of the ACL for businesses to fail to provide a remedy for consumer guarantee failures, or for manufacturers to fail to reimburse suppliers for consumer guarantee failures that they are responsible for. The Consultation Paper proposes introducing prohibitions for failing to provide a consumer guarantee remedy, manufacturers refusing to indemnify suppliers and manufacturers retaliating against suppliers who request indemnification. It also proposes introducing powers for the ACCC (and potentially the state and territory regulators) to issue infringement notices and seek civil penalties for contraventions of these prohibitions.
Consultation closed in November 2024. The next step is for a Decision Regulation Impact Statement to be developed to outline the evidence received and the preferred policy option. Reforms to the ACL will then be considered and agreed in consultation with the states and territories.
