Jan 2018 Charity & NFP Law Update>
The Australian Competition & Consumer Commission published A guide to the Australian Consumer Law (the “Guide”) on December 18, 2017. The Guide outlines general principles and provides examples to assist charities and fundraisers with understanding their obligations under the Australian Consumer Law (“ACL”), which is set out under Schedule 2 of the Competition and Consumer Act 2010. The ACL outlines obligations concerning unfair practices, consumer transactions, product safety, and product-related services, and applies to charities, not-for-profits, and fundraisers in Australia in certain circumstances.
In general, the ACL applies only to activities that are in “trade or commerce”. The Guide indicates that since fundraising activities may occur in trade or commerce, those who engage in fundraising activities may have obligations under the ACL. It further clarifies that a fundraising activity that is in trade or commerce includes fundraising activities involving supplies of goods or services, fundraising by a for-profit professional fundraiser, and “fundraising in an organized, continuous and repetitive way.”
Where a fundraising activity is in trade or commerce, or where goods or service are supplied as part of a fundraising activity, the fundraiser must not engage in misleading or deceptive conduct in relation to either the fundraising activity or the goods and services supplied, regardless of whether there is intention to mislead or deceive. Similarly, unconscionable conduct is prohibited under the ACL. The Guide explains that unconscionable conduct “includes trading practices that are harsh or oppressive and go against good conscience”, as conscience is judged by the norms of society. Further, it states that conduct may also be unconscionable “where one party knowingly exploits the special disadvantage of another.” The Guide also explains that there are further obligations to comply with where fundraising activities specifically involve the supply, or promotion of the supply of a good or service, and outlines these obligations.
While the Guide applies only to Australian charities, not-for-profits and fundraisers, its general principles and examples with regard to consumer protection may be of interest to those in the Canadian charitable sector and, despite having no legal application in Canada, is helpful in terms of providing guidelines for “best practices.”