PrivacyRules Australian law firm member Macpherson Kelley published an interesting article on the recent changes to the New Zealand Fair Trading Act 1986 (Act) that came into effect from 16 August 2022.
Since March 2015, the Act has prohibited the use of “unfair contract terms” (UCTs) in standard form consumer contracts.
Now, since August 2022, the UCT regime also extends to standard form small business (trade) contracts.
A standard form small trade contract is where:
- each party is engaged in trade and it is not a consumer contract; and
- the trading relationship does not exceed an annual value threshold of NZD$250,000 (including GST, if applicable) when the trading relationship first exists.
The expanded UCT regime applies to new small trade contracts entered into in New Zealand, as well as existing contracts that are renewed or varied, as of 16 August 2022.
The UCT regime cannot be contracted out of by the parties and any attempt to do so may be a breach of the Act.
Read Macpherson Kelley’s article to find about what businesses located in or trading in New Zealand should do.