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“Safety Net” Consumer Protection: Using Prohibitions on Unfair and Unconscionable Conduct to Respond to Predatory Business Models

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  • Jeannie Paterson
  • Gerard Brody

Abstract

Consumer advocates and regulators in Australia have long been concerned about prevalent business models that prey upon vulnerable consumers. This paper considers both the types of factors that might justify consumer protection legislation responding to business models that take advantage of the reduced ability of consumers to protect their own interests in the transaction in question and the type of legislative response that might be utilized. In particular, the paper explores the role of standard-based “safety net” prohibitions on unconscionable or unfair conduct. The paper considers the approach taken by Australian courts to the prohibition on “unconscionable conduct” in the Australian Consumer Law and compares this provision with the general prohibition in the Directive on Unfair Commercial Practices. The paper argues that, while Australian courts have made effective use of the prohibition on unconscionable conduct in responding to predatory business models, a safety net provision based on the Directive would have merit in the Australian context as providing better guidance to consumers and businesses alike as to the limits of acceptable market conduct. Copyright Springer Science+Business Media New York 2015

Suggested Citation

  • Jeannie Paterson & Gerard Brody, 2015. "“Safety Net” Consumer Protection: Using Prohibitions on Unfair and Unconscionable Conduct to Respond to Predatory Business Models," Journal of Consumer Policy, Springer, vol. 38(3), pages 331-355, September.
  • Handle: RePEc:kap:jcopol:v:38:y:2015:i:3:p:331-355
    DOI: 10.1007/s10603-014-9276-y
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    References listed on IDEAS

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    Cited by:

    1. J. M. Paterson & E. Bant, 2021. "Should Australia Introduce a Prohibition on Unfair Trading? Responding to Exploitative Business Systems in Person and Online," Journal of Consumer Policy, Springer, vol. 44(1), pages 1-19, March.

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