The Territorial Scope of Australia’s Unfair Contract Terms Provisions

Abstract

Section 23 of the Australian Consumer Law, which is sch 2 of the Competition and Consumer Act 2010 (Cth), invalidates unfair terms in particular types of contract. Section 5(1) of the Act extends the application of the Australian Consumer Law to conduct outside Australia by (among others) corporations carrying on business within Australia. In Carnival plc v Karpik (‘Ruby Princess’), the High Court of Australia held that s 5(1) applies to the unfair contract terms provisions without any further territorial limitation. The Court applied the provisions to a contract made in North America between a Canadian resident and a foreign company which was carrying on business in Australia through other transactions. This article investigates the territorial scope of the unfair contract terms provisions.