Australian Competition Tribunal decision: A missed opportunity to improve solar sales practices

The Australian Competition Tribunal (the Tribunal) has handed down its decision today on the New Energy Tech Consumer Code (the Code), the proposed industry code for new energy technology such as solar panel sales and installations.  

The Tribunal declined to authorise protections for consumers relating to door-to-door sales, telemarketing and unaffordable unregulated finance, which the Consumer Action Law Centre advocated for to strengthen protections against harm caused to consumers by poor and unlawful selling practices in this industry.

“The Tribunal decision is very disappointing”, said Gerard Brody, CEO of Consumer Action.

“We have seen many cases where people have been ripped off by salespeople spruiking solar panels with buy now pay later finance, including people signed up to finance without their knowledge, that turned out to be more expensive than they were led to believe or was simply unaffordable. We also provided evidence to the Tribunal of Australians purchasing solar panels using buy now pay later finance who may have been significantly overcharged for their solar energy systems.

“The decision shows that self-regulation has failed to address harm caused by business models that rely on unsolicited and aggressive marketing. In short, this is a missed opportunity for industry to fix its own problems. Now it’s time for government to act to ensure people are better protected,” said Mr Brody.

Recent research found 28 per cent of buy now pay later users surveyed encountered financial difficulties directly related to their spending.

“Buy now pay later finance providers are not regulated the same way as other credit providers. They aren’t required to assess if the loans – sometimes in the tens of thousands of dollars – are really suitable or going to cause people substantial hardship. There are real risks that these loans leave people overindebted, so this is a problem that is not going to go away,” said Mr Brody.

The authorised code will require disclosure of fees and charges, including for buy now pay later providers, but this will not adequately address harm.

“The Australian Securities and Investment Commission’s (ASIC) previous research has shown that disclosure can be ineffective and can even serve to backfire, causing consumer harm. That’s why it’s important that ASIC’s upcoming report into the buy now pay later industry must consider independent evidence of consumer harm and hardship, it cannot rely on industry’s say so.

“Many Australians rightly want to get on top of energy bills and invest in renewable energy options at home. But allowing ongoing consumer rip-offs only serves to undermine transition to cleaner energy. It is up to state and federal governments, as well as regulators, to act.”



Media contact: Mark Pearce, Media and Communications Adviser | Consumer Action Law Centre | 0413 299 567 |

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