Consumer protection continues to evolve across Australia’s regulatory landscape, with Parliament recently passing the Competition and Consumer Amendment (Unfair Trading Practices) Act 2026. The reforms introduce a broad prohibition on unfair trading practices and subscription traps from 1 July 2027 and are designed to prevent business practices that manipulate consumers, distort decision-making or create unnecessary barriers that may cause consumer detriment. The changes represent one of the most significant expansions of consumer protection law in many years and signal a continued regulatory focus on consumer outcomes, transparency and fairness.
While much of the initial discussion surrounding the reforms has focused on retail businesses and online commerce, AFSL and ACL holders should not assume they fall outside the broader regulatory direction. Regulators are increasingly looking beyond whether information has technically been disclosed and focusing on whether consumers can genuinely understand, access, and act on that information. This shift is already evident in increased scrutiny of complaints handling, vulnerable customers, breach reporting, product design, and broader conduct obligations.
Historically, compliance frameworks largely focused on disclosure. If fees were disclosed, warnings were included and documentation was signed, businesses were generally considered to have met their obligations. Increasingly, however, regulators are assessing what consumers actually experience. The new question becoming more relevant is not simply whether information was provided, but whether customers were able to make informed decisions without being pressured, manipulated or disadvantaged during the process.
This presents an important consideration for financial services businesses. Many organisations have invested heavily in compliance frameworks, policies and documentation, but compliance reviews continue to identify situations where operational processes create poor consumer outcomes despite technically compliant paperwork. Complex onboarding processes, confusing consent mechanisms, difficult cancellation procedures, unclear fee explanations, or customer journeys that unintentionally steer individuals toward a particular outcome can all create risk despite otherwise compliant documentation.
One of the most common causes is fragmented ownership of the customer journey. Marketing may manage website content, operations control onboarding processes, compliance reviews disclosures and management focuses on commercial outcomes. Individually, each component may appear appropriate. Collectively, however, the client experience may create confusion, friction or unintended consumer disadvantage. As regulators continue shifting their focus towards operational effectiveness and consumer outcomes, businesses that fail to assess how their customer journey operates in practice may face increasing scrutiny.
The period leading up to the commencement of the reforms provides an opportunity for organisations to review how clients interact with their business. Customer journeys should be assessed from initial enquiry through to onboarding, ongoing service, complaints handling and termination. Businesses should consider whether fees and charges are genuinely transparent, whether consent is clearly obtained, whether communications are easy to understand and whether customers can exercise their rights without unnecessary difficulty. While these considerations matter from a compliance perspective, they also strengthen customer relationships and improve business outcomes.
The most effective compliance frameworks are no longer those that simply contain policies and procedures. They are the frameworks that demonstrate those policies and procedures are operating effectively in practice. Organisations that regularly test their customer experience, monitor feedback and continuously improve their processes are likely to be best positioned for future regulatory expectations.
Call to Action
The new unfair trading practices regime highlights a simple question every AFSL and ACL holder should be asking:
Would an independent reviewer conclude that your customer journey is fair, transparent and operating as intended?
Many businesses have invested heavily in policies, disclosures, and compliance documentation but have never independently tested how clients experience onboarding, disclosures, consent mechanisms, the complaints process, or service delivery in practice. As regulatory expectations continue to shift toward consumer outcomes and operational effectiveness, those gaps may become increasingly difficult to defend.
AICS conducts independent AFSL and ACL Licensee Reviews, Compliance Health Checks, and Governance Reviews designed to identify weaknesses before regulators, complainants, or remediation programs do. Our reviews assess not only your documented framework but how your business operates in practice, providing practical recommendations that strengthen compliance, governance and consumer outcomes.
If you are unsure whether your customer journey, governance arrangements or compliance framework would withstand increasing regulatory scrutiny, now is the time to find out. Contact AICS to discuss an independent AFSL or ACL Licensee Review tailored to your business, and gain clear visibility of the risks, gaps, and improvement opportunities within your compliance framework. contact Cheyenne and the team at [email protected] or call 07 3251 2481.
