Amazon has been told to amend its ‘unfair’ rules for standard-form contracts before arriving to Australian shores. Kate Carnell, Australian Small Business and Family Enterprise Ombudsman, has written to the US online retail service to ensure their terms and conditions meet federal law requirements. “I’ve requested that Amazon review the terms and conditions in use for standard form contracts in its Australian operations to ensure they comply with the unfair contracts terms legislation,” states Carnell.

What are Amazon’s ‘unfair’ rules?

Under the US terms and conditions, the global-giant has absolute power to:

1. Reserve the right to refuse service,

2. Terminate accounts,

3. Cancel rights to use Amazon services,

4. Remove or edit content, and,

5. Cancel orders.

What is a standard-form contract?

The Australian Consumer Law was changed on the 12th of November 2016 to protect small businesses from unfair terms when entering into standard-form contracts.

A standard-form contract is a ‘take it or leave it’ agreement prepared by one party who has most, or all, bargaining power over the other party when negotiating terms. These contracts are typically used for the supply of goods and services to consumers in work environments such as: telecommunications, finance, domestic building, gyms, motor vehicle rentals, travel and utilities. Where an unfair contract may arise between Amazon and the vendor, the latter party would not be able to terminate the contract.

An unfair term can cause significant imbalance among the rights and obligations of the parties in a contract, may not be reasonably necessary to protect the legitimate interests of the party who would be advantaged by the term, and causes a detriment to a party if it were applied or relied upon.

To learn more about the changes to unfair contract terms, check out our previous guide.

When will Amazon arrive to Australia?

A recent report from Citi retail analyst Brian Raymond alerted clients the Australian site may launch within the next 60 days in October. Earlier this year, Amazon announced its fulfillment centre (major warehouse) will open in Dandenong, Melbourne in 2018. With a 24,000 sqm floor space that sheltered Bunnings Warehouse, it is expected the global giant will create hundreds of job opportunities for Australians. Amazon now has more than 382,000 employees around the globe.

Final Thoughts

The arrival of Amazon to the Australian marketplace will be a vital opportunity for small businesses to accelerate reach and competition online.

Let us know your thoughts…

Elie Choueifaty

Elie is a legal intern at LawPath assisting the content team to produce legal guides and blogs that facilitate for the access of legal service. With an interest in media, criminal, and family law, Elie is currently completing a Combined Bachelor's Degree of Communication (Journalism) and Laws at the University of Technology, Sydney.