GPSA welcomes changes to unfair fertiliser contracts

Grain Producers SA (GPSA) has welcomed much needed changes to fertiliser contracts after the peak body raised concerns with the Australian Competition and Consumer Commission (ACCC).

The ACCC this week announced that suppliers in the fertiliser industry have agreed to amend their contracts following an investigation into unfair contract terms.

In response to fertiliser supply complaints from some grain producers in South Australia, GPSA raised those concerns with the ACCC.

GPSA Chief Executive Officer Brad Perry said member feedback over the past few seasons exposed concerns with contracts.

“We thank the ACCC for investigating unfair contract terms and strengthening protections when it comes to fertiliser supply and urge grain producers to use the new and upcoming standard form fertiliser supply agreements,” he said.

Some of the potentially unfair terms identified by the ACCC included terms giving the supplier the right to unilaterally vary the quantity to be delivered to the buyer or to terminate the agreement if the supplier believed it would not be able to supply the goods. Some terms restricted buyers’ rights to raise issues about defects with the goods.

Under the new unfair contract term laws that come into effect on 10 November 2023, the ACCC will be able to take court action to seek pecuniary penalties for breaches of the unfair contract term law.

The maximum penalty will be the greater of $50 million or three times the value of the benefit derived or, if that value cannot be determined, 30 per cent of the company’s turnover during the period it engaged in the conduct.

The ACCC said it will continue to monitor traders in the fertiliser industry and, more broadly, across the agricultural sector, and investigate if there are concerns with contract terms.

Grain Producers SA is the peak industry body representing the 4,500 grain farming businesses in South Australia.

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