Navigating Australian Consumer Law (Section 18): Business Essentials

If you sell goods or services in Australia, the Australian Consumer Law (ACL) is part of your day-to-day reality - even if you don’t think of yourself as a “legal” person.

At the centre of the ACL is Section 18, the rule that says you must not engage in misleading or deceptive conduct. In plain English: don’t create a false impression in your advertising, sales conversations, website content or customer communications.

In this guide, we’ll unpack what Section 18 means in practice, where businesses commonly slip up, and how to set up a simple compliance program to reduce risk. We’ll also point you to the core contracts and policies that support compliance so you can trade with confidence.

What Is Section 18 Of The Australian Consumer Law?

Section 18 of the ACL prohibits conduct that is misleading or deceptive, or likely to mislead or deceive. It’s a broad, catch-all rule that applies to almost every aspect of your dealings with customers and other businesses.

This means it’s not just about outright lies. If the overall impression created by your words, images, pricing, disclaimers, or silence would lead an ordinary customer to a wrong conclusion, you could breach Section 18.

Courts look at the “dominant impression” your conduct creates. They consider the target audience, the context (online vs in-store, business-to-consumer vs business-to-business), and whether reasonable consumers would be misled - even if a small print disclaimer exists. For a deeper legal overview, it helps to understand Section 18 and the elements of misleading or deceptive conduct.

Who Does Section 18 Apply To, And When?

Section 18 applies to any person or business “in trade or commerce”. That covers almost every business interaction, including:

• Website content, landing pages and checkout flows
• Social media posts, ads and influencer campaigns
• Product packaging, labels and inserts
• Sales calls, live chats and in-store conversations
• Emails, SMS and promotions (including loyalty programs)
• B2B proposals, quotes and tenders

It applies to dealings with consumers and businesses. Even sophisticated corporate customers can rely on Section 18 if your conduct misleads them.

Section 18 sits alongside more specific ACL rules, such as Section 29 (false or misleading representations). The ACCC often alleges breaches of both: Section 18 for the overall misleading conduct, and Section 29 for particular false statements (e.g. about price, characteristics, testimonials or country of origin).

Common Traps: Real-World Examples Of Misleading Conduct

Most businesses don’t set out to mislead anyone. Issues usually arise because of fast-paced marketing, assumptions, or poor internal sign-off. Here are the areas we see trip people up.

1) Price Promotions And “Was/Now” Pricing

“Was $149, now $79!” only works if the “was” price was a genuine, recent selling price for a reasonable period. If you barely sold at $149, or you ran the “sale” most of the time, the claim may be misleading. Similar caution applies to “% off” claims, “from” pricing and “limited time” offers.

Make sure you’re across Australia’s advertised price laws, keep evidence of pricing history, and have a sign-off checklist for campaigns.

2) “Up To”, “Unlimited”, “Best” And Other Superlatives

“Up to 50% faster” needs a solid basis and clear context (what’s the baseline and in what conditions?). “Unlimited” offers that throttle after a threshold can mislead if that limitation isn’t clear. Superlatives like “best” or “No.1” are risky unless you can substantiate the claim (e.g. independent rankings).

3) Green Claims And Sustainability Messaging

“Eco-friendly”, “carbon-neutral” or “recyclable” statements must be specific and supported by evidence. Broad “green” claims without explanation can mislead, especially if only part of a product or process meets the standard.

4) Testimonials, Reviews And Influencer Content

Reviews must be genuine, and influencer content must be transparent about paid relationships. If posts are edited, curated or incentivised in a way that creates a false impression, that’s a problem under Section 18 and often Section 29.

If you engage creators, put clear rules in your Influencer Agreement about disclosure and accuracy, and ensure marketing sign-off checks for these issues.

5) Email, SMS And “Dark Patterns” In UX

Confusing unsubscribe flows, pre-ticked boxes, or burying key information deep in your checkout may create a misleading impression about consent, add-ons or total cost. This overlaps with spam, privacy and email marketing laws - make sure your systems and templates are reviewed together.

6) Silence And Omissions

Leaving out a material fact can mislead. For instance, promoting a “12-month warranty” without stating that customers also have non-excludable ACL rights could mislead them about what they can actually claim if something goes wrong.

7) B2B Proposals, Quotes And Tenders

Section 18 is not limited to consumers. Overstating capability, capacity, results or compliance in a pitch can expose you to ACL claims, even if the client is a sophisticated enterprise buyer. Be careful with projected outcomes, savings and timelines - present assumptions and limitations clearly.

8) Disclaimers And Fine Print That Don’t Fix The Problem

Fine print won’t save you if the overall impression is still misleading. A disclaimer must be prominent enough and consistent with the headline message. If your headline says “Free” and the reality is “free with multiple paid conditions”, that inconsistency is the risk, not the absence of a disclaimer.

How To Build A Section 18 Compliance Program

You don’t need a giant legal team to manage your risk. A simple, repeatable process gets you most of the way there.

Step 1: Map Your Claims And High-Risk Touchpoints

• List the common types of statements you make: features, performance, environmental, health, pricing, testimonials, service levels, origin, inclusions/exclusions.
• Identify high-risk formats: hero banners, price promotions, comparison ads, “limited time” offers, and social videos.
• Review your website journey for “dark patterns” - pre-checked boxes, hidden fees, confusing promotions or consent flows.

Step 2: Create A Substantiation File

• For every measurable claim, keep evidence on file: lab tests, timing studies, availability data, genuine reviews, supplier certifications, pricing history, campaign logs.
• Update the file when you change formulation, supply chain or service model - old proof for a new product can be risky.

Step 3: Set A Plain-English Sign-Off Checklist

• Ask: Who is the audience? What’s the likely overall impression? Could a reasonable person misunderstand?
• Check claims against your substantiation file. If it’s a forecast or estimate, label it clearly and include assumptions.
• Ensure disclaimers are consistent and genuinely prominent - not hidden.

Step 4: Train Your Team

• Give marketing, sales and customer support short, focused training on Section 18 basics and your internal checklist.
• Role-play sales conversations and queries about pricing, discounts, guarantees and comparisons.
• Align your email templates, ads and scripts so the message is consistent across channels.

Step 5: Use The Right Contracts And Policies

• Make sure your website and platform rules are clear (we cover key documents below) and that they match your marketing claims.
• Centralise approvals for promotions, influencers and testimonials so a lawyer or trained manager can review high-risk campaigns.

Step 6: Monitor, Correct And Learn

• Track complaints, returns and escalations to spot patterns that might indicate a misleading impression.
• If something slips through, correct it promptly, contact affected customers if appropriate, and document your remedial steps.

How Section 18 Interacts With Other ACL Rules

Section 18 is the broad “don’t mislead” rule. Specific rules like Section 29 catch particular false statements (e.g. about price, performance or testimonials). Other parts of the ACL cover consumer guarantees and warranties - if you offer a written warranty, make sure your wording aligns with your legal obligations, not just the marketing promise.

If the ACCC or a customer alleges a breach, remedies may include injunctions (to stop the conduct), corrective advertising, compensation and other orders. Keeping good records of your claims and substantiation is your best defence that you took care to comply.

What Legal Documents Help Reduce Your ACL Risk?

Your contracts and policies won’t replace compliance, but they can set clear expectations, reduce ambiguity and help you respond to issues quickly. These are the core documents most customer-facing businesses should consider.

• Website Terms and Conditions: Sets the rules for using your site or app, explains ordering, pricing, delivery and limitations in a clear, central place.
• Privacy Policy: Explains how you collect, use and store personal information, which is essential if you run digital marketing or analytics.
• Warranties Against Defects Policy: If you offer a written warranty, this ensures it uses the required ACL wording and doesn’t understate customer rights.
• Terms of Trade: Your customer-facing terms for supply of goods or services - scope, price, delivery, returns, and responsibilities, written to be consistent with your advertising and the ACL.
• Influencer Agreement: Sets clear rules for disclosures, claims and approvals when creators promote your products or services.
• UCT Review and Redraft: A review to remove unfair contract terms from your standard form contracts, which reduces the risk that key terms are void and keeps your documents aligned with ACL requirements.
• Email Disclaimer: Helps frame the status of information in outbound emails and reduces misunderstanding in fast-moving sales conversations - useful alongside training and template control.

Good documents work best when they’re tailored to your operations and synced with your marketing. For example, if you offer “next-day delivery” in ads, your Terms of Trade should explain cut-off times, locations and exclusions in clear, customer-friendly language.

What About Quotes, Proposals And Emails?

Statements made in pre-contract discussions can still create legal obligations. Depending on the context, emails can be legally binding, and verbal promises can become part of the deal. Use consistent templates, avoid absolute promises unless you’ve checked feasibility, and sign off high-risk claims before they’re sent.

Marketing Channels To Align With Section 18

• Search and Social Ads: Ensure headlines match landing page content and that any price or performance claims are backed by your substantiation file.
• Emails and SMS: Keep offers and disclaimers clear and ensure consent and unsubscribe processes meet email marketing laws.
• Web Banners and Popups: Avoid “dark patterns”; make it easy to see total price, key conditions and genuine limitations.
• Reviews and Testimonials: Maintain processes to verify authenticity and disclose incentives where relevant.

FAQs: Quick Answers To Common Section 18 Questions

Is a disclaimer enough to avoid misleading conduct?

Not by itself. A disclaimer must be consistent with your headline claim and prominent enough to correct any false impression. If the overall impression is still misleading, a disclaimer won’t cure it.

Do I need to prove every claim I make?

If it’s a factual or measurable claim (like performance, savings, durability or environmental impact), you should hold evidence before publishing it. Keep that proof in a central substantiation file.

Are “puffery” and opinions safe?

Some obvious exaggerations (e.g. “the tastiest cookies on earth”) may be treated as puffery. But the line is thin - many “opinions” are really factual claims in disguise. If a statement could influence a customer’s decision, treat it like a claim you need to support.

What happens if we get it wrong?

Consequences can include ACCC action, court orders to stop the conduct, corrective statements, compensation and reputational damage. Early correction and good compliance records can reduce risk and show you’re acting in good faith.

Key Takeaways

• Section 18 of the ACL prohibits conduct that misleads or deceives - it covers the overall impression from your ads, website, sales conversations and customer communications.
• Risky areas include price promotions, “up to” and “unlimited” claims, green marketing, testimonials and influencer content, and unclear checkout or unsubscribe flows.
• Build a simple compliance program: map your claims, keep a substantiation file, use a sign-off checklist, train your team, and monitor complaints to spot issues early.
• Align specific ACL rules with your marketing, including Section 29 on false representations and advertised price laws.
• Put supportive documents in place - strong Website Terms and Conditions, a compliant Privacy Policy, a clear Warranties Against Defects Policy and fair Terms of Trade - and make sure they match your marketing promises.
• Act fast to correct any slip-ups, communicate clearly with affected customers, and document what you’ve done - it’s both good customer service and smart legal risk management.

If you’d like a consultation on setting up an ACL compliance program for your business or reviewing your marketing documents, you can reach us at 1800 730 617 or team@sprintlaw.com.au for a free, no-obligations chat.