Starts 1 July 2027/C2026A00064/Read from the authorised Act/Not legal advice; does not certify
Competition and Consumer CheckerThe Act, section by section
Section 28B(2)Scope or machinery

The two-limb test for unfair conduct

Conduct is an unfair trading practice only if both limbs are met. It must manipulate the consumer or unreasonably distort the setting in which the consumer decides, or be likely to do so. It must also cause, or be likely to cause, detriment to the consumer, whether financial or otherwise.

Competition and Consumer Amendment (Unfair Trading Practices) Act 2026, Schedule 1, Part 1, item 7, section 28B(2)Starts 1 July 2027Part 1: unfair trading practices
The requirement

Apply both limbs together. A manipulative design with no detriment is outside the definition; a harmful outcome with no manipulation or distortion is also outside it. The definition says "if, and only if", so the two limbs are the whole test.

Who it binds. The same supplier as section 28B(1). The test is also the frame a regulator, court or complainant will use to read the conduct.

Operative term. manipulate the consumer

What this means in practice

The first limb is about the effect on the consumer, not the intent of the supplier. Conduct can manipulate without a lie, and it can distort the setting without hiding a fact. Pre-selected add-ons, a countdown that resets, a consent box that is hard to refuse, or a comparison that omits the realistic alternative are the kinds of facts a review should test. The second limb needs a detriment that is real or likely: money paid, time lost, a right given up, or a decision the consumer would not otherwise have made. Record both limbs separately. A single paragraph that says "the flow is fair" does not show the analysis.

How to test it

Write the test as two columns. In the first, describe how the conduct affects the consumer decision: what is shown, what is omitted, what is defaulted and what pressure is applied. In the second, describe the detriment and who bears it. If either column is empty, the conduct is not caught by this section as drafted, but it may still breach another provision. If both are filled, escalate before release. The word "likely" means the analysis must cover a realistic consumer, not only the most careful one.

Evidence to keep

The Act does not prescribe these records. They are the artefacts our reading says a regulator or auditor may ask for; keep the ones that fit your business and the provision.

  • Two-limb assessmentA dated assessment of the conduct against each limb, with the facts relied on and the reviewer.
  • Consumer journeyScreenshots or recordings of the decision point, including defaults, timers, prompts and the route to decline.
  • Detriment estimateThe price, time or right at stake, calculated for a typical consumer.
  • Legal sign-offA record that the assessment was reviewed by someone with authority to stop the release.
  • Post-release checkThe complaints or refunds that tested the assessment after launch, and what changed.

What to do first

  1. Split the assessment into the two limbs and refuse a release that cannot fill both columns.
  2. Test the flow with a consumer who is not familiar with the product, and keep the recording.
  3. Re-run the assessment when a default, a price or a cancellation route changes.

Questions

Is intent part of the test?
The text does not require proof of intent. It asks what the conduct does or is likely to do to the consumer, and whether harm follows or is likely. Intent may be evidence, but it is not a separate element in the definition.
Does a likely detriment count?
Yes. The second limb covers a detriment that is likely, not only one already suffered.

Related sections

s 28B(1): The bans 28B(6): Exampless 28B(3): Exclusions