Fair Trading Act 1987 (SA) and what your business must do to comply

If you sell goods or services to consumers in South Australia, the Fair Trading Act 1987 (SA) is a law you need to take seriously. It does two jobs at once. It applies the Australian Consumer Law as a law of South Australia, and it adds SA-specific rules and enforcement on top of that national framework.

The practical effect is straightforward. The same consumer protections that apply across Australia, such as the ban on misleading conduct and the consumer guarantees, are enforceable against you in South Australia, and Consumer and Business Services (CBS) is the agency that can investigate you for breaching them. This guide sets out who the obligations apply to, the four duty areas that catch most businesses, what non-compliance costs, and a checklist you can work through.

Who the Fair Trading Act applies to

The starting point is whether you supply goods or services in trade or commerce. That phrase covers almost everything a business does: advertising, quoting, selling, delivering and handling complaints. You do not need to be based in South Australia. If you sell to SA customers in person, online or by phone, you should assume the SA-applied Australian Consumer Law applies to you. The South Australian government's consumer law guidance confirms the Fair Trading Act 1987 (SA) applies the Australian Consumer Law as a law of the state, and the Act also provides additional consumer protections, industry codes and the role of the Commissioner for Consumer Affairs.

Whether a customer receives the full set of protections depends on whether they are a consumer under s 3 of the Australian Consumer Law. A person is a consumer if the price of the goods or services is $100,000 or less, or if the goods or services are of a kind ordinarily acquired for personal, domestic or household use. A vehicle or trailer acquired for use principally in transporting goods on public roads also counts, regardless of price. There are important carve-outs: a business that buys goods for re-supply, or to use up or transform them in production or manufacture, is not a consumer. And in any dispute, the customer is presumed to be a consumer unless the contrary is established.

You are likely in scope if any of these describe you:

Retailer or service provider: you sell goods or services to the public from premises in SA.
Online seller: you advertise to SA customers and ship goods or provide digital services into the state.
Direct seller: you approach customers door-to-door, by phone or in public places without an invitation.
Regulated industry: your industry is covered by an SA code of practice made under the Act's regulations, such as health and fitness, pre-paid funerals or fuel pricing information.

Duty 1: Do not mislead consumers or other businesses

The core rule is s 18 of the Australian Consumer Law: a person must not, in trade or commerce, engage in conduct that is misleading or deceptive, or is likely to mislead or deceive. It applies to what you say in advertisements, on your website, in quotes and in sales pitches, and it protects other businesses as well as consumers. There is no requirement that anyone actually was misled; conduct that is likely to mislead is enough.

Section 29 then lists specific false or misleading representations that are prohibited. You must not make false or misleading representations about a product's standard, quality, value, grade or composition, whether goods are new, testimonials, sponsorship or approval, price, place of origin, or the availability of guarantees and remedies.

The practical obligations that flow from this are:

Substantiate before you publish: keep evidence for every factual claim you make, whether it is about performance, quality, results or country of origin.
Check "was/now" pricing: a "was" price must be a price you genuinely offered for a reasonable period. CBS treats a price comparison as misleading if the item only sold at the higher price for a very short time before the sale.
Show the total price: display the single price the customer must pay, including unavoidable fees and charges. A breach of the single price rule carries a maximum penalty of $5,000 for a body corporate and $1,000 for an individual.
Avoid bait advertising: do not advertise goods or services at a particular price if you have no reasonable grounds for believing you can supply them in reasonable quantities.
Watch your testimonials: posting fake testimonials, or testimonials you cannot support, is squarely within the false representation rules.

Duty 2: Honour the consumer guarantees and fix problems promptly

When you supply goods or services to a consumer, the Australian Consumer Law implies a set of automatic guarantees. Goods must be of acceptable quality, which means fit for the purposes they are commonly supplied for, acceptable in appearance and finish, free from defects, safe and durable (s 54). Goods must be reasonably fit for any disclosed purpose (s 55), and services must be rendered with due care and skill (s 60).

When a guarantee is not met, the customer is entitled to a remedy. Depending on the nature and severity of the failure, that remedy is a repair, a replacement or a refund. These guarantees cannot be excluded by a term in your contract or your terms and conditions, and a term that tries to do so is ineffective.

A specific trap is signage. Displaying a notice that purports to exclude the guarantees, such as a "no refunds" sign, is itself a contravention and can attract a penalty of up to $50,000 for a body corporate and $10,000 for an individual. A customer who simply changes their mind is not automatically entitled to a refund, but a customer whose goods fail a guarantee is.

Practical steps for this duty:

Align your refunds process with the guarantees: train staff to distinguish a change-of-mind request from a genuine guarantee failure, and to offer repair, replacement or refund as the law requires.
Remove "no refunds" messaging: from signs, receipts, websites and staff scripts.
Keep complaints records: log what was raised, how it was assessed and what remedy was given, so you can show a consistent process if a dispute escalates.

Duty 3: Follow the unsolicited sales rules

If you sell door-to-door, by unsolicited phone call, or by approaching people in public places, the rules in Part 3-2 Division 2 of the Australian Consumer Law apply, and CBS actively polices them. The key requirements are:

Permitted hours: sellers cannot knock on doors after 6pm on weekdays, call after 8pm on weekdays, knock or call after 5pm on Saturday, or visit or call at all on Sundays or public holidays.
Disclosure and conduct: you must disclose your purpose and identity, and stop negotiating as soon as the customer asks you to.
Written agreement and cooling-off notice: the customer must receive a written agreement document that sets out their termination rights. If the sale is made in person, it must be given at the time of sale; if made by phone, it must be sent to the customer immediately.
Cooling-off period: the customer can terminate the agreement within 10 business days by telling you, orally or in writing (s 82). That period extends to 3 months if you breached the negotiating rules, and to 6 months if you failed to give the required agreement document or cooling-off information.
No supply during cooling-off: you must not take payment or supply goods or services during the termination period.

Breaches of these rules carry maximum penalties of $50,000 for a body corporate and $10,000 for an individual per contravention. Keep records of every contact, agreement and cancellation notice so you can demonstrate compliance if a dispute arises.

Duty 4: Meet product safety and information standards

If you supply regulated consumer goods, you have duties beyond advertising and guarantees. The Australian Consumer Law allows safety standards to be made for particular kinds of goods, and once a standard is in force you must not supply, offer to supply or manufacture goods that do not comply with it (s 104 and s 106). Bans can also be imposed on goods that present a safety risk.

You must also report to the regulator if you become aware that a good or product-related service you supplied has been associated with death, serious injury or serious illness. This mandatory reporting duty is easy to miss because it is reactive, but failing to report can attract a penalty of up to $16,500 for a body corporate and $3,300 for an individual.

For SA businesses, also check whether your industry has an SA-specific code made under the Fair Trading Act's regulations. The Act's regulations cover industries including health and fitness, pre-paid funerals, motor vehicle repair and fuel pricing information, and these codes can impose obligations on top of the national rules.

Practical steps:

Know your standards: identify which safety standards or bans apply to the goods you sell, and confirm your products comply.
Build a reporting process: know who in your business is responsible for making a mandatory report, and how quickly they can do it.
Act on safety issues: have a plan for contacting affected customers and arranging a remedy if a safety problem emerges.

What happens if you get it wrong

Enforcement in South Australia sits with CBS, a division of the state's Attorney-General's Department that protects consumers and regulates business. CBS handles complaints, provides advice to consumers and businesses, investigates suspected breaches, can issue fines for less serious matters, and can take court action for serious or repeated misconduct. The ACCC can also act where conduct raises national issues.

The penalty regime under s 224 of the Australian Consumer Law applies to the ACL as it operates in SA. For serious contraventions, such as unconscionable conduct, unfair contract terms, unfair practices like false or misleading representations, or supplying goods that breach a safety standard, a court can order a body corporate to pay the greater of:

$100 million;
three times the value of the benefit obtained from the conduct; or
30% of the corporation's adjusted turnover during the breach period.

For individuals, the maximum penalty for these contraventions is $2.5 million. Less serious contraventions carry smaller fixed maxima, including $50,000/$10,000 for display notices and unsolicited sales breaches, and the $5,000/$1,000 single-price breach mentioned above.

Beyond regulator action, consumers can pursue their own remedies, including refunds, damages and other orders from courts or tribunals. The Fair Trading Act 1987 (SA) itself also creates SA-specific offences and enforcement powers that sit alongside the Australian Consumer Law, so a single course of conduct can expose you to more than one line of attack.

A practical compliance checklist

Work through the items below and keep the evidence for each one on file:

Claims: list every factual claim in your current ads, website and sales scripts, and put the evidence next to each one.
Pricing: check that displayed prices are the total price, and that "was/now" comparisons are genuine.
Guarantees: align your refunds process with the consumer guarantees and remove "no refunds" messaging.
Unsolicited sales: if you sell door-to-door or by phone, build the permitted hours, disclosure and cooling-off steps into your scripts and systems.
Product safety: confirm compliance with any applicable safety standards and bans, and nominate who reports serious safety incidents.
Terms: review your customer terms for unfair contract terms and any attempt to contract out of the guarantees.
Review cycle: re-run this checklist at least annually, and whenever you change products, pricing, promotions or sales channels.

Where a lawyer helps

Most of these duties are things you can build into your operations, but a lawyer adds value at specific points. Before a promotional campaign runs, a lawyer can review the claims and substantiation you plan to rely on. A lawyer can also review your customer terms and refunds process against the consumer guarantees, draft the scripts and documentation for unsolicited sales, and help you respond if CBS or the ACCC raises concerns or issues a fine. If a safety issue emerges and a recall or mandatory report is required, advice early can materially reduce your exposure.

Start with the claims you make and the refunds you promise

Most SA businesses do not set out to mislead anyone. They get caught on claims they cannot substantiate and refunds they refuse out of habit. The duty most often missed is also the simplest: only say what you can prove, and treat the consumer guarantees as automatic rather than discretionary. This week, pull up your current advertisements and website, write down every factual claim, and put the evidence next to each one. Then check your refunds signage and process against the guarantees. If either step is harder than it should be, that is the point to get advice before a customer complaint turns into a CBS investigation.