National Priority 6

Trading Practices

The focus of this priority is to improve the trading practices of traders servicing Indigenous consumers. Key factors that exacerbate the disadvantage in this area include geographical isolation for remote consumers, lack of choice and competition, low levels of English, lack of financial literacy and access to services. These same factors also make it difficult for consumer agencies to monitor inappropriate behaviour by traders.

Lack of competition in remote communities means Indigenous consumers may experience exploitative pricing of goods and services and door to door selling of insurance, funeral plans, encyclopaedias, books, cleaning products, pay TV, and other products.

Poor practices associated with book up also have a detrimental effect on many Indigenous consumers.

Due to low levels of financial literacy, and the high proportion of Indigenous people in remote areas who speak an Indigenous language as their first language, many Indigenous consumers have problems with understanding complex contracts and the financial implications of signing these contracts.

Issues	Actions	Responsibility	Timeline
There is a need for all consumer agencies to adopt consistent policy, legislation (if necessary) and enforcement in relation to unsatisfactory book up practices by traders.	Compliance and enforcement activity by consumer agencies to penalise inappropriate behaviour by traders. All consumer agencies should adopt uniform policy that does not endorse the retention of PIN numbers or other information (re passwords for Internet banking) by traders.	All consumer protection agencies.	Ongoing. December 2005.
Traders continue to retain the credit cards and PIN numbers of Indigenous consumers, which increases scope for fraud and exploitation.	Through SCOCA Indigenous Banking and Financial Issues Liaison Group explore ways to discourage traders holding customer PIN numbers as a condition of credit, including the possibility of a prohibition in EFTPOS contracts on traders holding PINs. Breaches of the provision could result in traders losing their EFTPOS capacity.	SCOCA Indigenous Banking and Financial Issues Liaison Group.	Ongoing.
	Promote the use of ASIC’s ‘Book Up Kit’ which contains ideas and strategies for communities and traders to manage book up.	All consumer agencies.	Ongoing.
Door to door and itinerant traders continue to exploit Indigenous consumers with products they cannot afford or may not need.	Ongoing monitoring of door to door and itinerant traders including coordinated action between agencies to address emerging problems.	All consumer agencies.	Ongoing.
Despite the fact that many regional and remote stores are well run there is still a need to improve management practices.	Promotion of ACCC’s FairStore as best practice so that traders and communities have a benchmark for fair trading in remote communities. Consumer agencies to collaborate with communities and private sector to improve store management in regional areas.	ACCC to continue to set the standards through FairStore. State and Territory agencies to liaise with the Commonwealth Office of Indigenous Policy and Coordination and Indigenous Coordinating Councils to promote store management.	Ongoing.
Lack of awareness among Indigenous consumers about warranties and lack of capacity to enforce warranties and guarantees.	Consumer protection agencies to provide relevant and appropriate information for Indigenous consumers on warranty rights and obligations.	All consumer agencies.	Ongoing.
Ongoing problems in relation to funeral schemes.	Identify appropriate matters for enforcement to improve marketplace behaviour.	All consumer agencies.