Running a business in Australia is all about building trust. You work hard to deliver quality products or services - and your marketing, sales and customer communications should reflect that same integrity.
Section 18 of the Australian Consumer Law (ACL) is the key rule that keeps advertising and sales practices honest. It prohibits misleading or deceptive conduct in trade or commerce. Getting it right protects your customers, your brand and your long‑term growth.
In this guide, we’ll unpack what Section 18 means in practice, the kinds of conduct that can get businesses into trouble, and the practical steps you can take to stay compliant across websites, social media, ads, packaging and everyday customer interactions.
What Is Section 18 Of The Australian Consumer Law?
Section 18 of the Australian Consumer Law (Schedule 2 of the Competition and Consumer Act 2010 (Cth)) states that a person must not, in trade or commerce, engage in conduct that is misleading or deceptive, or is likely to mislead or deceive.
In simple terms, if you’re selling or promoting goods or services, you must not create a false impression. That includes what you say or write, what you show (images, layout and design), and what you leave out if the omission would mislead a reasonable customer.
This obligation applies broadly across:
- Websites, landing pages and online stores
- Social media posts, ads and influencer content
- Emails, SMS and other direct marketing
- Packaging and labels
- Sales calls, live chat and in‑store conversations
- B2C and B2B dealings in the course of trade
The Australian Competition and Consumer Commission (ACCC) and state/territory consumer regulators enforce Section 18, and businesses and individuals can also bring claims.
Why Section 18 Matters For Australian Businesses
Misleading conduct can have serious consequences. While Section 18 itself does not carry civil penalties, regulators and courts have wide powers to address the harm caused, and related ACL provisions can attract substantial fines.
Potential outcomes include:
- Injunctions (court orders to stop specific conduct)
- Corrective notices or advertising
- Compensation to customers or competitors for loss and damage
- Declarations and other remedial orders (including redress programs)
- Significant reputational damage and loss of customer trust
Importantly, many cases brought under Section 18 also involve specific prohibitions on false or misleading representations (for example, about price, quality, performance or testimonials). Those specific provisions - such as the false representations rules in Section 29 of the ACL - can carry civil penalties, so the overall risk profile is much bigger than Section 18 alone.
Bottom line: clear, accurate and complete communication isn’t just good marketing - it’s legal compliance that protects your brand and your customers.
What Counts As Misleading Or Deceptive Conduct?
Courts look at the overall impression created by your conduct. Intention doesn’t matter - you can breach Section 18 even if you didn’t mean to mislead anyone. The key question is whether an ordinary or reasonable member of your target audience is likely to be misled.
Key principles to keep in mind:
- Overall impression matters: Correct fine print won’t save an ad if the headline and imagery create a false takeaway. Qualifications need to be clear and prominent.
- Silence can mislead: Omitting or obscuring important limitations, defects or fees can be misleading if a reasonable customer would expect to be told.
- Substantiation: Objective claims (e.g. “removes 99% of bacteria”, “clinically proven”, “500 Mbps average speeds”) should be backed by evidence. Keep records.
- Context is everything: The audience, the medium and the timing all matter. What’s clear to an expert might mislead a first‑time buyer.
Common problem areas include:
- Pricing and “drip” fees: Advertising a low headline price while adding unavoidable fees late in the checkout flow can create a misleading impression. Make total prices and mandatory fees clear and upfront. For more on pricing transparency, see Australia’s advertised price laws.
- Comparisons and superlatives: Saying your product is “faster than X” or “award‑winning” requires a reasonable basis. Pure “puffery” - vague, self‑evident exaggeration no reasonable customer would rely on (like “world’s best coffee”) - is generally allowed, but when a claim looks specific or measurable, treat it as an objective claim and ensure you have evidence.
- Testimonials and reviews: Fake reviews or edited testimonials that overstate outcomes are risky. If you work with influencers or affiliates, ensure their content is truthful and clearly discloses any paid relationship.
- Performance and health claims: Claims such as “clinically proven” or “backed by science” need solid, relevant substantiation, not just general research on a different product or population.
- Visual and design cues: Imagery, layout, colour and button labels can imply something that isn’t true (for example, “highlighting” a plan as most popular when it isn’t). Design counts as conduct under Section 18.
- Selective disclosure: Promoting benefits but burying significant limitations (e.g. “unlimited” plans with tight throttling) can mislead if qualifications aren’t clear and prominent.
If you’d like to dive deeper into how courts assess misleading conduct, this overview of the elements of misleading or deceptive conduct breaks down the key factors and tests.
Examples of conduct likely to breach Section 18:
- “$500 off” promotions where the product was never sold at the higher “pre‑discount” price
- “Clinically proven to reduce pain in 24 hours” without appropriate clinical evidence
- “Lifetime warranty” where key exclusions or required conditions are hidden or unclear
- “Free” offers with undisclosed mandatory charges (e.g. compulsory setup or shipping fees)
- Presenting paid endorsements or reviews as independent consumer opinions
How To Comply With Section 18 (Step‑By‑Step)
Compliance isn’t about sanitising your marketing - it’s about ensuring your claims are fair, clear and accurate. A few practical habits go a long way.
1) Map Your Customer‑Facing Content
List all channels and touchpoints: website, landing pages, emails, SMS, social posts, video ads, sales scripts, packaging, invoices and checkout screens.
Audit the high‑traffic and high‑risk areas first (home pages, pricing pages, “hero” claims, social ads). Look for claims that sound specific or measurable and make sure you have evidence on file.
2) Make Pricing And Key Terms Clear Upfront
Show the total price (including mandatory fees) as early and as prominently as possible. If a fee is unavoidable, don’t hide it. Avoid “drip pricing” that only reveals real costs at the end of the checkout flow.
Keep cancellation terms, lock‑ins, renewal periods, stock limits and any major limitations near the claim they qualify. Don’t bury essential information in dense fine print or behind multiple clicks.
3) Substantiate Objective Claims
Maintain a claims register with the evidence supporting each objective statement. For example, keep copies of lab reports, awards, independent tests, customer surveys, speed tests or competitor comparisons. Update it regularly.
If a claim can’t be reliably substantiated, reword it or present it as a general benefit rather than a precise promise. Where relevant, add a short, clear qualification (and make sure it’s prominent).
4) Review Design, Not Just Words
Design choices can mislead just as easily as text. Check the hierarchy of information, colours, icons and button labels. Ask: what impression would a reasonable customer take away at a glance?
A/B test “disclosure” design and placement. If customers regularly miss important qualifications, the disclosure likely isn’t prominent enough.
5) Keep Contracts And Policies Up To Date
Ensure your website terms, customer terms and any warranties reflect what you actually do - and what the law requires. If you offer a repair, replacement or refund policy, make sure it aligns with the ACL consumer guarantees (and if you offer a “warranty against defects”, present it in the required format - a tailored Warranties Against Defects Policy can help).
Your website’s Terms and Conditions should be clear and readable. If you supply services on bespoke terms, have those agreements prepared or refreshed through contract drafting so they match your current offering.
6) Train Your Team, Affiliates And Influencers
Front‑line staff and contractors can create legal risk with a single off‑hand claim. Provide compliance training, clear scripts and escalation pathways for tricky questions.
If you work with affiliates or creators, set expectations around truthfulness and disclosure in a proper Marketing Service Agreement, and monitor for compliance.
7) Build A Review And Approvals Process
Put a lightweight sign‑off process in place for new campaigns and key landing pages. Involve someone who wasn’t part of the creative process to sanity‑check the overall impression.
When in doubt, soften the claim or add a clear qualification. It’s easier to dial up a claim later than to run corrective ads after a complaint.
8) Handle Complaints And ACCC Enquiries Promptly
- Listen and assess: If a customer says they were misled, investigate quickly. Check the exact wording and context that led to the complaint.
- Fix the source: Update the ad, page or script that created the impression. Consider offering a fair remedy to the affected customer.
- Respond carefully: If you receive an ACCC or regulator enquiry, respond professionally and seek advice early. Preserve relevant records and pause the conduct in question while you assess risk.
Section 18 is broad, but there are a few nuances worth knowing so you can calibrate risk and make practical decisions.
“Best” Or “Number 1” Claims
General puffery - vague statements so exaggerated that no reasonable customer would rely on them literally (e.g. “world‑class service” or “best coffee in town”) - is unlikely to be misleading. But if a claim appears specific or testable (“#1 for speed”, “Australia’s most awarded”, “clinically proven”), regulators will expect you to have a reasonable basis. If you can’t substantiate it, reframe or remove the claim.
Disclaimers And Fine Print
Disclaimers don’t cure a misleading overall impression. Qualifications must be clear, proximate to the claim and easy to notice. If the headline sends one message and the fine print says the opposite, you have a problem. Use simple, prominent qualifications instead of long, legalistic caveats.
Silence And Omissions
You don’t need to disclose every possible fact, but withholding important information can be misleading - particularly if you know a customer is relying on you for guidance or if a reasonable buyer would expect disclosure (e.g. known defects, major fees, material limitations).
Private Sales And Non‑Commercial Speech
Section 18 applies to conduct “in trade or commerce”. Private, one‑off sales between individuals that aren’t in the course of a business generally fall outside Section 18. However, if you’re operating a business (even informally or via a marketplace), expect the ACL to apply to your dealings with customers.
Reviews And Influencer Marketing
Presenting advertising as independent consumer opinion is risky. Make sure reviews are genuine, material connections are disclosed and creators don’t overstate outcomes. Put this in writing through your Marketing Service Agreement and train partners on what they can and can’t say.
Privacy Policies And Data Practices
Transparency about your data practices supports trust - and in some cases, it’s legally required. Under the Privacy Act, a Privacy Policy is mandatory for most “APP entities” (including businesses with annual turnover of more than $3 million, and smaller businesses in certain categories such as health service providers or those that trade in personal information). Many smaller businesses still choose to publish a clear Privacy Policy to set expectations and support compliance with other laws (like spam and consumer law), even if they’re not formally required to. The key is to avoid saying one thing and doing another - that disconnect can itself be misleading under Section 18.
Section 18 often appears alongside other ACL rules that do carry civil penalties, including:
- False or misleading representations: Specific prohibitions about price, quality, testimonials and more (see Section 29).
- Unconscionable conduct: Particularly harsh or oppressive tactics in business dealings (see Section 21).
- Advertising and pricing rules: Component pricing, “was/now” comparisons and total price display (our guide to advertised price laws covers the essentials).
Key Takeaways
- Section 18 of the ACL prohibits misleading or deceptive conduct in trade or commerce - it’s about the overall impression on a reasonable member of your audience.
- You don’t need to intend to mislead to breach the law; silence, design choices and fine print can all contribute to a misleading impression.
- Section 18 itself doesn’t have civil penalties, but regulators and courts can order remedies, and related ACL provisions (like the false representations rules) do carry significant penalties.
- Make pricing and key limitations clear upfront, keep evidence for objective claims, train your team and partners, and ensure your terms and policies match what you actually do.
- Disclaimers don’t fix a misleading headline; qualifications must be clear and prominent. Treat “specific‑sounding” superlatives as objective claims that require substantiation.
- Strong foundations - from accurate website terms and a compliant Terms and Conditions, to an appropriate Warranties Against Defects Policy - help you stay aligned with the ACL as you grow.
If you’d like help reviewing your marketing, pricing pages, customer terms or policies for ACL compliance, you can reach us on 1800 730 617 or team@sprintlaw.com.au for a free, no‑obligations chat.
