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Fuji Xerox taken to court over alleged unfair contract terms

Fuji Xerox taken to court over alleged unfair contract terms

Automatic renewal terms, excessive exit fees and unilateral price increases are just a few of the unfair terms

Credit: Dreamstime

Fuji Xerox has landed in the Federal Court following allegations of 173 unfair contract terms with small businesses brought upon by the Australian competition watchdog.

Automatic renewal terms, excessive exit fees and unilateral price increases are just a few of the 31 different ‘unfair’ terms the Australian Competition and Consumer Commission (ACCC) has picked up on among its allegations involving nine types of Fuji Xerox’s standard form small business contracts it claims contain 173 unfair contract terms.

“We have received a number of complaints from small businesses alleging that some of the terms in Fuji’s contracts have caused them significant financial harm,” ACCC deputy chair Mick Keogh said.

“Some of the unilateral variation terms allow Fuji to modify contracts by creating new rights and obligations, including increasing prices, without notifying its customers and without giving them any corresponding right to negotiate or reject.”

According to the watchdog, the terms were used in contracts between Fuji and its small business customers for the supply of printing goods, services and technical assistance since at least October 2018.

“The ACCC will argue that the unfair terms in these contracts cause a significant imbalance in the rights and obligations of Fuji and the small businesses they contract with,” he said.

The ACCC is seeking declarations that the terms in the existing contracts between Fuji and its small business customers are unfair and therefore void, and an injunction to prevent Fuji from relying on these terms in its current contracts or entering into future contracts that contain those terms.

The ACCC is also seeking an order for a corrective notice, a compliance program and costs.

Keogh sounded a warning this court action should prompt all other traders in the printing support industry to review their standard form contracts and make any necessary changes to remove unfair contract terms.

Fuji Xerox (FXA) said it had been cooperating with the ACCC’s investigation and had proposed several contract changes to address the contract concerns. 

"In that context, FXA is disappointed that the ACCC has decided to commence proceedings, which FXA intends to defend," FXA said. "FXA is sending correspondence to all its customers about how this impacts them and next steps." 


 


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