What Is Changing?

If implemented, the proposed reforms would provide offerors with greater scope to advertise or otherwise issue communications in relation to a proposed offer before lodging the relevant disclosure document.

This would potentially allow offerors to do the following:

a)    Engage with the market and create awareness before formally launching an offer.

b)    Address market commentary or reporting (if any).

c)    Better gauge interest in a proposed offer.

The Investor Protection Challenge

The existing pre-lodgement advertising regime, albeit limiting, serves important investor protection objectives. ASIC identifies these to include preventing the selective release or “drip-feeding” of information to the market, discouraging inadequate analysis of the disclosure document, and discouraging investment decisions being made on the basis of advertising or publicity rather than the disclosure document.

The proposed regime would bring the treatment of unquoted securities more closely into line with the existing pre-lodgement regime for quoted securities by allowing broader communications, provided prescribed statements are included. 

The proposed reforms do not, however, displace other requirements that apply to communications, including the existing prohibitions on misleading or deceptive conduct, and pre-lodgement communications should therefore be carefully considered before being issued.

What Should Offerors and Advisers Take From This?

The reform proposed by CP 390 represents a significant change to the practical operation of Australia's initial public offering (IPO) regime. If adopted, offerors contemplating an IPO would have greater flexibility to engage with the market before lodging their disclosure document.

If offerors are able to communicate more freely beforehand, there is a risk that particular statements or themes become the focus of investor attention, influencing investment decisions before investors have access to the disclosure document. There is also a risk of inconsistency between pre-lodgement communications and the subsequent disclosure document. A statement that appears reasonable when made may later need to be qualified, updated or omitted from the final prospectus, and this may create regulatory and reputational risks for the offeror and its advisers.

Accordingly, the greater flexibility would also require greater discipline around the preparation and approval of communications. Offerors and their advisers would need to carefully consider how statements made during the pre-lodgement period are supported, monitored and ultimately reflected in, or remain consistent with, the disclosure document.

The consultation period closes on 11 September 2026, with release of the legislative instrument and updated regulatory guidance expected on 30 October 2026.
 

This edition of the K&L Gates “Competition and Consumer Law Round-Up” provides a summary of recent and significant updates from the Australian Competition and Consumer Commission (ACCC), as well as other noteworthy developments in the competition and consumer law space. If you would like any additional details about the issues outlined in this newsletter or wish to discuss them further, please reach out to any member of the K&L Gates Competition and Consumer Law team.

Enforcement

• ACCC Commences Proceedings Against Grill’d for Alleged Greenwashing Claims
• JB Hi-Fi to Refund More Than AU$250,000 Following ACCC Investigation Into Misleading Pricing Practices
• ACCC Calls for a Stronger Horticulture Code as Fruitico and Fresh Express Pay Record Penalties for Alleged Breaches
• Dusk in Court Over Sale of Thousands of Allegedly Noncompliant Button Battery Products

Mergers and Acquisitions

• Acquisitions Register Update: FY2025/2026
• Peter Warren’s Acquisition of Wakeling Automotive Sites and Trescal’s Acquisition of TR Calibration Require Phase 2 Review by the ACCC
• ACCC Approves Ampol’s Acquisition of EG Australia, Subject to Conditions
• ACCC Opposes Coles’ Acquisition of a Supermarket and Liquor Site in Kalgoorlie
• ACCC Approves Heidelberg’s Acquisition of Maas’s Construction Materials Business Subject to Conditions

Notifications and Authorisations

• ACCC Grants Authorisation for Air Cargo Alliance
• ACCC Grants Interim Authorisation for Preparatory Steps to Establish Joint Venture for Commercial Cash Distribution
• ACCC Grants Exemptions From the Cash Acceptance Industry Codes to Petro National Pty Ltd and Ampol Australia Petroleum Pty Ltd

Noteworthy Developments

• Joint Statement: Regulators Strengthen Joint Oversight of Digital Platforms
• ACCC Issues Class Exemption for Global Supply Chain Disruptions
• ACCC Review Shows That Misleading and High-Pressure Unsolicited Sales Practices Are Widespread

Click here to view the Round-Up.

Why is This Important?

Automated bidding was flagged in the NEM wholesale market settings review chaired by Associate Professor Tim Nelson as a key risk and an area of future regulatory scrutiny, and the Compliance Bulletin confirms that scrutiny is increasing. While the AER acknowledges the operational benefits of automation, it expects Market Participants to maintain effective oversight, carry out robust due diligence of third-party providers and be able to demonstrate and explain automated bidding decisions if questioned.

What Are the Key Messages From the AER?

Greater Automation May Increase Compliance Risks

Market Participants remain responsible for ensuring all bids and rebids comply with the National Electricity Rules (NER), whether submitted manually, through internally developed software or via a third-party provider.

Systems that submit bids directly to the Australian Energy Market Operator without allowing the Market Participant to independently verify or adjust the bid present a higher compliance risk. Market Participants are expected to maintain appropriate oversight and control over automated bidding processes and implement suitable risk management measures.

Any noncompliance arising from automated bidding remains the responsibility of the relevant Market Participant.

Relevant obligations include the following:

• Rebid explanation requirements.
• Prohibitions on false or misleading bids and rebids.
• Obligations to ensure plant capability aligns with submitted bids. 

Competition Law Risks Must Also Be Considered

Bids submitted via third-party providers should be developed independently for each Market Participant, reflecting that participant’s technical parameters, portfolio constraints and commercial strategy. Participants and service providers should avoid arrangements that could facilitate cartel conduct, bid rigging or concerted practices under the Competition and Consumer Act 2010 (Cth).

Expectations When Using Third-Party Bidding Providers

The Compliance Bulletin sets out a due diligence framework for Market Participants engaging third-party bidding services, automated bidders or self-forecasting providers, recommending that they do the following:

• Undertake comprehensive due diligence on the provider and its systems.
• Understand how the service supports NER compliance.
• Ensure contractual arrangements support compliance obligations.
• Retain the ability to tailor software settings to site-specific circumstances.
• Confirm providers update systems in response to rule changes and AER guidance.
• Regularly monitor, audit and review the service.
• Maintain contingency plans for system failures, updates or technical issues.

Importantly, the AER reminds third-party bidding providers that they may face accessorial liability if their services contribute to a Market Participant’s breach of the National Electricity Law.

Contemporaneous Records for Automated Rebids

The Compliance Bulletin also gives guidance on record-keeping for automated rebids. Contemporaneous records should ideally include the following:

• The instructions or algorithms relied upon by the automated system.
• The triggering events or conditions that prompted the rebid.
• Relevant thresholds used by the system.
• Any standing instructions provided to third-party service providers.

Detailed system-generated logs may satisfy record-keeping requirements where they adequately record the following:

• Inputs used by the system.
• Decision logic applied.
• Outputs produced for each rebid decision. 

These suggestions are not yet mandatory, but the AER indicates they are likely to inform future amendments to the AER’s published Rebidding and Technical Parameters Guidelines.

What Are the Practical Implications for Generators and Integrated Resource Providers?

If you use optimisation platforms, bidding aggregators or third-party market services, the key takeaways are as follows:

1. Responsibility cannot be outsourced. Market Participants remain accountable for compliance, even where bidding decisions are fully or partly automated. 
2. Governance matters. Market Participants should have documented oversight procedures, approval frameworks and compliance controls around automated bidding systems. 
3. Contract reviews may be warranted. Review existing agreements with bidding service providers to ensure compliance obligations, audit rights and update obligations are appropriately allocated.
4. Record-keeping requirements are becoming more sophisticated. Assess whether your current software captures sufficient information to explain an automated rebid if requested by the AER. 
5. Competition law compliance should not be overlooked. Particularly where a service provider is acting for multiple participants in the market.

Background

Elecnor Australia Pty Ltd (Elecnor) and Clough Projects Australia Pty Ltd (Clough) were joint venture partners on Project EnergyConnect, a major electricity transmission infrastructure project for Transgrid. Following Clough’s insolvency in late 2022 and the subsequent implementation of a deed of company arrangement (DOCA), a dispute arose concerning the ownership of Clough’s interest in the joint venture.

In December 2024, Elecnor commenced proceedings in the Commercial List of the Supreme Court of New South Wales against Clough and the trustees of the DOCA. Elecnor sought declarations that the DOCA had not transferred Clough’s joint venture interest, the joint venture deed or the engineer, procure and construct contract to the trustees, together with orders requiring Clough to comply with the contractual compulsory acquisition process under the joint venture deed. 

Clough and the trustees defended the claim and alleged that Elecnor had breached its good faith and quasi-fiduciary obligations in connection with the proposed acquisition. Clough also filed a separate cross-claim seeking contribution following Transgrid’s earlier call on bank guarantees and insurance bonds procured at Clough’s request.

The joint venture deed contained an arbitration clause requiring disputes to be referred to arbitration in Singapore. Elecnor contended that Clough’s contribution cross-claim fell within that arbitration agreement and should therefore be stayed and referred to arbitration, even though Elecnor’s compulsory acquisition claim would remain before the court. Clough and the trustees, on the other hand, argued that the proceedings should not be split and sought to have Elecnor’s claim referred to arbitration if any part of the dispute was to be arbitrated.

The central question was whether, and to what extent, the proceedings comprised distinct “matters” that fell within the scope of the arbitration agreement.

Proceedings Can Be Split

The court confirmed that a single set of proceedings may involve more than one “matter” for the purposes of section 7(2) of the International Arbitration Act. As a result, only those matters that fall within the scope of the arbitration agreement, and are capable of settlement by arbitration, should be stayed and referred to arbitration.

This may create parallel proceedings. However, that is a consequence of the parties’ agreement and the mandatory operation of section 7(2). Convenience is not the test.

Parties and their advisers should consider and account for this when drafting dispute resolution clauses and commencing proceedings pursuant to them. Matters involving insolvency, multiple parties or overlapping contractual and statutory rights are particularly prone to fragmentation across forums.

Insolvency Disputes Have Limits

The court held that the primary judge did not err in concluding that the compulsory acquisition dispute was not arbitrable. Resolution of that dispute required construction of the DOCA and consideration of the part 5.3A regime under the Corporations Act 2001 (Cth) in a way that could affect the rights of third-party creditors and engage statutory rights beyond the parties themselves.

By contrast, Clough’s contribution claim—a dispute arising between the parties under the joint venture deed that could be determined without affecting third-party or statutory interests—was referred to arbitration.

The distinction is important. Parties should not assume that an arbitration clause will extend to every dispute that arises in, or is shaped by, an insolvency context. The question remains whether the particular matter is capable of settlement by arbitration, including having regard to whether its resolution may affect nonparties or the operation of a statutory regime.

Waiver Requires Unequivocal Conduct

The court also clarified when an arbitration agreement will be treated as inoperative. The threshold is high. A party must demonstrate clear and unequivocal conduct showing that the other party no longer intends to be bound by the arbitration agreement.

Elecnor sought a stay promptly after Clough’s cross-claim was filed. That conduct was consistent with an intention to arbitrate, not to abandon the arbitration agreement. The court confirmed that commencing court proceedings in respect of a nonarbitrable matter does not, without more, constitute waiver of the right to arbitrate a separate, arbitrable matter.

What This Means in Practice

Three key points follow from the decision.

First, arbitration agreements will be enforced even where only part of a dispute is arbitrable. Parties should plan for the possibility of parallel proceedings arising from the court’s task of identifying arbitrable “matters” at a granular level.

Second, disputes that require determination of statutory rights or may affect third-party creditors may fall outside the scope of arbitration, depending on their character. This is particularly relevant where contractual rights intersect with insolvency regimes or other statutory frameworks.

Third, parties who intend to rely on an arbitration agreement must act consistently and promptly. Delay or equivocal conduct may create an argument that the arbitration agreement has become inoperative.

The decision is an important reminder that arbitration clauses are not always all-encompassing. In complex commercial disputes, courts will enforce arbitration agreements according to their terms but with an eye to retaining jurisdiction of matters that are not capable of arbitral determination.
 

Tariffs cause tensions to rise between the world's major trading countries and often result in the exporting country's retaliation, as we have seen with China's retaliatory tariffs. The tariffs, tensions, fears of retaliation and trade wars do not boost economic growth. In fact, these factors cause many businesses to reduce their planned investments, which impact economies worldwide.² Further, the tariffs have caused global trade policy uncertainty to rise, forcing market participants to expect weaker economic outcomes.³ 

Consequently, the risks of a global economic slowdown, and possibly a recession, are growing. It is expected that the tariffs will result in a persistent decline in output growth, which will affect the gross domestic product (GDP) growth in Australia, especially considering that the United States and China, the two countries at the centre of the trade war, are two of Australia's largest trading partners.⁴ Additionally, in Australia, the inflationary pressures and higher borrowing costs add to economic uncertainties and further financial pressures on domestic businesses and households.⁵

Recent Updates—Aftermath of the US Supreme Court's Review

In February 2026, the US Supreme Court reviewed tariffs imposed under the International Emergency Economic Powers Act (IEEPA),⁶ including the “reciprocal” tariffs imposed on most US imports, including Australia.⁷

Upon its review of Learning Resources, Inc. v. Trump and Trump v. V.O.S. Selections, Inc., the US Supreme Court upheld the lower courts' findings that the IEEPA does not give power to the US president to impose tariffs on imported goods.⁸

(For further information, read the updates by K&L Gates' Policy and Regulatory team in the US in 'Summary: Supreme Court Decision on IEEPA Tariffs' here and 'Unpacking the US Supreme Court's IEEPA Tariff Decision: The Outlook for Future Disputes' here.  You can also watch a K&L Gates webinar on the 'Impacts of the Recent US Supreme Court Decision on Trump's Emergency Tariffs' here.)

However, in place of the withdrawn “reciprocal” tariffs, the United States has imposed a global 10% “Temporary Import Surcharge” under section 122 of the Trade Act of 1974,⁹ which applies to most Australian imports to the United States and is set to expire on 24 July 2026.¹⁰  Currently, aircrafts, jet engines and their parts are exempt from the Temporary Import Surcharge as the United States continues its investigation under Section 232 of the Trade Expansion Act 1962¹¹ to assess the effect of imports on US national security.¹²

You may be wondering: what will be the replacement tariff after the expiry of the Temporary Import Surcharge?

On 3 June 2026, the United States proposed a new 12.5% tariff on Australian exports as part of its forced labour investigation under section 301 of the Trade Act of 1974.¹³  While the Australian Government has made several submissions challenging the proposed tariffs, the United States has not shown any signs of backing down, nor has it indicated when it would put the proposed tariff in place.¹⁴ This leaves Australia in a place of great uncertainty in relation to the future effects of tariffs on Australian imports. 

Additionally, Australia is also subject to “national security” tariffs under section 232 of the Trade Expansion Act of 1962.¹⁵  Under these tariffs, materials which are commonly used in the production and repair of aircrafts and aircraft parts such as steel, aluminium, copper products and their derivatives are subject to a 10% to 50% tariff, and certain computer chips and products containing those chips are subject to a 25% tariff.¹⁶ This puts significant financial strain on Australian aviation industry operators and original equipment manufacturers. 

Effects on the Tourism and Aviation Industry in Australia 

What do the tariffs mean for the tourism and aviation industries in Australia?

The heightened uncertainties and financial market volatility, as a result of the US tariffs, leads to economic consequences such as reduced spending by businesses and households, which has knock-on effects to employment and productivity.¹⁷   

For the Australian aviation industry, this will likely mean lower demand for air travel, as the lowered productivity will lead to increased costs of production and delivery delays in aviation. Flag carriers will be hit hard as customers will choose between cheaper options or not flying at all. Low-cost airlines are expected to experience these impacts to a lesser degree, but they will not have the environmental, social, and governance (ESG) focus nor development pathway for sustainable aviation fuel or net-zero emissions, leading to a poorer outcome for the industry generally. ¹⁸

The status of substantiable growth for the Australian aviation market is adversely impacted by the following:

• Global financial markets reacting to the US tariff announcements on “Liberation Day” and there continues to be ructions to the market caused by the continued tariff negotiations.¹⁹  While some markets in East Asia notch new highs following the trade talks between President Trump and China President Xi Jinping, other economies around the world, such as manufacturing in the European Union and Asia have become weakened and even stagnant as tariffs take a hit on factory order volumes.²⁰  
• US tariffs jumping to the highest rates since 1909—given that the United States is the world's biggest sovereign economy, this is going to take the “wind out of the sails” of not only the aviation industry but the global tourism industry.²¹
• A weaker GDP growth, which will see a lower demand for air travel.

Hence, economic experts now predict that the global financial future is more unpredictable, over a much wider range of possible outcomes.²²  

Furthermore, the Australian tourism industry's sustainability is based on a balance of increased international patronage. For our international guests, the global economic instability poses risks to international travel flows and shifts their preferences away from extended stays, impacting Australia's tourism, which consists largely of long-haul tourists.²³ Indeed, international travel has only returned to pre-COVID-19 levels just last year.²⁴  

It is also important to remember that the tourism industry's success is based on "disposable income." As such, the growing public sentiment regarding a global economic slowdown does not give households the carefree attitude and financial confidence that is necessary in the spending of disposable income. ²⁵ In times of global economic uncertainty, people start replicating "squirrels"—they stop spending and start accumulating enough "nuts" to withstand the economic famine. As such, it is expected that the tourism industry in Australia will also suffer from the US tariffs. 

Complicating Factors

Beyond the US tariffs, a complicating factor to the outlook of the aviation industry is the advent of the emerging global ESG principles that are driving transformative changes across the industry, particularly in reducing environmental impacts.²⁶     

For major airlines, ESG is becoming central to operational and strategic decision-making, rather than a mere compliance obligation. Those that integrate ESG into their core operations are better positioning themselves for the future to improve efficiency, maintain access to capital, build resilience and respond to current market pressures.

With growing expectations from customers, investors, and governments, it is clear airlines are facing a critical intersection of challenges: managing tariff-induced cost pressures while simultaneously meeting escalating environmental, social, and governance commitments and navigating the complex legal landscape.

K&L Gates: Tracking Updates From the Trump Administration 

K&L Gates as an international firm, with offices across four continents, is uniquely positioned to provide advice on matters relating to international aviation and tourism.

Our Policy and Regulatory team in the US continues to assist clients in navigating this rapidly evolving federal policy and regulatory landscape. The K&L Gates’ Guiding Through Change initiative monitors new actions from the White House and federal agencies to provide analysis on widespread industry ramifications. 

To view more, go to our initiative’s landing page for insights on the latest updates. 

The authors acknowledge the assistance of Ziqi Zhao, paralegal, in the preparation of this article.

From 1 July 2026, the national minimum wage has increased by 6% to AU$26.44 per hour. Award minimum wages have also risen, by 4.75%. 

The Fair Work Commission noted that determination of the review was particularly challenging this year because of the unusual degree of complexity in the economic and business performance in Australia. Ultimately, the Fair Work Commission cited moderate wage growth, increasing inflation, a predicted slowing economy over the next year, and uncertainty in the Middle East as reasons for its decisions. 

Echoing its concerns from the 2025 national wage review, the Fair Work Commission was again fundamentally guided by its view that most Award-reliant employees found the real value of their wages to be lower than prior to the July 2021-post-panedmic inflation spike. The Fair Work Commission noted the resulting 'real wage gap' is particularly affecting the living standards of the low paid and their capacity to meet non-discretionary needs. 

The Fair Work Commission also determined that structural changes to Award wages were necessary, electing to eliminate classifications paid at the lowest wage rates; C13 and C14. 

The C13 rate is the lowest wage rate applicable to ongoing employment in the Award system, while the C14 rate is a transitional wage rate applicable to a limited initial period of employment. The phasing out of the C13 and C14 wage rates will occur in three stages, and C12 will then become the lowest wage rate for ongoing employment. The first of the three stages involves additional, proportional increases to the relevant wage rates. 

The Fair Work Commission otherwise noted it intends to continue its review of particular Award classifications with the objective of eliminating gender-based undervaluation. The Fair Work Commission confirmed review of priority Awards is now complete and will see a phasing in of wage increases accordingly. The Fair Work Commission intends to have completed the entirety of this review by the delivery of the national wage decision next year.  

At 1 July 2026, the Superannuation Guarantee rate will remain unchanged at 12%. An annual maximum contribution base of AU$270,830 for the 2027 income year will apply. 

This means that once an employee's ordinary time earnings exceed AU$270,830 per annum, employers are not required to make further superannuation contributions under the Superannuation guarantee legislation. If separate contractual obligations to pay superannuation apply, these obligations are unaffected.

With the introduction of Payday Super, there will be no per quarter maximum contribution base. 

The changes will apply from 1 July 2026.

The Fair Work Act’s high income threshold will also be indexed from 1 July 2026, and has increased to AU$190,100. Non-award and non-enterprise agreement covered employees who earn in excess of AU$190,100 will be unable to bring an unfair dismissal claim.

The value of penalty units applicable to the Fair Work Act has increased with effect from 1 July 2026 from AU$330 per unit to AU$364 per unit. 

What Should You Be Doing From 1 July?

Employers should:

• Review annualised salary arrangements to ensure that the annualised wage rate is sufficient to meet or exceed the employees’ minimum award or minimum wage entitlements taking into account the 4.75% or 6% increase respectively.
• Update payroll systems and processes to ensure that wages and superannuation contributions take into account 1 July 2026 increases and removal of the per quarter maximum contribution following the introduction of Payday Super.
• Review enterprise agreement pay rates (where applicable) and ensure the pay rates do not fall below the applicable modern award base rate or the national minimum wage (as applicable).
• Ensure all employees who are eligible are being paid the appropriate super guarantee. 
• Be mindful of the new high income threshold of AU$190,100.

How Can We Help?

If you have any questions about the effect of the 1 July 2026 threshold increases on your payment obligations as an employer, please contact our Labour, Employment and Workplace Safety team.

Date of Commencement

The WFH Bill is expected to take effect on 1 September 2026. However, small businesses (employers with fewer than 15 employees) will have a deferred commencement date of 1 July 2027.  

Right to Work From Home

The proposed reform moves working from home from a discretionary arrangement to a statutory entitlement. Employees will have a right to work from home where their role can reasonably be performed remotely as follows:

• Up to two days per week for full-time employees; and
• A pro-rata entitlement for part-time employees (with the calculation method to be set by the regulations).

This places the onus on employers to justify any refusal, similar to flexible working arrangements for employees with certain protected attributes under the Fair Work Act 2009 (Cth) (the FW Act). 

Eligible Employees

Many employees will be considered “eligible” to exercise the right, with limited exclusions that include:

• Employees on probation;
• Employees undertaking an apprenticeship, traineeship, internship, graduate program, work experience program or similar program; 
• Certain 'regulated workers' within the meaning of the FW Act (e.g. gig workers); or
• Casual employees not employed on a regular and systematic basis. 

Most significantly, any employees to whom the existing flexible working provisions in the FW Act apply (such as those with parental or caring responsibilities, with a disability, who are pregnant, who are over 55 years, or are experiencing or supporting somebody experiencing family and domestic violence) and who are seeking flexibility because of those circumstances are not eligible under the new WFH Bill. Generally, these individuals would make a request under the federal flexible working arrangements provision.

Practical Operation

The WFH Bill proposes that to exercise the right, an employee must provide written notice specifying their proposed working from home arrangements, including the days on which they propose to work from home and the intended place of work (if not their home). Employers will then be required to respond within 21 days.

If an employer does not agree to the requested arrangement, the response must:

• Confirm whether alternative working from home arrangements can be offered; and
• Set out reasons why the requested arrangement is not considered reasonable.

Grounds for Refusal

An employer may refuse a request only where it is not reasonable for the employee to work from home. While there are some similarities to the FW Act flexible working arrangements, the WFH Bill prescribes a closed set of factors that must be considered, focussing on:

• The inherent requirements of the role;
• The operational impact that working from home would have on the employer; and 
• Any prescribed matters. 

Relevant considerations include productivity, supervision, safety, customer impact, confidentiality, cost, and the practicality of altering working arrangements. Employers must assess these factors on an evidence-based basis.

Additional Employer Obligations

Where an employer is required to allow working from home under the WFH Bill, they will also be required to meet “reasonable costs” associated with the arrangement. This may include essential equipment and secure access to systems.

Pro-Rata Arrangements

For employees not working 38 hours per week, the entitlement is pro-rated. However, the method of calculation is left to the regulations, which have yet to be released.

Dispute Resolution

Notably, this right is to be introduced via an amendment to the Equal Opportunity Act 2010 (Vic) and will sit within its framework. Disputes between employees and employers may be brought to the Victorian Equal Opportunity and Human Rights Commission. Should conciliation between the employer and employee fail, the matter may then proceed to the Victorian Civil and Administrative Tribunal who may order that the employer permit the employee to work from home. 

Takeaways for Employers

The WFH Bill represents a material change to how flexible work arrangements are managed in Victoria. In particular, if it passes:

• Refusals of working from home will be constrained and subject to a structured statutory test;
• Decision-making will need to be clearly documented, reasoned and evidence-based; and
• There is an increased risk of employee claims where requests are not appropriately assessed.

We recommend that employers pay close attention to the WFH Bill's passage and begin reviewing their policies, role design, and decision-making frameworks to ensure they are positioned to respond to requests consistently and in accordance with the proposed legislation. 

The authors would like to thank graduate Tom Denovan for his contributions to this alert.

The Act focuses on accelerating development through the following two major pathways: 

• Facilitating specific “Priority Projects.”
• Coordinating the development of entire precincts for “State Development Areas.” 

To support achievement of the above, the Act establishes a new office of the coordinator general (Coordinator General) to identify and oversee priority projects and state development areas, as well as to provide advice and make recommendations to the Minister of State Development (the Minister) in relation to them.

Priority Projects 

As stated in the Act’s second reading speech, the government seeks to increase the competitiveness of Western Australian industry by prioritising projects in the following: 

• Critical minerals processing facilities.
• Naval shipbuilding.
• Large-scale renewable energy projects.
• Net-zero hubs for green metals. 

Though the scope of priority projects in the Act is not confined to specific industries, and requires only that the project has strategic or economic significance to the state, the state’s industrial focus is reinforced through the Act’s prohibition on designating purely residential developments as priority projects. Projects designated by the Minister as a priority project will receive fast-tracked approvals, strategic recognition and coordinated engagement and support across government.

The naval and industrial focus of the Act aligns with Australia’s participation in the AUKUS security partnership with the United Kingdom and the United States, particularly Australia’s acquisition of conventionally armed, nuclear-powered submarines (each, an SSN) and the development of the infrastructure, technical capabilities, industry and workforce necessary to operate a sovereign SSN fleet. This accelerated development trajectory is further bolstered by the Cook Labor Government’s entry in October 2025 into a landmark Australia-US agreement supporting critical minerals and rare earths, enhancing cooperation and investment to diversify Western Australia’s mineral supply chains and manufacturing sectors.¹  Modification orders may be issued to modify how certain provisions of a designated Act apply to a priority project, streamlining approvals. Priority projects may also gain access to several coordination mechanisms that may be exercised by the Coordinator General to ensure efficient delivery: due regard notices, time frame notices and joint decision notices.

Modification Orders

The Minister may, with the approval of the Premier, make a modification order providing that specified provisions of a designated Act do not apply, or apply with specified modifications, in relation to the making of a decision for a priority project. 

There are around 40 designated Acts that these modification orders may impact, including the Planning and Development Act 2005, the Biodiversity Conservation Act 2016 and the Heritage Act 2018, with some exclusions. 

In making a modification order, the Minister must consider it appropriate to do so because, in the Minister’s opinion: 

• The making of an order will prevent or reduce duplication of statutory or administrative processes or requirements that apply to the priority project or to a part of the priority project.
• Having regard to the purpose of the affected designated Act and the object of this Act, the making of the order will not prevent the priority project or part of the priority project from being effectively regulated under law. 

Noncompliance by a proponent for the priority project with any conditions set out in a modification order is an offence, punishable by a AU$100,000 fine and a daily penalty of AU$5,000 for each day during which the offence continues. 

To rein in the potentially broad and controversial effects of a modification order, the following checks and balances apply: 

• Consultation with each affected public authority and the proponent for the priority project prior to the making of an order.
• A modification order cannot have the effect that a key regulatory authorisation that would otherwise be required in relation to a priority project is not required.
• A modification order cannot exclude or modify the application of a provision of a designated Act, to the extent that it relates to an assessment under a bilateral agreement or a process that the Commonwealth minister administering the Environment Protection and Biodiversity Conservation Act 1999 (Cth) has decided to use under section 87(1).
• All orders are to be tabled in Parliament and subject to disallowance processes. 

Due Regard Notices

The Minister may give due regard notices to a public authority responsible for making a decision regarding the implementation of a priority project. A due regard notice requires the relevant responsible authority in making that decision to have due regard to a set of considerations specified by the Minister.

A due regard notice therefore allows for ministerial elevation of the importance of particular matters within a public authority’s decision-making process. Despite this, the notice cannot itself permit an authority to consider matters outside the scope of matters it may have regard to under the designated Act. 

Due regard notices may not be given to the Environmental Protection Authority or Heritage Council of Western Australia, nor to another minister without consent. 

Time Frame Notices

The Minister may also accelerate decision-making by issuing time-frame notices to a relevant public authority making decisions under a designated Act or the Aboriginal Heritage Act 1972. A time-frame notice requires that the responsible authority perform the designated function within a certain time period, which must not be less than 20 business days after the day on which the notice is given. 

As there are around 40 designated Acts under the Act, the scope of decision-making public authorities that may potentially be issued a time-frame notice is broad. An extension on the designated time frame may be granted by the Minister on application by the responsible authority. 

A time-frame notice may not be given to another minister without consent. 

Joint Decision Notices

The Minister may issue joint decision notices, requiring decisions to be made jointly between the public authority under a designated Act and the Minister or the Coordinator General. Upon the issuing of such a notice, the responsible authority must consult, and if possible agree with, the relevant coordination authority on the designated decision to be made. If agreement cannot be reached, the matter may be referred to the Minister and the responsible minister for the responsible authority or otherwise to the Premier for final determination.

A decision made under this process will be valid as if it were made by the responsible authority under the ordinary procedure applying under the designated Act. Revocation or variation of the joint decision is prohibited without consultation with the relevant coordination authority. 

A joint decision notice cannot be given to the Environmental Protection Authority, Heritage Council of Western Australia, Western Australian Planning Commission or another minister without consent. 

State Development Areas

State Development Areas (SDAs) are designated precincts identified to support Western Australia’s economic and industrial growth. These may include renewable energy precincts, industrial circular economy hubs and project hubs supporting industry clusters. An accompanying State Development Area Plan (SDA Plan) will outline the strategic direction for the nominated area, including setting out the following:

• Economic, environmental and social considerations.
• Intended precincts, developments and subdivisions in the plan area.
• Infrastructure and services required to support the plan area. 

Projects undertaken in an SDA will be assessed by a public authority with regard to the SDA Plan. In doing so, the government hopes to create investment-ready areas, giving clearer signals to industry and investors. 

Despite this, the Minister may give a public authority written notice exempting the public authority from the requirement to have due regard to an SDA Plan in making decisions under a designated Act. 

A newly operational SDA does not affect the application of any improvement scheme or planning scheme applying to that area under the Planning and Development Act 2005 or another written law at the time of operation. 

Next Steps

The Act came into operation on 18 February 2026 following the publication of the State Development Act 2025 Commencement Proclamation 2026 in the Government Gazette, save for sections 115–117 amending the Petroleum Legislation Amendment Act 2024, which are to be commenced at a later date.

As of the date of this article, no priority projects or SDAs have been designated. 
 

This edition of the K&L Gates Competition & Consumer Law Round-Up provides a summary of recent and significant updates from the Australian Competition and Consumer Commission (ACCC), as well as other noteworthy developments in the competition and consumer law space. If you wish to have any more detail about the issues outlined in this newsletter or discuss them further, please reach out to any member of the K&L Gates Competition and Consumer Law team.

Enforcement

• Australian Government Grants an Additional AU$67.7 Million to the ACCC Over a Four-Year Period to Strengthen Competition and Consumer Law Enforcement Capabilities
• Coles Found by the Federal Court to Have Misled Consumers in its "Down Down" Promotions
• AU$15 Million Penalty Ordered Against Emma Sleep for Misleading Statements About Sale Prices

Mergers and Acquisitions

• ACCC Requires Two More Merger Notifications to Proceed to Phase 2 Review (MicroStar - Konvoy and Insurance Australia Group - RAC Insurance)

Notifications and Authorisations

• ACCC Proposes Not to Authorise Screen Producers Australia to Negotiate With Broadcasters and Streaming Platforms
• ACCC Proposes to Grant Authorisation for Australian Hotels Association Members to Engage in Collective Bargaining

Noteworthy Developments

• Heightened ACCC Attention on Compliance With Consumer Guarantee Rights in the Electronics and Whitegoods Sector
• ACCC Granted Leave by the Federal Court to Intervene in the Epic Games, Inc v Apple Inc Proceedings
• Streamlined Competition Exemption Powers for Emergencies and Exceptional Circumstances, Alongside Increased Penalties in the Petroleum Marketing Industry

Click here to view the Round-Up.

The table below outlines the key features of break fees generally and naked break fees (sometimes also referred to as a "bare break fees" or "naked no-vote break fees"):

The firm recently acted for Ausmincon Holdings Limited on a merger by way of a court approved scheme of arrangement with AFRY AB in the Federal Court of Australia, under which AFRY AB acquired 100% of the issued share capital in Ausmincon Holdings Limited. This deal featured a naked break fee which was expressly considered by Justice Jonathan Beach in Re Ausmincon Holdings Limited [2026] FCA 280.

Justice Beach found that the naked break fee did not constitute unacceptable circumstances, but rather "the price of buying the opportunity” to put the AFRY AB offer to the Ausmincon Holdings Limited shareholders. In coming to this decision, Justice Beach considered the following:

• Circumstances where the bidder's preference was a traditional M&A transaction which would involve customary warranties and other deal protection arrangements;
• The market soundings leading up to the negotiation of the scheme implementation agreement;
• The quantum of the naked break fee being approximately 1% of the scheme consideration;
• The naked break fee being a reasonable estimate of the actual costs to be incurred by the bidder;
• The target's financial position which could facilitate payment of the naked break fee;
• The premium of the bid compared to the independent fairness report; and
• The likelihood of support from the target's shareholders.

This decision highlights that despite being unusual, naked break fees are not automatically unacceptable. However, as naked break fees carry a much higher regulatory risk than conventional break fees, they should be approached with caution and carefully considered before being implemented.

On 14 May 2026, the Federal Court of Australia (the Court), in a prosecution commenced by the Australian Competition and Consumer Commission (ACCC), found that Coles Supermarkets Australia Pty Ltd (Coles) had engaged in misleading conduct and made misleading representations about the price of products in trade or commerce between February 2022 and May 2023.

The proceedings, centred on Coles’ long-running “Down Down” promotional campaign which advertised lower prices on frequently bought grocery items, such as milk, bread and laundry liquid. 

The Court found that, for a discount on a product to be a “genuine discount,” it required the following:

• A pre-promotional price that was commercially justifiable and not artificially inflated.

• Commercial volumes of the product sold at that pre-promotional price.

• Importantly, a reasonable period during which the product was ordinarily offered at that price.

The Court held that a price that was only ever held for a short time (in these instances, about four weeks), notwithstanding that these prices were commercially grounded (the prices followed supplier price increases, were based on suppliers’ recommended retail prices (RRPs) and, hence, were “genuine prices”), was, in the context of Coles’ long-standing pricing behaviour and policies/“guardrails,” too short to constitute a genuine reference price, rendering the represented discounts illusory and misleading.

The Court stated that had the prices been held at the higher prices for a period of 12 weeks immediately prior to the “Down Down” promotion, the conduct would not have been misleading. However, while it was not explicitly stated, it is clear that the reference to the 12-week period related directly to Coles’ own policies/guardrails which were in place prior to the period in which the conduct took place—further detail below.

According to ACCC Chair Gina Cass-Gottlieb, the ACCC brought these proceedings as it considered that “Coles’ pricing practices within its ‘Down Down’ program made it harder for consumers to identify genuine value for money while shopping for household essentials.” ¹

This decision by the Court has important implications for businesses and their promotional strategies and activities. We set out a number of key considerations for businesses in light of the Court’s decision in more detail below.

Background

The ACCC commenced proceedings against Coles in September 2024 over alleged false or misleading representations made to consumers.

Specifically, Coles was alleged to have briefly raised prices (for periods of about four weeks or less) on 245 items (the Affected Products) by at least 15% before putting them on “Down Down” promotions. The Affected Products included Arnotts’ Shapes biscuits, Bega cheese, Band-Aids, Danone Yoghurt and more.

The Affected Products were marked with “Down Down” pricing tickets which noted both a promotional price and a “was” price for each product (being the temporarily increased price). Even though the promotional price was lower than the “was” price, it remained higher than the regular price before that temporary increase.

The ACCC’s allegations were that the “Down Down” pricing tickets constituted false or misleading representations that the Affected Products’ promotional price was a genuine discount, even though the “was” price displayed on the pricing tickets was the temporarily increased price and not the product’s regular price. Therefore, the discounts did not actually exist.

Coles denied the alleged representation, asserting that supplier cost increases and related negotiations resulted in the price increases from which the discounting occurred. Coles argued that the “was” price reflected the immediately preceding regular price and that the promotional price therefore represented a genuine discount.

For completeness, in parallel with the ACCC prosecution, a class action proceeding was commenced making similar allegations, and the initial trial involved all issues of liability in both the ACCC proceeding and the class action proceeding (the Joint Liability Trial).

The Joint Liability Trial was conducted using 12 out of the 245 Affected Products (Sample Products), all of which were manufactured and packaged grocery products instead of fresh products.

Is the Discount Genuine or Illusory?

The Court approached the issue of what separates a genuine discount from an illusory one, ultimately finding that the duration that the “was” price had been offered, particularly in the context of Coles’ own policies and guardrails that were in place in the three years prior to the conduct taking place (and which were amended at the conduct’s commencement), was the decisive issue in this case.

The Court accepted that most ordinary consumers, when grocery shopping, would not have formed a conscious belief about the period for which the “was” price was offered. 

As such, consumers would only have an intuitive sense that the discount being offered was genuine. In addition, incorporated into the notion of a genuine discount is the idea that the previous price was an ordinary price that had been offered by Coles for a reasonable period. 

Therefore, the Court’s view was that the “Down Down” pricing tickets conveyed a representation about Coles offering a genuine discount.

Was the Discount Genuine?

To determine whether the discount was genuine, the Court had to consider all relevant factors, including whether the “was” price shown on the “Down Down” pricing ticket truly reflected the product’s usual sale price over a reasonable time frame.

These relevant factors included the following:

• The commercial circumstances under which the price of the product had been determined.

• The level at which the price was set.

• The period over which the product was sold at that price.

• The volume of product sales at that price.

Based on its assessment of the circumstances under which Coles increased the Sample Products’ retail prices before placing them on “Down Down” pricing tickets, the Court concluded that the price increases were due to an increase in supplier cost prices and that Coles’ decision to increase retail prices (based in part on the price increases and suppliers’ RRPs) was commercially justifiable. The Sample Products were both offered for sale at the “was” price in Coles’ ordinary course of business and were also sold in commercial volumes.

Nevertheless, the determining consideration was the duration for which the Sample Products were sold at the “was” price. 

The Court considered in detail Coles’ own policies and in particular the “guardrails” that had been in place since September 2019, particularly the following:

• The requirement that the product which was the subject of the “Down Down” promotion must not have been offered at lower than the “was”/regular price at any time in the preceding 12 weeks.

• The requirement that the product must have been sold at the “was”/regular price for the four weeks immediately prior to the launch of the promotion (or for four out of the previous six weeks).

The Court also did the following:

• Considered that the above guardrails “provided contemporaneous evidence of Coles’ efforts to ensure that the Down Down price represented a genuine discount from the previous price”²—noting that the Court discounted the fact that the guardrails were amended immediately prior to the conduct commencing as being similarly probative.

• Proceeded to state that “…In that regard, the guardrails demonstrate that Coles was aware of the potential for the Down Down promotional strategy to mislead consumers….”³

• Therefore concluded that 13 of the 14 “Down Down” pricing tickets were misleading, as they had not been sold at the “was” price stated on the ticket for a reasonable period prior to the “Down Down” promotion. The only exception was the Nature’s Gift Dog Food “Down Down” pricing ticket, which was not misleading as it did not include a “was” price.

As such, the discounts represented on the “Down Down” pricing tickets were not genuine. In offering the Sample Products on the “Down Down” pricing tickets, Coles had done the following:

• Engaged in misleading conduct in trade or commerce.

• Made a misleading representation with respect to the price of the Sample Products in connection with the promotion of the supply of the Sample Products in trade or commerce.

Penalties

The question of penalties has yet to be determined by the Court. However, Ms. Cass-Gottlieb has stated that the ACCC will be seeking a substantial penalty to reflect “the importance of accurate pricing for consumers.”⁴

What Does This Mean for Your Business?

The Court determined that the concept of a genuine discount inherently includes the assumption that the referenced prior price reflects the ordinary sale price over a reasonable period. 

While there has been significant “publicity” about the “requirement” to make available the products at the “was” price for a period of 12 weeks, as is set out clearly above, this requirement was clearly contextual to Coles’ factual circumstances and is not, in our view, a “hard and fast rule.”

The Court determined that the concept of a genuine discount inherently includes the assumption that the referenced prior price reflects the ordinary sale price over a reasonable period. Having said that, businesses should exercise care when using “was/is” or “strike through” pricing strategies in promotions, as they are implicitly making a factual representation about the product’s pricing history.

To manage risks in relation to misleading conduct and representations, businesses should “take stock” of their promotional strategies, activities and mechanisms to ensure they are not at risk of contravening the Australian Consumer Law (ACL).

When assessing their promotional strategies, activities and mechanisms, businesses should consider the following:

• What is a reasonable period for the product to be offered at the pre-promotional price/“was” price?
  • Are the prices of the product relatively stable, or do they change frequently?
• What internal guardrails can be established (e.g. minimum price sale periods) to manage the risk of offering an illusory discount?
  • According to the promoter’s rules, how long must product prices remain stable/the products be sold at (or at least offered at) before the product is offered on promotion?
• What is the volume of sales for each product at the pre-promotional price?
  • Businesses should keep records of pre-promotion sales volume (or at least the period of time that the product was offered at the “was” price), promotion sales volume and other relevant data points. 
• What is the commercial basis behind pre-promotional prices?
  • If challenged, can the business provide sufficient evidence on why each specific price point is commercially justifiable? For example, by providing supplier cost data or internal documentation outlining the methodology used in price determination.

If your business cannot confidently establish that a pre-promotional reference price meets the factors for being a “genuine discount,” the most prudent approach may be to avoid “was/is” or “strike through” pricing and identify other ways to communicate the product’s value.

If you require any assistance in conducting an assessment on whether your business’s promotional activities and strategies pose a risk under the ACL, please contact us and we can assist you further.

Annual Reporting Requirements 

Currently, Australian companies listed on the ASX are required to:

• Provide the ASX with its audited accounts for the full financial year when lodging with the Australian Securities and Investments Commission (ASIC), in any case no later than three months from the end of its financial year; and
• Prepare and send an annual report to its shareholders within four months from the end of its financial year.

Moving forward, ASX-listed companies may now be captured by the new mandatory requirements which require the preparation of a sustainability report (Sustainability Reporting Requirements).¹

Which ASX-Listed Companies Are Required to Prepare Sustainability Reports? 

ASX-listed companies are required to prepare and lodge financial reports under Chapter 2M (being the financial reporting provisions) of the Corporations Act 2001 (Cth). Accordingly, the Sustainability Reporting Requirements will apply if an ASX-listed company falls within one of the following groups ² :

Group 1:

• Companies meeting at least two of the following criteria for the relevant financial year:
  • consolidated revenue of more than AU$500 million;
  • consolidated gross assets of more than AU$1 billion; or
  • 500 or more employees, or
• Companies above the threshold in section 13(1)(a) of the National Greenhouse and Energy Reporting Act 2007.

Group 2:

• Companies meeting at least two of the following criteria for the relevant financial year:
  • consolidated revenue of more than AU$200 million;
  • consolidated gross assets of more than AU$500 million; or
  • 250 or more employees, or
• Companies subject to other National Greenhouse and Energy Reporting Act 2007 reporting obligations.

Group 3:

• Companies meeting at least two of the following criteria for the relevant financial year:
  • consolidated revenue of more than AU$50 million;
  • consolidated gross assets of more than AU$25 million; or
  • 100 or more employees.

Deadlines

The first financial year in which Group 1, 2 and 3 companies must comply with the Sustainability Reporting Requirements is set out in the timeline below:

_{Source: K&L Gates}
 
Accordingly, the first phase of climate-related disclosures for Group 1 companies is due this financial year ending 30 June 2026.

What Must Be Reported?

The Sustainability Reporting Requirements include preparing:

• Climate statements for the year;
• Any notes to the climate statements; and
• The directors’ declaration regarding the statements and notes,

which must include:

• Material financial risks and material financial opportunities relating to climate;
• Metrics and targets relating to climate, including those relating to Scope 1, Scope 2 and Scope 3 greenhouse gas emissions; and
• Information relating to the governance or strategy of, or risk management by the company in relation to, the above.

If a Group 3 company determines that it has no material climate-related risks or opportunities for that financial year, its climate statement must state this and an explanation as to how it came to this conclusion.

ASX Lodgement

The timing for providing ASX with a sustainability report for an ASX-listed company coincides with lodgement of its annual reporting documents as required by Listing Rule 4.5 (being no later than three months after the end of the financial year).

However, late lodgement of a sustainability report will not automatically result in mandatory suspension from trading on the ASX (as a result of amendments made by the ASX to Listing Rule 17.5).

Next Steps

As the Sustainability Reporting Requirements are being phased in over three years, ASX-listed companies should begin preparing to ensure compliance ahead of each relevant deadline. 

We will continue to monitor developments and provide updates as required.

Further information can also be found in our ESG and the Sustainable Economy Handbook, and our Australian ESG Policy Updates (click here).

-----------------------

¹ As introduced by the Treasury Laws Amendment (Financial Market Infrastructure and Other Measures) Act 2024 (Cth).
² Separate thresholds apply for superannuation funds and managed investment scheme entities.
 

The author would like to thank graduate Cleo Taliadoros for her contributions to this alert.

A local government (LG) in Western Australia will frequently procure goods and services by way of an expression of interest (EOI) or a request for tender (RFT). 

An EOI or RFT may also form part of an LG's processes to dispose of land, an interest in land (e.g. a lease), or to develop land.

RFTs and EOIs invariably contain evaluation criteria against which submissions are to be assessed. Proper application of the assessment criteria is very important but can be time consuming, require careful analysis, be technically complicated, and involve making an informed judgment.

There is no single source that codifies the legal obligations that apply to LGs when managing EOIs and RFTs. But when undertaking procurement processes, LGs do have obligations, including:

• To adhere to procedural fairness;
• To ensure the process is free of bias and unfair advantage;
• To avoid and manage conflicts of interest;
• Confidentiality obligations;
• To not engage in misleading and deceptive conduct;
• To make legal, rational, and fair decisions;
• To comply with their own terms and conditions (as applicable to the LG);
• To comply with express legislative requirements, e.g. the LG (Functions and General) Regulations 1996 and privacy laws relating to automated decision-making (where applicable).

Artificial intelligence (AI) can assist with the EOI and RFT assessment process. But it cannot replace the need for human decision making.

How AI Can Assist

AI refers to technologies that enable computer systems to simulate aspects of human learning, comprehension, problem solving, decision making, and creativity. Generative AI tools do this by making use of a large language model to process natural language (as distinct from structured data, such as spreadsheets or financial statements).

Generative AI tools can assist by sorting and summarising large volumes of information, generating tables, or undertaking the preliminary assessment of EOIs and RFTs. AI can be utilised to identify gaps or inconsistencies and to highlight issues that may require further clarification with a bidder. 

Used appropriately, AI can be a valuable tool.

Practical and Legal Risks

AI use carries risks. 

These include:

• Incorrect assessments;
• Assessment by reference to unstated evaluation criteria;
• An advertent disclosure of confidential information;
• Abrogation of responsibility; and
• The risk that AI-generated material is given undue weight. 

AI outputs may be inaccurate, biased, outdated, or entirely fabricated. 

Bidders may "curate" their responses to be assessed favourably by an AI, e.g., to make their financial capacity or relevant experience appear greater than it is.

Reliance on AI generated outputs, particularly without adequate human oversight, can undermine the integrity of the assessment process and lead to difficulty in explaining or defending the final decision.

These issues may give rise to claims by unsuccessful bidders, including:

• Claims for injunctive relief;
• Allegations of misleading or deceptive conduct;
• Judicial review of decisions on the basis that a decision is one that no reasonable government decision maker could have made;
• A perceived lack of procedural fairness; and
• Breach of express legislative requirements, contractual terms and conditions, or terms implied by law into the tender process.

What Needs to Be Done

If AI is used to assist with EOI and RFT assessments, LGs must be able to demonstrate that:

• The assessment was undertaken strictly by reference to the stated evaluation criteria; and
• Suitably qualified humans were entirely responsible for the assessment outcome.

Decision makers must understand the extent to which AI has been used by their LG in the assessment process. In choosing a suitable AI tool for this task, consideration should be given to the tool's ability to explain its reasoning and the factors that led to a particular outcome or outputs.

If a decision is challenged the reasoning must be capable of explanation, independently of the output of any AI tools and supported by records showing how the AI outputs informed, but did not determine, the outcome.

EOI and RFT Documents Should Address AI Use

Clear disclosure of AI use is critical to transparency, procedural fairness, and defensibility.

Your EOI and RFT terms and conditions should expressly address AI use. 

This should include:

• Disclosure that AI tools may be used in the assessment process;
• Disclosure of the associated risks;
• A reservation of rights to disregard AI-generated outputs;
• The bidder's consent to the use of AI notwithstanding its risks and deficiencies;
• Appropriate waver of the right to bring claims arising from the use of AI; and
• Confirmation that responsibility for the assessment remains with human decision makers.

When choosing a suitable AI tool, LGs may also wish to consider how the information they provide to the tool will be used and whether the provider of the AI tool acquires some rights in that information and any prompts (including whether they are permitted to use your data to train their models). This is more common in publicly available Generative AI tools. As with any software tool, consideration should be given to the terms of use and whether they are acceptable given the nature of the information that will be input into the system.

Where confidential information is involved, bidders should be required to acknowledge that the LG may not be able to verify how that information is handled once it is input into AI systems, including what is retained, reused, or used to train models. Put another way, the LG should not be giving assurances how the information inputted into AI will or will not be used (unless the LG is certain of the answer).

How can K&L Gates help you?

K&L Gates is a Western Australian Local Government Association panel law firm.

We are focused locally and connected globally.

At K&L Gates, we advise LGs and public sector bodies on procurement risk, probity, and governance issues, including those arising from the use of AI.

We can assist with drafting tailored AI clauses for EOI and RFT documentation and with developing practical governance tools and checklists to mitigate the risks associated with AI assisted assessments. We can also assist as you select AI tools and negotiate terms of use for those tools.

More broadly we can assist with advice and documentation for EOIs and RFTs for the procurement of goods and services.

Our team has 20 years' experience supporting LG's undertaking or facilitating major land transactions and large-scale urban renewal projects.

The author would like to thank graduate Emilia Cottino for her contributions to this alert.

The CC&NH SEPP, which aims to consolidate and strengthen climate change controls within the one instrument, follows the insertion of a new climate change object into the Environmental Planning and Assessment Act 1979 (EPA Act) through the enactment of the Environmental Planning and Assessment Amendment (Planning Systems Reforms) Act 2025 (EPA Amendment) in November last year. 

Although no legal drafting for the CC&NH SEPP has been published yet, the Government has exhibited an Explanation of Intended Effect (EIE), draft Climate Change Scenario Guidelines, and draft NSW Urban Heat Policy for Land Use Planning. The recent EPA Amendment represents the most comprehensive reform of the NSW planning system in decades. 

Towards Consolidated and Systematic Climate Assessment

The current legislative approach to hazards operates on a case-by-case basis, identifying land affected by specific hazards—such as bush fires, floods, and coastal risks—and applying controls respectively. These controls are dispersed across the Resilience and Hazards SEPP, the EPA Act, the Standard Instrument LEP (Standard Instrument), and the Rural Fires Act 1997 (Rural Fires Act), among others. The proposed CC&NH SEPP seeks to consolidate those provisions within one instrument, citing anecdotal uncertainty about how those frameworks relate.

The CC&NH SEPP is intended to adopt a proactive rather than reactive approach to future climate risk by embedding the following overarching principles: 

• Planning decisions consider future climate risk and relevant natural hazards;
• Planning decisions reduce future exposure and vulnerability to natural hazards and climate risk;
• Planning decisions appropriately balance and manage future costs and risk to life from natural hazards and climate risk; and
• Planning decisions improve the health of Country (and therefore Aboriginal communities) in a changing climate.

The EIE also provides an overview of how major areas of climate risk are proposed to be addressed under the new SEPP. 

Climate Change

Climate Change Mandatory Considerations 

The proposed CC&NH SEPP will codify several matters that consent authorities must consider when determining a development application: 

• Consider climate risk and natural hazards, taking into account projected changes as a result of climate change;
• Minimise risk to development from climate risk and changing natural hazard exposure as a result of climate change;
• Consider if the development is appropriately designed, constructed and operated to be resilient to the future impacts of climate change; and 
• Use the appropriate prescribed climate scenarios for the relevant development assessment decision, as directed by the Climate Change Scenario Guidelines.

Climate Scenario Assessments

Climate scenario assessments are a new proposed requirement in development assessment. The Sixth Assessment Report of the Intergovernmental Panel on Climate Change identified five Shared Socioeconomic Pathways (SSPs). Each SSP represents a different emissions scenario that can inform how future climate risk impacts the life of the proposed development. 

To help consent authorities make informed decisions on climate risk, particular SSP modelling scenarios are proposed to be applied to future developments. The type of modelling scenario is proposed to vary with the scale, context, and lifetime of a proposed project to ensure proportionality. 

The following table is adapted from the exhibited Climate Change Scenario Guidelines, showcasing the minimum requirements for considering climate change scenarios in planning decisions. 

Fig 1–SSP emissions scenarios for planning decisions

Urban Heat–A New Hazard

Urban heat is not currently addressed on a statewide planning level. The exhibited EIE stresses the importance of heat planning, noting that some parts of the state such as Dubbo and Penrith are projected to experience an additional 56.7 and 25.9 hot days per year by 2090, being days where maximum temperatures are 35 degrees and above, while the cost of cooling Western Sydney homes may increase 370% by 2079. 

The draft Urban Heat Policy aims to install urban heat as a consideration in development projects within urban land use zones across NSW, especially in heat-vulnerable communities. The policy points to the proliferation of large areas of dark, hard, heat-absorbing surfaces that permeate daily commutes to urban centres and the corresponding lack of heat-reducing elements such as greenery, water bodies, and heat-reflective surfaces. Three principles for consideration are proposed: 

1. Consider the urban heat context of the land use planning decision or proposed development; 
2. Incorporate planning and design measures in development to support community adaptation to increased heat; and 
3. Design buildings and public spaces to support wellbeing during heatwaves and hot days. 

The Government is currently seeking feedback on how and where such provisions should apply, including potential triggers by development type (such as schools, hospitals, and aged care facilities) and the appropriate role of heat risk assessments and heat data. 

Approach to Existing Hazards

Bush Fires 

Although bush fire risk will continue to be substantively managed under the EPA Act and Rural Fires Act, the CC&NH SEPP will include new objectives requiring consent authorities to avoid inappropriate development in high-risk bush fire locations and ensure development includes adequate evacuation capability, among others. Existing bush fire provisions in section 272 and 274 of the Environmental Planning and Assessment Regulation 2021 and clause 5.11 of the Standard Instrument are also proposed to be consolidated into the CC&NH SEPP. 

A new planning pathway to facilitate cultural burning as an approved method of hazard reduction is also proposed. 

Coastal Hazards

The CC&NH SEPP would redistribute coastal protection clauses around various instruments to prevent duplication. For example, the four current coastal management areas under the Resilience and Hazards SEPP are suggested to be divided across the State Environmental Planning Policy (Biodiversity and Conservation) 2021 and the CC&NH SEPP. 

Concern has been expressed regarding the duplication of coastal risk planning clauses spread across local environmental plans (LEPs). These may be consolidated into a coastal vulnerability area clause in the CC&NH SEPP, although guidance on this transition is currently unclear. 

Flooding

Noting that flood planning is one of NSW’s most mature natural hazard frameworks, the CC&NH SEPP primarily consolidates clauses from several other instruments into its own ambit, including clause 5.21 (flood planning requirements) and clause 5.22 (special flood considerations) currently in the Standard Instrument.

A clause giving effect to local council flood maps is also suggested to be drafted. 

Connection with EPA Act Amendment

The proposal for the CC&NH SEPP follows on the heels of the new EPA Act climate objective and the powers conferred on the Department of Planning, Housing and Infrastructure to make environmental planning instruments for the purposes of administering the EPA Act. 

The recent EPA Amendment itself reflects a broader policy approach towards consolidation and streamlining. It rearranges the fabric of the planning landscape and underpins several mechanisms contemplated by the CC&NH SEPP. The essential elements of the EPA Amendment are summarised below.

The DCA–A Single Front Door for Referrals 

The Development Coordination Authority (DCA) is being established as a single front door for referrals, concurrences and issuing General Terms of Approval across all development types. It will act as the final decision-maker on these inputs, replacing the current system under which up to 22 separate agencies—including those responsible for bush fire and flooding—may need to be consulted, sometimes producing inconsistent requirements. 

The DCA will also function as a contactable agency for council and applicant enquiries, supporting an in-house technical advisory team. Consistent with the CC&NH SEPP’s aim to amalgamate fragmented climate risk legislation into a single instrument, the current 800+ triggers for concurrences with government agencies are also proposed to be consolidated into a schedule under the State Environmental Planning Policy (Planning Systems) 2021. 

The DCA is projected to commence full operation on 1 July 2026. 

Simplifying Development Approval Streams 

“Complying developments in New South Wales,” said Minister for Planning Paul Scully in the EPA Act’s second reading speech, “are too rigid, and in some cases, just ludicrous”. 

To simplify the development approval process, the Government has rearranged assessments into three pathways: 

1. Expanded scope of deemed approvals 
   
   Development that would be complying development but for some minor variations now will no longer need assessment under a full DA. These applications will generally be deemed approved if the consent authority does not make a decision within 10 days. 
2. Targeted assessment (new pathway)
   
   Targeted assessment sits as an intermediary pathway between complying and full development assessment. It ‘switches off’ the public interest, site suitability, and likely impacts from the section 4.15 application evaluation criteria by replacing them with a set of rules in a SEPP. This reduces the need for expert reporting on matters that have already been strategically assessed.
3. Full development assessment
   
   For developments continue to be assessed as a traditional full DA, section 4.15 of the EPA Act has been amended to require assessment of only ‘significant likely impacts’ (rather than just ‘likely impacts’). This is intended to prevent unduly extensive assessment of all matters touching upon a project. 

Standardised Development Conditions 

The EPA Act now enables an SEPP to specify model conditions for development consent. It will be mandatory for consent authorities to use these model conditions where directed. Applicants will also be given the chance to consider and comment on development conditions prior to their imposition by the consent authority. 

Variation of Definition of ‘Development Standards’ 

Alongside these changes, the definition of ‘development standards’ has been redrafted more restrictively. As a result, requirements in environmental planning instruments not specifically identified as a development standard may fall outside the definition and be characterised as a prohibition. They may therefore not be amendable to variation via section 4.6 of the Standard Instrument.

This may have implications for how the CC&NH SEPP’s new climate risk provisions are drafted, including whether they will be intended as development standards or prohibitions and whether any variation will be allowable. 

Next Steps

Developers should be aware that climate change risk assessment may be incorporated across all categories of development. Larger or more sensitive projects are likely to face more demanding climate scenario requirements. Consideration should also be given to how future projects may address urban heat, particularly in large urban zones. 

Exhibition of the proposed CC&NH SEPP and its supporting documents closed on 16 March 2026. We await the release of more detailed legal drafting following the Government’s consideration of submissions. 
 

The Amendment Bill doubles the maximum civil and criminal penalties for breaches of both the Competition and Consumer Act 2010 (Cth) (CCA) and certain sections of the Australian Consumer Law (ACL). It is the latest step in recent legislative reform aimed at deterring conduct by businesses that is anticompetitive or harmful to consumers.

We set out the key aspects of the Amendment Bill below, along with some salient changes to the Competition and Consumer Amendment (Unfair Trading Practices) Bill 2026 (UTP Bill) that was introduced on 1 April 2026 following a consultation draft circulated in February 2026.

IN BRIEF

WHAT'S NEW UNDER THE AMENDMENT BILL?

The explanatory statement to the Amendment Bill notes that it is intended to "strengthen the penalty regime under the CCA, including the ACL, to deter non-compliant conduct and reduce the financial benefits and incentives for businesses to engage in conduct in breach of competition and consumer law".

The Amendment Bill doubles the value of the first limb of this test from AU$50 million to AU$100 million (as part of the below three limb test), which increases the maximum penalty that can be imposed for a breach.

The maximum penalties are now the greater of:

• AU$100 million per contravention (previously AU$50 million);
• Three times the value of any benefit obtained from the contravening conduct; or
• 30% of adjusted turnover during the breach period (if the value of the benefit cannot be determined).

These increased penalties apply to a range of key provisions in the CCA and ACL, including:

Key Changes to the UTP Bill

Following an earlier exposure draft circulated in February 2026, the UTP Bill was introduced into the Australian  House of Representatives on 1 April 2026 and will be moving through parliament in the coming weeks.

The key changes to the UTP Bill from its previous exposure draft are:

The UTP Bill specifies (at section 21) that the amendments introduced by it will be reviewed two years after coming into effect.  

What Does This Mean for Your Business?

Doubling of Penalties Under the Amendment Bill

The increase in penalties from AU$50 million to AU$100 million under the Amendment Bill, alongside the prospective provisions enacted by the UTP Bill, continues the shift in the regulatory and enforcement landscape toward imposing heavier penalties for violations of the CCA or ACL.

With significantly increased penalties, the ACCC is expected to take a more assertive approach to its enforcement activities and pursue higher penalties in future. Courts will also be in a position to order even steeper penalties to businesses found to have violated the CCA or ACL (as has been the trend in recent years).

Businesses should take stock of their existing compliance frameworks and take a proactive approach to building and strengthening their internal compliance culture. To "get their house in order", businesses should:

• Assess the business's risk exposure against the sections of the CCA and ACL that the penalty increase applies to—identifying higher risk activities or practices and considering whether an updated risk assessment would be appropriate;
• Consider the existing compliance and governance programs of the business against the new penalties—are the current frameworks sufficient to protect the business?;
• Examine the need for any additional risk training for business personnel (both senior executives and regular staff) to encourage awareness and visibility of key risks to the business under the CCA and ACL; and
• Remember to inform the ACCC about any acquisitions that must be reported under the new merger rules, which started in January 2026, before completing the transaction or putting it into effect.

Prospective Changes Under the UTP Bill

Should the UTP Bill be passed, its provisions will become effective from 1 July 2027.

In anticipation of the UTP Bill's provisions becoming law, businesses should conduct a thorough evaluation of their operations and procedures to confirm compliance with the new disclosure obligations.

Our previous Insight article here reporting on the UTP Bill's exposure draft sets out some practical considerations in relation to the UTP Bill's various aspects to guide businesses in assessing their compliance.

If you require assistance in carrying out any of the above or have any queries about how your business may be affected, please contact us and we can assist you further.

The Act’s new objectives include to increase housing supply, diversity, and affordability, and to facilitate efficient infrastructure provision. 

Three-Tiered Planning Permit Assessment

The Act introduces a three-tiered approach to the assessment of planning permit applications, aimed at reducing the time and cost associated with obtaining such permits. 

The Act amends Part 5 of the Principal Act, introducing the following novel categories of permit applications in order of complexity: 

Type 1

This category applies to low impact, small scale developments, such as single dwellings and minor subdivisions. A project assessed as type 1 is not subject to public notice requirements or objections and will be deemed as approved if not determined within the prescribed time. Though greater clarity will come with amendments of the planning regulations, this deemed approval period is estimated to be 10 days. 

Type 2

This category applies to moderate impact developments that are compliant with planning policies. Though also not an application type against which objections may be made, some “specified type 2 applications” may be subject to notice requirements. People who receive notice may comment on the proposed development, though a comment does not amount to an objection. 

Type 3

This category applies to more complex development subject to the full process of assessment, including the provision of notice and receipt of objections. Under new section 57(2A), a responsible authority may reject an objection that it considers frivolous, vexatious, irrelevant, or made to secure a commercial advantage.

This three-tiered framework systematically reduces the scope for objection and delay within the majority of applications. For developers, this is a positive reform, simplifying and expediting the approval process commensurate to the complexity of the project. We look forward to further regulations and guidance on the precise scope of coverage contemplated by each of these streams. 

Impact-Based Planning Scheme Amendments

A three-tier approach has also been adopted in relation to amendments to planning schemes. Revised section 16N categorises potential amendments into the following groups based on impact: 

Low-Impact Amendment

This category applies to small scale amendments where public submissions and panel referrals are not required. 

Medium-Impact Amendment

This category opens the amendment to public submissions, but dispenses with panel referrals. 

High-Impact Amendment

This category applies where exhibition and independent review of the amendment is required. 

Additionally, in relation to medium and high impact amendments, notice of an amendment must be given to any native title holders, traditional owner group entities, and registered Aboriginal parties in the area affected by the amendment. 

Similarly to the staggering of planning permit assessments, this tiered approach in relation to scheme amendments is designed to fast-track straightforward amendments while ensuring due scrutiny for significant changes. The exact scope of the categorisations will be set by regulations. 

Easing Removal of Restrictive Covenants

The Act also introduces a series of significant reforms in the way restrictive covenants are treated in the permit process, greatly shifting the balance between the rights of the covenant beneficiary and the facilitation of streamlined, orderly development in the broader public interest. 

Contrary to the prior regime, permits may now be granted despite potentially breaching a restrictive covenant. The responsible authority would not be liable for any loss arising out of that breach. To similar ends, the Victorian Civil and Administrative Tribunal is authorised to amend a permit despite potentially creating opportunities for a registered restrictive covenant to be breached. 

In considering whether a permit should allow the removal or variation of a restriction, a responsible authority must consider: 

• The interests of the owner of the dominant tenement;
• Victorian state and regional planning strategy; and
• The merits of the proposed development itself, among others.

Notably, financial loss to the beneficiary of the covenant is excluded from the list of matters to be considered. 

Compensation for Land Reserved for a Public Purpose

Part 5 of the Principal Act allows for owners or occupiers of land reserved for a public purpose to seek compensation from the planning authority for financial loss. 

The Act restricts the type of loss able to be claimed by clarifying that references to compensable financial loss are to actual financial loss, and references to value mean market value. Claims for legal and other professional expenses incurred in connection with submitting compensation claims have also been limited to expenses accruing after the right to compensation arises. 

The amendment further restricts a landowner’s right to compensation by expanding the circumstances in section 98(3) where a person cannot claim compensation to include: 

• Where the land has been vested in the planning authority by purchase, compulsory acquisition, or otherwise; and 
• Where a permit granted in relation to the land provides that compensation is not payable. 

A new two-year limitation period on the making of compensation claims has also been introduced, with the period starting on the date on which the right to compensation arises. 

Gifts and Donations Disclosure

The Act introduces a new disclosure regime for political donations and gifts given within a period of two years prior to the submission of a planning application. 

Relevant reportable gift recipients include the Minister, Secretary to the Department, Ministerial Officers or Parliamentary advisors, Councillors, and Council staff, depending on the nature of the responsible authority. The disclosure must include matters such as the names of donors and recipients as well as the value of the gift. 

New section 113G makes it an offence to knowingly or recklessly fail to declare a reportable gift or donation, with a breach punishable by a fine of 240 penalty units (currently AU$203.51 per unit), two years imprisonment, or both. 

Strengthened Enforcement Powers

The Act also considerably strengthens enforcement powers to respond to contraventions against the Principal Act. 

A new general offence under section 126A makes it an offence to give false or misleading statements or documents to a person or body carrying out a function under the Principal Act. These offences are punishable by a fine of 240 penalty units, two years imprisonment, or both. 

Following a person’s conviction for a planning offence, courts may now also make a range of new orders including: 

Adverse Publicity Orders

These orders require wrongdoers to publicise their own offences, typically in electronic and print media.

Commercial Benefits Orders

These orders require payment of up to three times the estimated gross commercial benefit derived from the offence.

Supervisory Intervention Orders

These orders impose compliance requirements of up to one year for systematic or persistent offenders.

Industry Exclusion Orders

These orders prohibit systematic offenders from participating in the delivery of services relating to the commercial development of land.

Finally, the court is also empowered to order a person to pay a civil penalty of up to 2,000 penalty units for a natural person and 10,000 for a corporation in response to a contravention of a civil penalty provision.

This dramatically enhanced enforcement regime sends a clear message that planning noncompliance carries with it serious commercial and reputational consequences. 

Next Steps

The Act is due to commence on 29 October 2027 to allow industry participants, councils, and planning practitioners sufficient time to incorporate changes into their operational practices. In the interim, flow-on amendments are also expected to be made to the Planning and Environment Regulations 2015, Victorian planning provisions, and ministerial guidelines. 

While the Act offers real and tangible opportunities for faster decision making, deemed approvals, and a significantly curtailed objection system, it also restricts the ability of neighbours, covenant beneficiaries, and community groups to have their say. 

In anticipation of the commencement of the reforms, developers should watch for further guidance on the type of development any future planning permit application may fall under, and review gifts or donations that may require disclosure.