Extended powers for the Victorian Small Business Commissioner

The Small Business Commissioner Act 2003 (Act) has been amended by the Small Business Commissioner Amendment Act 2014, with changes operational from 1 May 2014.

Of particular interest are the changes relating to the increased powers of the Victorian Small Business Commissioner (Commissioner) which impact upon and broaden the matters which it will now be able to handle.

Amongst other amendments, Section 5(2)(c) of the Small Business Commissioner Act 2003now  provides that the Commissioner has the following functions:

“(c) to receive and investigate complaints by small businesses regarding unfair market practices or commercial dealings, and provide alternative dispute resolution between the parties involved in the complaint;”

Arguably there was always some debate over what “unfair market practices” covered, and the Commissioner has always been cautious in interpreting the ambit of that phrase. Those concerns have now been placed beyond doubt by the amendment, which now also incorporates “commercial dealings”.

This would now seem to include the capability of the Commissioner to investigate virtually any complaint touching upon the operation of a small business, which could even include commercial debt issues.

Whereas previously the power of the Commissioner was limited to mediation, that power has now been extended to include all forms of alternative dispute resolution, namely, conciliation, arbitration, assisted negotiation or facilitated meetings.

In relation to another amendment the Minister for Small Business, Mr Russell Northe noted in a recent press release: “The Bill extends the Commissioner’s jurisdiction to resolve disputes between small businesses and local councils, state government departments and agencies as well as more broadly covering commercial dealings and not just unfair market practices”.

The changes will no doubt be welcomed by small business as the door has now been opened wider to use a relatively inexpensive forum (currently $195 per party) where attempts can be made to resolve disputes fairly quickly (up to now by mediation) and before having to commence expensive, time-consuming and stressful litigation.

In the 2012-2013 at least 80% of matters heard at the Office of the Victorian Small Business Commissioner (VSBC) were resolved. There is now every good reason for small business to use that facility.

Jonathan Kaplan is an Accredited Specialist in Mediation and is on the panel of mediators of the VSBC.