"No refunds on sale items." The ACCC says that's illegal — and it's still checking.

What happened

In February 2025, the ACCC announced it had swept more than 2,000 Australian retail websites, reviewing return policies and terms and conditions for statements that might contravene the Australian Consumer Law (ACL). It found a consistent pattern of problems: time limits on returning faulty products, blanket "no refund" conditions on sale or specialised items, manufacturer warranties presented as the only way to get a remedy, and restrictions like non-refundable delivery fees or restocking charges on faulty-item returns. As a result, the ACCC sent warning letters to several businesses. ACCC Deputy Chair Catriona Lowe was direct about why: "Our sweep has found numerous examples of practices that could potentially mislead or deceive consumers regarding their rights to exchange, refund or return a product."

This isn't old news the regulator has moved on from. Improving industry compliance with consumer guarantees remains a standing ACCC compliance and enforcement priority, and the fines keep landing. In November 2024, homewares retailer Koala Living paid $56,340 in penalties after the ACCC issued infringement notices for telling customers their right to a remedy for faulty products was limited to 72 hours. And on 8 July 2026 — three weeks ago — the Federal Court ordered online service JustAnswer to pay $10 million in penalties after the ACCC took it to court for misleading consumers about pricing (a "$2, fully refundable" chat widget that actually signed people up to $45–$75 monthly subscriptions) and for falsely implying it was affiliated with the Fair Work Ombudsman. The JustAnswer case isn't about return policies specifically, but it's the same regulator, the same law, and the same underlying theme: what your website tells a customer about cost, cancellation and their rights has to be true — and the ACCC is actively litigating when it isn't.

Why it matters to your business

The Australian Consumer Law gives every consumer a set of consumer guarantees — nine for products, three for services — that exist automatically, regardless of turnover or business size. Products must be of acceptable quality, fit for their stated purpose, and match their description; services must be delivered with reasonable care and skill, within a reasonable time. Critically: a consumer guarantee cannot be excluded, restricted or taken away by anything a business says or does — not in a returns policy, not in a sign at the counter, not in a checkout pop-up. A website statement that tries to override these rights isn't just unenforceable — under the ACL, making it can itself be a misleading or deceptive representation.

That's the trap the ACCC's sweep found businesses falling into, usually without any intent to break the law. A returns page written years ago, copied from a template, or borrowed from a competitor's site can easily contain wording that was never checked against the ACL — and the ACCC has shown, from a $56,340 infringement notice against a mid-size retailer up to an $11.5 million Federal Court penalty against Mazda in 2024, that it enforces across the full range of business sizes.

The phrases the ACCC says are illegal

The ACCC's sweep findings included real examples pulled directly from Australian retail websites — and a companion list of statement types businesses should not make about faulty goods. Both are worth checking your own site against.

More broadly, the ACCC says businesses should not tell consumers, in writing or verbally, about faulty products that: no refunds are permitted under any circumstances; no refunds apply to sale or specialised items; there's a limited timeframe from receipt of the good to claim a refund; returns are subject to a processing, restocking or repair fee; opened or used items are never eligible for a refund; delivery fees are non-refundable; or that the customer must pay for return delivery. Any of these, applied to a genuinely faulty product, is the kind of statement the ACCC's sweep flagged.

What you're still allowed to say

This is the part that gets lost in translation, so it's worth being precise. Consumer guarantees apply to faulty goods and services — not to a customer who simply changed their mind, found it cheaper elsewhere, or no longer wants it. A "no refunds for change of mind" policy is entirely lawful, and most Australian retailers run one. You can also set a reasonable, clearly stated returns window for change-of-mind returns, require proof of purchase, and offer a store credit or exchange instead of cash for change-of-mind (though not for faulty items, where the consumer generally gets to choose). What you can't do is use language broad enough to sweep faulty items into the same "no refunds" bucket, or present your own voluntary warranty as if it replaces the consumer guarantees rather than sitting alongside them.

Where a website scan fits in

This is one of the more direct checks we run, on every tier including the free Scorecard: we check that a returns and refund policy is present, and separately, we read the wording of your terms and refund pages for blanket "no refunds" and "all sales are final" statements — the exact pattern the ACCC's sweep and enforcement history are about. We flag the wording we find and why it's worth a second look; we don't tell you it's illegal, because that's not a call an automated check gets to make. We also check that your shipping and delivery information is visible before checkout, which is a related but separate consumer-law expectation for online stores.