Webinar Q&As: 2025 Clause & Effect – Contract Law Series | Drafting Techniques

Piper Alderman provides answers in response to the questions received during our 2025 Clause and Effect – Contract Law Series | Drafting Techniques

Question:In terms of the size of a small business, and the definition of it under the Unfair Contract Terms regime, does it matter if the small business is a subsidiary of a larger corporate group?

Under Australian law, the definition of a small business for the purposes of the Unfair Contract Terms (UCT) regime does not change if the small business is a subsidiary of a larger corporate group. The UCT regime applies to a contract where one of the businesses employs fewer than 100 people or has an annual turnover of less than $10million for the last income year. This definition focuses on the individual business's employment and turnover metrics, regardless of its affiliation with a larger corporate entity. Therefore, even if a small business is part of a larger corporate group, it can still be considered a small