The subscription trap ban is law. Your existing members are not as grandfathered as you think.

Short answer: the ban is law, it starts on 1 July 2027, and the part that matters to you is not the fine. It is that a member then has to be able to leave as easily as they joined, and if they joined on your app they have to be able to cancel on your app. So if a slice of your monthly billing comes from people who have not walked through the door since March, that slice now has a date on it. Here is what is actually in the Act, what is still being written, and what the smart gyms are doing with the eleven months.

What is law, and when it bites

The Competition and Consumer Amendment (Unfair Trading Practices) Act 2026 was assented to on 6 July 2026 as Act No. 64 of 2026. Section 2 gives it one commencement, with no staged start: the whole Act begins on 1 July 2027.

It does three separate things to the Australian Consumer Law:

• a general ban on unfair trading practices (new section 28B)
• a rule forcing per-transaction fees to be shown with the advertised price (new section 48A)
• a new set of duties for subscription contracts (new Division 4A, sections 48B to 48H)

Your memberships live in the third one, your joining fees in the second, and your cancellation process in all three.

Why it exists, in the government's own words: the Assistant Minister's January 2026 release says three out of four Australians with subscriptions have had problems cancelling. The release does not say where that figure comes from, so treat it as the government's framing rather than a measured number. The direction of travel is the useful part.

Your memberships are subscription contracts, four different ways

Section 48B catches a contract if any one of these is true. Read the list against your own price board:

• it rolls on indefinitely, payment happens automatically, and the member can cancel (your month-to-month)
• it runs for a fixed period and then keeps going unless somebody stops it (your 12-month that drops to monthly)
• it starts with a period that is free and then starts charging (your free week, your two-week trial)
• it starts at one rate and then steps up to a higher rate (your $9.95 first month, most joining offers)

Section 48C lists the contracts that are excluded: a lease, a licence over real property, hire purchase, a contract for payment in instalments, childcare, and school or pre-school tuition. Gyms are not on that list.

One genuinely unsettled edge, and you should hear it straight rather than discover it in 2027. "A contract for payment in instalments" is excluded, and nothing yet says whether a fixed 12-month membership paid fortnightly counts as that or counts as a subscription contract. The regulations are not made and the ACCC has not published guidance. Do not build a plan around that exclusion rescuing you.

"We will just grandfather the old members" does not work

This is the paragraph to read twice, because it decides whether this is a small job or a repricing.

Section 312 says the subscription rules do not apply to a contract entered into before 1 July 2027. Sounds like your book is safe. Then it says the rest:

• if the contract is renewed, extended or otherwise continued on or after that date, the rules apply from the day that renewal or continuation takes effect
• if it is varied, they apply from the day the variation takes effect

A month-to-month membership continues every billing cycle. A price rise is a variation. So for most gyms there is no protected back book. There is a book that comes under the new rules over the course of a single billing cycle, some time in July 2027.

The general ban is blunter still. Section 311 applies section 28B to conduct from 1 July 2027 even where the supply or the offer was made before then. And section 28B(6) lists, as its own example of unfair conduct, "impeding the consumer's ability to exercise legal rights, or seek legal remedies". When they signed is irrelevant to that.

Two duties are written down. One is not.

At sign-up (section 48D). When you offer a membership you have to state that it is a subscription contract, and disclose what the member will be liable to pay, the period, how it renews or continues, any notice they have to give to get out, and how they get out. It has to be either explained clearly a reasonable time before they can agree, or shown legibly and prominently in close proximity to where they agree. In practice that means beside the join button, not in clause 14.

On the way out (section 48F). You must provide a way to end the contract. Every way you provide has to be easy to find, straightforward, and require only steps that are "reasonably necessary to end the contract and protect the subscriber's interests". And if the member joined online, or you offer an online way of joining at all, one of the exits has to be online. Cancel-by-visiting-reception and cancel-by-phone-during-business-hours are finished for anyone who signed up on a screen.

Not written down yet: the free-trial reminder. Section 48E covers information you have to give while a subscription is running, but every operative part of it, which contracts it applies to, what information, and at what times, is left to regulations. Those regulations do not exist. The January 2026 release describes reminders before a free trial converts as the intent, so treat it as coming rather than current, and build the reminder anyway. It is cheap, and it is exactly the kind of thing that reads well later.

The fee line, quietly (section 48A). If you advertise "$14.95 a week" and a $49 joining fee lands at checkout, from 1 July 2027 that charge has to be displayed with the price, legibly and close to it, every time the price is shown. Card payment surcharges are expressly carved out of the definition, and whether any particular fee of yours counts turns on the wording, so this is one to walk through with your own sign-up flow open in front of you.

One that catches owners out in a good way: section 48F protects small business subscribers too, not only consumers. Under section 48G you are covered if the contract is standard form and you either employ fewer than 100 people or turned over less than $10,000,000 in your last income year. That is you, sitting on the other side of the table, for every piece of software you pay for monthly.

Put a number on your own sleepers

Do this before anything else, because it turns a legal change into a figure you can act on.

Pull two reports: everyone billed last month, and everyone who has not scanned in for 90 days. The overlap is your exposure.

Now the arithmetic, as an illustration and not a benchmark, because your numbers are yours. Take 500 members at $80 a month. That book is $480,000 a year. Every 1% of it that cancels once leaving becomes easy is $4,800 a year gone. And because a member who never turns up costs you almost nothing to serve, close to all of that $4,800 is profit rather than revenue.

That is the whole reason this is a margin story and not a compliance story. The revenue most exposed on 1 July 2027 is the revenue carrying your highest margin.

On penalties, for completeness, then set them aside. These are civil penalty provisions, and the Act's own table sets the maximum for an individual at $2,500,000. The ACCC puts the current maximum for a company at the greater of $100 million, three times the benefit obtained, or 30% of adjusted turnover during the breach period. Those are ceilings written for large national businesses behaving badly. The realistic risk for a single-site studio is an ACCC compliance action, refunds and the hours it swallows. The number in the paragraph above is still the bigger one.

Two gyms, same revenue, different price

A buyer values your gym on the profit a new owner would keep, your owner earnings, times a multiple. What sets the multiple is how believable that profit looks.

Picture two studios with identical monthly revenue. In one, members come three times a week. In the other, members forgot they were members, and the cancellation process helps them keep forgetting. On a profit and loss statement those two businesses are indistinguishable.

A careful buyer has always tried to see through that by asking for attendance data. What changes now is that the law is about to run the diligence for them. From July 2027 a membership book that holds together mainly because leaving is annoying starts unwinding by itself, in your own reported numbers. Sell in 2029 and your trailing twelve months already contains the answer.

The upside is real and it is not a consolation prize. A book of members who stay because they attend has lower churn once the shakeout is done, and it is close to the textbook definition of revenue that transfers to somebody else. The gyms that do this in 2026 get to design the replacement offer themselves. The ones that wait get their book repriced for them on a Tuesday in July 2027.