Yes, that's what Ritters were saying. They said that the fact that the barrier even offers the possibility to have passengers sitting behind it, with no means of escape makes it illegal - He did mention something about having a glass breaking hammer available might be a solution.
However, The more I look at it the more it seams that Ritters are perpetuating a myth.
The Vic Roads allowed vehicle modification list that I found
here, makes no qualifications about the use of Cargo Barriers, and even more importantly, I checked with my Insurance company, and specifically asked the question whether a claim woule be denied on the basis of installing a cargo barrier in a 7 seater, and they said no. Provided that I advise them of the installation of the cargo barrier - it will be covered.
So the summary seems to be:
[1] It is legal (in Vic)
[2] Advise your insurance company
[3] Don't bother asking Ritters to do it for you.

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