The Federal Court in Adelaide has declared Nupak Australia Pty Ltd engaged in misleading and deceptive conduct and made false representations about its 'Goody' branded plastic bags.
From at least May 2009 Nupak claimed its 'Goody' branded plastic bags were biodegradable and compostable in accordance with the Australian Standard* and that they could be legally supplied in South Australia, when this was not the case as the bags:
- contained a heavy metal in amounts that exceeded the maximum concentration prescribed by the Australian Standard, and
- did not biodegrade, disintegrate, or compost in accordance with the criteria prescribed by the Australian Standard.
Nupak undertook to refrain from making representations that the plastic shopping bags it promotes are biodegradable or compostable in accordance with the Australian Standard unless Nupak has first obtained scientific testing which substantiates such representations.
By consent, Justice Lander declared that Nupak contravened section 52 and 53 of the Trade Practices Act 1974 and ordered Nupak to:
- publish corrective notices on its website and in the Advertiser newspaper
- send a letter to each Nupak customer supplied with Goody plastic bags informing them of the orders of the Federal Court and the undertakings given by Nupak
- implement a Trade Practices Compliance and Education Program, and
- contribute $10,000 to the ACCC's costs of the proceedings.
Nupak co-operated with the ACCC in its investigation and settlement of the matter.
The proceeding against Goody Environment Pty Ltd is continuing and the matter has been set down for trial in March 2011.
The ACCC has published an information sheet regarding biodegradable, degradable and recyclable claims regarding plastic bags which can be found on the ACCC website.
*Australian Standard AS4736-2006 for Biodegradable plastics suitable for composting and other Microbial Treatment.