The Australian Competition and Consumer Commission is urging businesses to review their country of origin labels now to ensure they comply with the Australian Consumer Law.
“In particular, businesses should review any claims on their product labelling or advertising which suggests that the product was ‘Made in’ a particular country,” ACCC Deputy Chair Dr Michael Schaper said.
To be able to safely claim that a product was made in a particular country, any imported ingredients or components must undergo a fundamental change in nature, identity or essential character. Minor processing which only changes the form or appearance of imported goods will no longer be enough to justify a ‘Made in’ claim.
“Consumers are often willing to pay a premium for products that originate from particular countries, but they need to be able to trust the labels. Failure to label products correctly may expose a business to penalties of up to $1.1 million,” Dr Schaper said.
In addition to the general ACL obligations not to make false, misleading or deceptive claims, businesses involved in the retail supply of food will also be bound by the Country of Origin Food Labelling Information Standard from 1 July 2018.
“By July 2018, labels on most food products that are made in Australia will have to clearly show the percentage of Australian-grown or produced ingredients. Businesses should be taking steps now to ensure they have the procedures in place to roll out the new labels,” Dr Schaper said.
“The ACCC will actively monitor compliance with the new food labelling requirements, and has the power to force companies to prove that any representation made is accurate.”
The ACCC has released Country of origin food labelling guidance to assist businesses with the transition to the new food labelling requirements.
The ACCC has also produced advice for all businesses on when a business can rely on the ‘safe harbour’ provisions in the Australian Consumer Law. If a business is able to satisfy certain criteria they will have an automatic defence against an allegation that the country of origin claim is false, misleading or deceptive. The safe harbour provisions were amended in February 2017.
In the last five years, the ACCC has received over 3000 complaints concerning country of origin claims about products ranging from food to furniture, clothing and electrical goods.
Notes to editors
On 1 July 2016, the Country of Origin Food Labelling Information Standard 2016 (Standard) commenced under the Australian Consumer Law. The Standard introduces new labelling requirements for most food sold in stores, markets, online and in vending machines. Businesses have until 30 June 2018 to transition to the new labels.
Further amendments to the ACL in February also affect when businesses can safely make a country of origin claim about their products without it raising concerns under the ACL’s key false, misleading or deceptive conduct provisions.
The ACCC has produced Country of origin food labelling guidance to assist businesses with the new Standard. Businesses have until 30 June 2018 to transition to the new labels.
The ACCC has also updated guidance for businesses making country of origin claims under the Australian Consumer Law. If a business is able to satisfy certain criteria they will have an automatic defence against an allegation that the claim is false, misleading or deceptive.
The ACCC has also published short video guidance: