Australian Product Safety Laws effective 1 January 2011

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Product Safety

The following summary is based on a Draft guide and information available from www.consumerlaw.gov.au and may be subject to change.

The product safety regime applies to:

●consumer goods

●product-related services

Safety warning notices

A Commonwealth, state or territory minister responsible for administering the ACL can publish a safety warning notice about consumer goods or product-related services.

These notices warn the public that the good or service is under investigation or poses a risk.

When a warning notice is published, suppliers do not have to stop supplying that good or service. However, they should stay informed about its status.

Bans on consumer goods or product-related services

Bans can be placed on consumer goods or product-related services in certain circumstances.

There are two types of bans:

●an interim ban - imposed by any responsible minister. An interim ban can last for 60 days and can be extended for up to another 60 days

●a permanent ban - may only be imposed by the Commonwealth minister

Failing to comply with a ban is an offence.

Penalties up to $220,000 for an individual and 1.1 million for a body corporate. Civil penalties for the same amounts may apply. A court does not have to consider the person’s intentions before finding them guilty.

Mandatory safety standards

The Commonwealth minister can impose mandatory safety standards that set specific requirements for consumer goods or product-related services.

It is an offence:

●to supply consumer goods or product-related services that do not comply with mandatory safety standards

●when a supplier fails to comply with an information standard

Penalties:

●A supplier may be found guilty of a criminal offence if they fail to:

ocomply with a mandatory safety standard. The maximum fine is $220,000 for an individual, or $1.1 million for a body corporate

onominate a standard if required to do so by a consumer protection agency. The maximum fine is $4400 for an individual,
or $22,000 for a body corporate

●Civil penalties for the same amounts may also apply

●A court does not have to consider the person’s intentions before finding them guilty

Voluntary recall of consumer goods

Suppliers should recall consumer goods as soon as they realise the goods:

●may cause injury

●do not comply with a safety standard, or

●are banned

A supplier must notify the Commonwealth minister within two days of recalling consumer goods. Failing to do so is unlawful.

Penalties:

●A supplier who fails to notify the minister as outlined above may be found guilty of a criminal offence

●The maximum fine is $3330 for an individual or $16,650 for a body corporate

●These are offences of strict liability - a court does not have to consider the person’s intentions before finding them guilty

Compulsory recall of consumer goods

A Commonwealth, state or territory minister responsible for administering the ACL can issue a compulsory recall notice for consumer goods that:

●will or may cause injury

●do not comply with a safety standard, or

●are banned

Suppliers must:

●comply with a compulsory recall notice, and

●notify the minister that they have advised overseas consumers of the recall

Failing to do either is an offence.

Penalties:

●A supplier who does not comply with a compulsory recall notice may be found guilty of a criminal offence. The maximum fine is to
$220,000 for an individual or $1.1 million for a body corporate

●A supplier who does not notify a person outside Australia of a recall, may also be found guilty of a criminal offence. The maximum
fine is $3330 for an individual or $16,650 for a body corporate

●These are offences of strict liability - a court does not have to consider the person’s intentions before finding them guilty

When consumer goods or product-related services may have caused death, serious injury or illness

Suppliers must notify the Commonwealth minister when they become aware a consumer good or product-related service they supplied has caused, or may have caused:

●death

●serious injury, or

●illness

●For the purposes of the reporting requirements, a serious injury or illness can include:

oan external physical injury, such as a serious burn, deep cut, broken bone, choking or serious fracture

oan internal injury, such as internal bleeding

oan illness, such as poisoning

othe death, injury or illness may have occurred to a person in Australia or elsewhere

They must do so within two days of becoming aware of the incident, regardless whether the goods were used before or at the time of the incident.

Failing to comply is an offence.

Minimum Report Requirements:

●Identification of the consumer goods; or the product related services and the consumer goods to which the services relate; and

●the following details, to the extent that they are known by the supplier at the time of reporting:

owhen and in what quantities the consumer goods were manufactured, supplied in Australia or imported into Australia or exported from Australia

owhen the product related services were supplied (where relevant)

othe circumstances surrounding how the death, serious injury or illness in question occurred

othe nature of any serious injury or illness suffered

oany action the supplier has taken or intends to take in relation to the consumer goods and/or the services

●Minimum details to be recorded at place of purchase or by the business:

othe name and contact details of the customer

oany available information about the product

owhen (or approximately when) he/she purchased the product

ohow and when the incident occurred

othe nature of the injury or illness

owhy the consumer thinks the product contributed to the incident

The Commonwealth, State and Territory laws and codes that will be specified in the ACL regulations are yet to be finalised. Consultation on the relevant laws will be undertaken by the Australian Treasury later this year. The forms are due for finalisation late 2010.

Note that there is no requirement for a supplier to substantiate information it has become aware of prior to making a report.

If business is unable to submit the forms published by ACCC then they need to call ACCC on 1300 302 502.

This reporting requirement:

●applies when the supplier or another person - for instance, the affected consumer - considers the death, serious injury or illness
was caused, or may have been caused, by use or foreseeable misuse of the consumer goods

●does not apply if it is clear that the death, serious injury or illness was not caused, or was very unlikely to have been caused by
the use or foreseeable misuse of the consumer goods

●does not apply when the supplier has to report the death, serious injury or illness under another law or an industry code of
practice specified in the regulations

●Suppliers should be very cautious about choosing not to report incidents. If there is doubt about whether to report an incident, it is appropriate to report it.

How is the information treated?

●Information provided when notifying a minister is confidential and cannot be disclosed unless the person giving the information consents.
The only exceptions are when the:

odisclosure is made by the Commonwealth minister to another responsible minister or a regulator, or by staff of a regulator
in the performance of their duties

oCommonwealth minister makes the disclosure in the public interest, or

odisclosure is required or authorised under law, or is necessary (within reason) to enforce criminal law or a law imposing a financial penalty

●A supplier does not admit liability by notifying the minister

oFor further detail on mandatory reporting, see the Guide to the mandatory reporting law in relation to consumer goods, or product-related
services, associated with death or serious injury or illness, available from the Product Safety Australia website - productsafety.gov.au

Penalties:

●A supplier who fails to notify the Commonwealth minister within two days of becoming aware of the incident may be found guilty of a criminal offence.

●The maximum fine is $3330 for an individual or $16,650 for a body corporate

●This is an offence of strict liability - a court does not have to consider the person’s intentions before finding them guilty

Product liability

Consumers who suffer loss or damage because of defects in a manufacturer’s goods can:

●take the manufacturer to court. A court can award compensation to cover these losses, or

●make a complaint to a consumer protection agency, which may conciliate or take action on the consumer’s behalf

For more specific information, refer to the Australian Consumer Law website