The Australian Consumer Law (ACL) prohibits businesses from making false or misleading representations about the country of origin of goods. A representation can include words, a picture or both, attached to the goods (ie label) or in promotional material. Claims can include, ‘made in’, ‘product of’, ‘produce of’, ‘produced in’, ‘grown in’ or the use of a particular logo. The criteria for claims only apply to countries not regions such as ‘made in California’.
For a business to claim goods are ‘made in’ or ‘manufactured in’ a certain country:
- the goods must be substantially transformed in that country, and
- 50% or more of the total cost of producing or manufacturing the goods must be made in that country. (Total cost of producing the goods includes materials, labour and overheads.)
To be considered as ‘substantially transformed’ the product has to undergo a fundamental change in that country. The change can be to the appearance, operation or purpose: for example, milling flour from wheat.
'Product of' claims
For a business to claim goods are ‘produced in’, ‘produce of’ or ‘product of’ a specific country, all or virtually all of the production or manufacturing must happen in that country, or all of the significant ingredients or components must come from that country.
'Grown in' claims
A business can claim goods are ‘grown in’ a particular country when:
- at least 50% of total weight comprises ingredients or components grown and processed in that country
- virtually all production or manufacturing processes happen in that countryeach significant ingredient or significant component was grown and produced in that country.
Making false or misleading representations about the country of origin is an offence and carries maximum criminal penalties of $220,000 for individuals and $1.1 million for a body corporate.
Civil remedies for the same amount apply. Other civil remedies include:
- orders for non-party consumers
- corrective advertising orders
- adverse publicity orders
- disqualification orders.
Consumer protection agencies can accept court-enforceable undertakings, issue infringement notices, substantiation notices and public warning notices.