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HomeLaw & conductLegislationThe Australian Consumer Law (ACL)

The Australian Consumer Law (ACL)

The Australian Consumer Law (ACL) introduced a new nationally consistent system to regulate the safety of consumer goods and product related services. 

The information provided below is a brief guide to the product safety provisions of the ACL. Further information on the ACL can also be found on the Consumer Law website established by the Commonwealth Department of the Treasury.

The Product Safety Provisions

The ACL’s product safety provisions set out how the Australian and state/territory Governments can regulate consumer goods and product related services to ensure they are safe.  These can include:

  • imposing mandatory safety standards or information standards on goods or product related services;
  • banning goods or product related services, either on an interim or permanent basis; or
  • issuing a compulsory recall notice requiring suppliers to recall a good. 

They also regulate what a supplier has to do, including:

  • responsibilities if a Minister bans a product or imposes a safety or information standard on a good or product related service;
  • when to recall a good and how to do this;
  • what to do if a Minister issues a compulsory recall notice;
  • when to report an incident associated with a good to the Minister; and
  • when a manufacturer may be liable for loss or damage caused by a good with a safety defect. 

The ACL is contained in a schedule to the Competition and Consumer Act 2010 , which has replaced  the Trade Practices Act 1974 .  The schedule is also mirrored in state and territory fair trading legislation. 

Mandatory safety standards or information standards

Under the ACL, only the Commonwealth Minister has the power to make or declare a mandatory safety or information standard for a good or product related service. These apply nationally. A full list of safety standards currently in force is available on the mandatory standards page of this website.

Interim and permanent bans

Under the ACL, only the Commonwealth Minister has the power to declare a permanent ban on a good or product related service. Commonwealth bans apply nationally.

The Commonwealth Minister and the relevant state and territory Ministers have the power to declare an interim ban. Interim bans last for 60 days unless extended for up to another 60 days. Interim bans declared by the Commonwealth Minister apply nationally. Interim bans declared by a state or territory Minister only apply in that state or territory. A full list of bans currently in force is available on the bans page of this website.

Compulsory recall notice

Either a state/territory Minister or the Commonwealth Minister can issue a compulsory recall notice for consumer goods.  This can require the supplier (or, if the supplier cannot be found, the ACCC or State/Territory regulator) to take certain action. 

Voluntary recall notice

Under the ACL, when a supplier voluntarily undertakes a recall because of concerns about the safety of its products, the supplier must notify the responsible Commonwealth Minister with details of the voluntary recall. For more information on recalls, visit the Recalls Australia website. 

Mandatory reporting

Another important legal change is the introduction of a mandatory reporting requirement. Under the new legislation, suppliers are required  to advise the Commonwealth Minister when they become aware that a good  they supply has caused, or may have caused, death or serious injury or illness to any person. 

Suppliers of services associated with consumer goods are also required to report deaths, serious injuries or illnesses asociated with the consumer good.   

The reporting requirement is triggered if either the supplier or another person (e.g. a customer) considers that the death, injury or illness was or may have been, caused by  the good. 

The ACCC has developed guidance material to assist suppliers to meet their mandatory reporting requirements. The guidance material is available from the mandatory reporting page of this website.

Public warning powers

Under the ACL a public warning power allows the Commonwealth or a state/territory Minister to issue a safety warning (s 129).  The warning may advise  that certain goods or product related services are under investigation to determine whether the goods, or their reasonably forseeable use, will or may, cause injury to any person. Alternatively the warning may advise of possible risks involved in the use of consumer goods or may provide a warning in both these areas.

Infringement notices

Under the new law, the ACCC can issue an infringement notice for breaches of consumer protection provisions, enabling it to deal more efficiently with matters warranting a quick regulatory response.

Infringement notices provide an opportunity for a person to pay a penalty and resolve a matter with the ACCC. If a person who is issued with an infringement notice does not pay an infringement notice penalty, the ACCC may commence proceedings in respect of the underlying alleged contravention of the ACL.

The ACCC can only issue one infringement notice for each alleged contravention of an infringement notice provision, including certain product safety and product information provisions.

An infringement notice must be issued within 12 months after the alleged contravention occurred.

In relation to product safety the ACCC has the power to issue an infringement notice where it has reasonable grounds to believe a person has breached various product safety provisions, including supplying goods that have been compulsorily recalled, are subject to a ban order or that do not comply with a mandatory safety or information standard.

Civil pecuniary penalties

The ACL provides the ACCC with the ability to institute a proceeding in a court for the recovery on behalf of the Commonwealth of a civil pecuniary penalty (CPP) for consumer protection matters.  The Court may order a person, who has contravened certain product safety provisions, to pay a civil pecuniary penalty if it is satisfied that the person contravened or attempted to contravene a product safety related provision of the ACL.

A court may order a civil pecuniary penalty for contraventions of the following product safety provisions of the ACL:

  • Supplying goods that do not comply with safety standards (s. 106)
  • Supplying product related services that do not comply with safety standards (s. 107)
  • Supplying consumer goods covered by a ban (s. 118)
  • Supplying product related services covered by a ban (s. 119)
  • Notification by persons who supply consumer goods outside Australia if there is compulsory recall (s. 125)
  • Compliance with recall notices (s. 127)
  • Notification of voluntary recall of consumer goods (s. 128)
  • Suppliers to report consumer goods associated with death or serious injury (s. 131)
  • Suppliers to report product related services associated with death or serious injury (s. 132)
  • Supplying goods that do not comply with information standards (s. 136)
  • Supplying services that do not comply with information standards (s. 137)
  • Compliance with substantiation notice (s. 221)

The maximum CPP for false or misleading (not s. 52) and unconscionable conduct, pyramid selling and breaches of certain product safety provisions is $1.1m for corporations and $220,000 for individuals. Lesser CPP apply to other contraventions.

Disqualification orders

On application by the ACCC, a court is able to disqualify a person from managing corporations for a period it considers appropriate as a consequence of contraventions of various consumer protection related provisions. Disqualification orders were initially introduced into the Trade Practices Act 1974 in relation to the competition provisions.  They may be particularly useful when addressing problems that arise with ‘repeat offenders’ regarding breaches of consumer law.

In some circumstances, disqualification orders may be appropriate for directors who fail to take steps to ensure that products they sell or produce comply with mandatory product safety standards and other trade practices breaches.

Substantiation power to check claims

The ACL provides the ACCC with a new investigative power: the substantiation notice. The notices can be used in a variety of circumstances, including in relation to product safety claims—such as requiring suppliers to provide information and/or produce documents to confirm that products comply with standards where a claim of compliance to a particular standard has been made by the supplier.

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