ACCC warns online businesses to display product info

The Australian Competition and Consumer Commission has warned online businesses that they are not exempt from complying with Australian Consumer Law (ACL).

Unlike their bricks and mortar counterparts, online retailers frequently neglect to list product information alongside product displays. This includes information relating to ingredients, materials used, and product origin.

Businesses, whether online or otherwise, breach the ACL if they sell banned products, do not meet all requirements of mandatory product safety standards, or fail in their obligations related to product liability, consumer guarantees, and misleading and deceptive conduct.

ACCC Deputy Chair Dr Michael Schaper said that as ecommerce continues to grow, the online environment creates unique product safety challenges and requirements, but online suppliers must be aware of their obligations to consumers.

As an example of this, while a consumer can quickly and easily check the mandatory ingredients list of a cosmetic product while in-store, they are unable to do so online unless the list is clearly displayed with the product information.

“The ACCC is concerned that some online sellers, particularly those based overseas, may not be aware that all businesses supplying to Australian consumers have the same obligations under the Australian Consumer Law (ACL),” Dr Schaper said.

In 2013, ACCC surveillance identified two online businesses supplying banned small, high-powered magnets to Australian consumers. Following negotiations with the ACCC, these suppliers stopped selling the magnets to Australians and conducted national product recalls.

“Product recalls can be expensive for a business but the cost of a recall is not the only potential financial consequence to online businesses who supply unsafe products. Penalties can include infringement notices and the ACCC can seek court-imposed penalties of up to $1.1 million for serious breaches,” Dr Schaper said.

Compliance tips for online businesses include:

  • clearly displaying warnings and product labelling;
  • using good quality product images;
  • providing clear product descriptions, including recommended usage and age-grading for children’s products;
  • checking the requirements of Australian safety standards and bans prior to listing a product as available for sale.

The ACCC has released a free guide on product safety online for businesses to ensure they are adhering to ACL standards.