New guide for online retailers

 

Browse And Buy Keys For Online ShoppingThe Australian Competition and Consumer Commission (ACCC)  has released a new publication, A guide for business: Consumer product safety online, that outlines best practice tips for online sellers and marketplaces.

“Australian consumers are increasingly looking to online stores to purchase consumer products but the online environment creates some unique product safety challenges and requirements that online suppliers need to be aware of,” ACCC deputy chair, Dr Michael Schaper, said.

For example, while a consumer can quickly and easily check the mandatory ingredients list of a cosmetic product while instore, they are unable to do this 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.

Businesses 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.

“Mandatory standards and bans are critical in preventing product-related deaths, injuries and illnesses. The ACCC regularly checks for non-compliant products being sold to Australian consumers, including via online stores,” Dr Schaper said.

For example 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
  • Age-grading for children’s products
  • Checking the requirements of Australian safety standards and bans prior to listing a product as available for sale.

“Businesses must remember that the Australian Consumer Law applies regardless of whether products are sold in a ‘bricks and mortar’ shop, in an online store or via an online marketplace, and regardless of where the seller is based, I encourage all online suppliers to download a copy of the free report,” Dr Schaper said

The report is available at www.productsafety.gov.au/consumersonline

Businesses can find further information on product safety at www.productsafety.gov.au

Comments

1 comment

  1. Avatar

    Mike Leask posted on March 20, 2014

    This article is good for Australian online businesses to be aware of their obligations, but the fact remains that the ACCC has no jurisdiction outside of Australian borders, and online transactions may be deemed to have been made in the country of origin, not the country of destination. It would only be a situation where the online seller has a presence in Australia, that the ACCC could act. The fact remains, that consumers need to be advised that the risk of purchasing items outside of Australian borders comes not only with the risk of un-enforceable guarantees and warranties, but the risk of unsafe, untested, or banned materials which could cause harm. Just think of all the toys with choking hazards which must be flooding into Australia at Christmas time! The reason why Australian businesses are seen as "overpriced" in many circumstances is because the taxation level which local businesses are subjected to provides all of the safety regulations and enforcement which we expect from the ACCC and similar bodies. When consumers purchase overseas they not only avoid paying local taxes, but they avoid the mechanisms designed to protect them also. reply

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