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Budget 2009–10: Legal issues and the Attorney-General's portfolio
National product safety regulation
Jonathan Chowns
The Australian Competition & Consumer Commission (ACCC)
is to be provided with $24.8 million over five years to help it implement
imminent reforms to Australia’s consumer product safety framework. These
reforms, when legislated, will create ‘a
single national product safety law with consistent enforcement by the
Australian Government and state and territory regulators’.[1] Product safety is now regulated at the State, Territory and Commonwealth level
giving nine different sets of substantive laws and enforcement regimes. The
ACCC will have a prominent role in administering the new product safety
framework which is the basis for this additional funding.
Brief recent history of product safety regulation reform
On 27 August 2004, the Ministerial Council on Consumer
Affairs (MCCA) released the discussion paper, Review
of the Australian Consumer Product Safety System.[2] This built on work done by the Standing Committee of Officials of Consumer
Affairs (SCOCA), which consists of all chief executive officers of consumer
protection agencies. SCOCA had identified two principal problems with the way
in which product safety laws worked. Firstly, there is a perceived inability to
operate swiftly and pro-actively. Secondly, the involvement of multiple
jurisdictions causes inefficient use of government regulatory resources and imposes
an excessive regulatory burden on business.[3] It is the second of these two problems which will eventually be addressed in the
new product safety framework that the ACCC is being funded to administer.
In March 2005, the then Coalition Government asked the
Productivity Commission (PC) to undertake a research study into Australia’s
consumer product safety laws and to examine the various reform options raised
in the MCCA discussion paper of August 2004.[4] On 16 January 2006, the PC published its 500 page research report, Review
of the Australian Consumer Product Safety System.[5] In this report, the PC ‘argued that significant regulatory inconsistencies between
governments reduce the overall efficiency and effectiveness of the system’ and
recommended improvements including ‘introducing a single national product
safety law administered by the ACCC or, if this is not achievable,
harmonisation of core legislative provisions across jurisdictions’.[6]
On 11 December 2006, the then Treasurer, Peter Costello,
asked the PC to inquire into Australia’s consumer policy framework and its
administration. The inquiry was to have regard to, but not replicate, the work
previously done on the consumer product safety system.[7] The PC published its report on 30 April 2008.[8] In this report, it repeated the view expressed in its earlier report on the
consumer product safety system that ‘the Australian Government, through the
Australian Competition and Consumer Commission (ACCC), should be responsible
for enforcing the product safety provisions nationally, though possibly with
scope for states and territories to implement, time limited, interim product
safety bans’.[9] It observed that:
Product safety issues are generally national in nature, with
most products being imported and sold across Australia. Product safety problems
can also have potentially severe consequences for some consumers if not
promptly addressed. Hence, the risks to consumer wellbeing under a system that
requires nine jurisdictions to take quick and effective action are likely to be
higher than for other parts of the generic law. The case for making the Australian
Government, through the ACCC, solely responsible for enforcing the product
safety provisions of the new national generic law — as recommended in the
Commission’s recent study into Australia’s consumer product safety system — is
therefore much stronger than for the rest of the generic law.[10]
By the time of the PC’s consumer policy framework report,
COAG had, according to its communiqué of 23 March 2008, already agreed in principle to regulatory reform of the
consumer product safety framework.[11] The nature of that reform was clarified in the COAG communiqué of 3 July 2008 which records that COAG had agreed that the Commonwealth will
assume responsibility for the making of
permanent product bans and standards under the Trade Practices Act 1974 while the states will retain powers to issue interim product bans.[12]
On 17 February 2009, the Assistant Treasurer and Minister
for Competition Policy and Consumer Affairs released an information and
consultation paper: An Australian Consumer Law: Fair
Markets – Confident Consumers. [13] The paper records that there will be a new national consumer law and that, as
recommended by the PC, the law will include ‘a new national legislative and
regulatory regime for product safety’.[14] Responsibility for enforcing
the consumer product safety provisions of the new law in all jurisdictions
should be transferred to the Australian Government and undertaken by the ACCC.[15]
Legislation to implement reform to the product safety laws
are expected to be finalised by 30 June 2010.[16]
[1]. Australian Government, Budget measures: budget paper no. 2: 2009–10, Commonwealth
of Australia, Canberra, 2009, p. 380, viewed 21 May 2009,
http://www.budget.gov.au/2009-10/content/bp2/html/bp2_expense-23.htm
[2]. Ministerial Council on
Consumer Affairs, Review of the Australian consumer product safety system,
Canberra, August 2004, viewed 21 May 2009,
http://www.consumer.gov.au/html/Consumer_Product_Safety_Review/
download/Consumer_Product_Safety_Review.pdf
[3]. Review of Australian
consumer product safety system, p. 5
[4]. C Pearce (Parliamentary
Secretary to the Treasury), Productivity Commission consumer product safety system,
media release, 16 March 2005, viewed 22 May 2009, http://parlsec.treasurer.gov.au/DisplayDocs.aspx?pageID=&doc=pressreleases/2005/008.htm&min=cjp
[5]. Productivity Commission (PC), Review of the Australian consumer product safety system, PC, Canberra,
2006, viewed 22 May 2009, http://www.pc.gov.au/projects/study/productsafety/docs/finalreport
[6]. Productivity Commission (PC), Review of Australia’s consumer policy framework, PC, Canberra, 30 April
2008, http://www.pc.gov.au/projects/inquiry/consumer
[7]. P Costello (Treasurer), Productivity
Commission inquiry into Australia’s consumer policy framework, media
release, 11 December 2006, viewed 22 May 2009, http://www.treasurer.gov.au/DisplayDocs.aspx?pageID=&doc=pressreleases/2006/133.htm&min=phc
[8]. PC, Review of Australia’s consumer
policy framework.
[9]. PC, Review of Australia’s consumer
policy framework. p. 2
[10]. PC, Review of Australia’s consumer
policy framework. p. 23
[11]. Council of Australian
Governments, Communiqué of 23 March 2008, Department of Prime Minister
and Cabinet, 2008, p. 4, viewed 22 May 2009,
http://www.coag.gov.au/coag_meeting_outcomes/2008-03-26/index.cfm
[12]. Council of Australian
Governments, Communiqué of 3 July 2008, Department of Prime Minister and
Cabinet, 2008, p. 3,
http://www.coag.gov.au/coag_meeting_outcomes/2008-07-03/docs/communique20080703.pdf
[13]. Australian Government,
‘Consumer Policy’, Department of Treasury website, viewed 22 May 2009, http://www.treasury.gov.au/content/consumer_affairs.asp?ContentID=270
[14]. Treasury, An Australian consumer
law: fair markets — confident consumers, Commonwealth of Australia,
Canberra, 17 February 2009, p. 1, viewed 22 May 2009, http://www.treasury.gov.au/documents/1484/PDF/An_Australian_Consumer_Law.pdf
[15]. An Australian consumer law:
fair markets, p. 6.
[16]. An Australian consumer law:
fair markets, p. 11.
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