Australian Food and Grocery Council - Australian Government, The ...

Australian Food and Grocery Council
TO:
THE TREASURY, ON BEHALF OF SCOCA
SUBMISSION
13 OCTOBER 2010
IN RESPONSE TO:
THE AUSTRALIAN CONSUMER LAW CONSULTATION ON
DRAFT REGULATIONS.

Australian Food and Grocery Council
PREFACE
The Australian Food and Grocery Council (AFGC) is the leading national organisation representing
Australia’s food, drink and grocery manufacturing industry.
The membership of AFGC comprises more than 150 companies, subsidiaries and associates which
constitutes in the order of 80 per cent of the gross dollar value of the processed food, beverage and
grocery products sectors. (A list of members is included as Appendix A.)
With an annual turnover of $100 billion, Australia’s food and grocery manufacturing industry makes a
substantial contribution to the Australian economy and is vital to the nation’s future prosperity.
Manufacturing of food, beverages and groceries in the fast moving consumer goods sector 1 is
Australia’s largest and most important manufacturing industry. Representing 28 per cent of total
manufacturing turnover, the sector is comparable in size to the Australian mining sector and is more
than four times larger than the automotive sector.
The growing and sustainable industry is made up of 38,000 businesses and accounts for $49 billion of
the nation’s international trade. The industry’s total sales and service income in 2007-08 was $100
billion and value added increased to nearly $27 billion 2 . The industry spends about $3.8 billion a year
on capital investment and over $500 million a year on research and development.
The food and grocery manufacturing sector employs more than 315,000 representing about 3 per cent
of all employed people in Australia paying around $14 billion a year in salaries and wages.
Many food manufacturing plants are located outside the metropolitan regions. The industry makes a
large contribution to rural and regional Australia economies, with almost half of the total persons
employed being in rural and regional Australia 3 . It is essential for the economic and social development
of Australia, and particularly rural and regional Australia, that the magnitude, significance and
contribution of this industry is recognised and factored into the Government’s economic, industrial and
trade policies.
1 Fast moving consumer goods includes all products bought almost daily by Australians through retail outlets including food, beverages,
toiletries, cosmetics, household cleaning items etc..
2 AFGC and KMPG. State of the Industry 2009. Essential information: facts and figures. Australian Food and Grocery Council. Oct 2009.
3 About Australia: www.dfat.gov.au

Australian Food and Grocery Council
SUBMISSION
1. INTRODUCTION
AFGC welcomes the opportunity to make this submission to The Treasury in regard to the consultation
draft regulations to the Australian Consumer Laws, with specific reference to the mandatory reporting
requirements for consumer goods, or product related services, associated with death, or serious injury
or illness.
The AFGC supports the principle that Consumer Protection Laws should ensure fair competition and
the free flow of truthful information in the marketplace; that the laws should be designed to prevent
businesses from engaging in fraudulent or unfair practices that gaining an advantage over competitors
and disadvantage consumers; and that the laws provide the basis for an efficient and effective
notification and recall system for defective goods that pose a significant risk to the health and safety of
consumers.
The AFGC supports in-principle, the new requirements of the Australian Consumer Law, contained in
Division 5 for the mandatory reporting requirements and that under these provisions there is provision
to exempt to reporting where notification is specified in other laws or regulations, or where notification
is required in accordance with an industry code of practice. (Attachment 1). The AFGC supports this
exemption provision in order that duplication is avoided and to ensure the efficiency and effectiveness
of any investigation or action necessary as a result of identifying a potential risk to consumers.
Current arrangements under the Trade Practice Act provides that where a food recall is initiated,
whether voluntarily or at the direction of a State or Territory Health Authority, then Food Standards
Australia New Zealand (FSANZ) undertakes to notify the Commonwealth Minister in the administration
of the recall process. It should be noted that in regard to food manufacturing there is separate
legislation governing the protection of health and safety under the Model Food legislation and adopted
in each of the States and Territories.
However, the relevant regulations or industry codes cited in the regulations are inappropriate to enable
such exemption to take effect. Clause 92 of the regulations cite the Australia New Zealand Food
Standards Code, yet these standards do not contain mandatory recall provision. FSANZ undertakes a
national coordinating role in executing a food recall, this is under an administrative arrangement. There
are no mandatory reporting requirements, nor are there mandatory recall powers, contained in either
the Food Standards Code or the FSANZ Act. Instead the mandatory recall provisions exist under
individual State and Territory food acts.
Recommendation
1. The current reference to the Food Standards Code in Clause 92 be
deleted.
2. The relevant State and Territory Food Acts, be cited in Clause 91:
Food Act 2005, Queensland
Food Act 2005, Western Australia
Food Act 2004, Northern Territory
Food Act 2003, New South Wales
Food Act 2002, Tasmanian
Food Act 2001, Australian Capital Territory
Food Act 2001, South Australia
Food Act 1984, Victoria and amendments
Food Act 1981, New Zealand
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Australian Food and Grocery Council
SUBMISSION
2. SPECIFIC COMMENTS
2.1. Inherent nature of food
Separate legislation governing the requirements for protection of health and safety of foods in each
State and Territory which, under the Inter-Governmental Agreement requires that each State and
Territory adopt into legislation the provisions of Annex A of the Model Food legislation without
amendment.
The Model Food Act recognises that there may have risk factors which are inherent in the nature or
composition of the product, which is distinct from food which is unsafe and poses a risk to public health
and safety. The Model Food legislation defines unsafe food as:
Meaning of “unsafe” food 4
(1) For the purposes of this Act, food is unsafe at a particular time if it would be
likely to cause physical harm to a person who might later consume it, assuming:
(a) it was, after that particular time and before being consumed by the person,
properly subjected to all processes (if any) that are relevant to its reasonable
intended use, and
(b) nothing happened to it after that particular time and before being consumed
by the person that would prevent its being used for its reasonable intended
use, and
(c) it was consumed by the person according to its reasonable intended use.
(2) However, food is not unsafe for the purposes of this Act merely because its
inherent nutritional or chemical properties cause, or its inherent nature causes,
adverse reactions only in persons with allergies or sensitivities that are not
common to the majority of persons.
Meaning of “unsafe” food 4
It is relevant to note that while a product which is an inherent allergen, such as peanuts, is exempt
from being considered as unsafe, a product which fails to declare the presence of peanuts on the
label is in breach of the Food Acts by failing to comply with requirements of the Australia New
Zealand Food Standards Code labelling requirements under Standard 1.2 3 – Mandatory Warning
and Advisory Statements, and as such is a risk to the health and safety of allergic consumers.
The AFGC acknowledges that the State and Territory Health Departments have the specialist
knowledge, expertise and investigative resources necessary to make a determination that a food is
associated with a serious injury or illness. However, in assessing the potential risk to public health and
safety, consideration must be given to additional factors other than the simple inherent nature of the
food. Inappropriate consumer use, or failure to follow manufacturer’s instructions, may result in a
determination that the consumer is at fault, and that there is no fault with the product. However, in a
food poisoning investigation where pathogens are identified, there are also mandatory reporting
requirement for reporting of certain notifiable infectious diseases both in the food and in patients.
4 http://www.foodstandards.gov.au/_srcfiles/mfa_core_10_Oct_2000.pdf
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Australian Food and Grocery Council
SUBMISSION
There are also prohibitions under the Model Food Act for knowingly selling food that is unsafe, which
provides the incentive for industry to conduct a recall when industry is made aware of the potential for
the product to cause serious injury or illness. The Model Food Act contains significant penalties for a
person who renders a food unsafe or who knowingly sells unsafe food:
Handling of food in unsafe manner
A person must not handle food intended for sale in a manner that the person knows
will render, or is likely to render, the food unsafe.
Maximum penalty: $100,000 or imprisonment for 2 years, or both, in the case of an
individual and $500,000 in the case of a corporation.
Sale of unsafe food
A person must not sell food that the person knows is unsafe.
Maximum penalty: $100,000 or imprisonment for 2 years, or both, in the case of an
individual and $500,000 in the case of a corporation.
2.2. Consumer information
The requirements of the Australian Consumer Legislation regulations place on onus of responsibility on
the reporting company to provide information about the circumstances of the death, serious injury or
illness and to establish that their product was directly attributable to this outcome.
In order determine the circumstances in which the death or serious injury or illness occurred, and the
nature of any serious injury or illness suffered by aforesaid persons, it will be necessary for the
company to be able to obtain reliable and independently confirmed information from interviews and
investigation of the affected person, relevant health authorities or police. Such information is often
difficult to obtain, particularly over public holidays, and requires a degree of sensitivity particularly if a
death has occurred.
Experience from investigations of food poisoning outbreaks has shown that often it is difficult for the
affected consumer to accurately identify the food likely to have caused their illness due to the delay
between the time of consumption and onset of illness, for example in the case of salmonella food
poisoning it is common for a delay of up to 48 hours, while in the case of Listeriosis the delay may be
several weeks. Circumstances which are more straight-forward, such as mouth injury due to the
presence of stones and pips, may be readily identified; yet even such situations may be complicated by
malicious tampering, blackmail and extortion in which police or other investigative authorities take a
pivotal role.
It is therefore highly unlikely that such investigations will be able to make a definitive assessment of the
causal relationship within a 48 hour period, that laboratory analysis of products to determine the cause
of the fault may be required, and that the investigation and determination that there is a causal link
between a death, injury or illness and a food is outside the control of the manufacturer, imported or
retailer.
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Australian Food and Grocery Council
SUBMISSION
It is therefore important that these regulations reflect the administrative arrangement for notifying the
Commonwealth Minister are undertaken by FSANZ, or by the relevant State or Territory Health
Department; and that food producers, importers, food manufacturers and food retailers are not obliged
to separately report food safety concerns about a product to the Commonwealth Minister.
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Australian Food and Grocery Council
SUBMISSION
Appendix 1.
Division 5—Consumer goods, or product related services, associated with death or
serious injury or illness
131 Suppliers to report consumer goods associated with the death or serious injury or illness of
any person
(1) If:
(a) a person (the supplier), in trade or commerce, supplies consumer goods; and
(b) the supplier becomes aware of the death or serious injury or illness of any person and:
(i) considers that the death or serious injury or illness was caused, or may have been caused,
by the use or foreseeable misuse of the consumer goods; or
(ii) becomes aware that a person other than the supplier considers that the death or serious
injury or illness was caused, or may have been caused, by the use or foreseeable misuse of
the consumer goods;
the supplier must, within 2 days of becoming so aware, give the Commonwealth Minister a written
notice that complies with subsection (5).
Note: A pecuniary penalty may be imposed for a contravention of this subsection.
(2) Subsection (1) does not apply if:
(a) it is clear that the death or serious injury or illness was not caused by the use or foreseeable
misuse of the consumer goods; or
(b) it is very unlikely that the death or serious injury or illness was caused by the use or
foreseeable misuse of the consumer goods; or
(c) the supplier, or another person, is required to notify the death or serious injury or illness in
accordance with a law of the Commonwealth, a State or a Territory that is a law specified in
the regulations; or
(d) the supplier, or another person, is required to notify the death or serious injury or illness in
accordance with an industry code of practice that:
(i) applies to the supplier or other person; and
(ii) is specified in the regulations.
(3) Subsection (1) applies whether or not the consumer goods were being used before or at the time the
death or serious injury or illness occurred.
(4) Without limiting subsection (1), the ways in which the supplier may become aware as mentioned in
subsection (1)(b) include receiving the relevant information from any of the following:
(a) a consumer;
(b) a person who re-supplies the consumer goods;
(c) a repairer or insurer of the goods;
(d) an industry organisation or consumer organisation.
(5) The notice must:
(a) identify the consumer goods; and
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Australian Food and Grocery Council
SUBMISSION
(b) include information about the following matters to the extent that it is known by the supplier at
the time the notice is given:
(i) when, and in what quantities, the consumer goods were manufactured in Australia,
supplied in Australia, imported into Australia or exported from Australia;
(ii) the circumstances in which the death or serious injury or illness occurred;
(iii) the nature of any serious injury or illness suffered by any person;
(iv) any action that the supplier has taken, or is intending to take, in relation to the consumer
goods.
(6) The giving of the notice under subsection (1) is not to be taken for any purpose to be an admission
by the supplier of any liability in relation to:
(a) the consumer goods; or
(b) the death or serious injury or illness of any person.
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Australian Food and Grocery Council
APPENDIX A
Membership as at 13 OCTOBER 2010
Arnott's Biscuits Limited
Asia-Pacific Blending Corporation P/L
Barilla Australia Pty Ltd
Beak & Johnston Pty Ltd
BOC Gases Australia Limited
Bronte Industries Pty Ltd
Bulla Dairy Foods
Bundaberg Brewed Drinks Pty Ltd
Bundaberg Sugar Limited
Byford Flour Mills T/a Millers Foods
Cadbury Pty Ltd
Campbell’s Soup Australia
Cantarella Bros Pty Ltd
Cerebos (Australia) Limited
Cheetham Salt Ltd
Christie Tea Pty Ltd
Church & Dwight (Australia) Pty Ltd
Clorox Australia Pty Ltd
Coca-Cola Amatil (Aust) Limited
Coca-Cola South Pacific Pty Ltd
Colgate-Palmolive Pty Ltd
Coopers Brewery Limited
Danisco Australia Pty Ltd
Devro Pty Ltd
DSM Food Specialties Australia Pty
Ltd
Earlee Products
FPM Cereal Milling Systems Pty Ltd
Ferrero Australia
Fibrisol Services Australia Pty Ltd
Fonterra Brands (Australia) Pty Ltd
Food Spectrum Group
Foster’s Group Limited
Frucor Beverages (Australia)
General Mills Australia Pty Ltd
George Weston Foods Limited
GlaxoSmithKline Consumer
Healthcare
Go Natural
Goodman Fielder Limited
H J Heinz Company Australia Limited
Harvest FreshCuts Pty Ltd
Hela Schwarz
Hoyt Food Manufacturing Industries P/L
Hungry Jack’s Australia
Johnson & Johnson Pacific Pty Ltd
Kellogg (Australia) Pty Ltd
Kerry Ingredients Australia Pty Ltd
Kimberly-Clark Australia Pty Ltd
Kraft Foods Asia Pacific
Laucke Flour Mills
Lion Nathan Limited
Madura Tea Estates
Manildra Harwood Sugars
Mars Australia
McCain Foods (Aust) Pty Ltd
McCormick Foods Aust. Pty Ltd
McDonald’s Australia
Merisant Manufacturing Aust. Pty Ltd
National Foods Limited
Nerada Tea Pty Ltd
Nestlé Australia Limited
Nutricia Australia Pty Ltd
Ocean Spray International Inc
Parmalat Australia Limited
Patties Foods Pty Ltd
Procter & Gamble Australia Pty Ltd
PZ Cussons Australia Pty Ltd
Queen Fine Foods Pty Ltd
Reckitt Benckiser (Aust) Pty Ltd
Sanitarium Health Food Company
Sara Lee Australia
SCA Hygiene Australasia
Schweppes Australia
Sensient Technologies
Simplot Australia Pty Ltd
Spicemasters of Australia Pty Ltd
Stuart Alexander & Co Pty Ltd
Sugar Australia Pty Ltd
SunRice
Swift Australia Pty Ltd
Tasmanian Flour Mills Pty Ltd
Tate & Lyle ANZ
The Smith’s Snackfood Co.
The Wrigley Company
Tixana Pty Ltd
Unilever Australasia
Wyeth Australia Pty Ltd
Yakult Australia Pty Ltd
Yum Restaurants International
Associate & *Affiliate
Members
Accenture
Australian Pork Limited
Australian Dietetic Services
ACI Operations Pty Ltd
Amcor Fibre Packaging
*ASMI
AT Kearney
BRI Australia Pty Ltd
*Baking Association Australia
CAS Systems of Australia
CHEP Asia-Pacific
CSIRO Food and Nutritional Sciences
CoreProcess (Australia) Pty Ltd
Dairy Australia
Exel (Aust) Logistics Pty Ltd
Food Liaison Pty Ltd
FoodLegal
*Foodservice Suppliers Ass. Aust.
*Food industry Association WA
Foodbank Australia Limited
*Go Grains Health & Nutrition Ltd
GS1
Harris Smith
IBM Business Cons Svcs
innovations & solutions
KN3W Ideas Pty Ltd
KPMG
Leadership Solutions
Legal Finesse
Linfox Australia Pty Ltd
Meat and Livestock Australia Limited
Monsanto Australia Limited
New Zealand Trade and Enterprise
QSR Holdings
StayinFront Group Australia
Sue Akeroyd & Associates
Swisslog Australia Pty Ltd
The Food Group Australia
The Nielsen Company
Touchstone Cons. Australia Pty Ltd
Valesco Consulting FZE
Visy Pak
Wiley & Co Pty Ltd
PSF Members
Amcor Fibre Packaging
Bundaberg Brewed Drinks Pty Ltd
Schweppes Australia Pty Ltd
Coca-Cola Amatil (Aust) Limited
Foster’s Group Limited
Golden Circle Limited
Lion Nathan Limited
Owens Illinois
Visy Pak
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Australian Food and Grocery Council
Level 2, Salvation Army House
2–4 Brisbane Avenue
Barton ACT 2600
Locked Bag 1
Kingston ACT 2604
T: (02) 6273 1466
F: (02) 6273 1477
afgc@afgc.org.au
www.afgc.org.au