explanatory STATEMENT
Issued by the Authority of the Parliamentary Secretary to the Treasurer
Competition and Consumer Act 2010
Permanent ban on toy‑like novelty cigarette lighters
Background
Prior to 1 January 2011, a notice declaring goods to be unsafe was made pursuant to subsection 65C(5) of the Trade Practices Act 1974 (TPA) in relation to toy‑like novelty cigarette lighters.
The Trade Practices Amendment (Australian Consumer Law) Act (No.2) 2010 together with the Trade Practices Amendment (Australian Consumer Law) Act (No.1) 2010, amended the TPA to implement a new national consumer law regime known as the Australian Consumer Law (ACL).
The TPA was renamed the Competition and Consumer Act 2010 (CCA) on 1 January 2011. The ACL forms Schedule 2 to the CCA.
Schedule 7 of the Trade Practices Amendment (Australian Consumer Law) Act (No.2) 2010 sets out the transitional matters relating to the commencement of the ACL. Item 2 of Schedule 7 provides that a notice under subsection 65C(5) of the TPA that was in force immediately before the commencement of the ACL takes effect ‘as if’ it were an interim ban imposed under section 109 of Schedule 2 to the CCA, starting on the day of commencement (1 January 2011). Therefore, an interim ban on toy‑like novelty cigarette lighters came into force on 1 January 2011. An interim ban under the ACL exists for a period of 60 days and is able to be extended on two separate occasions by a period of 30 days.
Subsection 114(1) of Schedule 2 to the CCA provides that the Commonwealth Minister may impose a permanent ban on consumer goods of a particular kind if an interim ban exists for those goods, or it appears to the Commonwealth Minister that consumer goods of that kind will or may cause injury to any person or a reasonably foreseeable use (including misuse) of consumer goods will or may cause injury to any person. A permanent ban on toy‑like novelty cigarette lighters is imposed pursuant to subsection 114(1)(a) of Schedule 2 to the CCA.
Permanent ban on toy‑like novelty cigarette lighters
The purpose of the permanent ban on these goods is to ensure ongoing consumer safety by prohibiting the supply of toy‑like novelty cigarette lighters. The hazard associated with these goods is the risk of children mistaking these lighters for toys and playing with them and potentially suffering serious burns.
Under the CCA, a permanent ban on toy‑like novelty cigarette lighters is a legislative instrument for the purposes of the Legislative Instruments Act 2003 (LIA). For the purposes of section 17 of the LIA, consultation has been undertaken both at the time the notice was made under subsection 65C(5) of the TPA and also in January 2011 when the proposed ban notice was published on the internet in accordance with subsection 132(3) of Part XI to the CCA. There are no known suppliers of these banned goods.
This instrument is subject to sunsetting under Part 6 of the LIA. Unless action is taken to defer or exempt it from sunsetting, it is expected to sunset on 1 April 2021. This estimate assumes it is registered on or before 31 March 2011.
Overview
The Competition and Consumer Act 2010 (CCA) was enacted to provide a comprehensive framework for regulating competition and consumer protection in Australia. It was introduced to address the need for a unified consumer law regime, replacing the Trade Practices Act 1974 (TPA). The CCA was enacted by the Parliament of Australia and its purpose is to protect consumers and ensure fair competition in the marketplace. One of the key issues the Act addresses is the prohibition of consumer goods that pose a safety risk. In response to concerns about the safety of toy-like novelty cigarette lighters, a permanent ban was imposed under the CCA to protect consumers, particularly children, from potential injuries caused by mistaking these lighters for toys. This ban was introduced to ensure ongoing consumer safety by prohibiting the supply of such hazardous items.
Scope and Application
The Competition and Consumer Act 2010 applies to all individuals and entities engaged in trade or commerce within Australia, including corporations, partnerships, and sole traders. The Act regulates various aspects of commerce, including consumer protection, competition, and fair trading. The geographic reach of the Act is national, applying across all states and territories of Australia. The Act's provisions cover a wide array of conduct and transactions, aiming to ensure fair and honest business practices and to protect consumers from unsafe products. One specific application of the Act is the permanent ban on toy-like novelty cigarette lighters, which was enacted to prevent injuries caused by children mistaking these items for toys. The Act extends its application through subordinate instruments, which provide detailed regulations and guidelines. There are no stated exclusions or exemptions for the ban on toy-like novelty cigarette lighters, as the primary objective is to ensure consumer safety.
Key Provisions
The Competition and Consumer Act 2010 (CCA), specifically through Schedule 2, includes a permanent ban on toy-like novelty cigarette lighters. This ban was established under section 114(1)(a) of the CCA, following an interim ban that was in effect from 1 January 2011. This interim ban was a continuation of a previous notice under the Trade Practices Act 1974 (TPA) that declared such lighters to be unsafe. The permanent ban is intended to protect consumers, particularly children, from the risk of serious burns caused by mistaking these lighters for toys. The ban is a legislative instrument under the Legislative Instruments Act 2003 (LIA) and has undergone consultation as required.
The CCA imposes several obligations on parties and entities affected by this ban. Manufacturers, importers, suppliers, and retailers must ensure that they do not supply, advertise, or sell toy-like novelty cigarette lighters. This includes not having the lighters in their inventory or on their premises for commercial purposes. Additionally, the ban requires compliance with the notification and record-keeping requirements under the LIA. Suppliers must also ensure that any remaining stock of these lighters is appropriately disposed of or destroyed.
Violations of the ban can lead to both civil and criminal consequences. Under section 126 of the CCA, a person who contravenes a prohibition or restriction imposed by the ACL can be subject to civil penalty proceedings. For a corporation, the maximum penalty is $1.1 million for a single contravention. Individuals involved in the contravention can face penalties of up to $220,000. Furthermore, under section 131, any person who knowingly or recklessly contravenes a provision of the ACL can be charged with a criminal offence. Upon conviction, individuals can face penalties of up to $220,000 or imprisonment for up to two years, or both, while corporations can face penalties of up to $1.1 million. These stringent penalties underscore the seriousness with which the law treats breaches of consumer safety regulations.