explanatory STATEMENT
Issued by the Authority of the Parliamentary Secretary to the Treasurer
Competition and Consumer Act 2010
Permanent ban on yo‑yo water balls
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 yo‑yo water balls.
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 yo‑yo water balls 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 yo‑yo water balls is imposed pursuant to subsection 114(1)(a) of Schedule 2 to the CCA.
Permanent ban on yo‑yo water balls
A yo-yo water ball is a liquid‑filled toy or novelty that has a soft and spongy texture; a centre filled with a hydrocarbon based liquid such as toluene (a product of petroleum); a thermal plastic rubber outer casing; an elasticised cord capable of extending at least 500 mm in length.
Yo-yo water balls may also have a novelty feature inside the liquid filled ball, such as a flashing light; resemble the form of a cartoon animal; have a loop to put a finger through.
The purpose of the permanent ban on these goods is to ensure ongoing consumer safety by prohibiting the supply of yo‑yo water balls. There are several hazards associated with these goods, including:
- the cord provides a yo‑yo effect, but because it can sometimes stretch to over one metre in length, it can wind around a child’s neck, especially if swung around the head, and cause choking
- the highly elastic and ‘sticky’ nature of the cord can constrict breathing if wound tightly around a child’s neck
- if the thermal plastic outer casing of a yo‑yo ball is pierced, the liquid inside can cause illness if swallowed, and/or adverse reactions if it comes into contact with the skin.
Under the CCA, a permanent ban on yo‑yo water balls 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 unified national consumer law regime, replacing the Trade Practices Act 1974 (TPA). The CCA was introduced to address gaps in consumer protection and competition law by integrating the Australian Consumer Law (ACL) as Schedule 2. The ACL aimed to provide a consistent and comprehensive set of consumer protections across Australia. The Trade Practices Amendment (Australian Consumer Law) Act (No.2) 2010 played a crucial role in transitioning from the TPA to the CCA and the ACL, ensuring continuity in consumer protection measures.
The Act specifically addresses the problem of unsafe consumer goods by allowing for the imposition of both interim and permanent bans. This mechanism was activated concerning yo-yo water balls, which presented significant safety hazards to children, including risks of choking and chemical exposure. The ban on these goods was implemented to ensure ongoing consumer safety, and the policy objective was clearly stated as preventing potential injuries associated with the use of these products. The Commonwealth Minister imposed the permanent ban under subsection 114(1) of Schedule 2 to the CCA, following consultations and the sunset provisions outlined in the Legislative Instruments Act 2003.
Scope and Application
The Competition and Consumer Act 2010, as amended, applies to individuals, businesses, and entities engaged in the supply of goods and services within Australia. The Act's provisions extend to all industries and encompass conduct or transactions that could potentially contravene the law's consumer protection and competition principles. The Act operates on a national level, governed by Commonwealth law, and ensures uniform consumer protection and competition regulations across the country. Notably, the Act includes a permanent ban on yo-yo water balls, which are deemed unsafe and prohibited from being supplied to consumers. This ban applies to all persons and entities involved in the distribution or sale of these products within Australia. The ban is subject to certain exclusions and is enforced through subordinate legislation, with the possibility of extensions under specific conditions as outlined in the Act. The legislation's scope is further clarified through transitional arrangements and consultation processes as mandated by the Legislative Instruments Act 2003.
Key Provisions
The Competition and Consumer Act 2010 (CCA) includes a permanent ban on yo-yo water balls, which was established pursuant to subsection 114(1)(a) of Schedule 2 (sections 109 and 114). The ban was initiated due to the inherent risks associated with the toy, including the potential for choking or poisoning if the liquid inside is swallowed or if it contacts the skin. These toys are essentially liquid-filled balls with an elastic cord that can stretch significantly, posing a serious risk to children, especially if they swing the toy around their head. The ban was first declared as an interim measure on 1 January 2011, and subsequently made permanent, reflecting a commitment to public safety.
The CCA imposes strict obligations on parties and entities concerning the supply of banned goods. Manufacturers, importers, and suppliers are prohibited from supplying yo-yo water balls in Australia, which includes manufacturing, importing, or selling the product. The Act requires these entities to ensure that they do not participate in any manner of supply chain that could result in the distribution of these toys. Additionally, the Act mandates that any stock of yo-yo water balls must be disposed of or destroyed to prevent any further distribution or sale.
Violating the provisions of the CCA related to the supply of banned goods such as yo-yo water balls can result in significant penalties. Under section 131 of the CCA, individuals who contravene the ban may be subject to civil penalties, including fines of up to $1.1 million for corporations and $220,000 for individuals, depending on the severity and frequency of the breach. Additionally, the Act allows for criminal penalties, including imprisonment for up to five years for individuals who knowingly or recklessly contravene the ban. These stringent measures are designed to enforce compliance and protect public health and safety.