Trade Practices Amendment (Country of Origin Representations) Act 1998

Legislation au C2004A00363 Not in force Act

Legislation content

 

 

 

 

Trade Practices Amendment (Country of Origin Representations) Act 1998

 

No. 106, 1998

 

 

 

 

 

 

 

 

 

 

Trade Practices Amendment (Country of Origin Representations) Act 1998

 

No. 106, 1998

 

 

 

 

An Act to amend the Trade Practices Act 1974, and for related purposes

 

 

Contents

1 Short title..................................1

2 Commencement..............................1

3 Schedule(s).................................2

Schedule 1—Amendment of the Trade Practices Act 1974 relating to country of origin representations 3

Part 1—Insertion of new Division 3

Part 2—Consequential amendments 9

Schedule 2—Miscellaneous amendment of the Trade Practices Act 1974 11

Schedule 3—Amendment of the Trade Practices Act 1974 relating to section 51 authorisation 12

 

Trade Practices Amendment (Country of Origin Representations) Act 1998

No. 106, 1998

 

 

 

An Act to amend the Trade Practices Act 1974, and for related purposes

[Assented to 30 July 1998]

The Parliament of Australia enacts:

1  Short title

  This Act may be cited as the Trade Practices Amendment (Country of Origin Representations) Act 1998.

2  Commencement

 (1) Subject to subsections (2) and (3), this Act commences on the day on which it receives the Royal Assent.

 (2) Subject to subsection (3), Schedule 1 commences on a day to be fixed by Proclamation.

 (3) If Schedule 1 does not commence under subsection (2) within the period of 6 months beginning on the day on which this Act receives the Royal Assent, it commences on the first day after the end of that period.

3  Schedule(s)

  Subject to section 2, each Act that is specified in a Schedule to this Act is amended or repealed as set out in the applicable items in the Schedule concerned, and any other item in a Schedule to this Act has effect according to its terms.


Schedule 1—Amendment of the Trade Practices Act 1974 relating to country of origin representations

Part 1—Insertion of new Division

1  After Division 1 of Part V

Insert:

Division 1AA—Country of origin representations

Subdivision A—General

65AA  Overview

  This Division provides that certain country of origin representations made about goods do not contravene section 52 (which deals with misleading or deceptive conduct) or paragraph 53(eb) (which deals with false or misleading representations as to place of origin).

65AB  General test for country of origin representations

  If:

 (a) a corporation makes a representation as to the country of origin of goods; and

 (b) the goods have been substantially transformed in that country; and

 (c) 50% or more of the cost of producing or manufacturing the goods (as the case may be) is attributable to production or manufacturing processes that occurred in that country; and

 (d) the representation is not a representation to which section 65AC (product of/produce of representations) or section 65AD (prescribed logo representations) applies;

the corporation does not contravene section 52 or paragraph 53(eb) by reason only of making the representation.

65AC  Test for representations that goods are product of/produce of a country

  If:

 (a) a corporation makes a representation that goods are the produce of a particular country (whether the representation uses the words “product of”, “produce of” or any other grammatical variation of the word “produce”); and

 (b) the country was the country of origin of each significant ingredient or significant component of the goods; and

 (c) all, or virtually all, processes involved in the production or manufacture happened in that country;

the corporation does not contravene section 52 or paragraph 53(eb) by reason only of making the representation.

65AD  Test for representations made by means of prescribed logo

 (1) If:

 (a) a corporation makes a representation as to the country of origin of goods by means of a logo specified in regulations made under subsection (2); and

 (b) the goods have been substantially transformed in the country represented by the logo as the country of origin of the goods; and

 (c) the prescribed percentage of the cost of producing or manufacturing the goods (as the case may be) is attributable to production or manufacturing processes that occurred in that country;

the corporation does not contravene section 52 or paragraph 53(eb) by reason only of making the representation.

 (2) The regulations may, in relation to a specified logo, prescribe a percentage in the range of 51% to 100% as the percentage applicable to goods for the purposes of paragraph (1)(c).

65AE  Substantial transformation of goods

 (1) For the purposes of this Division, goods are substantially transformed in a country if they undergo a fundamental change in that country in form, appearance or nature such that the goods existing after the change are new and different goods from those existing before the change.

 (2) Without limiting subsection (1), the regulations may prescribe changes (whether in relation to particular classes of goods or otherwise) that are not fundamental changes for the purposes of subsection (1), and may include examples (in relation to particular classes of goods or otherwise) of changes which are fundamental changes for the purposes of subsection (1).

65AF  Method of working out costs of production or manufacture

  For the purposes of this Division, the cost of producing or manufacturing goods is to be worked out under Subdivision B.

Subdivision B—Cost of production or manufacture of goods

65AG  Definitions

  In this Subdivision:

inner container includes any container into which goods are packed, other than a shipping or airline container, pallet or other similar article.

materials, in relation to goods, means:

 (a) if the goods are unmanufactured raw products—those products; and

 (b) if the goods are manufactured goods—all matter or substances used or consumed in the manufacture of the goods (other than matter or substances that are treated as overheads); and

 (c) in either case—the inner containers in which the goods are packed.

65AH  Cost of producing or manufacturing goods

  The cost of producing or manufacturing goods means the sum of:

 (a) the expenditure on materials in respect of the goods, worked out under section 65AJ; and

 (b) the expenditure on labour in respect of the goods, worked out under section 65AK; and

 (c) the expenditure on overheads in respect of the goods, worked out under section 65AL.

65AJ  Expenditure on materials

Calculation of expenditure on materials

 (1) Expenditure on materials in respect of goods means the cost of materials:

 (a) incurred by the producer or manufacturer of the goods (as the case may be); and

 (b) that are used in the production or manufacture of the goods; and

 (c) that has not been prescribed under paragraph (2)(a).

Regulations may prescribe materials that are not allowable

 (2) The regulations may prescribe, for the purposes of subsection (1):

 (a) the cost of a particular material, or a part of such a cost, that is not allowable in respect of goods, or classes of goods; and

 (b) the manner of working out the cost of a material, or part of the cost.

65AK  Expenditure on labour

Calculation of expenditure on labour

 (1) Expenditure on labour in respect of goods means the sum of each labour cost:

 (a) that is incurred by the producer or manufacturer of the goods (as the case may be); and

 (b) that relates to the production or manufacture of the goods; and

 (c) that can reasonably be allocated to the production or manufacture of the goods; and

 (d) that has not been prescribed under paragraph (2)(a).

Regulations may prescribe labour costs that are not allowable

 (2) The regulations may prescribe, for the purposes of subsection (1):

 (a) a particular labour cost, or a part of a labour cost, that is not allowable in respect of goods, or classes of goods; and

 (b) the manner of working out a labour cost, or part of the cost.

65AL  Expenditure on overheads

Calculation of expenditure on overheads

 (1) Expenditure on overheads in respect of goods means the sum of each overhead cost:

 (a) that is incurred by the producer or manufacturer of the goods (as the case may be); and

 (b) that relates to the production or manufacture of the goods; and

 (c) that can reasonably be allocated to the production or manufacture of the goods; and

 (d) that has not been prescribed under paragraph (2)(a).

Regulations may prescribe overhead costs that are not allowable

 (2) The regulations may prescribe, for the purposes of subsection (1):

 (a) a particular overhead cost, or a part of an overhead cost, that is not allowable in respect of goods, or classes of goods; and

 (b) the manner of working out an overhead cost, or part of the cost.

65AM  Regulations may prescribe rules for determining the local percentage costs of production or manufacture

 (1) Subject to subsection (2), the regulations may prescribe rules for determining the percentage of the total cost of production or manufacture of goods attributable to production or manufacturing processes that occurred in a particular country.

Note: Section 65AH deals with the cost of production or manufacture of goods.

 (2) Rules prescribed under subsection (1) must not discriminate (whether favourably or unfavourably) between countries or classes of countries.

Subdivision C—Evidentiary matters

65AN  Proceedings arising under section 52 and paragraph 53(eb)

 (1) If:

 (a) proceedings are brought against a person in respect of section 52 or paragraph 53(eb); and

 (b) the person seeks to rely on a provision of this Division, or of a regulation made under this Division, in the proceedings;

the person bears an evidential burden in relation to the matters set out in the provision on which the person seeks to rely.

 (2) In this section:

evidential burden, in relation to a matter, means the burden of adducing or pointing to evidence that suggests a reasonable possibility that the matter exists or does not exist.


Part 2—Consequential amendments

2  Subsection 5(1)

Omit “Parts IV, IVA and V”, substitute “Part IV, Part IVA and Part V (other than Division 1AA)”.

3  Subsection 6(3)

Omit “and 1A”, substitute “, 1A and 1AA”.

4  Subsection 6(4)

Omit “Division 1 of Part V (other than sections 53A, 55 and 61)”, substitute “Division 1 (other than sections 53A, 55 and 61) and Division 1AA of Part V”.

5  At the end of section 52

Add:

Note: For rules relating to representations as to the country of origin of goods, see Division 1AA (sections 65AA to 65AN).

6  At the end of section 53

Add:

Note: For rules relating to representations as to the country of origin of goods, see Division 1AA (sections 65AA to 65AN).

7  Paragraph 75AS(b)

Omit “or 1A”, substitute “, 1A or 1AA”.

8  Subsection 86(2)

Omit “or 1A”, substitute “, 1A or 1AA”.

9  Paragraph 86A(1)(b)

Omit “or 1A”, substitute “, 1A or 1AA”.

10  Paragraph 86A(4)(b)

Omit “or 1A”, substitute “, 1A or 1AA”.

11  Paragraph 86A(5)(b)

Omit “or 1A”, substitute “, 1A or 1AA”.

12  Paragraph 86B(1)(b)

Omit “or 1A”, substitute “, 1A or 1AA”.


Schedule 2—Miscellaneous amendment of the Trade Practices Act 1974

 

1  Subsection 7(3)

Repeal the subsection, substitute:

 (3) Before the Governor-General appoints a person as a member of the Commission or as Chairperson, the Minister must:

 (a) be satisfied that the person qualifies for the appointment because of the person’s knowledge of, or experience in, industry, commerce, economics, law, public administration or consumer protection; and

 (b) consider whether the person has knowledge of, or experience in, small business matters; and

 (c) if there is at least one fully-participating jurisdiction—be satisfied that a majority of such jurisdictions support the appointment.

2  Subsection 34(1)

Omit “Attorney-General”, substitute “Minister”.

3  Subsection 163(3)

Repeal the subsection.

Note: Subsection 163(3) deals with procedures relating to offence provisions which were repealed in 1989. The subsection no longer has any effect.

 


Schedule 3—Amendment of the Trade Practices Act 1974 relating to section 51 authorisation

 

1  At the end of Part XII

Add:

173  Authorisation for the purposes of subsection 51(1)

 (1) In deciding whether a person (including a corporation) has contravened section 50 of this Act, the vesting of ownership of primary products in the person by legislation is to be taken, for the purposes of subparagraph 51(1)(a)(i), to be specified in, and specifically authorised by, this section.

 (2) In this section:

primary products means:

 (a) agricultural or horticultural produce, including produce that has been subjected to a manufacturing process; or

 (b) crops, whether on or attached to the land or not; or

 (c) animals (whether dead or alive); or

 (d) the bodily produce (including natural increase) of animals.

Note: An example of agricultural produce that has been subjected to a manufacturing process is sugar cane that has been transformed into raw sugar.

 

 

[Minister's second reading speech made in—

House of Representatives on 8 April 1998

Senate on 24 June 1998]

 

 

(50/98)

 

Overview

The Trade Practices Amendment (Country of Origin Representations) Act 1998 was enacted by the Parliament of Australia to amend the Trade Practices Act 1974, addressing the problem of misleading country of origin representations made by corporations about the goods they produce or manufacture. The Act aims to provide clarity and protection for consumers by setting specific criteria under which such representations do not contravene the prohibition against misleading or deceptive conduct. This legislative change was necessary to prevent corporations from making deceptive claims about the origin of their products, ensuring that consumers have accurate information about the country of origin of goods. The primary policy objective of the Act is to establish a framework that allows corporations to make country of origin representations without breaching trade practices laws, provided certain conditions are met. These conditions include the substantial transformation of goods in the claimed country of origin, a significant proportion of production or manufacturing costs attributable to that country, and compliance with specific tests for representations that goods are the product or produce of a particular country. This Act thus seeks to balance the interests of businesses in making legitimate origin claims with the need to protect consumers from misleading information.

Scope and Application

The Trade Practices Amendment (Country of Origin Representations) Act 1998 applies to corporations that make representations about the country of origin of goods they produce or manufacture. This legislation amends the Trade Practices Act 1974, which is a Commonwealth Act, thereby extending its reach across the entire nation. The Act introduces specific provisions concerning representations of country of origin, ensuring that such representations do not constitute misleading or deceptive conduct under the Trade Practices Act unless they fail certain criteria. The Act provides tests for determining when such representations are permissible, including when goods have been substantially transformed in the country of origin and when a significant portion of the production or manufacturing costs are attributable to processes in that country. Notably, the Act also allows for the creation of subordinate legislation to specify logos that can be used to make such representations and to set the percentage of costs that must be attributable to the country of origin for these representations to be valid. The Act does not specify any exclusions or exemptions, and its application can be extended or modified through regulations made under its authority.

Key Provisions

The Trade Practices Amendment (Country of Origin Representations) Act 1998 (Cth) introduces new provisions into the Trade Practices Act 1974 (Cth), specifically addressing representations made about the country of origin of goods. The Act inserts a new Division 1AA into Part V of the Trade Practices Act 1974, which provides specific rules for country of origin representations. Section 65AA outlines that certain country of origin representations do not contravene the prohibitions on misleading or deceptive conduct or false or misleading representations as to place of origin. For instance, a corporation will not contravene these sections if it makes a representation about the country of origin of goods that have been substantially transformed in that country and if at least 50% of the cost of producing or manufacturing the goods is attributable to processes in that country (Section 65AB). Further, Section 65AC provides an exemption for representations that goods are the produce of a particular country if that country was the origin of each significant ingredient or component, and all or virtually all production processes occurred there. Additionally, Section 65AD addresses representations made by means of a prescribed logo, stating that if the goods are substantially transformed in the country represented and the prescribed percentage of the cost of production or manufacture is attributable to processes in that country, the representation does not contravene the Act. The Act imposes obligations on corporations to ensure that any country of origin representations they make comply with the specified tests. Specifically, corporations must verify that the goods in question have undergone substantial transformation in the country of origin and that the production or manufacturing costs meet the required thresholds. For example, under Section 65AB, a corporation must ensure that at least 50% of the production or manufacturing costs are attributable to processes in the country of origin. Additionally, the Act mandates that corporations bear the evidential burden in proceedings related to Section 52 or paragraph 53(eb) if they seek to rely on the provisions of Division 1AA (Section 65AN). The Act delineates potential consequences for breaches of its provisions. While the Act itself does not explicitly state penalties for non-compliance, breaches of the underlying Trade Practices Act 1974 may incur civil or criminal penalties. For corporations, contraventions of the misleading or deceptive conduct provisions can result in significant fines, with penalties under Section 82 of the Trade Practices Act 1974 reaching up to $1.1 million for corporations. Individuals involved in breaches may face penalties of up to $220,000 and/or imprisonment for up to five years, as stipulated in Section 83 of the Trade Practices Act 1974. These penalties underscore the importance of adhering to the Act’s requirements regarding country of origin representations.

Legal classification tags

Area of Law
Commercial Law
Instrument
Amending Act
Concepts
Definitions & Interpretation
Commencement Provisions
Regulatory Standards
Prohibited Conduct

Interactions

Authorises

All Versions

Sourced from the Federal Register of Legislation at 26 August 2026. For the latest information on Australian Government law please go to https://www.legislation.gov.au.