Trade Practices (Consumer Product Information Standards) (Cosmetics) Amendment Regulations 1998 (No. 1) 1998 No. 364
EXPLANATORY STATEMENT
STATUTORY RULES 1998 No. 364
Issued by the Authority of the Minister for Financial Services and Regulation
Trade Practices Act 1974
Trade Practices (Consumer Product Information Standards) (Cosmetics) Amendment Regulations 1998 (No. 1)
Section 172 of the Trade Practices Act 1974 (the Act) provides that the Governor-General may make regulations for the purposes of the Act.
Subsection 65D(1) of the Act provides that a corporation shall not, in trade or commerce, supply goods that are intended to be used, or are of a kind likely to be used, by a consumer, if the goods are of a kind in respect of which a consumer product information standard has been prescribed, unless the corporation has complied with that standard in relation to those goods.
Subsection 65D(2) of the Act provides that a regulation may, in respect of goods of a particular kind, prescribe a consumer product information standard consisting of such requirements as to:
(a) the disclosure of information relating to the performance, composition, contents, methods of manufacture or processing, design, construction, finish or packaging of the goods; and
(b) the form and manner in which that information is to be disclosed on or with the goods,
as are reasonably necessary to give persons using the goods information as to the quantity, quality, nature or value of the goods.
The purpose of the amendments to the regulations is to harmonise with other international standards in the interests of increasing trade opportunities and compliance costs by adopting the International Nomenclature of Cosmetic Ingredients (INCI) system of nomenclature for the labelling of cosmetic products.
Details of the proposed amendment to the regulation are as follows:
Regulation 1 changes the name of the Regulations to the Trade Practices (Consumer Product Information Standards) (Cosmetics) Regulations 1991.
Regulation 2 specifies the changes to Subregulation 5 (6) to allow a reference to a colour additive to be identified by the words 'may contain' and the name of the additive or the symbol '+/-' and the name of the additive.
Regulation 3 specifies the changes to Paragraph 5 (7) (a) to allow the word 'aroma' as an alternative to flavour.
Regulation 4 specifies the changes to Paragraph 5(8) (a) to allow the word 'parfum' or 'parfums' to be used as an alternative to 'fragrance' or 'fragrances'.
Regulation 5 specifies the changes to the form of ingredients list to allow the names of the ingredients in the list to be either their English names or their International Nomenclature Cosmetic Ingredient names.
Overview
The Trade Practices (Consumer Product Information Standards) (Cosmetics) Amendment Regulations 1998 (No. 1) were enacted to align Australia’s regulatory framework for cosmetic product information with international standards, primarily to facilitate trade and reduce compliance costs. These regulations were introduced as an amendment to the Trade Practices (Consumer Product Information Standards) (Cosmetics) Regulations 1991, and were issued by the authority of the Minister for Financial Services and Regulation under the Trade Practices Act 1974. The policy objective behind these amendments was to adopt the International Nomenclature of Cosmetic Ingredients (INCI) system for ingredient labelling, thereby ensuring that Australian consumers receive clear and consistent information about the composition of cosmetic products in line with global practices. The regulations aim to enhance consumer protection by ensuring that essential information regarding the performance, composition, and quality of cosmetics is adequately disclosed, thereby supporting informed purchasing decisions and fostering a competitive marketplace that aligns with international standards.
Scope and Application
The Trade Practices (Consumer Product Information Standards) (Cosmetics) Amendment Regulations 1998 (No. 1) applies to corporations engaged in trade or commerce in Australia, specifically in the supply of cosmetic goods intended for consumer use. These regulations, made under the authority of the Trade Practices Act 1974, ensure that corporations comply with consumer product information standards to disclose adequate information about the performance, composition, and other attributes of cosmetic products. The regulations aim to harmonise with international standards, particularly the International Nomenclature of Cosmetic Ingredients (INCI) system, to enhance trade opportunities and streamline compliance costs. This amendment allows for variations in the disclosure of colour additives, the use of 'aroma' instead of 'flavour', 'parfum' or 'parfums' instead of 'fragrance', and permits ingredient names in either English or INCI names on cosmetic product labels. The changes extend across the Commonwealth of Australia, impacting all entities supplying cosmetic goods within this jurisdiction.
Key Provisions
The Trade Practices (Consumer Product Information Standards) (Cosmetics) Amendment Regulations 1998 (No. 1) introduce several changes to the existing regulations, specifically aimed at aligning cosmetic product information standards with international practices. Regulation 1 updates the name of the Regulations to Trade Practices (Consumer Product Information Standards) (Cosmetics) Regulations 1991. Regulation 2 modifies Subregulation 5(6) to permit the use of the words 'may contain' followed by the name of a colour additive, or the symbol '+/–' followed by the name of the additive, to identify a colour additive on cosmetic labels. Regulation 3 allows the term 'aroma' to be used as an alternative to 'flavour' in Subregulation 5(7)(a). Regulation 4 permits the terms 'parfum' or 'parfums' to be used in place of 'fragrance' or 'fragrances' in Subregulation 5(8)(a). Finally, Regulation 5 permits the use of either the English names or the International Nomenclature of Cosmetic Ingredient (INCI) names for ingredients listed on cosmetic products.
These regulations impose specific obligations on corporations to ensure compliance with consumer product information standards for cosmetics. Under section 65D(1) of the Trade Practices Act 1974, corporations must not supply goods intended for consumer use if they are of a kind in respect of which a consumer product information standard has been prescribed, unless they have complied with that standard. This includes ensuring that all necessary information about the performance, composition, contents, methods of manufacture or processing, design, construction, finish, or packaging of the goods is disclosed in the manner prescribed by the regulations. Corporations must also ensure that this information is clearly and accurately presented on or with the goods.
Breaches of these regulations can lead to various consequences, including civil penalties. Under section 12GA of the Trade Practices Act, corporations found in breach of consumer product information standards can be subject to substantial penalties. The maximum penalty for corporations is generally $1.1 million, reflecting the seriousness of non-compliance with consumer protection laws. It is important for corporations to ensure that they adhere to these regulations to avoid potential legal repercussions.