A business must not make false or misleading representations about the country of origin of goods.
Claims about country of origin include:
A representation about country of origin includes words, a picture or both, either:
It does not include a representation that is a necessary part of the good.
For example - representation about country of origin. A t-shirt with a 'Made in Australia' label makes a representation about country of origin. A t-shirt emblazoned with the word 'Australia' as part of its design, does not.
A business must ensure absence of a country of origin representation does not imply one, because of other statements or signs associated with a good.
For example – implying a country of origin. A person may buy a genuine Turkish rug believing it is made in Turkey, when it is actually made in China.
There are criteria for claims about the country of origin of goods.
The criteria apply to claims about country, not region - for example, they do not apply to 'made in Tasmania' or 'made in California'
A business accused of making a false or misleading claim about country of origin must point to evidence that suggests a reasonable possibility the products originated in that country.
For a business to claim goods are made in a particular country:
For a business to claim goods are 'produced in', 'produce of’ or 'product of' a particular country:
For example – 'product of' claims - when is an ingredient 'significant'? An apple and cranberry juice bottle can carry a 'produce of Australia' label only if both juices are from Australia.
Even though the cranberry juice is about five per cent of the total volume, it is 'significant' to the product and the label would be misleading if the cranberry juice was imported.
The final product may contain an imported preservative and still be 'produce of Australia'; the cranberry juice is 'significant', the preservative is not.
If a business labels a product with a prescribed logo (for example, the 'Made in Australia' brand), the goods must:
A business can lawfully claim goods are 'grown in' a particular country when:
This means the product undergoes a fundamental change in the country represented. The changes can be to the product's appearance, operation or purpose.
Processes that lead to substantial transformation include:
It does not include:
The cost of producing and manufacturing goods includes the producer or manufacturer's expenditure on materials, labour and overheads.
The expenditure on materials to produce or manufacture the goods includes:
It does not include:
The expenditure on labour related to and reasonably allocated to the production or manufacture of the goods includes:
The expenditure on overheads related to and reasonably allocated to the production or manufacture of the goods includes:
Example - calculating cost of production
An item that has material costs of $45, labour costs of $25 and overheads of $15 has a production cost of $85.