Investigating your business

Fair Trading Investigators may enter any place at a reasonable time where they believe on reasonable grounds that goods are manufactured, prepared or supplied, services are supplied or arranged, or documents evidencing a contravention of the law are contained . Investigators have the power to enter a dwelling or other residential premises where manufacturing, business or trade is done or with the occupier’s consent. In certain circumstances where reasonable grounds exist, the power to enter does not include a power to enter a place that is a dwelling-house or other residential premises unless:

1. the occupier consents or,
2. some manufacture, business or trade is carried on there.

An investigator can enter and inspect premises, as well as make copies of, take extracts from, or seize   any document that is believed to be evidence. If Fair Trading reasonably believes a person or organisation can provide information or evidence regarding a breach of the law, an investigator can request this information or evidence from the person by giving them written statutory notice.

Evidence seized for the purpose of investigation must be returned to the owner if it is no longer required for the investigation.

An investigator who has entered premises on the grounds described above may:

• take any goods, or partly manufactured goods, for which he or she pays a fair price,
• take a sample of anything from which goods are manufactured or produced in that place,
• seize, detain or remove any consumer goods in that place that
  • do not comply with a safety standard (within the meaning of section 2 (1) of the ACL), or
  • are the subject of an interim or permanent ban, or
  • are the subject of a recall notice, or
  • the investigator believes, on reasonable grounds, are or are likely to become unsafe

Receipts must be issued for any seized, detained or removed goods.

An investigator may issue an embargo notice to the occupier of premises in relation to consumer goods or products-related services if they are manufactured, prepared, stored or supplied in trade from the premises and either:

• do not comply with a safety standard under section 2(1) of the ACL, or
• are the subject of an interim or permanent ban, or
• are the subject of a recall notice, or
• are, or are likely to become, unsafe.

In addition to the above, an embargo notice may only be issued if it is not practicable to seize and remove the consumer goods or equipment used in the manufacturing, processing, storage or supply of the consumer goods or goods-related services.

Goods or property seized for the purpose of investigation must be returned to the owner if it is no longer required for the investigation.

It’s an offence to stop investigators from doing their job. It’s also an offence not to provide an investigator with reasonable access and assistance so they can effectively undertake an investigation. Hindering or obstructing a Fair Trading investigation can result in penalties of up to $2,200 or up to six months imprisonment or both.

Your business can help by:

• providing accurate and reliable advice and information when required
• acting ethically, fairly and honestly in all dealings with investigators
• not offering investigators gifts or other benefits designed to improperly influence the conduct of their duties.

There are a number of actions the NSW Government can take if you are found to be in breach of the law, including:

• ordering that you reimburse the government for the costs reasonably incurred during the investigation. This includes costs relating to the purchase, inspecting, testing, transporting, storing and disposing of goods, as well as the associated auditing of financial records.
• an enforceable undertaking, a legally-binding agreement entered into by consent, to do certain things so you will comply with the law
• an injunction to stop you continuing to do something which breaks the law. For example, you may have to cancel advertising that is considered to be misleading or even force you or your business to cease trading
• issuing a public warning notice
• prosecution through the courts
• imposing of financial penalties
• notice to place corrective advertising. You may be required to place an advertisement in a major paper that gives customers certain information about your business, such as fees not disclosed in previous advertisements
• freezing of bank accounts
• referral of complaints to other authorities or bodies.

Important: consumers and businesses also have the right to compensation through the courts for any loss or damage that occurs due to a business breaking the law.

Investigators are bound by a code of conduct and must uphold organisational values. They must make sure their decisions and actions are:

• reasonable
• fair
• appropriate to the circumstances.

They must consider all relevant facts, legislation, policies and procedures before finalising their investigations and making recommendations.

As a NSW government organisation, Fair Trading must follow a code of practice when dealing with businesses. This is based on:

• open and effective communication
• respect and trust
• non-adversarial dispute resolution.

We are committed to providing fair, reasonable and appropriate conduct in all aspects of our investigations. However, if you believe you have been treated unfairly, you can make a complaint about our service. Go to the feedback page on our website.

Go to the NSW Legislation website for more information.