What are the penalties for breaching food safety regulations

Suppliers who fail to comply with product bans, standards or mandatory reporting requirements under the Australian Consumer Law may face enforcement action that attracts fines and pecuniary penalties.

From 1 July 2020 the value of the penalty unit for Commonwealth criminal offences increased from $210 to $222.

Definitions

Suppliers may include manufacturers, importers, distributors and retailers. There will often be more than one supplier responsible for compliance and ensuring products are safe and fit for purpose, regardless of where they may be in the supply chain, or whether they are domestic or overseas suppliers.

Fines are monetary fines (criminal penalty) imposed by courts in criminal proceedings. Criminal standard of proof is required.

Pecuniary penalties are monetary fines imposed and collected by civil courts. The civil standard of proof is applied (namely the balance of probabilities).

A number of factors are taken into account by the Court in determining the appropriate fine or level of penalty. The calculation of the monetary amount of a penalty is dependent on ‘penalty units’ that are set out in the Crimes Act 1914. The value of a penalty unit is currently $222.

Breaches attracting fines and penalties

Bans

A person who supplies a product or product related service which is the subject of a ban may be found guilty of a criminal offence. The maximum fine is:

For a body corporate, the greater of:

• $10 000 000
• three times the value of the benefit received, or
• 10% of annual turnover in the preceding 12 months, if a court cannot determine the benefit obtained from the offence.

Civil penalties of the same amounts also apply.

Standards

A supplier may be found guilty of a criminal offence if they fail to comply with a mandatory safety or information standard. The maximum fine is:

For a body corporate, the greater of:

• $10 000 000
• three times the value of the benefit received, or
• 10% of annual turnover in the preceding 12 months, if a court cannot determine the benefit obtained from the offence.

Civil penalties for the same amounts also apply.

Where a safety standard specifies two or more sets of requirements for complying with the standard, the supplier must, if requested by a regulator, provide a notice specifying which of those sets of requirements it intends to comply with. The maximum fine for failing to do so is:

• $4400 for individuals
• $22 000 for a body corporate.

This is an offence of strict liability.

Recalls

A person who refuses or fails to comply with a recall notice may be found guilty of a criminal offence. The maximum fine is:

For a body corporate, the greater of:

• $10 000 000
• three times the value of the benefit received, or
• 10% of annual turnover in the preceding 12 months, if a court cannot determine the benefit obtained from the offence.

Civil penalties of the same amounts also apply.

This is an offence of strict liability.

Mandatory reporting

Suppliers must notify the Commonwealth minister within 2 days of becoming aware that a person suffered serious injury, illness or death associated with a consumer good or product-related service they have supplied in Australia, or overseas.

A supplier who fails to notify the Commonwealth minister within 2 days of becoming aware of the incident may be found guilty of a criminal offence. The maximum fine is:

• $3330 for individuals
• $16 650 for a body corporate.

This is an offence of strict liability, which means that a court does not have to find that a person intended not to notify the minister in order to find them guilty.

Resolving breaches of product safety regulations

When a product safety regulator finds that a supplier is supplying consumer goods or product related services that breach a mandatory standard or are banned, the regulator's priority is to ensure that the hazardous goods or product related services are removed from the marketplace. The ACCC or a state or territory regulator will inform the suppliers involved.

After receiving the information, the ACCC or state or territory regulator is likely to require that suppliers take action to recall the goods, including:

• immediately stopping the supply of the consumer goods or product related services
• remove the goods from retail outlets
• retrieve the consumer goods from throughout the supply chain and from consumers.

An assessment will then be made of what compliance and enforcement action may be appropriate in the circumstances. How Australian regulators respond and what sort of action they take depends on a range of factors including:

• the seriousness of the safety hazard – how much damage it has caused or is likely to cause
• the volume of goods supplied
• the blatancy of the breach
• the supplier’s past conduct
• the extent to which the supplier cooperates.

More information

Mandatory standards
Product bans
Mandatory reporting

(1)  In this Act:

means:

(a)  any words, whether written or spoken, or

(b)  any pictorial representation or design, or

(c)  any other representation by any means at all,

used or apparently used to promote, directly or indirectly, the sale of food.

analysis includes any examination or testing of food or any other thing.

animal includes an amphibian, bird, crustacean, fish, mollusc or reptile.

appropriate enforcement agency means, in relation to the provision in which the expression is used, the enforcement agency prescribed by the regulations for the purposes of that provision.

approved analyst means a person approved under Division 4 of Part 6.

approved form means the form approved from time to time by the Food Authority.

approved laboratory means a laboratory approved under Division 3 of Part 6.

authorised justice has the same meaning as in the Search Warrants Act 1985.

authorised officer means a person appointed under Division 3 of Part 9.

Chief Executive Officer means the person employed in the Public Service as the Chief Executive Officer of the Food Authority.

enforcement agency means:

(a)  the Food Authority, or

(b)  a relevant body appointed as an enforcement agency under Division 2 of Part 9, or

(c)  any person or body, or a person or body within a class of persons or bodies, prescribed by the regulations for the purposes of this definition (other than a relevant body within the meaning of Division 2 of Part 9).

equipment means the whole or part of:

(a)  any utensil, machinery, instrument, device, apparatus or appliance that is used, or that is designed or intended for use, in or in connection with the handling of food, or

(b)  any substance, utensil, machinery, instrument, device, apparatus or appliance that is used, or that is designed or intended for use, in cleaning anything referred to in paragraph (a).

examine includes weigh, count, test or measure.

exercise a function includes perform a duty.

food has the meaning given by section 5.

Food Authority means the NSW Food Authority constituted under Part 9.

Food Authority Fund means the fund established under section 117A.

food business has the meaning given by section 6.

food safety auditor means a member of staff of the Food Authority authorised under Division 1 of Part 7, or another person approved under that Division, to be a food safety auditor.

food safety scheme means a food safety scheme prescribed by the regulations in accordance with Part 8.

Food Safety Standards means the standards contained in Chapter 3 of the Food Standards Code.

Food Standards Code means the Australia New Zealand Food Standards Code as defined in the Food Standards Australia New Zealand Act 1991 of the Commonwealth, as modified in accordance with regulations referred to in section 140 or 141.

food transport vehicle means a vehicle used for the transport of food for sale.

Forum means the Food Regulation Forum established under Division 3A of Part 9.

function includes a power, authority or duty.

handling of food includes the making, manufacturing, producing, collecting, extracting, processing, storing, transporting, delivering, preparing, treating, preserving, packing, cooking, thawing, serving or displaying of food.

improvement notice means an improvement notice issued under Part 5.

label includes any tag, brand, mark or statement in writing or any representation or design or other descriptive matter on or attached to or used or displayed in connection with or accompanying any food or package.

package includes any container or wrapper in or by which food intended for sale is wholly or partly encased, covered, enclosed, contained or packed and, in the case of food carried or sold or intended to be carried or sold in more than one package, includes every such package.

premises includes:

(a)  land (whether or not vacant), or

(b)  the whole or any part of a building, tent, stall or other structure (whether of a permanent or temporary nature), or

(d)  a vehicle (other than a food transport vehicle while it is engaged in the transport of food).

primary food production has the meaning given by section 7.

private corporation means a corporation within the meaning of the Corporations Act 2001 of the Commonwealth.

private subsidiary corporation means a private corporation in which the Food Authority has a controlling interest.

prohibition order means a prohibition order made under Part 5.

proprietor of a food business means:

(a)  the person carrying on the food business, or

(b)  if that person cannot be identified the person in charge of the food business.

recall order means an order under Part 3 requiring the recall or disposal, or both, of any food.

register of offences means the register of offences kept under Part 10A.

register of penalty notices means the register of penalty notices kept under Part 10A.

sell includes:

(a)  barter, offer or attempt to sell, or

(c)  have in possession for sale, or

(e)  cause or permit to be sold or offered for sale, or

(f)  send, forward or deliver for sale, or

(g)  dispose of by any method for valuable consideration, or

(h)  dispose of to an agent for sale on consignment, or

(i)  provide under a contract of service, or

(j)  supply food as a meal or part of a meal to an employee, in accordance with a term of an award governing the employment of the employee or a term of the employee’s contract of service, for consumption by the employee at the employee’s place of work, or

(k)  dispose of by way of raffle, lottery or other game of chance, or

(l)  offer as a prize or reward, or

(m)  give away for the purpose of advertisement or in furtherance of trade or business, or

(n)  supply food under a contract (whether or not the contract is made with the consumer of the food), together with accommodation, service or entertainment, in consideration of an inclusive charge for the food supplied and the accommodation, service or entertainment, or

(p)  sell for the purpose of resale.

unsafe has the meaning given by section 8.

unsuitable has the meaning given by section 9.

vehicle means any means of transport, whether self-propelled or not, and whether used on land or sea or in the air.

s 4: Am 2004 No 16, Sch 1 [2] [3]; 2007 No 47, Sch 1 [1] [2]; 2008 No 5, Sch 1 [1]; 2009 No 96, Sch 8 [1] [2]; 2013 No 95, Sch 2.63 [1]; 2014 No 26, Sch 3.2 [1] [2]; 2015 No 58, Sch 3.35 [1] [2].