ACCC sharpens focus on product safety: What retailers need to know

Every link in the supply chain, including retailers, is responsible for product safety and compliance. With a growing number of high-risk items under recall, including lithium-ion power banks, the ACCC is cracking down on anything that poses a serious threat to consumers.

Known for its strong stance on compliance, particularly where physical harm is at risk, the ACCC is reinforcing its commitment to protecting consumers and the message is clear: unsafe products will not be tolerated, and the consequences for non-compliance are significant.

ACCC’s enforcement approach

Each year, the ACCC sets specific product safety priorities to focus on those products that pose the greatest risk to Australian consumers. These priorities are shaped by factors such as community concern, the likelihood and severity of injuries, and the difficulty consumers may face in identifying potential hazards.

For the 2025-26 period, the ACCC has outlined five key focus areas:

• Digital economy
• Young children
• Mandatory standards
• Lithium-ion battery safety
• Improving product safety data to identify risks and protect consumers.

Mandatory safety standards are constantly evolving, covering an increasingly broad spectrum of products, from technology and electronics to cosmetics, clothing, and household goods. Even if your business does not currently supply products subject to specific safety regulations, it is essential to stay informed and up to date as regulatory landscapes can shift quickly. By proactively monitoring regulatory developments, businesses can maintain compliance, minimise the risk of costly legal or financial penalties, and adapt quickly to changes in the safety standards landscape.

Moreover, aligning with product safety standards demonstrates a commitment to consumer wellbeing, building trust, brand credibility, and can serve as a competitive advantage in markets where safety and quality are key purchasing considerations.

 Product safety is everyone’s business

 A key message for businesses is that product safety isn’t just the manufacturer’s responsibility. Under Australian Consumer Law (ACL), every party in the supply chain, from manufacturers and importers to distributors and retailers, is accountable for ensuring the safety and compliance of the products they supply, in accordance with the relevant mandatory safety standards and information standards.

To meet these obligations, businesses should implement proactive practices such as:

• Monitoring product design and safety and staying alert to emerging risks, new bans and regulatory updates.
• Conducting regular product testing including batch testing, to ensure compliance with mandatory standards and quality assurance procedures.
• Ensuring honest marketing including clear safety warnings where required, comprehensive and easy to understand user instructions, and ensuring any statements are supported factually (unless it is obvious they are mere puffery) e.g. see our recent article Washed up: ASIC and ACCC set sights on unsupported AI claims – Macpherson Kelley.
• Communicating openly and effectively with both the direct consumers and regulators during product reviews or recalls.

If retailers suspect a product they sell may be unsafe or non-compliant, swift action is essential. Under the ACL, the key steps to reduce risk, maintain compliance, and build stronger consumer trust include either:

1. Initiating a voluntary recall
   If a product is found to pose a risk to safety, or if it does not comply with a mandatory standard or product ban, the product may need to be recalled and the relevant Government Minister should be contacted within 2 days; or
2. Complying with mandatory reporting requirements for serious incidents
   If a business or retailer becomes aware of a serious injury, illness or death associated with a product they have sold or supplied, they must report it within 2 days.

It is worth noting that if your business also supplies goods or services in New Zealand, similar notification requirements will also apply. This includes promptly notifying the Ministry of Business, Innovation and Employment and other relevant regulators of any voluntary recalls. Such notifications should be made in good faith and with full transparency within two working days of the recall being made public to avoid attracting fines of up to $600,000.

Recent example: Retailers on notice after power bank recalls

The ACCC has recently raised concerns over a surge in power bank recalls, with over 34,000 units affected due to serious fire and burn hazards, most commonly occurring while the devices are charging.

Several well-known brands, including Anker and Cygnett, have been impacted with products recalled for overheating and fire risks. Not only do these incidents underscore the dangers associated with lithium-ion batteries, but it further reinforces the ACCC’s commitment to product safety compliance. The regulator has made it clear that safety failures, whether due to poor manufacturing, misuse, or lack of oversight, will be met with swift action.

Importantly, these recalls serve as a reminder that accountability extends across the supply chain and retailers, not just manufacturers, may be held responsible for unsafe products. Businesses must ensure they have robust safety checks and recall procedures in place to protect consumers and meet their obligations under Australian Consumer Law, and, if a product is identified as non-compliant, take swift action as required by law.

Key takeaways

Recent voluntary recalls underscore the critical need for retailers to maintain strong product compliance practices, in line with the mandatory safety standards.

To avoid the risk of significant fines and reputational harm, businesses and retailers should take proactive steps to strengthen their product safety compliance, including the following actions:

• Stay up to date with the mandatory safety standards, information standards, and recall notices to stay well informed and ahead of the game for any updates or changes to the way you do business or the products you sell.
• Implement regular and targeted compliance training which can be an important and cost-efficient way for businesses to ensure all employees understand their obligations.
• Conduct comprehensive audits of products and compliance operations to detect any potential safety issues and ensure all products are compliant within the key product safety guidelines before they are advertised for sale, or sold, to consumers.

 If you’re a manufacturer, retailer, or distributor, of regulated products and need guidance on your obligations under product safety standards, take the proactive approach and contact Mark Metzeling or Kelly Dickson of Macpherson Kelley’s IP, Trade & Technology team for assistance with:

• Annual educational seminars for your employees;
• Advice on which mandatory safety standards and information standards apply to your business;
• Assessing whether a recall is necessary;
• Assisting with conducting effective and compliant recalls; or
• Engaging with the ACCC to ensure regulatory alignment.

Macpherson Kelley has extensive experience in helping clients navigate these complex issues and are know how to reduce your regulatory burden while securing compliance, so you can focus on your successful business. Now that’s good thinking!

The information contained in this article is general in nature and cannot be relied on as legal advice nor does it create an engagement. Please contact one of our lawyers listed above for advice about your specific situation.