Consumers are entitled to expect that the products they purchase are safe.
This article sets out when a voluntary recall may be required, outlines your obligations during a recall and provides steps to minimise the risk of having to recall your products.
When is a recall needed?
Your business should recall a consumer product if you become aware that:
- using the product presents a risk of injury to a person
- using or misusing the product in a reasonably foreseeable way may injure a person
- it is likely the product does not comply with mandatory safety standards applicable under the Australian Consumer Law (ACL)
- there is an interim or permanent ban in force in relation to the product.
The recall process: what do you need to do?
To the extent possible, these actions should be taken simultaneously, but generally speaking, if you decide to proceed with a recall, the necessary steps are as follows:
1. Conduct investigations to identify all potentially affected products and the size and urgency of the recall and to assess the risk posed to consumers – this should involve preparing a recall plan.
2. Submit a recall notification to the ACCC (on behalf of the responsible Commonwealth Minister) within two days of taking recall action – this notification should include information such as contact details, product details, reasons for the recall and the type of compensation being offered to consumers.
3. Activate your recall plan and conduct the recall – this involves communicating the recall through appropriate public channels; tracking, reviewing and reporting progress; adjusting the recall to ensure effectiveness; and finalising the recall, including by offering suitable remedies.
You also have an obligation to submit a mandatory report of any death, serious injury or serious illness arising in connection with a consumer good or service supplied by you within two days, irrespective of whether you take recall action.
Consequences of not taking recall action
Prompt action is likely to make a recall process cheaper and more effective, as it helps minimise the risk of loss or damage. Delaying or resisting recall action could lead to a Minister-ordered compulsory recall, over which your business will have much less control.
There are penalties for failing to submit mandatory reports or notifications relating to recall action within prescribed time frames.
Taking preventative action
To minimise the risk of needing to conduct voluntarily recall products and endangering your consumers, businesses should:
- be aware of mandatory or industry standards
- implement quality assurance procedures
- regularly review product quality, production and design
- market products honestly, including relevant safety warnings
- provide clear and thorough user instructions
- stay up to date with product bans.
Conclusion
If you are considering a recall or would like detailed advice on the preparation of a recall plan or recall notification, please contact David Grace, Adelaide Hayes or Lochlann Woodall.
