• 

Olive Products & Law (Aus) - Product Origin Labelling

The repercussions of advertising a product as "Australian Extra Virgin Olive Oil" when it contains imported product;

Division 1AA of the TPA prohibits misleading and deceptive conduct concerning the place of origin of goods. This applies to all form of representation both written and oral, including labelling, media, signs and brochures. The underlying policy on which the section is based is ensuring that the right of consumers to be accurately informed of the place of origin of the goods is addressed while preventing traders from taking advantage of consumers by misleading them as to the location or production of the goods. Labelling a product containing imported olive oil as "Australian Extra Virgin Olive Oil" would, prima facie, be a breach of this section.

There are two types of representations that can be made in respect of goods. These are "Country of Origin" claims (s.65AB) which concern the location in which the goods were manufactured or produced and "Product Of" claims which concern where the significant ingredient of the goods was produced. The Division 1AA guidelines found at http://www.accc.gov.au/ note that the latter type of claims are treated more stringently.

If the olive oil producer was representing through the terms " Australian Extra Virgin Olive Oil" that the olives were grown in Australian and that the oil was produced in Australia, the "Product of" criteria would apply but if it meant that imported olives were used to produce olive oil in Australia, the "Country of Origin" test might apply. In the absence of further information , I believe that the phrase "Product of" refers to the complete process of creating olive oil and that the "Product Of" test would apply as the term seems to refer to the essential ingredients and the manufacturing process.

In order for a manufacturer to be able to safely label their product as "Australian", each significant component (or ingredient) of the good must originate from and all, or virtually all, of the production processes must take place in Australia. Falling short of this criteria will potentially expose the manufacturer to liability.

In 1998, the ACCC commenced proceedings against Unilever for its marketing activities under the name of "John West". The allegations were that by

a). marketing tins of tuna labelled "Product of Australia" and "Product of Port Lincoln Tuna Processors Pty Ltd, Sth. Australia'' and
b). distributing advertising stating that the tuna was 90% "sourced from Port Lincoln" in South Australia and
c). broadcasting a series of television advertisements representing that "John West" tuna was caught from Port Lincoln

Unilever had breached section 53(eb) of the TPA. While the processing of the fish occurred entirely within Australia, between 5 and 15% of the tuna was caught in Australia, the remainder came from Thailand.

Unilever's advertising and broadcasting campaign was found to have breached the TPA as the words "sourced" and the implication of "caught" suggested the origin of the product rather than the manner in which it was processed. By labelling the tins with the term "product of… Processors" (emphasis added), however, implied that the processing occurred in Australia and was not misleading and deceptive conduct under the TPA.

By applying the ratio of this case it can be concluded that it would be acceptable to label a product "Extra Virgin Olive Oil processed in Australia" even when the olives contained in the product were not wholly or partly sourced from Australia. On the other hand, it might be misleading and deceptive to advertise a product as being "Australian Extra Virgin Olive Oil" when the olives were sourced externally as this phrase implies that the olives were sourced from within Australia when they were not.

This Update has been prepared for clients and professional associates of Baker & McKenzie. Whilst every effort has been made to ensure accuracy, this Update is not an exhaustive treatment of the areas of law discussed and no responsibility for any loss occasioned to any person acting or refraining from action as a result of material in this Update is accepted by Baker & McKenzie.