Products that are labelled as ‘organic’ may be very appealing to consumers. They may also appeal to you, as a producer, because organic products often retail at a premium price. However, you should be careful if you label your products as organic. Under Australian law, some claims may be misleading or deceptive.

This article explains the requirements your products must meet if you would like to promote them as organic. 

Are My Products Organic?

It is legal to describe your product as organic without formal certification in Australia. However, you must ensure that any branding or claims you make are not false, misleading or deceptive. 

For example, you cannot describe a product or its ingredients as ‘certified organic’ unless the ingredients or products have been certified as such by an Australian certifier, such as Australian Certified Organic Pty Ltd.

Even if some of the ingredients in your products are organic, often not all ingredients are. In some cases, only a few minor ingredients will be organic. You should assess whether promoting your products as organic would mislead and deceive consumers by fooling them into thinking the product is entirely organic.

Whether your behaviour is misleading or deceptive depends on the surrounding circumstances and the overall impression that your products give your consumers. Your behaviour may be misleading or deceptive if it could trick people into buying something they otherwise would not. 

For example, if a consumer who usually only purchases products with 100% organic ingredients decides to purchase a product with artificial ingredients because the product label suggested that it was an ‘organic’ product, this may be misleading or deceptive.

As consumers cannot easily confirm for themselves whether a product labelled organic is really organic or not, the Australian Competition and Consumer Commission (ACCC) stresses that consumers should be able to trust the accuracy of product labels. Because of this, the ACCC requires that you are able to prove any claim you make about your products.

How Will the Court Decide Whether an Organic Claim Is Misleading?

The recent Federal Court of Australia decision of Aldi Foods Pty Ltd v Moroccanoil Israel Ltd [2018] FCAFC 93 (the Aldi case) created some clear guidance on the commercial use of terms such as ‘natural’ or ‘organic’.

In the Aldi case, the court considered the use of branding such as ‘naturals’ or ‘organics’. The case was about a range of products marketed as ‘Protane Naturals’. Unfortunately, the majority of the products’ ingredients were not, in fact, ‘natural’. 

The Aldi case provided some clarity about the factors a court will consider when determining whether an organic claim is misleading or deceptive. For example, some relevant factors include whether: 

  • the word ‘organic’ is part of the product name;
  • the word ‘organic’ has a prominent position on the label;
  • a substantial amount of the ingredients are organic or only a small amount;
  • the label uses the plural term ‘organics’ or the singular term ‘organic’; and
  • the products are sold in organic health stores or discount supermarkets. 

How Can I Avoid Misleading and Deceptive Conduct?

To avoid a claim of misleading and deceptive conduct relating to your ‘organic’ products, you should be sure to reserve the term for products that are wholly or substantially organic. 

You can still use the term organic without taking this step. However, you should take careful steps to comply with the law. For example, you may wish to:

  • write the word ‘organic’ in small print below your brand name;
  • use the plural ‘organics’ rather than ‘organic’;
  • ensure consumers are not purchasing the products at a premium price because of the organic branding; 
  • consider where you are selling the products;
  • Ensure that the remaining ingredients do not include synthetic chemicals;
  • clearly and prominently state the percentage of organic ingredients; and
  • use clear and prominent disclaimers on your labels wherever necessary to avoid misleading consumers as to the product contents.

Key Takeaways

Marketing your products as organic can be a very effective selling point. Consumers are often willing to pay a premium for these products. Because of the value many consumers attribute to the ‘organic’ label, you must not mislead them about your products. Before you market your products as organic, it is best to ensure that they are completely or mostly organic. If that is not possible, you should take careful precautions to minimise the risk of facing legal claims of misleading and deceptive conduct. If you need assistance with making organic claims, contact LegalVision’s Regulatory and Compliance lawyers on 1300 544 755 or fill out the form on this page.

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