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Black & Decker Slammed By ACCC for The Second Time

By David Richards | Wednesday | 01/04/2009

Tools company Black and Decker is in strife with the Australian Competition and Consumer Commission after being nobbled twice for selling products as "Made in Australia" when in reality they were made in Germany and India.

In a statement issued last night the ACCC said "For the second time Black & Decker has supplied a sanding product incorrectly labelled as 'Made in Australia". The packaging on some of its Powerfile sanding belts were labelled 'Made in Australia' when in fact the belts were made in Germany.

The material to make the belts was originally sourced from Australia but was later sourced from Germany. Despite quality control processes put in place to resolve previous concerns raised by the Australian Competition and Consumer Commission, Black & Decker failed to detect the change to the sourcing of the materials used in the manufacture of the sanding belts.

ACCC Chairman, Mr Graeme Samuel, said traders need to continually ensure statements made about their goods are true and correct. "This vigilance is not a one off process but requires traders to be pro-active and to monitor and scrutinise statements about their products."

As well as promptly removing the belts from sale, Black & Decker (Australia) Pty Ltd will extend the court enforceable undertaking provided to the ACCC to resolve a similar matter in 2006.

The 2006 undertaking followed concerns that Black & Decker had engaged in conduct in breach of the Trade Practices Act 1974 by representing certain of its sanding sheets were 'Made in Australia' when in fact the sheets were made in India.

To address the concerns identified in connection with the supply of the Powerfile belts, Black & Decker has cooperated and given the ACCC a variation to the original undertaking that:

Extends the period of time (to 4 years) during which Black & Decker is to maintain and implement the trade practices compliance program requires Black & Decker undertake an audit of its domestic suppliers to identify the source (country of origin) of all of the materials used in the manufacture of the products that they supply to Black & Decker, and requires Black & Decker conduct a review of its compliance processes with respect to country of origin statements made on the products and implement all necessary changes.

The Trade Practices Act 1974 provides a test which allows goods to be represented as being made in a specified country. The two hurdles to pass that test are: "the goods have been substantially transformed in the country that is the subject of the claim, and 50 per cent or more of the cost of production or manufacture of the goods has occurred in that country."

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