Clothing retailer Cotton On is being taken to court by the competition watchdog for selling children’s nightwear that allegedly breached product safety standards, sending a stark reminder to start-ups of their obligations under the Competition and Consumer Act.
The Australian Competition and Consumer Commission alleges that Cotton On sold children’s nightdresses and pyjamas that did not comply with the mandatory product safety standard for children’s nightwear.
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It’s alleged that between September 2010 and March 2011, Cotton On sold children’s nightgowns composed of fabric that exceeded the level of flammability allowed.
It’s also alleged that between October 2010 and March 2011, the retailer sold children’s pyjamas that had an attached appliqué with some unstitched fabric wider than the allowed amount.
Finally, the ACCC alleges that by offering the items for sale with a “low fire danger” label, Cotton On misrepresented the garments.
The ACCC is seeking five-year injunctions against Cotton On Kids and Cotton On Clothing selling children’s nightwear, unless they provide written evidence from an accredited person that the clothing complies with safety standards.
The ACCC is also seeking penalties for eight contraventions of competition regulations. The new Competition and Consumer Act carries penalties of up to $10 million for a body corporate.
The matter has been filed in the Federal Court’s Fast Track List and is listed for a scheduling conference in November.
Cotton On could not be reached for comment.
The news comes six months after the Federal Court imposed penalties totalling $400,000 against Dimmeys Stores for supplying children’s dressing gowns that also breached safety standards.
The Competition and Consumer Act 2010 has a section relating to prescribed consumer product safety standards, including a mandatory standard for the labelling of children’s nightwear.
“The children’s nightwear standard is extremely important because it concerns the safety of young children. Partial compliance is not an option for suppliers,” the ACCC said in a statement.
“It is imperative that suppliers have in place a compliance program, which incorporates appropriate procedures, to ensure that the products they supply comply with prescribed consumer product safety standards.”