Source: Australian Ministers for Regional Development
The Federal Court today ordered Clorox Australia Pty Ltd (Clorox) to pay a total penalty of $8.25 million for making false or misleading representations to consumers that certain GLAD kitchen and garbage bags were partly made of recycled ‘ocean plastic’, following court action by the ACCC.
Clorox admitted that, between June 2021 and July 2023, it breached the Australian Consumer Law by representing on the packaging of its GLAD to be GREEN “50% Ocean Plastic Recycled” Kitchen Tidy Bags and Garbage Bags products that the products were made of at least 50 per cent recycled plastic waste collected from the ocean or sea, when this was not the case. More than 2.2 million products were supplied in this packaging over this period.
Rather, the products were made from about 50 per cent plastic waste which had been collected from communities in Indonesia with no formal waste management systems, situated up to 50 kilometres from a shoreline, and otherwise from non-recycled plastic, processing aid and dye.
“Claims about environmental benefits matter to many consumers and may impact their purchasing behaviour. When those claims are false or misleading, this is a serious breach of trust, as well as the Australian Consumer Law,” ACCC Chair Gina Cass-Gottlieb said.
“This is also a significant matter because consumers have limited or no ability to independently verify the accuracy of the claims made on packaging and it also disadvantages competitors who are accurately communicating their environmental credentials.”
“We consider this penalty is appropriate in this case where Clorox gave insufficient consideration to what ‘ocean plastic’ meant to an ordinary consumer, particularly in light of the blue colour and wave imaging on the packaging,” Ms Cass-Gottlieb said.
The Court held that these features “connoted a relationship between the Products and the ocean” and the “reference to ‘green’ on the Packaging connoted environmental-friendliness”, and that these were “important contextual matters in assessing the contravening conduct”.
It was also observed by the Court that “there is a particular societal harm that arises when conduct undermines consumers’ confidence in environmental claims”, adding that the “development of products that minimise adverse environmental impacts is beneficial” but “[e]nvironmental claims are useful for consumers only if they are accurate.”
Clorox was also ordered to set up an Australian Consumer Law compliance program, publish a corrective notice on its website, and pay part of the ACCC’s legal costs, among other orders.
“While the ACCC encourages businesses to innovate and offer environmentally sustainable products, businesses need to be clear and accurate when making representations about them. We take allegations of greenwashing extremely seriously and will continue to monitor claims made by businesses and, where appropriate, will take enforcement action on misleading environmental claims,” Ms Cass-Gottlieb said.
Clorox cooperated with the ACCC during its investigation and the legal proceedings, made admissions, and agreed to make joint submissions with the ACCC to the Court, including on the appropriate total penalty and other orders.
Clorox discontinued the products in July 2023, after it became aware the ACCC had started investigating, but before the ACCC commenced these proceedings.
Examples of the misleading packaging
Between June 2021 and about 13 November 2022, the packaging of Clorox’s small, medium, and large Kitchen Tidy Bags included the statements ‘50% Ocean Plastic Recycled Bags’, and ‘Made using 50% Ocean Plastic*’ around an image of a wave, overlaid on an image of a blue coloured waste disposal bag.
The back of the packaging carried the following statements in smaller font:
‘These bags are made from 50% ocean recycled plastic, and have the trusted strength of Glad® to hold household waste on its way to landfill. Recycling ocean bound plastic reduces plastic pollution before it enters the ocean, helping to reduce pollution in waterways, save marine life and put an end to irresponsible waste.’
‘*Made using 50% ocean bound plastic that is collected from communities with no formal waste management system within 50 km of the shore line.’
These statements were insufficient to dispel the false or misleading ocean plastic representation.
From about 6 March 2022, Clorox began updating the packaging to include the statement ‘Made using 50% Ocean Bound Plastic*’ on the front of the packaging.
Clorox also updated the statements, which appeared in small font on the back of the Kitchen Tidy Bags’ packaging as follows (changes in bold):
‘These bags are made from 50% ocean bound recycled plastic, and have the trusted strength of Glad® to hold household waste on its way to landfill. Recycling ocean bound plastic reduces plastic pollution before it enters the ocean, helping to reduce pollution in waterways, making the seas safer for marine life, and helping to put an end to irresponsible waste.’
‘*Made using 50% ocean bound recycled plastic that is collected from communities with no formal waste management system within 50 km of the shore line.’
These changes were insufficient to dispel the false or misleading ocean plastic representation.
Clorox discontinued the products in July 2023.
Garbage Bags
Between about May 2022 and July 2023, the packaging of its large and extra-large Garbage Bags included the statements ‘50% Ocean Plastic Recycled Garbage Bags’, and ‘Made using 50% Ocean Bound Plastic*’ around an image of a wave, overlaid on an image of a blue coloured waste disposal bag.
The back of the packaging also carried two statements in smaller font, which sought to qualify the ocean plastic representation:
‘These strong garbage bags are made from 50% ocean bound recycled plastic, and have the trusted strength of Glad® to hold waste on its way to landfill. Recycling ocean bound plastic reduces plastic pollution before it enters the ocean, helping to reduce pollution in waterways, making the seas safer for marine life, and helping to put an end to irresponsible waste.’
‘*Made using 50% ocean bound recycled plastic that is collected from communities with no formal waste management system within 50 km of the shore line.’
Again, this information was insufficient to dispel the false or misleading ocean plastic representation.
Background
Clorox supplies various consumer goods, including garbage bags and kitchen tidy bags, under the GLAD brand. The products subject to these proceedings were available in major retailers including Woolworths and Coles.
In April 2024, the ACCC instituted proceedings in the Federal Court against Clorox Australia Pty Limited.
In December 2023, the ACCC released its guidance on making environmental claims for businesses, which explains business’ obligations under the Australian Consumer Law when they make environmental and sustainability claims. It also sets out what the ACCC considers to be misleading conduct and good practice when making such claims, to help businesses provide clear, accurate and trustworthy information to consumers about the environmental performance of their business.