03 April 2023

Many Australians will enjoy Australian seafood this Easter, but it should not come at the expense of proposed new country of origin labelling rules imposing a compliance nightmare for small and family businesses.  

The Australian Small Business and Family Enterprise Ombudsman, Bruce Billson, is calling for a common-sense approach to new labelling laws currently being considered.  

“Country-of-origin labelling for seafood in hospitality should be simple, useful and proportionate to the seller’s offering,” Mr Billson said.  

“While it is rightly intended to improve transparency for consumers and support Australian seafood producers, the proposal is onerous, costly and an unhelpful addition to the growing regulatory burden mounting on small and family businesses.”  

The federal Department of Industry, Science and Resources is consulting on the proposed model for mandatory country-of-origin labelling for hospitality businesses.   

Mr Billson called for the entire scheme to be reconsidered – given its high compliance costs – or failing that, to require only voluntary reporting where the seafood is a minor ingredient or a small proportion of the value of the offering.  

“An independent study, commissioned by the department and conducted in 2021 by Deloitte Access Economics, found that the business costs of compliance would outweigh the benefits to consumers,” Mr Billson said.  

“Many hospitality businesses who take pride in using local seafood already promote this to enhance their competitiveness, but a blanket requirement is not a sensible answer.”  

Under the current proposal, any seafood used in a dish will need to be listed on a menu as Australian, imported, or mixed. The proposal excludes ‘seafood by-products’, meaning anchovy paste will not require labelling, but anchovies on their own would.   

“This will be onerous for hospitality businesses to navigate and maintain compliance,” Mr Billson said.  

“When Australian seafood is sold out or not available, a small business may decide it does not want to disappoint customers so will temporarily source an imported product, yet this will require the costly step of reprinting new menus for every change.”  

Mr Billson also said many small businesses did not have the resources or capability to verify information from suppliers.  

“Small businesses cannot reasonably be expected to investigate external supply chains to ensure the authenticity of a supplier’s country of origin claims about its products,” he said.  

He suggested if the labelling requirement is enforced, there should be an additional category of ‘variable’ which could be used on menus in cases where there could be frequent change.  

“Allowing businesses to use a fourth label of ‘variable’ would remove the excessive cost of reprinting menus and avoid inadvertently attributing an incorrect or misleading country-of-origin label in these instances,” he said. “Businesses with discerning customers would no doubt make sure that they can respond to any questions they may be asked”.  

Mr Billson said it was also important to have easy to understand checklists and assistance for small businesses.   

The 2021 Census found that 56% of food and beverage service small business owners in Australia spoke a language other than English at home.  

“Many of our small businesses, particularly in the hospitality sector, are run by people who have moved to Australia from overseas and have made a wonderful contribution to the vibrancy of the community and vitality of the national economy,” Mr Billson said.  

“The stories of how migrants have created, and grown businesses are inspiring, as are the foods and tastes they have introduced that have enriched our nation.”  

Small businesses can go to the Department of Industry, Science and Resources website to lodge a submission.

MEDIA CONTACT: 0448 467 178