Onus of risk on faulty goods
SMALL businesses can now easily become importers. You can import a container of widgets and sell them through an e- commerce website using off- the- shelf templates and easy- to- use purchase and distribution platforms.
You are then an importer under the Australian Consumer Law.
The ACL deems importers to be the manufacturer of the goods in some circumstances.
Importers may be liable for defects in the goods they import, as if they were the actual manufacturer, for example where the manufacturer does not have an office in Australia or the importer applies their own branding to the product.
As a rule, the importer is responsible for product safety and liability issues and exposed to claims resulting from defects in the goods it sells.
Liability arises also for those who sell “consumer goods” that are intended or likely to be used for personal, domestic or household use or consumption.
All goods and services you sell, hire or lease in Australia to “consumers” ( as defined in the ACL) are deemed to be covered by a warranty that the goods are free from defect and fit for their intended purpose.
You cannot exclude that warranty in your terms of contract with your customers.
Claims under this deemed warranty can be passed back up the chain of supply.
If you are required to replace defective goods under the ACL warranty, you can claim that cost back from the wholesaler who supplied them to you.
The wholesaler can claim from the importer. The importer can claim from the manufacturer. However, enforcing those rights may be problematic or impossible where the manufacturer is located overseas or can hurt your business by not supplying to you.
If you acquire goods from overseas and then sell them, you need to be aware of the risks to your business in the event those goods are faulty.
You should take steps to minimise your personal exposure, in the event something goes wrong with goods you import and sell. SHARES in ride share and taxi fleet management company P2P Transport have fallen sharply after the company warned of a drop in earnings due to higher costs and lower revenue.
P2P says earnings for 201718 are now expected to be between $ 10.1 million and $ 11.1 million, down from its prospectus forecast of $ 12.7 million. The company said the cost of increasing its fleet beyond prospectus forecasts