The impact COVID19 has had on the economy may seem a bit doom and gloom. However an optimistic view is that more Aussies are now actively pursuing ‘Australian Made’ products and services.
It’s no secret that Aussies love a bargain. But this money saving attitude has often translated into purchase behaviour that favours price over anything else. However, the economic struggle we are currently facing has pushed many of us to think beyond the cost.
In order to support Australia, it seems we are becoming a little more patriotic in our purchasing decisions. However, finding out if a product is “Australian Made” or “Australian Owned” is complex.
The complexity of classification
It’s tricky for many reasons. Predominantly, it’s due to the fact there is no single definition of what ‘Australian products’ really are.
- Is a product made by an Aussie, in Australia, for a US-owned company, an Australian product?
- Is a product owned by an Aussie company, manufactured in China, with Spanish ingredients, Australian?
- What about a product made from Japanese ingredients, manufactured in Australia, owned by a Swedish company?
See, this is complicated.
I can hear the resounding response as I write this.
“Don’t you just look for the green triangle logo with the yellow kangaroo?”
The AMAG Logo; what does it mean?
The logo you’re thinking of is the Australian Made, Australian Grown (AMAG) logo, created by the not-for-profit Australian Made Campaign Ltd (AMCL),
Any business, Australian or foreign, can pay AMCL an annual fee for the right to use one of their five logos on products.
According to ACML, “The famous Australian Made, Australian Grown (AMAG) logo is the true mark of Aussie authenticity. It’s Australia’s most trusted, recognised and widely used country of origin symbol, and is underpinned by a third-party accreditation system, which ensures products that carry the logo are certified as ‘genuinely Australian’.”
I agree with two parts of this statement. Yes, it is the most trusted, recognised and widely used country of origin symbol, underpinned by a third-part accreditation system.
However, stating that these logos are the “true mark of Aussie authenticity” is problematic. As is claiming that these logos ensure products that carry the logo are certified as ‘genuinely Australian’.
What are ‘genuinely Australian’ products
As a naturally curious person, I enjoy diving deep into complex economics topics, code of practice documents and legislation. So, I looked at the AMAG Code of Practice, to see how ‘genuinely Australian’ the products and services paying for the use of this logo are.
I now disagree with their definition of ‘genuinely Australian’ for three main reasons:
1. Why can you buy authenticity?
The financial obligation is something that I believe allows for discrimination, particularly against smaller companies and bootstrapped startups. Those just starting out need to use their capital to pay for operating expenses, and may not be able to afford the $300 per year.
This is especially true for businesses who choose to pay a premium for Australian ingredients, suppliers and business services.
2. Ownership is overlooked
ACML state on their website that businesses can choose to include ‘and owned’ on the logo they have paid for. But there’s only one mention of Australian owned on their website.
Why doesn’t a product have to be owned by an Aussie company to be ‘genuinely Australian’?
In their Code of Practice. they don’t mention the alteration to the logo. In fact, no rules about Australian owned certification are mentioned.
What counted as Australian owned, was it 1%, 40%, 100%?
I have left a message with ACML asking why there are no rules around this inclusion, but have yet to receive a call back.
The only thing I could see that might reflect certification of the “& owned” was the statement that the product must have the ‘relevant country of origin claim’.
The Australian Competition and Consumer Commission (ACCC) website states that representations must be clear, truthful and accurate. But how can a company 1% Australian owned still count as ‘Australian owned?’
3. Compliance criteria is less than expected
According to the ACML “Australian” products and services come in many different forms.
In Rule 18 of the Code of Practice, the compliance criteria is outlined in detail, but none of these different forms include their ownership status.
What classifies as Australian Made?
For a business to show the logo, over 50% of the manufacturing cost must be attributed to processes in Australia. These products must also be “substantially transformed” in Australia.
According to the Competition and Consumer Amendment (Country of Origin) Bill 2016:
“Goods are considered ‘substantially transformed’ in a country if they undergo a ‘fundamental change in that country in form, appearance or nature such that the goods existing after the change are new and different goods from those existing before the change.”
That means even if most of the production occurred overseas, and the company is 100% owned by a foreign country, it can still be “Australian Made.”
As long as 50.00001% of the cost was in Australia, you are ‘genuinely Australian’ according to AMCL and can display the Australian Made logo.
Why is ownership important?
Australian Made products can create jobs in our country, and their importance should not be disregarded. However, the value of Australian ownership when our economy is struggling is second to none.
Supporting local industry also provides employment for Australians, and as the profits of Australian owned companies remain in Australia, it helps boost our economy and better the future of our country.
Without our knowledge, foreign owned products and services flood our supermarket shelves, boasting the Australian Made logo. As we purchase these products, we think we are supporting the Australian economy, however most of the time we are investing our money in foreign multinational corporations and overseas parent companies.
The COVID19 lockdown has provided us with an opportunity to learn. To look deeper into why things are the way they are, and what is actually going on around us.
A better idea would be for the government to create their own Australian ownership certification process. A free certification process to allow Australian owned businesses to proudly boast their ownership status, and help communities support local.