The Chicken or the Egg: ACCC decides


The ACCC has recently weighed in on the eternal question of which came first: the chicken or the free range, barn laid or cage egg. In a move that will have hens the country over clucking with approval, the ACCC has elected to veto a certification trade mark application filed by the Australian Egg Corporation Limited (AECL).

Following a range of submissions made to the ACCC, the body was of the view that AECL’s proposed standards may mislead consumers about the nature of eggs described as ‘free range’. As a consequence, AECL moved to withdraw its certification trade mark application, which was formally advertised as withdrawn 24 January 2013.

This brings to a close a saga that started 22 October 2010, when the AECL filed the certification trade mark application with the Registrar of Trade Marks at IP Australia. AECL sought in this case to bring about a Quality Assurance program for the Australian egg industry, essentially benchmarking some of the standard terms relating to store-bought eggs, and in particular the term "free range".

A certification trade mark (CTM) indicates to consumers that a product or service meets a particular standard. For example, a CTM might indicate that a product:

  • is of a particular quality
  • has been manufactured in a particular location or by using a particular process
  • is made from particular materials or ingredients
  • is suited to a particular task.

ACCC consideration and approval is required before certification trade mark applications can be registered under the Trade Marks Act.

AECL's certification trade mark application was always bound to be controversial and so it proved - the ACCC received a broad range of submissions relating to the proposed guidelines accompanying the certification trade mark application. The weight of opinion was that AECL's proposed standards did not accord with consumer expectations about the free range production of eggs. As one might expect, consumer expectations can diverge quite widely from actual commercial farming practices - with the result that the ACCC decided that it could not back AECL's application. 

The AECL has announced that it intends to review the matter, and press its case with a revised application in time, once it has thoroughly reviewed its position.

by David Perkins