Amazon could be on the hook for a hefty fine over allegations the retail giant sold children's backpacks that fell foul of safety warning requirements.
Australia's consumer watchdog on Friday launched Federal Court proceedings against Amazon over the toddler backpacks that included a detachable light-up unicorn plush toy containing button batteries.
Required button battery warning labels were missing from the products or the plastic outer packaging, the Australian Competition and Consumer Commission alleges.
The watchdog claims the backpacks were in the possession or control of Amazon in its Australian fulfilment centres between June 22 and November 1, 2022.
Forty-one were purchased by local buyers through Amazon's Australian website and 267 in its centres as of November 1, 2022, it said.
Amazon took down the relevant product listing when the issue was raised by the watchdog and contacted buyers to warn of the danger, the commission's deputy chair Catriona Lowe said.
Button batteries are commonly used in toys and other household items such as keys, remote controls, calculators, musical greeting cards, watches and kitchen scales.
A 2024 University of Sydney-led review found severe injuries and complications can develop in fewer than six hours after a child swallows a button battery.
The consumer watchdog is not alleging that any children came to harm through the sale of the unicorn backpacks but noted the serious safety risks button batteries posed to young children.
"They can become stuck in a child's throat and result in serious life-long injuries or death," Ms Lowe told reporters in Melbourne on Friday.
"Children up to five years of age are at the greatest risk."
The consumer watchdog is seeking declarations, penalties, costs and other orders.
Ms Lowe said the maximum fine for corporations that breached Australian consumer law provisions was $50 million.
"The penalty that's awarded in the circumstances is a matter for the court to decide but we do consider that this is a very serious conduct and we will be seeking a penalty that reflects that view," she said.
It is the first Federal Court case brought by the commission against an online marketplace.
With Australians increasingly shopping online, the watchdog wants to use the case to set a precedent that Australian consumer law applies to online companies such as Amazon.
An Amazon spokesperson said the company was considering the case filed by the commission.
"Amazon is proud to be a founding signatory of the ACCC’s Online Product Safety Pledge, and we remain focused on providing the best experience for our Australian customers," they said.
"That includes continuing to work hard to ensure every product available in our store is safe and compliant with our policies and applicable regulations."
