SUBMISSION ON THE AUSTRALIAN EGG CORPORATION LIMITED CERTIFICATION TRADE MARK APPLICATION NO

SUBMISSION ON THE AUSTRALIAN EGG CORPORATION LIMITED CERTIFICATION TRADE MARK APPLICATION NO. 1390450 21 June 2012 Voiceless Limited ACN 108 494 631 2 Paddington Street Paddington NSW 2021 P +61 2 9357 0777 F+61 2 9357 0711 Disclaimer: Voiceless Limited ACN 108 494 631 ( Voiceless ) is a company limited by guarantee. Voiceless is not a legal practice and does not give legal advice to individuals or organisations. While Voiceless makes every effort to ensure the accuracy of information presented on its behalf, Voiceless does not guarantee the accuracy or completeness of that information. Information is provided by Voiceless as general information only and any use of or reliance on it should only be undertaken on a strictly voluntary basis after an independent review by a qualified legal practitioner (or other expert). Voiceless is not responsible for, and disclaims all liability for, any loss or damage arising out of the use of or reliance on information it provides. To learn more about Voiceless, please visit http://www.voiceless.org.au Voiceless envisions a world in which animals are treated with respect and compassion

ABOUT VOICELESS As an innovator, capacity builder and ideas-generator, Voiceless plays a leading role in the development of a cutting edge social justice movement, animal protection. With a highly professional and well-educated team, Voiceless brings together like-minded compassionate Australians from the legal, academic, non-profit and education sectors to form strong and effective networks. Voiceless believes in the provision of quality information, analysis and resources to inspire debate and discussion and to empower individuals and organisations to generate positive social change. Voiceless is a non-profit Australian organisation established in May 2004 by father and daughter team Brian and Ondine Sherman. To build and fortify the animal protection movement, Voiceless: Creates and fosters networks of leading lawyers, politicians, businesspeople and academics to influence law, policy, business and public opinion; Conducts high quality research and analysis of animal industries, exposing legalised cruelty and promoting informed debate; Creates a groundswell for social change by building and fortifying the Australian animal protection movement with select grants and prizes; Grows animal law as a mainstream practice area to advocate for change in the courts and in legislation; and Informs consumers and empowers them to make animal-friendly choices. PATRONS J.M. COETZEE, Nobel Prize for Literature Winner 2003, author of 'Lives of Animals' and 'Elizabeth Costello' BRIAN SHERMAN AM, businessman and philanthropist DR JANE GOODALL, world-renowned primatologist and animal advocate THE HON MICHAEL KIRBY AC CMG, former justice of the High Court of Australia AMBASSADORS HUGO WEAVING, Actor Last Ride, Little Fish, Lord of the Rings Trilogy, Matrix Trilogy, The Adventures of Priscilla Queen of the Desert, Oranges and Sunshine EMILY BARCLAY, Actor Prime Mover, Piece of my Heart, Suburban Mayhem, In My Father s Den ABBIE CORNISH, Actor Bright Star, Stop Loss, Elizabeth: The Golden Age, Somersault, Candy, A Good Year, Suckerpunch, Limitless For further information visit http://www.voiceless.org.au All correspondence in relation to this submission should be directed to: Ms Ruth Hatten, Legal Counsel Voiceless 2 Paddington Street Paddington NSW 2021 AUSTRALIA T: + 612 9357 0777 F: + 612 9357 0711 e.mail: ruth@voiceless.org.au 21 June 2012

1 Introduction 1.1 The Australian Competition and Consumer Commission (ACCC) has called for public comment on the Australian Egg Corporation Limited Certification Trade Mark Application No. 1390450 (AECL Application). 1.2 In order to certify the Certification Trade Mark (CTM), the ACCC must be satisfied that the CTM application and corresponding rules meet the technical requirements set by the Trade Marks Act 1995 (TMA) and do not raise consumer protection, competition or associated concerns. Specifically, the ACCC must be satisfied that: (a) (b) the technical requirements of the rules as set out in section 173 of the TMA have been met; the rules governing the use of the CTM: would not be to the detriment of the public (the public detriment test); and would be satisfactory having regard to the principles relating to restrictive trade practices in Part IV of the Competition and Consumer Act 2010 and the principles relating to unconscionable conduct (Part 2-2), unfair practices (Part 3-1), and safety of consumer goods and product related services (Part 3-3) in Schedule 2 (Australian Consumer Law) of the Competition and Consumer Act 2010 (the trade practices test) as provided for by section 175 of the TMA. 1.3 The AECL Application sets out rules and standards for the production method of eggs (standards). The fundamental elements of the standards are to: (a) (b) (c) (d) allow a maximum stocking density of up to 2 hens per square metre (20,000 hens per hectare); keep young hens locked in sheds until they are about 25 weeks old (even though they usually start laying at 16-20 weeks of age); have no restrictions on the beak trimming of hens; and keep the hens locked up if the weather is too hot, too windy, too wet or in any other way 'adverse'. 1.4 If these standards are approved, there will be serious consequences for consumer protection, especially in respect of unfair practices (Part 3.1 of the Australian Consumer Law), likely misuse of market power (Part IV of the Competition and Consumer Act) resulting in unfair competition within the egg Page 1

production industry and issues of animal welfare. As a consequence of these matters, there will be an overall detriment to the public. 2 Consumer protection 2.1 Consumers are becoming increasingly concerned with issues surrounding the use of terms such as free range. This concern arises due to the absence of a legal definition of such a term. As far as the term free range is concerned, we have as guidance: (a) the Model Code of Practice for the Welfare of Animals: Domestic Poultry, which provides: (iii) (iv) (v) a Maximum Acceptable Live Weight Densities for Free-Range Birds of 1,500 layer hens per hectare (Appendix 2, paragraph A2.1.4). This maximum stocking density is disputed by AECL in its Fact Sheet on free range outdoor stocking densities but to refute this, we repeat and rely upon the opinion of barrister and chair of the Barristers Animal Welfare Panel, Graeme McEwen. 1 However, it is interesting to note that in 2007, AECL acknowledged that the Model Code recommended that a free range area should not have a stocking density in excess of 1,500 hens per hectare 2 ; a prohibition on beak trimming unless other methods of addressing feather pecking and cannibalism problems have been tried and failed, such as appropriate selection of more docile strains of laying hens, reducing stocking density, better lighting management and feed control (paragraph 12.5); hens, once fully feathered, must be allowed access to the outdoor range during daylight hours for a minimum of eight hours per day (paragraph 2.4.5.3); hens must have ready access to shaded areas and shelter from rain, and windbreaks should be provided in exposed areas (paragraph 2.4.5.4); every reasonable effort must be made to provide protection from predators (paragraph 2.4.5.5); (b) the Free Range Farmers Association Standards which provide: 1 Memorandum to Lisa Baker MP, 7 May 2012 2 Australian Egg Corporation Limited, Environmental Guidelines for the Australian Egg Industry (June 2008) 16. Page 2

(iii) (iv) the maximum stocking must be sustainable and in any case not exceed 750 hens per hectare (Part C, paragraph 1); hens must have unrestricted access to the free range run during daylight hours (Part C, paragraph 2); the area where the hens are permitted to range shall have adequate shade/wind/predator protection and be capable of longterm sustainability with adequate natural ground cover (Part C, paragraph 3); and all bird mutilation practices are unnecessary at the allowed stocking densities and are prohibited (Beak trimming, etc) (Part D, paragraph 1); (c) the RSPCA Approved Farming Scheme Standards for Layer Hens which provide: (iii) (iv) (v) a maximum of 1500 birds per hectare of range area to be available to birds in outdoor systems with no rotational range management strategies in place (i.e. a fixed range area) (paragraph 4.6). a maximum of 2500 birds per hectare of range area to be available to birds in outdoor systems with rotational range access, where it can be demonstrated that birds access a well-maintained sustainable range area (paragraph 4.7). beak trimming must only occur where all other methods of preventing feather pecking have failed (paragraph 5.13) all birds must have access to the range for a minimum of 8 hours per day once they are reasonably feathered, except during extreme weather conditions or under veterinary advice (paragraph 3.31); and adequate and appropriately distributed shelter to protect from extreme weather conditions and from predators (paragraph 3.33); and (d) the Australian Certified Organic Standard which provides: as a guide, maximum outdoor stocking rates should not exceed 1000 birds per hectare for egg production (paragraph 5.2.23); all birds shall have access to pastured areas during the substantial majority of daylight hours (paragraph 5.2.21); Page 3

(iii) (iv) (v) sufficient shade and adequate water and feed shall be maintained in areas where birds are foraging (paragraph 5.2.24); adequate protection from predators shall be provided for birds. This shall include adequate natural cover (trees, cover crops) such that birds are protected both from overhead predators as well as extreme weather conditions (paragraph 5.2.28); and practices such as systematic de-beaking as well as the use of poly peepers are prohibited (paragraph 5.2.27. 2.2 A maximum stocking density of 20,000 hens per hectare as proposed by AECL far exceeds the current standards for free range hens, as shown above. The Model Code is considered to be the base standard for free range hens, which sets a maximum stocking density of 1,500 hens per hectare. Further, the Model Code has been adopted into legislation by Queensland and is currently being considered for adoption in New South Wales and South Australia. A standard which permits an absurdly higher standard as the AECL standard does, will be in complete opposition to the Model Code and will only create further confusion for consumers. 2.3 Recent studies have shown that purchasing of free range eggs has increased. In the year 2010/11 free range eggs made up 28.4% of the national market in volume and 40.7% of the value. 3 However there exists concern over whether all of the free range eggs are genuine free range eggs. In 2007, the NSW Food Authority admitted that eggs that are from caged hens were being sold to consumers as free range. It is believed that during 2006/2007, there were not enough free range flocks in Australia to produce the number of free range eggs that were being sold on the market. 4 This highlights concerns with the labelling of eggs as free range when they re not genuine free range. This problem arises in part due to the absence of a legal definition of free range. Setting a higher stocking density, as AECL intends on doing, will not resolve the issue, it will simply make matters worse. Consumers who buy eggs compliant with AECL standards will not be buying genuine free range eggs. 2.4 In a survey conducted by Choice earlier this year, 60% of respondents said when buying eggs, it was essential that they be free range. Interestingly, less than 1% of those respondents think that AECL s new standard meets their expectations of what free range means 5 and the RSPCA has stated that the 3 Greens NSW, Free-range facts (May 2012) <http://johnkaye.org.au/greens-truth-in-labelling-free-range-eggs-billhas-successfully-passed-the-nsw-upper-house>. 4 Ibid. 5 CHOICE, CHOICE Survey on Consumer Expectations of Free Range Egg Labelling Key Findings Report - May 2012 2. Page 4

AECL s new standard does not meet animal welfare standards or consumer expectations. 6 3 Likely misuse of market power 3.1 Should the AECL Application be approved, there will likely be unfair competition between businesses that are producing genuine free range eggs and those that produce eggs in accordance with the AECL standards. AECL represents about 400 egg producers nationally, with its biggest members being large corporate producers. In fact, the AECL board consists primarily of managing directors of the biggest egg production companies in the country. 7 One could therefore reasonably assume that actions of AECL are those that will benefit the biggest producers, such as Sunny Queen Eggs and Pace Farms. Taking these two producers as an example, they predominantly produce cage eggs but also have free range egg lines. With a new stocking density of 20,000 hens per hectare, companies such as these will be able to increase their free range egg lines and obtain the financial benefits of doing so without needing to produce genuine free range eggs. 3.2 These actions must be questioned. Genuine free range egg producers are quite small compared to the corporate producers. Such a high stocking density will unfairly put the large corporate producers at a distinct advantage, likely resulting in unfair competition between genuine free range egg producers and those falsely holding themselves out to be. Such unfair competition could result in genuine free range egg producers going out of business and the loss of a product that meets consumer expectations. Misuse of market power is likely and Voiceless urges the ACCC to err on the side of caution in this regard. 4 Issues of animal welfare 4.1 Animal welfare has been established as the main reason why consumers choose to purchase free range products. 8 Consumers want to be assured that hens are never confined in cages, that hens have access to pasture and that they have more space. A stocking density of 20,000 hens per hectare does not satisfy the consumer expectation that free range equals more space. This is especially so where high stocking densities can result in social stress and increased levels of aggression, displayed by way of feather pecking and cannibalism, 9 due to competition for space. 6 Sue Neales, RSPCA Steps into free-range egg row, The Australian, 16 May 2012 <http://www.theaustralian.com.au/news/nation/rspca-steps-into-free-range-egg-row/story-e6frg6nf- 1226356715868>. 7 Australian Egg Corporation Limited, Annual Report 2010-2011, 7-8. 8 Above note 5, 1. 9 T.A.D. Nagle and P.C. Glatz, Free Range Hens Use the Range More When the Outdoor Environment is Enriched (2012) Asian-Australian Journal of Animal Science, 589. Page 5

4.2 While animal welfare is not a determining factor for the ACCC approving the AECL Application, it is relevant when considering consumer protection. This is so in circumstances where consumers hold expectations of buying eggs that are genuinely free range. 5 Overall detriment to the public 5.1 As shown above, consumers are increasingly concerned about issues of animal welfare and are consequently purchasing products that are produced using free range methods. Consumer awareness of genuine free range products is quite lacking due to confusion that surrounds whether a product is genuinely produced using free range methods. If the ACCC decides to approve the AECL Application, further confusion will exist as to what is a genuine free range egg. Consumer expectations of free range eggs will not be satisfied and as such, there will be detriment to the public. 5.2 In addition to the matters stated above, there must also be consideration of the environmental impact of stocking 20,000 hens per hectare, especially in respect of the sheer volume of manure that will be produced each day. Environmental damage will also be detrimental to the public. 6 Summary 6.1 In closing, it is Voiceless s opinion that the ACCC must refuse the AECL Application. Concerns exist as to consumer protection, likely misuse of market power and an overall detriment to the public should the AECL standards be allowed. Voiceless also has serious concern about AECL making critical decisions which impact animal welfare, the environment and consumer rights when their primary, if not only, concern is producer profit. Respectfully submitted by Ruth Hatten, Legal Counsel, Voiceless Page 6