Australia's competition regulator today launched Federal Court proceedings against Amazon Commercial Services Pty Ltd, alleging the company held children's backpacks at its Australian fulfilment centres without mandatory button battery warning labels required under national product safety law. The case, filed on 29 May 2026 under case number NSD905/2026 in the New South Wales Registry of the Federal Court of Australia, is the first time the Australian Competition and Consumer Commission has taken an online marketplace before the Federal Court over alleged non-compliance with mandatory product safety standards.

The ACCC alleges Amazon AU possessed or had control of a product known as the "Unicorn Toddler Backpack" between 22 June 2022 and 1 November 2022 - the period the regulator designates as the Relevant Period - in contravention of section 136(3) of the Australian Consumer Law. The backpacks, designed for young children, included a detachable light-up unicorn plush toy containing button batteries. According to the ACCC's concise statement lodged with the court, the products were not accompanied by the prescribed warnings required under the Consumer Goods (Products Containing Button/Coin Batteries) Information Standard 2020.

What the case is about

The heart of the ACCC's legal argument concerns not whether Amazon listed the product or sold it directly, but whether the company's physical custody of the goods inside its fulfilment network makes it liable under Australian Consumer Law. This is a notable legal framing. Amazon was not the third-party seller of the Unicorn Backpacks. According to the concise statement, a seller registered under the name "Brokbridge" listed the product on amazon.com.au on 29 October 2021 and enrolled it in Fulfilment by Amazon (FBA) services.

Under FBA, third-party sellers ship inventory to Amazon-operated fulfilment centres in Australia. Amazon then stores the goods, picks, packs, and ships orders to consumers, manages customer inquiries, processes refunds, and handles returns. Sellers pay Amazon fees for each of these services, including storage fees. According to the concise statement, Amazon maintained exclusive possession of its fulfilment centres and kept records of all units received and dispatched.

The ACCC argues that this physical custody and exclusive control of the facilities means Amazon had "possession and/or control" of the Unicorn Backpacks for the purposes of section 136(3) of the Australian Consumer Law - a provision that prohibits a person, in trade or commerce, from possessing or controlling goods whose supply is prohibited because a mandatory information standard has not been met.

The product and the safety standard

A button battery - also called a coin battery - is defined in the concise statement as a small, single-cell battery with a diameter greater than its height. The Consumer Goods (Products Containing Button/Coin Batteries) Information Standard 2020 commenced on 22 June 2022, the same date that marks the start of the Relevant Period in the ACCC's case. Section 8 of the Information Standard requires prescribed warnings to be affixed to, attached to, or included with goods containing button batteries, depending on whether the goods are packaged.

According to the ACCC, the Unicorn Backpacks stored by Amazon AU during the Relevant Period were not accompanied by instructions and did not include warning labels as required by subsections 8(4), 8(5), 8(6) and 8(7) of the Information Standard. The products therefore did not comply with section 8 of the standard, and their supply was accordingly prohibited under the Australian Consumer Law.

Button batteries are considered particularly hazardous for children under five years of age. According to the ACCC, if swallowed or inserted into body parts such as the ears or nose, they can become lodged in a child's throat and cause severe internal burns, lifelong injuries, or death. The narrower oesophagus of young children and their tendency to place small objects in their mouths, ears, and noses makes them especially vulnerable.

A timeline of events

The concise statement sets out a detailed sequence of events. Brokbridge registered as a third-party seller on 15 January 2021. The Unicorn Backpack was listed on amazon.com.au on 29 October 2021 and registered for FBA services. Amazon began providing FBA services to Brokbridge for the product from 19 November 2021. Brokbridge also acquired optional FBA services including barcode labelling, meaning Amazon applied barcodes to individual units.

The product listing remained active on amazon.com.au from 29 October 2021 until 12 July 2022. According to the concise statement, Amazon removed the listing after the ACCC contacted the company on 11 July 2022 to raise potential safety risks associated with the Unicorn Backpacks. Despite the delisting, Amazon last shipped a Unicorn Backpack to a consumer on 22 July 2022 - ten days after the listing was removed.

The listing then reappeared briefly for a few hours on 20 October 2022, before being removed again pending a "bin check" - an internal Amazon process in which staff physically inspect existing inventory stored in its Australian fulfilment centres. That bin check took place on 1 November 2022, at which time Amazon determined the Unicorn Backpacks did not comply with the Information Standard.

The numbers at stake

According to the ACCC's media release, 41 backpacks were purchased by Australian consumers through amazon.com.au during the Relevant Period. As of 1 November 2022, 267 backpacks were held in Amazon's Australian fulfilment centres. The concise statement also notes that the ACCC itself purchased four units via the Amazon AU Online Marketplace on 6 July 2022 - purchases that likely formed part of the regulator's evidence-gathering process.

The ACCC is seeking declarations, financial penalties, costs, and other court orders. The specific penalty amounts have not yet been set, as that determination will be a matter for the Federal Court. Under the Australian Consumer Law, contraventions of mandatory information standards can attract significant financial penalties for corporations.

What makes this case different

According to the ACCC, this is the first Federal Court case the regulator has brought against an online marketplace specifically alleging non-compliance with mandatory product safety standards. The significance of that framing is hard to overstate. The case tests whether the operator of a fulfilment network - which physically stores, handles, and ships goods on behalf of third-party sellers - can be held liable for the safety compliance status of those goods under Australian law, even when a separate entity listed and sold them.

The ACCC's deputy chair, Catriona Lowe, addressed this framing directly. "Many Australian consumers now shop on online marketplaces. That's why it is important that consumers have confidence and trust in digital markets, and for the ACCC to take this action, the first of its kind to come before the Federal Court," Lowe said. She added: "Button batteries pose a serious hazard for young children. If swallowed or inserted, they can cause severe internal burns and injury, and in some cases death. These mandatory warnings are there to help keep children safe and businesses must get them right."

The ACCC's concise statement makes clear the legal theory: section 136(3) of the Australian Consumer Law applies to any person who, in trade or commerce, possesses or controls goods whose supply is prohibited. The ACCC's position is that this provision covers online marketplaces with physical possession of fulfilment inventory, in the same way it applies to other suppliers of goods.

Amazon's position in Australia

Amazon Commercial Services Pty Ltd is an Australian subsidiary of the US-based Amazon.com, Inc. It is listed as ACN 616 935 623. According to the ACCC's media release, Amazon AU is one of three signatories to the Australian Product Safety Pledge, a voluntary initiative under which participating companies commit to 12 product safety-related actions and report annually on their performance against preventative and corrective measures.

That voluntary commitment now sits alongside compulsory Federal Court proceedings - a juxtaposition that highlights the limits of self-regulatory frameworks when specific incidents come to light.

Regulatory context and priorities

The case lands within a broader enforcement agenda. The ACCC's 2026/2027 Compliance and Enforcement priorities, according to its media release, explicitly include unsafe products in digital markets and consumer product safety issues for young children, with a focus on button battery compliance.

The ACCC outlined its 2026-27 enforcement priorities in February, flagging unsafe consumer goods in digital markets as a core concern. ACCC Chair Gina Cass-Gottlieb stated at the time that the rise in unsafe consumer goods across digital channels, enabled by the scale of online marketplaces, fell within the regulator's priority scope. The Amazon case is one of the first concrete enforcement actions to flow from those stated priorities.

The ACCC has also been expanding its scrutiny of online marketplaces over several years, with its Digital Platform Services Inquiry identifying product safety as a concern alongside subscription traps, fake reviews, and pricing practices. The regulator has found that more than 50 percent of third-party suppliers on Amazon's US website are based in China, complicating enforcement of Australian consumer law protections. The commission concluded that five-year inquiry in March 2025, delivering 35 recommendations and noting persistent risks when online marketplaces fail to monitor product safety issues.

The ACCC has taken other digital-platform enforcement actions in recent months. It took JustAnswer to court in September 2025 over alleged subscription trap practices. That case, like this one, involves the question of how international digital businesses interact with Australian consumer protection obligations.

The FBA liability question

For the advertising and e-commerce marketing community, the legal theory at the centre of this case carries particular weight. The question of whether an online marketplace bears product safety liability for goods it physically stores and ships - as distinct from goods merely listed on its platform - has been debated in multiple jurisdictions.

This case focuses specifically on the FBA model, where Amazon exercises extensive operational control: it receives inventory, stores it in its own facilities, applies barcodes, picks orders, packs shipments, ships goods, and manages returns. The concise statement notes that Amazon had exclusive possession of its fulfilment centres and maintained records of every unit. Under that operational structure, the ACCC argues, the company cannot be treated simply as a passive intermediary.

Amazon has shifted increasing responsibility to third-party sellers across its marketplace infrastructure in recent years. A March 2025 FBA damaged inventory ownership policy change transferred liability for damaged units from Amazon to sellers. The Australian case pushes in a different direction: it seeks to establish that certain product safety obligations cannot be transferred away from the party with physical custody and operational control of the goods.

This matters beyond Australia. If the Federal Court accepts the ACCC's legal theory, the precedent would clarify - at least under Australian law - that FBA-style fulfilment services carry product safety compliance obligations for the operator of the network. That could have implications for how Amazon and similar marketplace operators structure their fulfilment agreements, conduct product inspections, and manage inventory acceptance processes going forward.

What the Information Standard requires

The Consumer Goods (Products Containing Button/Coin Batteries) Information Standard 2020 is part of a set of four mandatory standards covering button batteries and products containing them in Australia. The four standards collectively address how button batteries and products must be designed and tested to reduce the risk of children accessing them, as well as the warnings and safety information that must be provided.

Section 8 of the Information Standard, which is central to this case, specifies that prescribed warnings must be physically affixed to, attached to, or included with goods depending on whether they are packaged. According to the concise statement, the Unicorn Backpacks fell short across multiple subsections - 8(4), 8(5), 8(6) and 8(7) - meaning neither the product itself nor its outer plastic packaging bore the required warnings.

The Information Standard took effect on 22 June 2022. That date is significant: it marks the start of the Relevant Period in the ACCC's case. Prior to that date, the Information Standard was not yet in force. After it came into force, the Unicorn Backpacks stored in Amazon's fulfilment centres were non-compliant. The ACCC contacted Amazon on 11 July 2022 - less than three weeks after the standard commenced. The listing was removed the following day. Yet goods already held in the network remained there, and the last shipment occurred on 22 July 2022.

What happens next

The matter will proceed through the Federal Court of Australia, New South Wales Registry. The ACCC is seeking declarations, penalties, costs, and other orders. No findings of liability have been made - these are allegations at this stage.

According to the ACCC, it will not be uploading further court documents beyond the initial concise statement, even if that document is subsequently amended. The case was prepared by counsel Geoffrey Kozminsky and Gary Zhang, with AGS lawyer Jane Healy acting as solicitor for the ACCC.

For consumers who purchased the Unicorn Toddler Backpack or similar products containing button batteries, the ACCC advises that button batteries are dangerous if swallowed or inserted. If a child is suspected of swallowing or inserting a button battery, the ACCC advises calling Triple Zero (000) immediately if the child is having difficulty breathing, or calling the Poisons Information Centre on 13 11 26 at any hour for expert advice. The regulator explicitly warns not to wait for symptoms, not to let the child eat or drink, and not to induce vomiting.

Timeline

  • 15 January 2021 - Brokbridge registers as a third-party seller on amazon.com.au
  • 29 October 2021 - Brokbridge lists the Unicorn Backpack on amazon.com.au and registers it for FBA services
  • 19 November 2021 - Amazon begins providing FBA services to Brokbridge for the Unicorn Backpack, including optional barcode labelling
  • 22 June 2022 - Consumer Goods (Products Containing Button/Coin Batteries) Information Standard 2020 commences; Relevant Period begins
  • 6 July 2022 - ACCC purchases four units of the Unicorn Backpack via amazon.com.au as part of its investigation
  • 11 July 2022 - ACCC contacts Amazon AU to raise potential safety risks associated with the Unicorn Backpacks
  • 12 July 2022 - Amazon removes the Unicorn Backpack listing from amazon.com.au
  • 22 July 2022 - Amazon ships its last unit of the Unicorn Backpack to a consumer, ten days after delisting
  • 20 October 2022 - Unicorn Backpack listing briefly reappears on amazon.com.au for a few hours before being removed pending a bin check
  • 1 November 2022 - Amazon conducts a bin check; confirms Unicorn Backpacks do not comply with the Information Standard; Relevant Period ends; 267 units remain in Australian fulfilment centres
  • 19 February 2026 - ACCC outlines 2026-27 enforcement priorities, including unsafe products in digital markets and button battery compliance as a focus area
  • 29 May 2026 - ACCC files Federal Court proceedings (NSD905/2026) against Amazon Commercial Services Pty Ltd; first Federal Court case against an online marketplace over alleged non-compliance with mandatory product safety standards

Summary

Who: The Australian Competition and Consumer Commission (ACCC) as applicant, and Amazon Commercial Services Pty Ltd (Amazon AU, ACN 616 935 623) as respondent. The case involves a third-party seller registered as "Brokbridge" and was prepared by AGS lawyer Jane Healy, with counsel Geoffrey Kozminsky and Gary Zhang.

What: Federal Court proceedings alleging Amazon AU contravened section 136(3) of the Australian Consumer Law by possessing or controlling children's unicorn backpacks at its Australian FBA fulfilment centres without mandatory button battery warning labels required under the Consumer Goods (Products Containing Button/Coin Batteries) Information Standard 2020. The ACCC alleges 41 units were purchased by consumers and 267 units remained in Amazon's fulfilment centres at the end of the Relevant Period. The ACCC is seeking declarations, financial penalties, and costs.

When: The alleged contraventions occurred between 22 June 2022 and 1 November 2022. The Federal Court proceedings were filed today, 29 May 2026, with the case accepted for filing at 9:56 AM AEST.

Where: Amazon's Australian fulfilment centres. The case was filed in the New South Wales Registry of the Federal Court of Australia (case number NSD905/2026). The products were sold on amazon.com.au.

Why: The ACCC's case is that section 136(3) of the Australian Consumer Law applies to online marketplaces that physically store and ship goods via fulfilment networks, not only to traditional retailers. This is the first Federal Court action of its kind in Australia. The action reflects the ACCC's stated 2026-27 enforcement priorities around unsafe products in digital markets and child product safety - particularly button battery compliance, which the regulator has identified as a priority area given the potentially fatal hazard button batteries pose to children under five.

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