Australia is one of the most attractive markets for premium consumer brands, and one of the most active when it comes to packaging sustainability. If you import products in custom boxes, bags or cartons, you need to understand how the Australian Packaging Covenant, the National Packaging Targets and the Australasian Recycling Label work, and how the government’s ongoing packaging reform could change your obligations.
This guide gives brand owners and buyers a practical overview. It is not legal advice; always confirm current requirements with APCO or a local compliance adviser before launch.
The Australian Packaging Covenant and APCO
The Australian Packaging Covenant is a co-regulatory agreement between government and industry designed to reduce the environmental impact of packaging. It is administered by the Australian Packaging Covenant Organisation (APCO).
Under the National Environment Protection (Used Packaging Materials) Measure, brand owners that sell packaged products in Australia with an annual turnover of AUD 5 million or more are generally expected to either become APCO members or comply with the equivalent state and territory regulations. In practice, most qualifying brands choose APCO membership.
What APCO Members Must Do
- Pay an annual membership fee based on turnover
- Submit an annual report on their packaging, typically through APCO’s Packaging Sustainability Framework
- Develop and implement a packaging action plan
- Assess packaging using tools such as the Packaging Recyclability Evaluation Portal (PREP)
Importantly, the obligation sits with the brand owner, not the overseas manufacturer. But your packaging supplier’s material choices and documentation directly affect how easy it is to report and improve.
The National Packaging Targets
Australia’s National Packaging Targets were set with a 2025 deadline and have shaped packaging design for years. The four targets are:
- 100% of packaging to be reusable, recyclable or compostable
- 70% of plastic packaging to be recycled or composted
- 50% average recycled content across packaging
- Phase-out of problematic and unnecessary single-use plastic packaging
Industry did not fully meet these targets by 2025, and that shortfall has been a major driver of the push toward mandatory rules. For paper-based packaging the practical implication is clear: designs that are fully paper-based, easy to separate and made with recycled or certified fiber are best placed for whatever comes next.
The Australasian Recycling Label (ARL)
The ARL is an on-pack label that tells consumers how to dispose of each component of the packaging: recyclable, conditionally recyclable, or not recyclable. It is run by Planet Ark, APCO and PREP Design.
Key points for brands:
- The label is based on a PREP assessment of your actual packaging design, so the result depends on materials, coatings, inks and components
- APCO members can use the ARL, and it has been widely adopted by major Australian retailers
- The ARL artwork must be placed correctly and at a legible size; include it in your die-line artwork from the start
For custom paper packaging, ARL outcomes are usually good for uncoated or water-based coated paperboard. Plastic lamination, metallized papers, magnets and mixed materials can complicate the result, so review your spec with your supplier before finalizing.
Packaging Reform: What Is Changing
Australian environment ministers have committed to reforming packaging regulation, moving from the largely voluntary covenant model to mandatory requirements. The federal government has consulted on options that include mandatory packaging design standards, requirements around recycled content, restrictions on chemicals of concern, and labeling obligations.
Details and timelines are still being developed, so brands should monitor announcements from the Department of Climate Change, Energy, the Environment and Water (DCCEEW) and APCO. What seems likely is that design for recyclability, reduced plastic and clear disposal labeling will become obligations rather than best practice.
How This Affects Custom Packaging Made in China or Vietnam
Choose Mono-Material Paper Structures Where Possible
A folding carton or rigid box made entirely of paper, with water-based inks and adhesives, is easier to classify as recyclable. Consider replacing plastic windows, PVC trays and foam inserts with paper or molded pulp alternatives. Our molded pulp packaging guide covers this option in detail.
Reconsider Laminations and Magnets
Plastic lamination and embedded magnets are common in premium rigid boxes. They do not automatically make packaging non-recyclable, but they can affect assessments. Ask about aqueous coatings, paper-based lamination alternatives or ribbon closures if your ARL result is a concern.
Use Certified and Recycled Fiber
FSC-certified board and papers, including recycled-content options, support both recycled-content reporting and responsible sourcing claims. Read our FSC-certified packaging guide to understand chain-of-custody documentation.
Request a Material Specification Sheet
For APCO reporting you need to know the weight and material of every component. Ask your manufacturer for a bill of materials listing board, paper, coating, ink type, adhesive, inserts and closures per unit. Caiye Packaging can provide this with your pre-production sample.
Plan the ARL Into Your Artwork
Add the ARL placeholder to your die-line early so it is not squeezed in at the end. Our die-line design service can position it for you.
Other Australian Requirements to Keep in Mind
- Biosecurity: Australia has strict import biosecurity rules. Paper packaging is generally low risk, but untreated wood components (for example wooden inserts or pallets) must meet treatment requirements.
- Consumer law: environmental claims such as “eco-friendly” or “100% recyclable” must be accurate and substantiated. The ACCC has been actively reviewing greenwashing.
- Country of origin: product labeling rules apply to certain goods, particularly food.
Practical Checklist for Brands Entering Australia
- Check whether your turnover triggers APCO membership
- Run a PREP assessment on your packaging design
- Minimize plastic components and mixed materials
- Request FSC-certified or recycled-content paperboard
- Collect a per-component material specification from your supplier
- Add the ARL to your artwork
- Keep evidence for every environmental claim on pack
- Monitor packaging reform updates from DCCEEW and APCO
Final Thoughts
Australia is moving toward stricter, mandatory packaging rules, and the brands that adapt early will avoid expensive redesigns later. Paper-based packaging is well placed, provided it is designed with recyclability in mind and supported by clear material documentation.
Caiye Packaging supplies FSC-certified custom packaging to brands in Australia, Europe, North America and the Middle East from our factories in China and Vietnam. Contact Harriet@dgcaiye.com to discuss a packaging specification that works for the Australian market.