More than 121,000 "clothing and manchester" items using the chemical had been recalled by various retailers around Australia after they were found to be tainted with a carcinogenic dye that's banned in Europe and has restricted use in the US.
The use of azo dye, which can form carcinogenic chemicals which break down and can be absorbed through the skin, is legal in Australia, although from June 1 will be classified as a dangerous poison in the same category as cyanide, strychnine and arsenic.
The ACCC said more than 121,000 "clothing and manchester" items using the chemical had been recalled by various retailers.
The consumer watchdog said had it negotiated a total of eight recalls, comprising 28 product lines from impacted suppliers.