Legal Services Directions 2017 [F2017L00369]-Further response required [2017] AUSStaCSDLM 185 (14 June 2017)

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Instrument	Competition and Consumer (Industry Code—Sugar) Regulations 2017 [F2017L00387]
Purpose	Prescribes a new mandatory Sugar Code of Conduct which regulates the conduct of growers, mill owners and marketers in relation to the supply of cane or the on-supply of sugar
Authorising legislation	Competition and Consumer Act 2010
Department	Treasury
Disallowance	15 sitting days after tabling (tabled Senate 9 May 2017) Notice of motion to disallow must be given by 16 August 2017
Scrutiny principle	Standing Order 23(3)(a)
Previously reported in	Delegated legislation monitor 5 of 2017

Consultation

The committee previously commented as follows:

Section 17 of the Legislation Act 2003 directs a rule-maker to be satisfied that appropriate consultation, as is reasonably practicable, has been undertaken in relation to a proposed instrument. The ES which must accompany an instrument is required to describe the nature of any consultation that has been carried out or,

if there has been no consultation, to explain why none was undertaken (paragraphs 15J(2)(d) and (e)).

With reference to these requirements, the committee notes that the ES for the Competition and Consumer (Industry Code—Sugar) Regulations 2017 [F2017L00387] (the sugar code) provides no information regarding consultation.

The committee's expectations in this regard are set out in the guideline on consultation contained in Appendix 1.

The committee further notes that the Prime Minister granted an exemption from the regulation impact statement (RIS) requirements for the sugar code 'because urgent and unforseen events arose requiring a decision before a RIS could be prepared.'^[1] The ES to the sugar code states:

The Prime Minister has granted an exemption from the need to complete a Regulation Impact Statement due to special circumstances. Urgent and unforeseen events have occurred in the export sugar industry. The stalemate in commercial negotiations between the parties has created significant uncertainty for regional families and the export sugar industry. The Government is taking immediate action in order to provide certainty regarding regulatory arrangements in the industry.
To ensure the Sugar Code of Conduct (the Code) operates efficiently and effectively as intended, the Regulations also require a review of the Code to take place within 18 months after its commencement.

The committee's guideline on consultation states:

It is also important to note that requirements regarding the preparation of a Regulation Impact Statement (RIS) are separate to the requirements of the Act in relation to consultation. This means that, although a RIS may not be required in relation to a certain instrument, the requirements of the Act regarding a description of the nature of consultation undertaken, or an explanation of why consultation has not occurred, must still be met.

The committee requests the advice of the minister in relation to this matter; and requests that the ES be updated in accordance with the requirements of the Legislation Act 2003.

Minister's response

The Treasurer advised:

With regards to consultation, unfortunately due to the events that warranted the Government's intervention in the raw sugar export industry, it was not reasonably practical for the Government to consult on the regulation. The Government started developing the regulations in February as a contingency should commercial negotiations fail; however consulting at that time was not appropriate as it would have undermined those negotiations. When it became clear that a commercial outcome was no longer a reasonable possibility, the Government considered the benefits of acting quickly to provide certainty for the industry outweighed the benefits of taking further time to consult before making the regulation.

Committee's response

The committee thanks the Treasurer for his response.

The committee notes the Treasurer's advice that consultation was not undertaken for the sugar code.

However, the committee's concern with consultation is to ensure that an ES is technically compliant with the requirements of the Legislation Act 2003, and thus in accordance with statute (scrutiny principle 23(3)(a)). The committee considers that an ES that does not contain a description of consultation (including in appropriate instances a description stating that consultation was not considered necessary) falls short of these requirements.

The committee requests the further advice of the Treasurer in relation to this matter; and reiterates its request that the ES be updated in accordance with the requirements of the Legislation Act 2003.

Paragraph 15J(2)(c) of the Legislation Act 2003 requires the ES for a legislative instrument that incorporates a document to contain a description of that document and indicate how it may be obtained.

The committee's expectations where a legislative instrument incorporates a document generally accord with the approach of the Senate Standing Committee for the Scrutiny of Bills, which has consistently drawn attention to legislation that incorporates documents not readily and freely available (i.e. without cost) to the public. Generally, the committee will be concerned where incorporated documents are not publicly and freely available, because persons interested in or affected by the law may have inadequate access to its terms.

With reference to the above, the committee notes that the sugar code incorporates the RIA Rules. However, the ES does not contain a description of this document,

or indicate how the document may be obtained.

In this instance, the committee notes that the RIA Rules are available for free online.^[2] Where an incorporated document is available for free online, the committee considers that a best-practice approach is for the ES to an instrument to provide details of the website where the document can be accessed.

The committee's expectations in this regard are set out in the guideline on incorporation contained in Appendix 1.

The committee draws the above to the minister's attention.

Minister's response

The Treasurer advised:

In compliance with section 14 of the Legislation Act 2003, the Resolution Institute Arbitration Rules 2016 (RIA Rules) are incorporated as in force
at the time of commencement. The rules are not a disallowable instrument and the Competition and Consumer Act 2010 does not alter the operation of section 14. As the Committee has noted, the RIA Rules are freely available online at https://www.resolution.institute/documents/item/ 1844.

Committee's response

The committee thanks the Treasurer for his response and has concluded its examination of the above.

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^[1] Australian Government, Department of Prime Minister and Cabinet, Prime Minister's exemption – Sugar Industry Code, 5^th April 2017, http://ris.pmc.gov.au/2017/04/05/prime-minister%E2%80%99s-exemption-%E2%80%93-sugar-industry-code (accessed 5 May 2017).

^[2] Resolution Institute, Current Arbitration Rules, https://www.resolution.institute/dispute-resolution/arbitration-rules (accessed 4 May 2017).