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Australian Senate Standing Committee for the Scrutiny of Bills - Scrutiny Digests |
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Purpose
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This bill seeks to amend the e Ozone Protection and Synthetic Greenhouse
Gas Management Act 1989 to improve the effectiveness and efficiency of the
Ozone Protection and Synthetic Greenhouse Gas Program in order to reduce the
burden
on business, streamline and reduce the complexity of the Act, and ensure
the Program can continue to achieve important environmental
outcomes.
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Portfolio
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Climate Change, Energy, the Environment and Water
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Introduced
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House of Representative on 28 September 2022
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1.169 The Ozone Protection and Synthetic Greenhouse Gas Management Amendment (Miscellaneous Measures) Bill 2021 (the 2021 Bill) was introduced in the House of Representatives on 2 December 2021 and lapsed at the dissolution of the previous Parliament. The committee raised scrutiny concerns in relation to the earlier bill in Scrutiny Digest 1 of 2022 and Scrutiny Digest 2 of 2022.[124] The provisions identified below in relation to the Ozone Protection and Synthetic Greenhouse Gas Management Reform (Closing the Hole in the Ozone Layer) Bill 2022 (the 2022 Bill) are almost identical to the provisions which the committee was concerned with in relation to the earlier bill.
1.170 The 2022 Bill seeks to establish several defences which reverse the evidential burden of proof. Proposed subsection 13(1) provides that it is an offence if a person manufactures a scheduled substance and the person does not hold a licence that allows the manufacture. Proposed subsections 13(2), (4), and (6) of the 2022 Bill provide offence-specific defences to this offence to the effect that the offence does not apply to a person in a circumstance prescribed by the regulations.
1.171 Similarly, proposed subsection 13AA(1) provides that it is an offence if a person imports a scheduled substance and the person does not hold a licence that allows the importation. Proposed subsection 13AB(1) provides that it is an offence if a person exports a scheduled substance and the person does not hold a licence that allows the exportation. Proposed subsections 13AA(2), (6) (7), (8) and (9) and proposed subsections 13AB(2), (4) and (6) provide offence-specific defences to these offences to the effect that the offences do not apply to a person in a circumstance prescribed by the regulations.
1.172 At common law, it is ordinarily the duty of the prosecution to prove all elements of an offence.[126] This is an important aspect of the right to be presumed innocent until proven guilty. Provisions that reverse the burden of proof and require a defendant to disprove, or raise evidence to disprove, one or more elements of an offence, interferes with this common law right.
1.173 While in this instance the defendant bears an evidential burden (requiring the defendant to raise evidence about the matter), rather than a legal burden (requiring the defendant to positively prove the matter), the committee expects any such reversal of the evidential burden of proof to be justified. In this instance, the explanatory memorandum states:
The reversal of the burden of proof is appropriate as the matter to be proved is a matter than would be peculiarly in the knowledge of the defendant. For instance, the defendant would be best placed to know the circumstance in which, or purpose for which, they manufactured a scheduled substance. Further, there may be a number of circumstances or purposes prescribed in the regulations for which a licence would not be required to manufacture a scheduled substance. In the event of a prosecution, it would be significantly more difficult and costly for the prosecution to disprove all possible circumstances than it would be for a defendant to establish the existence of one potential circumstance or purpose.[127]
1.174 Similar explanations are provided in relation to the other offence-specific defences listed above.
1.175 It is not clear to the committee how the relevant matters can be said to be peculiarly within the knowledge of the defendant or why it would be significantly more difficult and costly for the prosecution to disprove the matters than it would be for a defendant to establish them when the content of the offence-specific defences have not yet been prescribed.
1.176 In addition, the committee's view is that significant matters, such as the key details of an offence-specific defence, should be included in primary legislation unless a sound justification for the use of delegated legislation is provided. In this instance, the explanatory memorandum states in relation to the use of delegated legislation that:
The ability to prescribe such matters in regulations made under the Act is consistent with good regulatory practice and ensures continued compliance with Australia’s international obligations under the Montreal Protocol and other relevant international treaties. In the past, the Montreal Protocol has adopted decisions to exempt certain circumstances or purposes from the scope of the treaty. Over time, exemptions may be adopted or amended, and domestic requirements will need to be able to be quickly updated to reflect these changes, in order to support decision-makers and ensure both compliance with international obligations and minimal disruptions to licence applicants and holders. Continuing to allow the regulations to prescribe such matters provides the necessary flexibility to quickly respond to changes in the international regulatory regime.[128]
1.177 The committee has not generally considered a desire for flexibility to be a sufficient justification, of itself, for prescribing significant matters in delegated legislation. In this case, the committee's scrutiny concerns are heightened given the significance of prescribing key details of an offence-specific defence, which reverses the evidential burden of proof and limits fundamental common law rights, within delegated legislation. In this regard, the committee notes that a legislative instrument, made by the executive, is not subject to the full range of parliamentary scrutiny inherent in bringing proposed changes in the form of an amending bill.
1.178 The committee draws its scrutiny concerns to the attention of senators and leaves to the Senate as a whole the appropriateness of reversing the evidential burden of proof in proposed subsections 13(2), 13(4), 13(6), 13AA(2), 13AA(6), 13AA(7), 13AA(8), 13AA(9), 13AB(2), 13AB(4) and 13AB(6) in relation to matters that do not appear to be peculiarly within the knowledge of the defendant and of leaving the prescription of key details of these defences to delegated legislation.
1.179 Proposed subsection 45C(1) of the 2022 Bill provides that a person contravenes the subsection if the person uses an HCFC[130] that was manufactured or imported on or after 1 January 2020 and the use is not for a purpose prescribed by the regulations. Contravention of the subsection is an offence (subject to a maximum penalty of 300 penalty units for the fault-based offence and 60 penalty units for the strict liability offence). Additionally, a person is liable to a civil penalty of 400 penalty units for contravening proposed subsection 45C(1). The committee's view is that significant matters, such as key elements of an offence, particularly an offence of strict liability which undermines fundamental criminal law principles, should be included in primary legislation unless a sound justification for the use of delegated legislation is provided.
1.180 In this instance, the explanatory memorandum states:
Production and import of HCFC is in the last stage of a global phase out in developed countries under the Montreal Protocol on Substances that Deplete the Ozone Layer (the Montreal Protocol). ... As the global phase out progresses and changes in technology result in fewer essential uses for HCFC, the uses allowed under the Montreal Protocol are expected to be further refined in the future and it is important that Australia’s laws are aligned to such changes in a timely way.
Allowing the regulations to prescribe allowed uses for HCFC that was manufactured or imported on or after 1 January 2020 provides the necessary flexibility in the Act to respond in a timely way to changes in Australia’s international obligations and to ensure that the regulatory burden to industry is minimised so far as possible. Importantly, this would ensure Australia’s continued and ongoing compliance with its international obligations and would also minimise the adverse impacts of HCFC on human health and the environment.
As the regulations would be required to adapt to changing circumstances domestically and internationally, providing high level guidance in the Act would not be appropriate as it could hamper the ability to align with international requirements. For example, it could hamper the ability to address unforeseen advances in technology. Further, any regulations made to prescribe permitted uses of HCFC would be subject to the usual parliamentary scrutiny processes.[131]
1.181 While acknowledging the need for administrative flexibility due to potential changes in technology, the committee considers that it would be possible to include at least high-level guidance regarding permitted uses of HCFCs within the bill. The committee notes that the bill is proposing to prescribe key elements of offences, including an offence of strict liability which undermines fundamental common law rights, within delegated legislation.
1.182 The committee draws its scrutiny concerns to the attention of senators and leaves to the Senate as a whole the appropriateness of leaving the prescription of permitted uses of HCFCs for the purposes of offence and civil penalty provisions to delegated legislation.
1.183 Proposed section 65U of the 2022 Bill makes it an offence to disclose protected information by a person who is, or has been, an entrusted person and who obtained the protected information in their capacity as an entrusted person. The fault‑based offence carries a maximum penalty of 180 penalty units, or 2 years' imprisonment, or both. The strict liability offence carries a maximum penalty of 60 penalty units. Proposed subsection 65U(2) provides that it is a defence if the use of disclosure is authorised or required by the Act, another law of the Commonwealth or a prescribed law of a State or a Territory.
1.184 The defendant bears an evidential burden in relation to the defence set out at proposed subsection 65U(2). As noted above, at common law, it is ordinarily the duty of the prosecution to prove all elements of an offence.[133] This is an important aspect of the right to be presumed innocent until proven guilty. Provisions that reverse the burden of proof and require a defendant to disprove, or raise evidence to disprove, one or more elements of an offence, interferes with this common law right.
1.185 The committee expects any such reversal of the evidential burden of proof to be justified. In this instance, the explanatory memorandum states:
The reversal of the burden of proof is justified in this instance as the matter to be proved (that is, that the use or disclosure of protected information was authorised by a Commonwealth law or a prescribed State or Territory law) is a matter that would be peculiarly in the knowledge of the defendant. Further, there would be a number of authorised uses and disclosures set out in Division 3 of Part VIIIB of the Act (as inserted by this Bill) and across Commonwealth law generally. In the event of a prosecution, it would be significantly more difficult and costly for the prosecution to disprove all possible circumstances than it would be for a defendant to establish the existence of one potential circumstance.[134]
1.186 While the committee acknowledges that it may be significantly more difficult and costly for the prosecution to establish that a person did not have lawful authority to engage in the conduct set out in proposed section 65U(2) than the defendant, it is not clear to the committee why the relevant matters would be peculiarly within the knowledge of the defendant. For example, whether disclosure of information is authorised by another Commonwealth law would appear to be a matter that the prosecution could readily ascertain.
1.187 The committee draws its scrutiny concerns to the attention of senators and leaves to the Senate as a whole the appropriateness of reversing the evidential burden of proof in proposed subsection 65U(2) in relation to matters that do not appear to be peculiarly within the knowledge of the defendant.
1.188 Proposed subsection 45A(4) of the 2022 Bill provides that regulations made for the purposes of proposed section 45A may incorporate an instrument or other writing as in force or existing from time to time.
1.189 At a general level, the committee will have scrutiny concerns where provisions in a bill allow the incorporation of legislative provisions by reference to other documents because such an approach:
• raises the prospect of changes being made to the law in the absence of Parliamentary scrutiny (for example, where an external document is incorporated as in force 'from time to time' this would mean that any future changes to that document would operate to change the law without any involvement from Parliament);
• can create uncertainty in the law; and
• means that those obliged to obey the law may have inadequate access to its terms (in particular, the committee will be concerned where relevant information, including standards, accounting principles or industry databases, is not publicly available or is available only if a fee is paid).
1.190 As a matter of general principle, any member of the public should be able to freely and readily access the terms of the law. Therefore, the committee's consistent scrutiny view is that where material is incorporated by reference into the law it should be freely and readily available to all those who may be interested in the law.
1.191 In this instance, the explanatory memorandum explains:
The purpose of this amendment is to allow the regulations concerning the end use of scheduled substances to incorporate documents (such as standards or qualifications) as existing from time to time. This is appropriate as such documents are regularly updated and amended, and it is important that end use permit holders and applicants are at all times required to comply with the most up to date and appropriate qualifications and standards for the substance they are using. It is anticipated that this power would be used where the relevant standards or qualifications remain in regulations and are updated on a regular basis (rather than in a legislative instrument under new subsection 45A(3), which is expected to be used to add new standards or qualifications quickly as needed).
It is envisaged that the standards that would be incorporated by the regulations would generally be official Australia and New Zealand industry standards which would be readily available via Standards Australia. While Standards Australia is not freely accessible, it is expected that standards that are incorporated would be industry best practice and would already be widely used by industry. Therefore, it can be reasonably expected that those who would be regulated by any such regulations would already have access to any incorporated standards to carry out their business or meet their professional obligations.[136]
1.192 While acknowledging this explanation, the committee notes that, as a matter of general principle, any member of the public should be able to freely and readily access the terms of the law. Therefore, the committee's consistent scrutiny view is that where material is incorporated by reference into the law it should be both freely and readily available to all those who may be interested in the law.
1.193 The committee draws its scrutiny concerns to the attention of senators and leaves to the Senate as a whole the appropriateness of including in the bill a power to incorporate external materials as in force from time to time in circumstances where incorporated materials will not be freely available.
1.194 Item 145 of Schedule 1 to the 2022 Bill seeks to insert proposed subsections 65Y(3) and 65ZB(3) into the Ozone Protection and Synthetic Greenhouse Gas Management Act 1989 to provide that a failure to provide a written notice of a decision, including the reasons for the decision and the details of person's right to have the decision reviewed, would not affect the validity of the original reviewable decision or reconsideration decision.
1.195 A legislative provision that indicates that an act done or decision made in breach of a particular statutory requirement or other administrative law norm does not result in the invalidity of that act or decision, may be described as a 'no-invalidity' clause. There are significant scrutiny concerns with no-invalidity clauses, as these clauses may limit the practical efficacy of judicial review to provide a remedy for legal errors. For example, as the conclusion that a decision is not invalid means that the decision-maker had the power (i.e. jurisdiction) to make it, review of the decision on the grounds of jurisdictional error is unlikely to be available. The result is that some of judicial review's standard remedies will not be available. Consequently, the committee expects a sound justification for the use of a no-invalidity clause to be provided in the explanatory memorandum. In this instance, the explanatory memorandum states:
The purpose of proposed subsection 65Y(3) is to provide the necessary certainty for both industry and the Commonwealth as to whether a licence is in force and covers a particular import, manufacture or export. This is particularly the case where, for example, a decision has been made to refuse to grant a licence or refuse to renew a licence. In these instances, it is important that current practices are maintained and that industry has sufficient certainty over the decision to reduce any further regulatory burden and to minimise any possibility of non-compliance.
It is also important that decisions relating to non-compliance with the licensing conditions by licence holders, for example, are made in a timely way and with sufficient certainty. This enables an effective response to manage and mitigate any harm that may result from the non-compliance to Australia’s environmental and human health, as well as Australia’s continued compliance with its international obligations and its international relations. Proposed 65Y(3) would provide the necessary regulatory certainty that is required to deal with these situations.[138]
1.196 An identical explanation is provided in relation to proposed subsection 65ZB(3).[139]
1.197 While acknowledging these explanations, the committee reiterates that there are significant scrutiny concerns with no-invalidity clauses, as these clauses may limit the practical efficacy of judicial review to provide a remedy for legal errors. For example, as the conclusion that a decision is not invalid means that the decision-maker had the power (i.e. jurisdiction) to make it, review of the decision on the grounds of jurisdictional error is unlikely to be available. The result is that some of judicial review's standard remedies will not be available. The committee has generally not accepted a desire for certainty to be, of itself, a sufficient justification for the inclusion of no-invalidity clauses.
1.198 The committee draws this matter to the attention of senators and leaves to the Senate as a whole the appropriateness of including a no-invalidity clause in proposed subsections 65Y(3) and 65ZB(3).
[124] Senate Standing Committee for the Scrutiny of Bills, Scrutiny Digest 1 of 2022, 4 February 2022, pp. 17–22; Scrutiny Digest 2 of 2022, 18 March 2022, pp. 96–101.
[125] Schedule 1, item 52, proposed subsections 13(2), 13(4), 13(6), 13AA(2), 13AA(6), 13AA(7), 13AA(8), 13AA(9), 13AB(2), 13AB(4), 13AB(6). The committee draws senators' attention to these provisions pursuant to Senate Standing Order 24(1)(a)(i) and (iv).
[126] Subsection 13.3(3) of the Criminal Code Act 1995 provides that a defendant who wishes to rely on any exception, exemption, excuse, qualification or justification bears an evidential burden in relation to that matter.
[127] Explanatory memorandum, p. 25.
[128] Explanatory memorandum, pp. 24–25.
[129] Schedule 1, item 111, proposed section 45C. The committee draws senators' attention to this provision pursuant to Senate Standing Order 24(1)(a)(iv).
[130] Defined in section 7 of the Ozone Protection and Synthetic Greenhouse Gas Management Act 1989.
[131] Explanatory memorandum, pp.24–25.
[132] Schedule 1, item 145, proposed section 65U. The committee draws senators' attention to this provision pursuant to Senate Standing Order 24(1)(a)(i).
[133] Subsection 13.3(3) of the Criminal Code Act 1995 provides that a defendant who wishes to rely on any exception, exemption, excuse, qualification or justification bears an evidential burden in relation to that matter.
[134] Explanatory memorandum, p. 119.
[135] Schedule 1, item 110, proposed subsection 45A(4). The committee draws senators' attention to this provision pursuant to Senate Standing Order 24(1)(a)(v).
[136] Explanatory memorandum, p. 71.
[137] Schedule 1, item 145, proposed subsection 65Y(3), and proposed subsection 65ZB(3). The committee draws senators’ attention to these provisions pursuant to Senate Standing Order 24(1)(a)(iii) and (iv).
[138] Explanatory memorandum, p. 124.
[139] Explanatory memorandum, p. 126.
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