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Export Charges (Collection) Bill 2015 [and] Export Charges (Imposition—General) Bill 2015 [and] Export Charges (Imposition—Excise) Bill 2015 [and] Export Charges (Imposition—Customs) Bill 2015



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ISSN 1328-8091

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BILLS DIGEST NO. 132, 2014-15 23 JUNE 2015

Export Charges (Collection) Bill 2015 [and] Export Charges (Imposition—General) Bill 2015 [and] Export Charges (Imposition—Excise) Bill 2015 [and] Export Charges (Imposition—Customs) Bill 2015 Rob Dossor Economics Section

Contents

Purpose of the Bills .............................................................. 2

Structure of the Bills ............................................................ 2

Background ......................................................................... 2

Current review ......................................................................... 2

Australia export inspection regime ....................................... 3

Committee consideration .................................................... 3

Senate Standing Committee for the Selection of Bills ............. 3

Senate Standing Committee for the Scrutiny of Bills .............. 3

Parliamentary Joint Committee on Human Rights .................. 4

Financial implications .......................................................... 4

Statement of Compatibility with Human Rights .................... 4

Position of major interest groups ......................................... 4

Key issues and provisions..................................................... 4

The Collection Bill .................................................................... 4

Paying export charges ........................................................... 4

Unpaid export charges .......................................................... 5

Miscellaneous ........................................................................ 6

The General Bill ....................................................................... 7

Charges in relation to regulated goods ................................. 7

Charges in relation to regulated matters relating to regulated goods ..................................................................... 8

The Customs Bill and the Excise Bill......................................... 8

Date introduced: 3 June 2015

House: House of Representatives

Portfolio: Agriculture

Commencement: Various dates as set out in the body of this Bills Digest

Links: The links to the Bills, their Explanatory Memoranda and second reading speeches can be found on the Bills’ home pages for the Export Charges (Collection) Bill 2015, the Export Charges (Imposition— General) Bill 2015, the Export Charges (Imposition— Customs) Bill 2015 and the Export Charges (Imposition—Excise) Bill 2015, or through the Australian Parliament website.

When Bills have been passed and have received Royal Assent, they become Acts, which can be found at the ComLaw website.

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Purpose of the Bills The four Bills discussed in this Bills Digest form a package that seeks to enable the making of regulations which charge a levy in relation to matters connected with export services provided by the Department of Agriculture (the Department).

The Export Charges (Collection) Bill 2015 (the Collection Bill)1 provides for the collection of charges in relation to certain exported goods and late payment fees. The export charges are imposed by the other Bills in the legislative package, being:

• Export Charges (Imposition—General) Bill 2015 (the General Bill)2

• Export Charges (Imposition—Customs) Bill 2015 (the Customs Bill)3 and

• Export Charges (Imposition—Excise) Bill 2015 (the Excise Bill).4

Structure of the Bills The Collection Bill contains four parts:

• Part 1 deals with preliminary matters

• Part 2 contains provisions relating to paying export charges

• Part 3 contains provisions relating to unpaid export charges and

• Part 4 deals with miscellaneous matters such as remitting or refunding export charges.

The General Bill, the Customs Bill and the Excise Bill each contain four parts:

• Part 1 deals with preliminary matters

• Part 2 includes provisions relating to charges for the export of regulated goods

• Part 3 includes provisions relating to charges for regulated matters relating to the export of regulated goods and

• Part 4 provides for the making of regulations under each Bill (when enacted).

Background Current review The Department is currently conducting a comprehensive review of cost recovery fees and charges.5 The aim of the review, amongst other things, is to streamline existing frameworks and update fees and charges to reflect the current business operating model.6

The Department has sought to gauge industry’s views by way of a series of discussion papers on various aspects of the redesign. These canvas matters such as:

• the application of cost recovery levies and fees

• standard treatment of travel costs

• charging for out of hours service and

• annual indexation of fees and charges.7

According to the Department:

1. Parliament of Australia, ‘Export Charges (Collection) Bill 2015 homepage’, Australian Parliament website, accessed 15 June 2015. 2. Parliament of Australia, ‘Export Charges (Imposition—General) Bill 2015 homepage’, Australian Parliament website, accessed 15 June 2015. 3. Parliament of Australia, ‘Export Charges (Imposition—Customs) Bill 2015 homepage’, Australian Parliament website, accessed 15 June 2015. 4. Parliament of Australia, ‘Export Charges (Imposition—Excise) Bill 2015 homepage’, Australian Parliament website, accessed 15 June 2015. 5. Department of Agriculture (DA), ‘Cost recovery reviews: comprehensive review of Agriculture’s fees and charges’, DA website, accessed

4 June 2015. 6. Ibid.

7. Department of Agriculture (DA), ‘Redesign of Agriculture’s cost recovery arrangements’, DA website, accessed 11 June 2015.

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There are a number of processes that still need to be completed to progress the redesign of cost recovery arrangements … The next round of consultation with [Industry Consultative Committees] ICCs will occur in June-July 2015.

Draft Cost Recovery Implementation Statements are planned to be released for broader public consultation in July- August 2015. These will include the proposed fees and charges. 8

Australia export inspection regime This legislative package relates only to exports covered under the Export Control Act 1982 and the Australian Meat and Live-stock Industry Act 1997.9 These exports can be generally characterised as food or ‘agricultural products’ (including live animals, forestry and wood products).

Regulations made under the Export Control Act require that if a good is a ‘prescribed good’ its export is prohibited unless specific conditions and restrictions are complied with.10 Some prescribed goods include:

• dairy

• live animals

• fish

• plants and plant products

• grain

• meat and meat products and

• fresh fruit and vegetables.11

Most prescribed goods must undergo some form of inspection to verify that they are safe and accurately described, and to insure that foreign government requirements and Australia’s international obligations are met.12 Fees are imposed for the performance of services such as inspections, issuing of documents and auditing registered premises.13

There appears to be no mechanism presently available however to enable the recovery of the costs associated with programme management and administration, verification, risk and incident management activities.

This legislative package will permit the recovery of these costs and enable the export services provided by the Department of Agriculture (the Department) to become fully cost recoverable consistent with the Australian Government Cost Recovery Guidelines.14

Committee consideration Senate Standing Committee for the Selection of Bills The Senate Standing Committee for the Selection of Bills resolved not to refer the Bills in this legislative package to a committee.15

Senate Standing Committee for the Scrutiny of Bills The Standing Committee for the Scrutiny of Bills had no comment on the General Bill, the Customs Bill or the Excise Bill, but has sought information from the Minister on elements of the Collection Bill-specifically the use of

8. Ibid.

9. Export Control Act 1982; Australian Meat and Live-stock Industry Act 1997, accessed 16 June 2015. 10. Section 7A, Export Control Act 1982. 11. Department of Agriculture (DA), ‘Getting your product overseas’, DA website, accessed 15 June 2015. 12. Ibid.

13. Export Control (Fees) Orders 2001, accessed 15 June 2015. 14. B Joyce (Minister for Agriculture), Funding strong biosecurity and export certification for the future, media release, 3 June 2015, accessed 16 June 2015 and Department of Finance, Australian Government Cost Recovery Guidelines, third edition, July 2014, accessed 11 June 2015. 15. Senate Standing Committee for Selection of Bills, Report No. 6 of 2015, The Senate, Canberra, 2015, accessed 17 June 2015.

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delegated legislation to set a late payment fee (clause 11) and the constraint on the ability to bring legal action against the Commonwealth or one of its officers for actions undertaken in good faith (clause 20).16

Parliamentary Joint Committee on Human Rights The Parliamentary Joint Committee on Human Rights had no comment on the package of Bills.17

Financial implications The Explanatory Memorandum to the Collection Bill and the Explanatory Memorandum to the General Bill, the Customs Bill and Excise Bills indicate that the Bills will have no financial impacts on the Commonwealth Government, industry or people who ‘export or deal with export regulated goods’.18 The Bills do not set the amounts of the charges but will enable charges to be set in regulations which may impact all exporters of prescribed goods. This may result in a financial impact on business.

Statement of Compatibility with Human Rights As required under Part 3 of the Human Rights (Parliamentary Scrutiny) Act 2011 (Cth), the Government has assessed the Bills’ compatibility with the human rights and freedoms recognised or declared in the international instruments listed in section 3 of that Act. The Government acknowledges that the Collection Bill may engage the following human rights:

• Article 14(1) of the International Covenant on Civil and Political Rights (ICCPR)—right to a fair hearing19

• Article 17 of the ICCPR—right to protection from arbitrary and unlawful interferences with privacy and

• Article 6(1) of the International Covenant on Economic Social and Cultural Rights—right to work.20

Nevertheless, the Government considers the relevant provisions to be reasonable and necessary, and that the Collection Bill is compatible with applicable human rights requirements.21

The Government considers that the General Bill, the Customs Bill and the Excise Bill do not engage any of the applicable rights or freedoms.22

Position of major interest groups At the time of writing, it appears that exporters had not made any public comment in relation to the contents or effect of the Bills in the legislative package.

Key issues and provisions The Collection Bill The Collection Bill commences on the day after Royal Assent.

It provides for the collection of charges in relation to exports and late payment fees.

Paying export charges Clause 8 provides that regulations may prescribe the time when an export charge is due and payable and/or prescribe rules relating to the liability of an exporter’s agent to pay export charges on the exporter’s behalf, and

16. Senate Standing Committee for the Scrutiny of Bills, Alert Digest No. 6 of 2015, The Senate, Canberra, 17 June 2015, pp. 21-25, accessed 23 June 2015. 17. Parliamentary Joint Committee on Human Rights, Twenty-third report of the 44th Parliament, The Senate, Canberra, 18 June 2015, pp. 1-2, accessed 23 June 2015. 18. Explanatory Memorandum, Export Charges (Collection) Bill 2015, p. 2; Explanatory Memorandum, Export Charges (Imposition-General) Bill

2015 [and] Export Charges (Imposition-Customs) Bill 2015 [and] Export Charges (Imposition-Excise) Bill 2015, p. 3, accessed 17 June 2015. 19. International Covenant on Civil and Political Rights, done in New York on 16 December 1966, [1980] ATS 23 (entered into force for Australia (except Art. 41) on 13 November 1980; Art. 41 came into force for Australia on 28 January 1994), accessed 23 June 2015. 20. International Covenant on Economic, Social and Cultural Rights, done in New York on 16 December 1966, [1976] ATS 5 (entered into force for

Australia on 10 March 1976), accessed 23 June 2015. 21. The Statement of Compatibility with Human Rights can be found at page 7 of the Explanatory Memorandum to the Export Charges (Collection) Bill 2015. 22. The Statements of Compatibility with Human Rights can be found on pages 4, 6 and 8 of the Explanatory Memorandum for the Export

Charges (Imposition-General) Bill 2015 [and] Export Charges (Imposition-Customs) Bill 2015 [and] Export Charges (Imposition-Excise) Bill 2015.

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the recovery of the charges by the agent from the exporter. Clause 6 of the Collection Bill defines the term export charge as a charge imposed under:

• section 7 or 11 of the Export Charges (Imposition—Customs) Act 2015

• section 7 or 11 of the Export Charges (Imposition—Excise) Act 2015 or

• section 7 or 11 of the Export Charges (Imposition—General) Act 2015.

Clause 9 specifies that the Commonwealth is notionally liable to pay the export charge, including late payment fees, for activities performed in relation to exports under the Export Charges (Collection) Act 2015 (subclause 9(1)). It also provides that the Minister for Finance may give written directions to collect charges from agencies and other Commonwealth bodies (subclause 9(2)). Subclause 9(3) provides that any direction made under subclause 9(2) must be complied with, despite any other Commonwealth law. Subclause 9(4) establishes that any direction made under subclause 9(2) is not a legislative instrument. This means that any direction under subclause 9(2) is not subject to disallowance under section 42 of the Legislative Instruments Act 2003.23

According to the Explanatory Memorandum for the Collection Bill:

The intent of this clause is that, under the Minister for Finance’s direction, the department will have the legal authority to collect charges from agencies and other Commonwealth bodies for export-related activities under the Export Control Act and [Australian Meat and Live-stock Industry Act], and those bodies will have the legal authority to make payments to the department for such activities.

24

Unpaid export charges Clause 11 establishes that if regulations prescribe the time when an export charge is due and payable, they may also set a late payment fee (subclause 11(1)). The late payment fee may relate to each day, or part of a day that the charge remains unpaid after becoming due and payable (subclause 11(2)). The regulation may also prescribe who is liable to pay the late payment fee (subclause 11(3)).

Clause 12 applies to a debtor who is liable to pay an export charge or late payment fee that is due and payable.

Under subclause 12(2) the Secretary may, by written notice to a debtor, suspend an export control instrument of the debtor until the export charge or late payment fee is paid—or simply revoke the export control instrument. The term export control instrument of a person is defined in clause 6 to mean:

• a licence, permission, permit, consent or approval granted to the person under:

- regulations made under the Export Control Act - orders made under such regulations or • a certificate or notice issued or given to the person under:

- regulations made under the Export Control Act - orders made under such regulations • a registration or accreditation held by the person under:

- regulations made under the Export Control Act - orders made under such regulations or • a licence granted to the person under section 10 of the Australian Meat and Live-stock Industry Act 199725 or

• an approval granted to the person under:

- Part 2 of the Australian Meat and Live-stock Industry Act or - regulations or orders made under that Act for the purposes of that Part or • any other thing granted to, issued to or held by the person under such an Act, regulations or orders that:

- relate to the export of goods and

23. Legislative Instruments Act 2003, accessed 23 June 2015. 24. Explanatory Memorandum, Export Charges (Collection) Bill 2015, op. cit., p. 9. 25. Australian Meat and Live-stock Industry Act 1997, accessed 15 June 2015.

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- Is prescribed by the regulations. The notice must include reasons for the decision and outline the debtor’s right to have the decision reviewed. However, a failure to comply with this requirement does not affect the validity of the decision (subclause 12(3)).26

Subclause 12(5) empowers the Secretary to direct a person not to take certain actions involved with obtaining an export control instrument until an export charge or late payment fee is paid.

A direction made under subclause 12(5) is not reviewable on its merits (judicial review is available). According to the Explanatory Memorandum:

In addition to encouraging compliance with the Bill, this clause is intended to prevent the department from directing resources toward providing activities and incurring costs where a person has not paid the required export charge or late fee. The inclusion of a review mechanism would unnecessarily add to the administrative burden of administering the Bill and would be contrary to the purpose of this clause.

27

Clause 13 provides that an unpaid export charge or a late payment fee may be recovered as a debt due to the Commonwealth by action in a court of competent jurisdiction.

Miscellaneous Clause 15 allows the Secretary, on his or her own initiative or on written application by a person, to remit or refund the whole or part of an export charge or late payment fee that is payable or has been paid to the Commonwealth.

Clause 16 provides that, if the Secretary has reasonable grounds to believe that a person has information or documents relevant to the operation of the Export Charges (Collection) Act or an export charge, he, or she, may by written notice, require that person to provide the information or documents which are specified in the notice. The notice must specify the period within which the information or documents are to be provided, being not less than 14 days after the notice is given (subclause 16(2)). Under subclause 16(3), a person commits an offence if he, or she, is given a notice under the clause and fails to comply with the notice. The penalty for the offence is 30 penalty units.28

Clause 17 provides for the internal review of a decision to suspend or revoke an export control instrument which has been made by a delegate of the Secretary. In that case, the affected person may apply in writing to the Secretary for review of the original decision. Subclause 17(2) sets out the formal requirements of the application. Once the application is received, the Secretary must review the decision personally, or cause the decision to be reviewed by another person who was not involved in the original decision-making process and is senior to the original decision maker (subclause 17(3)).

The internal reviewer may affirm, vary or set aside the original decision. Where the original decision is set aside, the internal reviewer may make such other decision as he or she thinks appropriate (subclause 17(4)). The decision of the internal reviewer is called the decision on review. Having made the decision on review the internal reviewer must give the applicant a written notice setting out the terms of the decision and the reasons for it. In addition, the internal reviewer must inform the applicant of his, or her, right to have the decision reviewed by the Administrative Appeals Tribunal (AAT) (subclause 17(6)). If the applicant has not received notice of the decision on review within 90 days after the application for internal review was made, then the original decision is deemed to have been affirmed (subclause 17(7)). The Secretary may require a person who has applied for review to give further information about the application and may refuse to consider the application until the information is received (clause 18).

Clause 19 provides that a person may make an application to the AAT for a review of the following decisions:

• a decision to suspend or revoke an export control instrument made personally by the Secretary under subclause 12(2) and

26. However, merits review of a decision under subclause 12(2) is provided for by clauses 17 and 19 of the Bill. Judicial review is also available. 27. Explanatory Memorandum, Export Charges (Collection) Bill 2015, op. cit., p. 11. 28. Section 4AA of the Crimes Act 1914 provides that a penalty unit is equivalent to $170. This means that the maximum penalty payable is $5,100.

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• a decision of an internal reviewer made under clause 17 about a decision to suspend or revoke an export control instrument.

Subsection 27(1) of the Administrative Appeals Tribunal Act 1975 (AAT Act) states that ‘an application may be made by or on behalf of any person or persons (including the Commonwealth or an authority of the Commonwealth or Norfolk Island or an authority of Norfolk Island) whose interests are affected by the decision’.29 However, subclauses 19(2) and (3) of the Bill operate so that an application to the AAT for a review of the decisions set out above may only be made by, or on behalf of, a person whose export control instrument was suspended or revoked. This is an exception to the general rule in subsection 27(1) of the AAT Act.

Clause 20 provides that the Commonwealth or a protected person will have protection from civil proceedings for anything done or omitted to be done in good faith in the exercise, or purported exercise of a power conferred by the Export Charges (Collection) Act (when enacted). The term protected person is defined in clause 6 of the Bill as being any of the following:

• the Secretary

• a person who has been given a direction not to take certain actions until an export charge or late payment fee is paid (under subclause 12(5))

• a person who is given information or documents in accordance with a notice given under subclause 16(1) or

• a person who is delegated by the Secretary to exercise the powers and functions of the Secretary under clause 21.

The protection extends to a person providing assistance, information or documents to a protected person as a result of a request, direction or other requirement made by the protected person (paragraph 20(b)).

The Governor-General may make regulations prescribing matters that are required or permitted to be prescribed or are necessary and convenient to be prescribed for carrying out or giving effect to the Export Charges (Collection) Act (when enacted) (clause 22).

The General Bill Sections 1 and 2 of the General Bill commence on the day of Royal Assent. The remaining sections of the General Bill commence on the later of either the day after Royal Assent or immediately after the commencement of the Collection Bill. However if the Export Charges (Collection) Act is not enacted, or does not commence, the provisions of the General Bill will not commence.

Charges in relation to regulated goods Subclause 7(1) provides that the regulations may prescribe charges in relation to the export of regulated goods. Subclause 7(2) provides that these charges are imposed as taxes.

The term regulated good is defined in clause 5 as a good that is prescribed by regulation. The charges will ‘reflect the costs of corporate activities and supporting export activities provided by the Commonwealth such as, but not limited to, programme management and administration, verification, risk and incident management activities.’30

Two or more charges may be made in relation to the same regulated good and a single charge may be made in relation to two or more kinds of regulated goods (subclause 7(3)).

Subclause 8(1) allows the regulations to prescribe a charge for the purposes of subclause 7(1) by specifying an amount as the charge, or by specifying a method for calculating the amount of the charge. Subclause 8(2) provides that before a regulation is made to impose a charge (under subclause 7(1)) the Agriculture Minister must be satisfied that the amount is set at a level that will recover only the Commonwealth’s likely costs in connection with the export of the regulated goods.

29. Administrative Appeals Tribunal Act 1975, accessed 15 June 2015. 30. Explanatory Memorandum, Export Charges (Imposition-General) Bill 2015 [and] Export Charges (Imposition-Customs) Bill 2015 [and] Export Charges (Imposition-Excise) Bill 2015, op. cit., p. 11.

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Clause 9 of the General Bill provides that the regulations may prescribe one or more persons who are liable to pay a specified charge under subclause 7(1). In addition, clause 10 permits the regulations to provide for exemptions from a charge under subclause 7(1).

Charges in relation to regulated matters relating to regulated goods Clause 11 is similarly structured to clause 7. It provides that regulations may prescribe charges which are imposed as taxes (subclause 11(2)) in relation to a regulated matter relating to the export of regulated goods. The term regulated matter is defined in clause 5 as a matter that is prescribed by regulations to be regulated matter. Like charges imposed under clause 7, the charges will ‘reflect the costs of corporate activities and supporting export activities provided by the department such as programme management and administration, verification, risk and incident management activities.’31

Clauses 12 to 14 are similarly structured to clauses 8 to 10. They allow the regulations to prescribe a charge or specify a method for calculating a charge (subclause 12(1)); require that the Mister must be satisfied that the amount of the charge is set at a level that will recover only the Commonwealth’s likely costs in connection with the regulated matter (subclause 12(2)); provide that the regulations may prescribe one or more persons who are required to pay a specified charge under subclause 11(1) (clause 13) and permit regulations to provide for exemptions from a charge under subclause 11(1) (clause 14).

Clause 15 provides for regulations prescribing matters that are required or permitted to be prescribed, or are necessary or convenient to be prescribed for carrying out or giving effect to the Export Charges (Imposition— General) Act (when enacted).

The Customs Bill and the Excise Bill Sections 1 and 2 of both the Customs Bill and the Excise Bill commence on the day of Royal Assent. The remaining sections of both the Customs Bill and the Excise Bill commence on the later of the day after Royal Assent or immediately after the commencement of the Collection Bill. However if the Export Charges (Collection) Act 2015 is not enacted, or does not commence, the provisions of the Customs Bill and the Excise Bill will not commence.

The Customs Bill and the Excise Bill contain provisions in equivalent terms to those in the General Bill, except for subclause 7(4) and subclause 11(4) which specify that a charge is imposed only so far as the charge is a duty of customs (for the Customs Bill) and a duty of excise (for the Excise Bill). The Explanatory Memorandum notes that, consistent with the Constitution, charges imposed under the Customs Bill are valid insofar as they impose duties of customs, while the charges imposed under the Excise Bill are only valid insofar as they impose duties of excises.32

31. Ibid., p. 12. 32. Ibid., p. 15 and p. 19.

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