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Road Vehicle Standards Bill 2018 [and associated Bills]



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ISSN 1328-8091

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BILLS DIGEST NO. 108, 2017-18 21 MAY 2018

Road Vehicle Standards Bill 2018 [and associated Bills] Dr Emily Hanna Science, Technology, Environment and Resources Section Dr Jonathon Deans Economics Section

Contents

The Bills Digest at a glance .............................................. 3

Purpose of the Bills ......................................................... 4

Structure of the Bills........................................................ 4

Commencement ............................................................. 5

Background ..................................................................... 5

Consultation on reform ............................................... 6

Committee consideration ................................................ 8

Senate Standing Committee for Selection of Bills ...... 8 Senate Standing Committee for the Scrutiny of Bills .............................................................................. 8

The Road Vehicle Standards Bill ................................ 8

Broad delegation of powers .................................... 8

Broad discretionary powers .................................. 10

External material ................................................... 11

Evidential burden of proof .................................... 12

Strict liability offence ............................................. 14

Self-incrimination .................................................. 14

Judicial review limits ............................................. 15

Liability immunity .................................................. 17

Reviews of decisions .............................................. 17

The Charges (General), Charges (Customs) and Charges (Excise) Bills ............................................... 18

Policy position of non-government parties/independents.................................................... 19

Date introduced: 7 February 2018

House: House of Representatives

Portfolio: Infrastructure, Regional Development and Cities

Commencement: The substantive provisions of the Road Vehicle Standards Bill will commence either on the day after the Act receives Royal Assent or one year after Royal Assent (depending on the particular provision). Further detail and the commencement dates of the other Bills are specified in subclause 2(1) of each Bill and outlined in this Bills Digest.

Links: The links to the Bills, their Explanatory Memoranda and second reading speeches can be found on each Bill’s home page, 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 Federal Register of Legislation website.

All hyperlinks in this Bills Digest are correct as at May 2018.

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Position of major interest groups................................... 19

Financial implications .................................................... 21

Statement of Compatibility with Human Rights.............. 21

Parliamentary Joint Committee on Human Rights ... 21 Key issues and provisions .............................................. 22

The Road Vehicle Standards Bill ................................ 22

Preliminary Provisions ............................................. 22

Definition of road vehicle ...................................... 22

Definition of road vehicle component .................. 23 Regulation of road vehicles and road vehicle components............................................................. 24

National Road Vehicle Standards .......................... 24

Register of Approved Vehicles .............................. 25

Specialist and Enthusiast Vehicles (SEVs) Register .................................................................. 26

Importation of Road Vehicles ................................ 26

Modifying road vehicles ........................................ 27

Recalls ...................................................................... 28

Compliance and enforcement ................................. 29

Administration and miscellaneous .......................... 30

The Consequential Provisions Bill ............................. 31

The Charges (General), Charges (Customs) and Charges (Excise) Bills ................................................. 32

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The Bills Digest at a glance Purpose of the Bills

• The purpose of the Road Vehicle Standards Bill is to establish a new legislative framework for Regulation of the importation and supply to market of road vehicles, and provision of some road vehicle components. It will also provide the power to recall uncompliant road vehicles.

• This legislation will replace the nearly three decades old Motor Vehicle Standards Act 1989.

Structure of the Bills

• This is a package of five associated Bills.

Background

• Several reviews of the Motor Vehicles Standards Act and its associated Regulations were undertaken to determine whether they were still working efficiently and effectively given the rise in number of vehicles, changes in technology, and the changes in the national and international vehicle markets since implementation. The resultant Bills aim to give consumers more choice and reduce the regulatory burden on industry whilst upholding safety and environmental standards.

Key elements

• The new framework enables national road vehicle standards to be set for both road vehicles and their components, including environmental, safety and anti-theft standards. It will allow only vehicles that meet these standards to be imported into Australia (except for some limited exceptions).

• There will be a new register, called the Register of Approved Vehicles (RAV), onto which, generally, road vehicles must be entered before they enter the Australian market. It will be the main entry pathway for vehicles.

• The Road Vehicle Standards Bill also establishes a framework for recalling unsafe and/or uncompliant road vehicles or components.

Stakeholder concerns

• While the modernisation of the legislation was often welcomed, not all bodies believed that the regulatory compliance burden would always be reduced by the new scheme. Multiple groups approved of including a power to recall vehicles when necessary.

• Stakeholders representing heavy vehicles believe that the legislation is too focused on light vehicles (such as cars).

• Numerous bodies believe that there is a lack of clarity and that some provisions in the new legislation are confusing.

Key issues

• One major issue that applies to the whole Road Vehicle Standards Bill is that little detail of the scheme is included in the Bill itself. Instead, the Bill provides an overarching framework and the detail of how the scheme will operate is left to delegated legislation. This greatly reduces the level of parliamentary scrutiny that can apply to the scope and actual operation of the scheme.

• It is a concern that the right to review of decisions is not included in the primary legislation.

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Purpose of the Bills This Bills Digest is for a package of five Bills:

• the Road Vehicle Standards Bill 2018 (Road Vehicle Standards Bill)

• the Road Vehicle Standards (Consequential and Transitional Provisions) Bill 2018 (Consequential Provisions Bill)

• the Road Vehicle Standards Charges (Imposition—General) Bill 2018 (Charges (General) Bill)

• the Road Vehicle Standards Charges (Imposition—Customs) Bill 2018 (Charges (Customs) Bill) and

• the Road Vehicle Standards Charges (Imposition—Excise) Bill 2018 (Charges (Excise) Bill).

The purpose of the Road Vehicle Standards Bill is to establish a new legislative framework for Regulation of the importation and supply to market of road vehicles, and provision of some road vehicle components. This legislation will replace the Motor Vehicle Standards Act. The purpose of

the new framework is to:

• enable national road vehicle standards to be set for both road vehicles and their components, including environmental, safety and anti-theft standards

• allow only vehicles that meet these standards to be imported into Australia (with some limited exceptions)

• establish a Register of Approved Vehicles (RAV) onto which, generally, road vehicles must be entered before they enter the Australian market and

• establish the framework for recalling uncompliant road vehicles or components.1

The purpose of the Consequential Provisions Bill is to:

• repeal the Motor Vehicle Standards Act and

• provide transitional arrangements and consequential amendments as the framework under the Road Vehicle Standards Bill 2018 replaces that under the Motor Vehicle Standards Act.

The purposes of the Charges (General) Bill, Charges (Customs) Bill and Charges (Excise) Bill are to allow the Government to impose charges (as taxes) related to the administration of the Road Vehicle Standards Bill and the Consequential Provisions Bill. These three Charges Bills allow, respectively, charges that are not an excise or customs duty, excise charges, and customs charges. The three Charges Bills are separate due to the constitutional requirement for taxation, duties of excise and duties of customs to be dealt with in Bills that only include that particular individual type of charge.2

Structure of the Bills The Road Vehicle Standards Bill is divided into a number of parts:

• Part 1 contains preliminary provisions, including definitions

• Part 2 provides for the Regulation of road vehicles and associated components, including setting standards and establishing the Register of Approved Vehicles and Specialist and Enthusiast Vehicles Register

• Part 3 establishes the framework for road vehicle or component recalls

• Part 4 provides for compliance with, and enforcement of, the Road Vehicle Standards Bill

1. Road Vehicle Standards Bill 2018, clause 3. 2. Australian Constitution, section 55.

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• Part 5 outlines administrative matters, including the use of computerised decision-making, delegation of power and cost-recovery charges and

• Part 6 contains miscellaneous provisions, including the general rule making power.3

The Consequential Provisions Bill is divided into four schedules. Schedule 1 provides for transitional national road vehicle standards to be applied for one year after the Road Vehicle Standards Bill receives Royal Assent, while Schedule 2 repeals the Motor Vehicle Standards Act.

Schedule 3 contains transitional provisions and Schedule 4 contains consequential legislative amendments.

Commencement The clauses of the Road Vehicle Standards Bill commence on two dates, the day after the Road Vehicle Standards Bill receives Royal Assent and one year after Royal Assent. The Bill will therefore be completely operational one year after commencement so as to allow for a transition period to the new scheme. Clauses 15-18, 22, 24, 26, 29, 38-47 and 75-78 commence one year after the date of Royal Assent while all other clauses commence the day after Royal Assent.

The Consequential Provisions Bill also has multiple commencement dates:

• Schedule 1 commences immediately after clause 12 of the Road Vehicle Standards Bill commences (the day after Royal Assent of the Road Vehicle Standards Bill)

• Schedules 2 and 3 as well as Part 2 of Schedule 4 commence at the same time as clause 15 of the Road Vehicle Standards Bill (one year after the date of Royal Assent of the Road Vehicle Standards Bill)

• Part 1 of Schedule 4 commences at the same time as clause 3 of the Road Vehicle Standards Bill (the day after the Road Vehicle Standards Bill receives Royal Assent)

• Part 3 of Schedule 4 commences the day after one year from clause 15 of the Road Vehicle Standards Bill commencing (two years from the day the Road Vehicle Standards Bill receives Royal Assent) and

• the remaining provisions of the Consequential Provisions Bill commence the day after the Consequential Provisions Bill receives Royal Assent.

The provisions in the three Charges Bills share the same commencement dates (if they receive Royal Assent on the same day). Clauses 3-8 of all three Bills commence on the later of the beginning of the day after the particular Charges Bill receives Royal Assent or immediately after

the commencement of clause 3 of the Road Vehicle Standards Bill (the day after the Road Vehicle Standards Bill receives Royal Assent). However, if clause 3 of the Road Vehicle Standards Bill does not commence, then clauses 3-8 of the Charges Bills do not commence. The remaining provisions in the Charges Bills commence the day after the particular Bill they are in receives Royal Assent.

Background The Road Vehicle Standards package of Bills has been introduced as a replacement for the Motor Vehicle Standards Act, which has now been in force for nearly three decades. The Motor Vehicle Standards Act was introduced ‘to give effect to the Australian Government’s commitment to road safety and environmental quality on a nationally consistent basis’.4 This simplified requirements for industry by making nationally consistent standards and ensured that members of the public

3. A more detailed explanation of the operation of each part is outlined on pages 9-12 of the Explanatory Memorandum to the Bill. 4. Department of Infrastructure and Transport, Consultation Paper on the Motor Vehicle Standards Act 1989, Department of Infrastructure and Transport, [Canberra], May 2013, p. 2.

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were protected through enforcement of these national standards. This is especially important in relation to items that are unable to be seen during purchase, such as the crashworthiness of a vehicle.

The Motor Vehicle Standards Act ‘controls the safety, environmental and anti-theft performance of all vehicles entering the Australian market for the first time’, whether new or used.5 The number of vehicles entering the Australian market each year, and therefore under control of this legislation, is substantial. For example, ‘[i]n 2017, over 1.2 million vehicles entered the Australian market for the first time—including passenger vehicles; heavy, medium and light commercial vehicles; motorcycles; and trailers’.6 Over 98% of these vehicles were new. It is predicted that there will be nearly 19 million vehicles registered in Australia for road use by the end of 2018 (approximately double the 9.4 million registered vehicles when the Motor Vehicle Standards Act was introduced). With the rise in number of vehicles, changes in technology, and the changes in the national and international vehicle markets, the Government considers it important that the legislation can meet these different needs.7

Consultation on reform Since 2013, the Commonwealth Government has conducted consultation sessions on and reviews of the Act and associated Regulations to determine whether or not they were still working efficiently and effectively.8 The then-Department of Infrastructure and Transport held a public consultation on the Motor Vehicles Standards Act 1989 and its Regulations in 2013 to determine whether the legislation was still fit for purpose, given the change in ‘society’s expectations, technology and the global automotive industry’.9

A review was then announced in 2014, looking to reduce business costs through reducing regulatory burden and also to improve safety.10 As well as public consultation sessions and a submission process, the review included the release of an Options Discussion paper (which invited responses from the public).11 The options considered to increase the efficiency and effectiveness of the Act included:

• ‘Do nothing or repeal the Act’—the consultation held in 2013 actually ‘supported in part’ continuing with the Motor Vehicles Standards Act 1989.12 However, the Options Discussion paper suggested that this could possibly result in outcomes such as the regulatory burden continuing to rise. Repealing the Act and not replacing it with another national scheme could result in different standards being applied in different states and territories, potentially reducing safety, environmental and consumer protection standards, as well as increasing the regulatory burden.

5. Department of Infrastructure, Regional Development and Cities (DIRDC), ‘Reform of the Motor Vehicle Standards Act 1989’, DIRDC website, last updated 16 March 2018. 6. P Fletcher, ‘Second Reading Speech: Road Vehicle Standards Bill 2018’, House of Representatives, Debates, 7 February 2018, p. 493. 7. Ibid., pp. 493-7. 8. DIRDC, ‘2013 Public Consultation on the Motor Vehicle Standards Act 1989 and Regulations’, DIRDC website, last updated

10 February 2016. 9. Ibid.; Department of Infrastructure and Transport, Consultation Paper on the Motor Vehicle Standards Act 1989, op. cit., p. 2. 10. J Briggs (Former Assistant Minister for Infrastructure and Regional Development), Reducing motor vehicle red tape, media

release, 16 January 2014. 11. Department of Infrastructure and Regional Development (DIRD), Options discussion paper: 2014 review of the Motor Vehicle Standards Act 1989, DIRD, Canberra, September 2014. 12. Ibid., p. 4.

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• ‘Modernise and strengthen the legislation’—improvements such as simplifying administrative requirements and clarifying definitions could possibly reduce the burden of regulatory compliance and implement risk-focused compliance and enforcement.13

• ‘Harmonise with international standards and streamline certification’—both industry and the Productivity Commission basically supported Australian vehicle standards aligning with UN standards.14

• ‘Reduce the barriers to the importation of second-hand quality vehicles and personally imported new vehicles’—the Productivity Commission recommended easing the importation requirements for second-hand vehicles.15 However, reducing the barriers for importation could raise risks to the community in relation to, for example, safety and consumer protection.16

• ‘Consolidate concession scheme arrangements’—reducing the number of ways that second-hand vehicles can be imported could reduce application costs and regulator interaction.17

Three reports were also commissioned by the Government as part of the 2014 review. Two reports looked at the economic benefits of reducing restrictions on importing used vehicles, with the second report concentrating on personal imports from Japan and the UK (both of which have similar vehicle standards to Australia). The third report examined the crash risk of vehicles imported through the concession schemes (such as personal imports or low volume imports) with other vehicles of a similar age.18

The Government announced reforms to the Motor Vehicles Standards Act 1989 in February 2016, designed to give consumers more choice and reduce the regulatory burden on industry. The proposed changes included allowing personal import of new vehicles with a consumer ‘able to personally import a new car or motor cycle from another country with comparable standards to Australia’s, up to once every two years, if specified conditions are met’ and improving arrangements for import of ‘exotic, rare, classic, collectible and special purpose vehicles’.19 Countries with comparable standards were to be specified by the Government, consisting at that time of Japan and the UK. Lower industry regulatory costs were forecast as a consequence of making Australia’s rules more similar to international standards.20 Numerous consultations on the proposed changes were held for industry and community members in 2016 and 2017.21

The Government released exposure drafts of the Road Vehicle Standards Bill package along with the draft associated Rules on 13 December 2017 for stakeholder consultation.22 The Department of Infrastructure, Regional Development and Cities (the Department) suggests that the new legislation will:

… reduce regulatory compliance costs to business by around $68 million a year and provide the Australian public with greater choice and confidence in the vehicle market. The reforms will improve

13. Ibid. 14. Ibid. 15. Ibid., p. 5. 16. Ibid., pp. 5, 43-6. 17. Ibid., p. 5. 18. DIRDC, ‘2016 to 2017 reform process prior to exposure draft of Bills’, DIRDC website, last updated 22 December 2017. 19. P Fletcher (Minister for Major Projects, Territories and Local Government), More choice for car buyers and less red tape for the

car industry under planned Government reforms to motor vehicle laws, media release, 10 February 2016, p. 1. 20. Ibid. 21. DIRDC, ‘2016 to 2017 reform process prior to exposure draft of Bills’, op. cit. 22. P Fletcher (Minister for Urban Infrastructure), Government to consult stakeholders on exposure draft of Road Vehicle

Standards Bills, media release, 13 December 2017.

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access to specialist and enthusiast vehicles and ensure that Australia's vehicle fleet continues to offer world-leading standards in community and environmental safety. 23

Not all the changes announced in the 2016 reforms announcement are included in the legislative package. For example, the ability for consumers to personally import new vehicles from Japan and the United Kingdom has not been included.

Committee consideration

Senate Standing Committee for Selection of Bills The package of Road Vehicle Standards Bills was referred to the Senate Rural and Regional Affairs and Transport Legislation Committee for inquiry and report.24 Details of the inquiry are at the inquiry homepage.25

The Committee reported on 7 May 2018, recommending that the Bill be passed.26

Senate Standing Committee for the Scrutiny of Bills The Senate Standing Committee for the Scrutiny of Bills has examined the five Road Vehicle Standards Bills. The Committee had no comment on the Consequential Provisions Bill,27 but had concerns with several aspects of the other Bills.

The Road Vehicle Standards Bill

Broad delegation of powers The Scrutiny of Bills Committee was concerned about multiple instances of legislative and administrative powers being broadly delegated. The first instance is in relation to the determination of what constitutes and what are not road vehicles and road vehicle components for the purposes of the Bill. Under subclause 6(5) and subclause 7(3), the Secretary of the Department can determine, by legislative instrument, the classes of vehicles and components that are road vehicles and road vehicle components, respectively, for the purposes of the regime. The Committee believes that significant matters, such as this (as it defines what is controlled by the new legislation) should be part of the primary legislation, unless there is ‘sound justification’ for making it part of delegated legislation.28 The Bill itself does not contain any limits on this power nor matters that must be taken into account when the secretary is using this power. As such, the Committee drew its concerns to the attention of senators and left to the Senate as a whole the appropriateness of granting the Secretary this broad power.29

The Minister subsequently provided additional information, explaining that sometimes a decision on whether or not a vehicle is a road vehicle under the legislation is needed quickly, and that it could be a safety issue if there were delays as a result of the need to amend legislation. The

Minister communicated that this approach was the same as that in the current legislation and that making these decisions requires very technical information that is not suitable for primary

23. DIRDC, ‘Reform of the Motor Vehicle Standards Act 1989’, op. cit. 24. Senate Standing Committee for Selection of Bills, Report, 4, 2018, The Senate, Canberra, 28 March 2018. 25. Parliament of Australia, ‘Senate Rural and Regional Affairs and Transport Legislation Committee: Road Vehicle Standards Bill 2018 [provisions] and related bills’, Inquiry homepage, Parliament of Australia website.

26. Senate Rural and Regional Affairs and Transport Legislation Committee, Road Vehicle Standards Bill 2018 and related bills [provisions], The Senate, Canberra, 7 May 2018, p. 34. 27. Senate Standing Committee for the Scrutiny of Bills, Scrutiny digest, 2, 2018, The Senate, 14 February 2018, p. 44. 28. Ibid., p. 29. 29. Ibid., p. 30.

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legislation. These determinations had only been made twice since the Motor Vehicles Standards Act had come into effect, with one being a determination that electric wheelchairs and other personal mobility devices with motors were not road vehicles (as increases in power in these devices meant they had inadvertently met the definition of a road vehicle). The Committee noted this extra information, requesting that the key information provided be included in the explanatory memorandum since it aids understanding of the law and can be used if required to assist with interpretation as extrinsic material.30

The Committee also raised the issue of broad delegation of administrative powers in relation to clauses 50 and 52. These clauses ‘seek to trigger the monitoring and investigation powers under the Regulatory Powers (Standard Provisions) Act 2014’ for offences related to the Motor Vehicle Standards Bill.31 Subclauses 50(5) and 52(4) seek to allow ‘other people’ to assist the authorised people carrying out the functions or duties related to the monitoring and investigation powers. Neither the Bill nor the Explanatory Memorandum contain any guidance on the ‘other persons’ or any required skills. This is in contrast to requirements being provided for the inspectors. The Committee therefore asked the Minister ‘whether it would be appropriate to amend the [B]ill to require that any person assisting an authorised officer have specified skills, training or experience’.32

The Minister replied that people with a wide range of skills, including experts in specific fields, may be required for assistance given technological advances in road vehicles. As well as this, people with skills such as translation may be required in an investigation. As such, specifying required skills for these ‘other persons’ in the legislation could ‘limit the ability of authorised persons to obtain the assistance of appropriately qualified persons and may jeopardise the monitoring and investigation outcomes intended under the Bill’.33 However, while understanding the need for flexibility, the Committee remained concerned about people assisting ‘authorised officers in exercising potentially coercive or investigatory powers’ without a requirement for training in the relevant powers.34

The final issue raised by the Committee in relation to broad delegation of administrative powers related to delegation of the Minister’s and Secretary’s functions and powers. Under subclause 73(5), any of the Minister’s powers and functions existing under the Rules (discussed under Key Issues and Provisions, below) can be delegated to the Secretary or any Australian Public Service (APS) employee, with the exceptions of issuing a recall notice or determining ‘specified matters by legislative instrument’. Likewise, subclause 74(5) allows all the Secretary’s powers and functions under the Rules to be delegated to any APS employee. The Explanatory Memorandum does not explain why these powers of delegation are so broad, which the Committee considers necessary when the delegation of administrative powers in legislation goes to ‘a relatively large class of persons, with little or no specificity as to their qualifications or attributes’.35 Although the Explanatory Memorandum does provide principles on the employee level that should be required for particular types of decisions, none of this is in the Bill itself, meaning there is no legislative requirement to follow these principles. The Committee therefore asked the Minister why the Minister’s and Secretary’s functions and powers under the Rules can be delegated to any APS employees (with a few restrictions) and whether the Bill can include legislative guidance on the

30. Senate Standing Committee for the Scrutiny of Bills, Scrutiny digest, 3, 2018, The Senate, 21 March 2018, pp. 240-3. 31. Senate Standing Committee for the Scrutiny of Bills, Scrutiny digest, 2, op. cit., p. 38. 32. Ibid. 33. Senate Standing Committee for the Scrutiny of Bills, Scrutiny digest, 3, op. cit., p. 265. 34. Ibid. 35. Senate Standing Committee for the Scrutiny of Bills, Scrutiny digest, 2, op. cit., p. 40.

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scope of powers able to be delegated or to which categories of people these powers can be delegated.36

The Minister responded that, under the draft Road Vehicle Standards Rules, most industry applications will need to be considered by the Minister or Secretary within 30 to 60 days. There are expected to be approximately 200,000 decisions required per year on a range of applications, including type approvals and model reports, and it is more efficient to allow less complicated or sensitive applications to be dealt with by more staff. The Minister also explained that a Delegation Instrument is in place in the Department to manage delegation of powers (with delegation of powers determined by the Secretary or Minister using a risk management basis) as well as administrative processes to ensure appropriate use of the delegated powers by staff.37

While the Committee welcomed the information on how the powers are intended to be delegated, it remained concerned that there is ‘no legislative guidance as to the scope of powers that might be delegated (with limited exceptions), or the categories of people to whom those powers might be delegated’ in the Bill itself.38 The Committee therefore requested that the Explanatory Memorandum contain the key information from the Minister’s response, and drew its concerns to the notice of the Senators.39

Broad discretionary powers The Scrutiny of Bills Committee was concerned about the broad discretionary powers given to the Secretary to determine, by notifiable instrument, whether a specified vehicle is or is not a road vehicle under subclause 6(6), and whether a specified component is or is not a road vehicle component under subclause 7(4) of the Bill. Although the Explanatory Memorandum explains this will allow flexible responses and that the power should be used in a manner consistent with the Bill’s objects, the Committee noted that ‘these provisions seek to grant a very broad power to the secretary with no legislative criteria as to the matters that the secretary must take into account when making such determinations’.40 The Committee went on to say:

The [B]ill also does not set out any right to challenge or seek review of these determinations. Further, no justification is provided for including a power to include or exclude specific vehicles and components in addition to the power to make determinations, by legislative instrument, with respect to classes of vehicles under subclauses 6(5) and 7(3). The committee also notes that notifiable instruments are not subject to the tabling, disallowance and sunsetting requirements imposed on legislative instruments. Parliamentary scrutiny of determinations made by the secretary under subclauses 6(6) and 7(4) is therefore likely to be limited.

41

The Committee asked the Minister why this power was needed, given the power in subclauses 6(5) and 7(3) (discussed above); why the Bill cannot include rules or guidance on use of this power; and whether any form of review will apply to these determinations.42 The Minister replied that these powers were needed for individual vehicles as modifications can easily change their nature and the powers would ensure the community is protected (from potentially unsafe modifications). Being made by notifiable instrument meant that the determination would be published and

36. Ibid., p. 41. 37. Senate Standing Committee for the Scrutiny of Bills, Scrutiny digest, 3, Ministerial response, op. cit., p. 269-70. 38. Senate Standing Committee for the Scrutiny of Bills, Scrutiny digest, 3, op. cit., p. 271. 39. Ibid. 40. Explanatory Memorandum, Road Vehicle Standards Bill, p. 23; Senate Standing Committee for the Scrutiny of Bills, Scrutiny

digest, 2, op. cit., p. 30. 41. Senate Standing Committee for the Scrutiny of Bills, Scrutiny digest, 2, op. cit., p. 30. 42. Ibid., p. 31.

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publically accessible. Approximately 17,000 applications a year are made for individual vehicle importation and the power is envisaged to be used only in ‘complex cases where definitive advice is considered by the Secretary to be in the interests of meeting the objectives of the Bill’.43 The Minister said that the Bill’s objects provide ‘the high level principles that the Secretary needs to consider when making notifiable instruments’.44 The Minister did not provide any reasons for review not being available for determinations made under subclauses 6(6) and 7(4).45

Despite the Minister’s information, the Committee remained concerned about the lack of legislative guidance for use of these powers. The Committee was also still concerned that the objects of the Bill referred to by the Minister set out the objects for the whole Bill and that ‘it is not clear that it would provide any specific guidance in relation to the making of these specific determinations’.46 The lack of merits review of the determinations compounded the Committee’s concerns over the broad powers granted, with the Committee noting there was no justification for the lack of review in the Minister’s response. The Committee drew its concerns to the notice of the Senators and requested that important information from the Minister be included in the explanatory memorandum.47

External material Instruments made under the Motor Vehicle Standards Bill are able to ‘make provision for a matter by applying, adopting or incorporating any matter contained in any other instrument or writing as in force or existing from time to time’ in the following situations:

• the determination of what is or is not a ‘road vehicle’ (subclause 6(8))

• the determination of what is or is not a ‘road vehicle component’ (subclause 7(6))

• the determination of national road vehicle standards (subclause 12(2)) and

• in the Rules or instruments made under the Rules (subclause 82(6)).48

Incorporating external documents into law raises a number of issues, as it ‘can create uncertainty in the law’, means that it is possible the law can change without parliamentary scrutiny and can make it difficult for people to access the provisions of the law they are meant to be following.49

The Explanatory Memorandum explains that incorporating the external material is required in relation to subclauses 6(8) and 7(6) to allow flexibility and currency and is required in relation to subclause 12(2) for ‘flexibility and adaptability’ in response to changes in technology. 50 In addition, the documents incorporated under subclause 12(2) are intended to generally be technical standards from the United Nations (UN) or vehicle standards from other countries. These tend to be publically available except when the UN incorporates International Standards Organisation (ISO) standards or similar with the standards requiring payment for access. The Explanatory Memorandum explains that the provision is required for subclause 82(6) so that technical instruments in or made under the Rules can reference documents to which the National Road Vehicles Standards refer.51 Given the explanations in the Explanatory Memorandum, the

43. Senate Standing Committee for the Scrutiny of Bills, Scrutiny digest, 3, op. cit., pp. 244-5. 44. Ibid., p. 245. 45. Ibid. 46. Ibid., p. 246. 47. Ibid. 48. Senate Standing Committee for the Scrutiny of Bills, Scrutiny digest, 2, op. cit., p. 31. 49. Ibid., pp. 31-2. 50. Ibid; Explanatory Memorandum, Road Vehicle Standards Bill, pp. 25-6. 51. Explanatory Memorandum, Road Vehicle Standards Bill, p. 60.

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Committee drew its concerns about the incorporation of external material to the attention of the Senate.52

The Minister subsequently explained that the ability to incorporate external material was required to continue harmonising Australia’s road vehicle standards with international standards. This continues the policy under section 7A of the Motor Vehicle Standards Act. The Minister also said that the National Library of Australia has some (although not all) international standards available for public access. Overall, the Government believed that the benefits of incorporating international standards (including the safest vehicles available globally being available in Australia) ‘outweighs the minimal detriment caused by the standard potentially not being freely and readily available to persons who are interested, but not directly affected by, the law’.53

In response, the Committee reiterated that it is a ‘fundamental principle of the rule of law that every person subject to the law should be able to freely and readily access its terms’.54 The Committee further requested that the key provided information be included in the Explanatory Memorandum, and drew the attention of the Senate to its continuing concerns.55

Evidential burden of proof The evidential burden of proof is reversed multiple times in the Road Vehicle Standards Bill due to offences that contain offence-specific defences:

• subclauses 16(1) and 16(2) create the offence of entering or authorising ‘another person to enter, a vehicle on the Register of Approved Vehicles (RAV) if the vehicle does not satisfy the requirements of an “entry pathway”’.56 Subclause 16(3) provides an exception to this offence if a component, which a supplier said was an approved type (but did not meet the standards), was used in accordance with the road vehicle standards during vehicle manufacture and that otherwise the entry pathway requirements would have been met

• subclause 24(1) creates the offence of providing a road vehicle for the first time that is not on the RAV. Subclauses 24(3) and 24(4) provide exceptions to this in particular circumstances, including in circumstances specified in the Rules, and

• subclause 32(1) creates the offence of giving false or misleading information with subclause 32(2) providing an exception if the information is ‘not false or misleading in a material particular’.57

The Committee stated:

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.

At common law, it is ordinarily the duty of the prosecution to prove all elements of an offence. 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.

52. Senate Standing Committee for the Scrutiny of Bills, Scrutiny digest, 2, op. cit., p. 33. 53. Senate Standing Committee for the Scrutiny of Bills, Scrutiny digest, 3, op. cit., p. 249. 54. Senate Standing Committee for the Scrutiny of Bills, Scrutiny digest, 3, op. cit., p. 250. 55. Ibid., pp. 250-1. 56. Senate Standing Committee for the Scrutiny of Bills, Scrutiny digest, 2, op. cit., p. 33. 57. Ibid., pp. 33-4.

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While in these instances 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. 58

The Committee further noted that according to the Guide to Framing Commonwealth Offences, only matters that are ‘peculiarly within the knowledge of the defendant’ and ‘significantly more difficult and costly for the prosecution to disprove than for the defendant to establish the matter’ should be in an offence-specific defence.59 This is in contrast with the general explanation in the Explanatory Memorandum that the matters need to meet one of these criteria. While the Explanatory Memorandum did contain further explanation for some of the offence-specific defences, the Committee did not consider it justified their use and so asked the Minister for justification.60

The Minister subsequently explained that, in relation to subclause 16(3), the type-approval holder holds the relevant documentation (as they are required to keep it as supporting documentation as part of their application) and that it would be significantly more difficult and costly for the Department to access, due in part to the resource intensity of understanding the production process. In relation to clause 24, it was also explained that the Department would not have the documentation in the specific situation of vehicles imported under intergovernmental agreements currently included in the draft Rules (paragraph 24(3)(f)) and that in relation to non-RAV entry import (paragraph 24(4)(a)), the importer has the required vehicle and documentation, making it much harder for the Department to prove. The Minister also provided an example for subclause 32(1) where the information would be peculiarly within the knowledge of the defendant, and stated that ‘reversal of evidential burden in this offence is consistent with the Criminal Code Act 1995 and other Commonwealth legislation that operates in a similar regulatory environment, such as the Biosecurity Act 2015’.61

Given the Minister’s responses, the Committee had no further comment on the reversal of the evidential burden of guilt in paragraphs 16(3)(a), (c), and (d) and 24(4)(a). However, in relation to paragraph 24(3)(f), the Committee did not think the matter was definitely peculiarly within the defendant’s knowledge. Also, given that the exception is reliant on the delegated legislation, rather than the primary legislation, the situation could change and other circumstances could ‘be prescribed that are clearly not peculiarly within the knowledge of the defendant or significantly more difficult and costly for the prosecution to disprove’.62 In relation to subclause 32(2), the Committee, despite acknowledging that in the example provided by the Minister the information was peculiarly within the knowledge of the defendant, was not convinced that this would always be the case in other situations that could fall under this subclause. As such, it was not clear to the Committee that it was ‘appropriate to reverse the evidential burden of proof in relation whether a document or information is not false or misleading in a material particular’.63 The Committee requested that important information from the Minister be included in the Explanatory Memorandum, and drew its concern about paragraph 24(3)(f) and subclause 32(2) to the attention of senators.64

58. Ibid., p. 34. 59. Ibid.; Attorney-General’s Department, A guide to framing Commonwealth offences, infringement notices and enforcement powers, [Attorney-General’s Department], [Canberra], 2011, p. 50.

60. Senate Standing Committee for the Scrutiny of Bills, Scrutiny digest, 2, op. cit., pp. 35-6. 61. Senate Standing Committee for the Scrutiny of Bills, Scrutiny digest, 3, op. cit., pp. 254-5. 62. Ibid., p. 257. 63. Ibid. 64. Ibid.

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Strict liability offence Clause 38 creates a strict liability offence for refusal or failure to obey a recall notice or for supplying a road vehicle or component that is the subject of a recall notice. General principles of criminal law require a person to be proved at fault before they are found guilty, ensuring that people are not liable if they are not sufficiently aware of their action and its potential consequences. However, in the case of strict liability offences, the prosecution does not need to prove that the defendant intended to engage in a particular action, or was negligent or reckless. As the imposition of strict liability undermines general criminal law principles, the Scrutiny of Bills Committee expects clear justification for strict liability offences to be included in the Explanatory Memorandum, including whether it is consistent with the Guide to Framing Commonwealth Offences.

Clause 38 imposes a maximum penalty of 1,050 penalty units for an individual and 5,250 penalty units for a body corporate (currently equivalent to $220,500 and $1,102,500, respectively).65 The Guide to Framing Commonwealth Offences, however, says that ‘strict liability is only considered appropriate where the offence is not punishable by imprisonment and only punishable by a fine of up to 60 penalty units for an individual’.66 The Explanatory Memorandum considers strict liability is required in this situation ‘to “ensure the integrity of the regulatory regime, particularly when failure to comply with the recall notice could cause significant health or environmental risks to the

Australian public”’ and that persons in the industry are already aware of strict liability offences in this regard.67 However, the Explanatory Memorandum contains no ‘direct justification for the very significant penalties proposed, particularly with respect to individuals, in a context where there is no requirement to prove fault’.68 Given this, the Committee drew its concerns to the Senate’s notice.

The Minister subsequently explained that both strict liability and the penalty amount were required for the ‘integrity of the regulatory regime’, thus making the use of strict liability compatible with the Guide to Framing Commonwealth Offences.69 The Minister explained the

penalty amount needed to be high enough so that non-compliance with a recall was not more attractive than undertaking a (likely to be expensive) recall. The Minister also explained that it was unlikely that an individual would commit this offence. The provisions were also consistent with the provisions under the Australian Consumer Law that apply to those supplying consumer goods, including road vehicles.70 The Committee welcomed the Minister’s explanation, requesting that the important information be contained in the Explanatory Memorandum and otherwise had no further comment on this issue.71

Self-incrimination The Scrutiny of Bills Committee was concerned that aspects of the Bill may override the common law principle of a person being excused from giving evidence that will incriminate him or herself in particular circumstances. Clause 41 allows for disclosure notices requiring information to be provided in particular circumstances. Subclause 42(1) then provides that the information

65. As of May 2018, one penalty unit is equal to $210: Crimes Act 1914, section 4AA. 66. Senate Standing Committee for the Scrutiny of Bills, Scrutiny digest, 2, op. cit., p. 36; Attorney-General’s Department, A guide to framing Commonwealth offences, infringement notices and enforcement powers, op. cit., p. 23. 67. Senate Standing Committee for the Scrutiny of Bills, Scrutiny digest, 2, op. cit., p. 36; Explanatory Memorandum, Road Vehicle

Standards Bill, p. 41. 68. Senate Standing Committee for the Scrutiny of Bills, Scrutiny digest, 2, op. cit., p. 37. 69. Senate Standing Committee for the Scrutiny of Bills, Scrutiny digest, 3, op. cit., p. 259. 70. Ibid. 71. Ibid., pp. 260-1.

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requested in the disclosure notice must be given even if it tends to incriminate the person or expose them to a penalty. However, subclause 42(2) provides use immunity for the individual, by providing:

… the information, evidence or documents provided in response to a disclosure notice are not admissible in evidence against the individual in civil or criminal proceedings, with the exception of proceedings relating to a refusal or failure to comply with a disclosure notice, knowingly providing false or misleading information in response to a disclosure notice, or knowingly giving false or misleading information to a Commonwealth entity.

72

However, the Bill does not prevent indirectly obtained information being used in criminal proceedings against the person. The Committee understood that there are appropriate circumstances where the privilege against self-incrimination is overridden. However, it also believes that it is ‘more likely to be considered appropriate if accompanied by a use and derivative use immunity’.73 The Explanatory Memorandum explained that abrogating the privilege against self-incrimination was required as information may need to be gathered quickly where road vehicles or components are believed to be a risk. However, no explanation was given for why use immunity was given but not derivative use immunity. Given this, the Committee requested the Minister to explain why there was no derivative use immunity provided in this situation.74

The Minister explained that it was not appropriate to have derivative use immunity in this situation for a number of reasons, including:

• it ensures consistency with the Australian Consumer Law, so as to ‘prevent suppliers of road vehicles “legislation shopping” by pressuring regulators to use legislation with more lenient compliance tools’

• it may delay the release of information from non-compliant suppliers required to protect the community from harm, as the derivative use immunity could provide an incentive to withhold information and ‘then use the subsequent disclosure notice to “confess” to other serious non-compliance’ and

• there are very limited circumstances where evidence will be required from an individual, as it is most likely type approval holders that would receive a disclosure notice.75

Given this information, the Committee requested that the important information from the Minister be included in the Explanatory Memorandum and otherwise had no further comment.76

Judicial review limits Under subclause 62(1), computer programs can be used by the Minister ‘for any purposes for which the Minister may, or must, under the Bill make a decision, exercise any power or comply with any obligation, or do anything else related’ to this.77 Under subclause 62(2), anything done by the computer program in the above circumstances is taken to have been done by the Minister. Subclause 63(1) then allows the Minister to substitute a decision for one made by the program if:

72. Senate Standing Committee for the Scrutiny of Bills, Scrutiny digest, 2, op. cit., p. 37; Use immunity means that the information or evidential material given, and the fact that the person has given the information or evidence, is not admissible evidence in criminal proceedings against that person . Derivative use immunity means that any information, document or thing obtained as a direct or indirect consequence of the person having given information or evidence is not admissible in criminal proceedings against that person. See C Raymond, Regulatory Powers (Standardisation Reform) Bill 2016, 42, 2016-17, Parliamentary Library, Canberra, 22 November 2016, p. 54. 73. Senate Standing Committee for the Scrutiny of Bills, Scrutiny digest, 2, op. cit., p. 37. 74. Ibid., p. 38. 75. Senate Standing Committee for the Scrutiny of Bills, Scrutiny digest, 3, op. cit., pp. 262-3. 76. Ibid., p. 263. 77. Senate Standing Committee for the Scrutiny of Bills, Scrutiny digest, 2, op. cit., p. 39.

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• the program was not working correctly when the decision was made (paragraph 63(1)(a))

• the substituted decision could have been made under the same provision as the initial decision (paragraph 63(1)(b)) and

• the substituted decision is more favourable to the applicant (paragraph 63(1)(c)).

However, subclause 63(2) states that the Minister, even if requested, does not have to consider whether to use this power in respect of any decision. The Explanatory Memorandum does not explain why this ‘no-duty-to-consider’ clause is included, despite saying that ‘subclause 63(1) would allow the minister to “correct adverse decisions without the need for applicants to seek external review when it is the computer program itself that has made an error”’ and ‘that nothing in this subclause is intended to affect any merits review entitlements that an applicant may have’.78

The Committee noted that it is hard to determine whether the remaining merit review entitlements are sufficient as the Motor Vehicle Standards Bill allows the rules to specify review entitlements for administrative decisions. It also noted that although the High and Federal Courts can still undertake judicial review of no-duty-to-consider clauses, the judicial review is less effective ‘where no decision to consider the exercise of a power has been made’ and that ‘[e]ven where a decision has been made to consider the exercise of the power, some judicial review remedies will not be available’.79 As such:

The committee considers it may be appropriate to amend the no-duty-to consider clause to ensure it does not apply where the minister is made aware of facts that indicate that an adverse decision has been made as a result of a computer program not functioning correctly. The committee requests the minister's response on this matter and an explanation as to why proposed subclause 63(2) is otherwise considered necessary and appropriate.

80

In response, the Minister stated that a discretionary power was considered apt by the Government, explaining that making it a duty to consider exercising the power in subclause 63(1) could ‘place an undue burden on the Minister’.81 The Minister anticipated that minimal cases would be referred for reconsideration and ‘that the Minister would consider whether to exercise the power, where reasonably asked to do so’.82

The Scrutiny of Bills Committee noted the explanation from the Minister of a possible ‘undue burden’:

However, the committee does not consider that amending the no-duty-to-consider clause to ensure that it does not apply where the minister is made aware of facts that indicate that an adverse decision has been made as a result of a computer program not functioning correctly would amount to there being a positive duty to consider whether to exercise the power in relation to every computer-based decision. The committee's suggestion would merely make it clear that the no-duty-to-consider clause would not apply in the limited circumstance where the minister is made aware of facts that indicate that an adverse decision has been made as a result of a computer program not functioning correctly. In this way, the practical concerns raised by the minister may be balanced against the committee's concern about the breadth of this power and the limited facility for review of its exercise.

83

78. Ibid.; Explanatory Memorandum, Road Vehicle Standards Bill, p. 53. 79. Senate Standing Committee for the Scrutiny of Bills, Scrutiny digest, 2, op. cit., pp. 39-40. 80. Ibid., p. 40. 81. Senate Standing Committee for the Scrutiny of Bills, Scrutiny digest, 3, op. cit., p. 267. 82. Ibid. 83. Ibid., pp. 267-8.

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The Committee requested that the important information from the Minister be included in the Explanatory Memorandum, and drew its concern about this matter to the attention of senators.84

Liability immunity The Scrutiny of Bills Committee was also concerned about clause 81 in the Road Vehicle Standards Bill, which attempts to severely limit the common law right to bring an action to enforce legal rights. Subclause 81(1) seeks to prevent legal proceedings being brought against the Commonwealth, including for loss or damage, because of a reliance on certain matters done under the Act. In addition, subclause 81(2) prevents proceedings (whether criminal or civil) against the Minister; the Secretary; an inspector; or a Department APS employee; for anything done or not done in good faith under the Bill. The Committee noted that ‘bad faith can only be shown in very limited circumstances’ as it ‘is said to imply a lack of an honest or genuine attempt to undertake the task and that it will involve a personal attack on the honesty of the decision-maker’.85 The Explanatory Memorandum provides no explanation for this. Given that, the Committee requested the Minister to explain why it is appropriate to limit legal proceedings, ‘such that affected persons would have their right to bring an action to enforce their legal rights removed or limited to situations where a lack of good faith is shown’.86

The Minister explained that ‘[c]lause 81 of the Bill is a policy continuation of section 37 of the Motor Vehicle Standards Act.’87 He went on to explain that the Department is not able to inspect each of the over 1.2 million vehicles that enter the Australian market annually, relying on approval holders to provide evidence that each vehicle meets requirements. Despite aptly trained staff, it is still possible that losses could occur due to reliance on decisions made under the Bill, such as approvals granted due to, for example, fraud by the approval holder. It would therefore be unfair to make the Minister, Secretary or staff responsible legally for such loss if they have acted in good faith. In addition, the extra ‘legal burden placed on the Department would significantly increase decision times and could result in the Department being more cautious and restrictive in relation to the approval of applications’ which would be detrimental to consumers, the public and the Australian automotive industry.88 The Minister concluded by saying that clause 81 does not prevent claims against persons who did not act in good faith and that it prevented ‘frivolous claims’.89

The Scrutiny of Bills Committee noted the Minister’s advice but restated its concerns ‘that clause 81 appears to remove any common law right to bring an action to enforce legal rights, except where a lack of good faith can be demonstrated’.90 The Committee also noted the Minister did not explain why actions could not be brought against the Commonwealth. The Committee requested that important information provided by the Minister be included in the Explanatory Memorandum and made no further comment.91

Reviews of decisions The Scrutiny of Bills Committee also raised concerns about the availability of review of decisions made under the Road Vehicle Standards Bill. Subclause 82(1) grants the Minister the power to

84. Ibid, p. 268. 85. Senate Standing Committee for the Scrutiny of Bills, Scrutiny digest, 2, op. cit., pp. 41-2. 86. Ibid., p. 42. 87. Senate Standing Committee for the Scrutiny of Bills, Scrutiny digest, 3, op. cit., p. 272. 88. Ibid., p. 273 89. Ibid. 90. Ibid., p. 274. 91. Ibid.

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make rules by legislative instrument. Without limiting subclause 82(1), subclause 82(2) contains a list of matters that may be prescribed by the rules, including ‘provide for and in relation to the review of a decision made under this Act, the rules or any instrument made under the rules’ (paragraph 82(2)(c)).The Committee noted that subclause 82(2) only says that rules may be made in relation to these matters; they do not have to be made. There is no other provision in the Bill for persons to seek review (either internal and external) and the Bill does not list any decisions as being reviewable under the Administrative Appeals Tribunal Act 1975, meaning reviews cannot be

carried out by the Administrative Appeals Tribunal (AAT). In contrast, the Motor Vehicle Standards Act has a number of ministerial decisions subject to AAT review (see section 39).

The Explanatory Memorandum does not explain why rules were allowed to specify the review rights of administrative decisions nor ‘why it is appropriate not to require that the rules make provision for review rights’.92 If important matters such as merits review are not included in the primary legislation, as the Committee believes they should be, the Committee considers that it should be a minimum requirement that the ‘delegated legislation set out what decisions will be subject to review rights’.93 The Committee therefore requested the Minister to explain:

… why the bill does not set out which decisions will be subject to merits review before the Administrative Appeals Tribunal, and why, at a minimum, the bill does not require the rules to provide for and in relation to the review of decisions made under the bill. 94

The Minister explained that allowing the Rules to specify which decisions are subject to merit review ‘allows for a more nuanced and considered approach to merits review’ as it allows the Minister to consider whether each individual decision point is suitable for merits review.95 The Minister also noted that ‘the draft Rules provide extensive rights to merit review by the AAT’.96 The Committee noted the Minister’s response, and reiterated ‘its preference that, as it is a significant matter, the availability of merits review should, wherever possible, be set out in primary legislation’.97 The Committee requested that important information provided by the Minister be included in the Explanatory Memorandum and made no further comment.98

The Charges (General), Charges (Customs) and Charges (Excise) Bills The Scrutiny of Bills Committee had the same concern for all three of the Bills related to charges— the Charges (General) Bill, the Charges (Customs) Bill and Charges (Excise) Bill. Clause 6 of the Charges (General) and Charges (Customs) Bills and clause 5 of the Charges (Excise) Bill allow for the imposition of charges, imposed as a tax, in relation to prescribed matters related to the administration of the Road Vehicle Standards Bill or the Consequential Provisions Bill. Clause 7 of the Charges (General) and Charges (Customs) Bills and clause 6 of the Charges (Excise) Bill state that a Regulation may prescribe these charges through the specification of an amount or a method to calculate the amount. However, there is no further guidance or limitation in the Bills on the amounts of the charges.

The Committee stated that ‘[o]ne of the most fundamental functions of the Parliament is to impose taxation (including duties of customs and excise)’ and ‘that it is for the Parliament, rather

92. Senate Standing Committee for the Scrutiny of Bills, Scrutiny digest, 2, op. cit., p. 43. 93. Ibid. 94. Ibid. 95. Senate Standing Committee for the Scrutiny of Bills, Scrutiny digest, 3, op. cit., pp. 275-6. 96. Ibid. 97. Ibid., p. 276. 98. Ibid.

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than makers of delegated legislation, to set a rate of tax’.99 The Committee expressed concern that the Bills do not set a limit on the charge. The Bills also do not contain guidance restricting the charges to reflect the Explanatory Memorandum’s statement that the charges are for cost recovery and should not raise money beyond costs of administering the Road Vehicle Standards Bill and the Consequential Provisions Bill, including services to regulated bodies. The Committee

requested the Minister’s advice as to why the Bills do not specify a maximum charge and also ‘whether guidance in relation to the method of calculation of these charges and/or a maximum charge’ can be included in each Bill.100

The Minister responded that having the charge amount and/or calculation method in the Regulations, rather than the legislation, gives the required flexibility to change the amount quickly when required to avoid over or under charging without having to amend legislation. A Draft Cost Recovery Implementation Statement has already been released for consultation, and the Department has committed to review charges made in the future. The Minister also noted that Regulations are subject to parliamentary scrutiny from the Senate Standing Committee on Regulations and Ordinances and disallowance. Based on all these factors, ‘the Government does not believe a method of calculation to these charges and/or a maximum charge can be specifically included in each Bill’.101

The Scrutiny of Bills Committee, while acknowledging the Minister’s reply, reiterated its previous objections, and added that it did not think amendments to legislation would be regularly required if a maximum charge was included in the Bill. If that was not suitable, then ‘guidance as to the method of calculation of the charge…could still be provided on the face of the primary legislation’.102 The Committee requested that ‘the key information provided by the minister be included in the explanatory memorandum’ as well as drawing its concerns to the attention of senators and the Senate Standing Committee on Regulations and Ordinances.103

Policy position of non-government parties/independents The only aspect of the Road Vehicle Standards Bill and associated Bills that Labor appears to have commented on is an exclusion from, rather than an inclusion in, the Bills. Labor supported the decision of the Turnbull Government to not allow personal importation of new vehicles from Japan and the United Kingdom (see Background for information on this possible importation). Senator Kim Carr, Shadow Minister for Innovation, Industry, Science and Research said ‘the Government had done the right thing in heeding warnings from the automotive industry that safety and service standards could not be guaranteed in direct personal imports of cars’.104

At the time of writing, there do not appear to have been any other comments from non-government parties or independents on the Road Vehicle Standards Bill and its associated Bills.

Position of major interest groups Opinions on the new road vehicles scheme have been mixed. While the modernisation of the legislation was often welcomed (for example, by the Caravan Industry Association of Australia,

99. Senate Standing Committee for the Scrutiny of Bills, Scrutiny digest, 2, op. cit., p. 46. 100. Ibid. 101. Senate Standing Committee for the Scrutiny of Bills, Scrutiny digest, 3, op. cit., p. 279. 102. Ibid., p. 281. 103. Ibid. 104. K Carr (Shadow Minister for Innovation, Industry, Science and Research), Upholding the auto import ban is a win for

consumers and the automotive industry, media release, 17 August 2017.

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VicRoads and the Australian Historic Motoring Federation and Council of Heritage Motoring Clubs NSW), not all bodies believed that the regulatory compliance burden is necessarily reduced by the new scheme.105 Multiple groups, including the Australian Automotive Dealer Association (AADA) and the National Road Transport Association (NatRoad), also approve including a power to recall vehicles when necessary.106 However, the difficulty in enforcing an Australian recall (as well as enforcing other parts of the scheme) on an overseas company (due to extraterritorial application of the Road Vehicle Standards Bill) was raised by bodies such as the Truck Industry Council.107 The RAWS Association (which represents small businesses that import used vehicles not sold in Australia by major brands) fears that its industry could be wiped out by the new road vehicles scheme.108

Numerous groups representing heavy vehicles believe that the legislation is too focused on light vehicles (such as cars). For example, NatRoad stated that ‘[t]here appears to be a very firm focus on the regulatory regime being designed for light vehicles, especially cars’, despite truck manufacturing still occurring in Australia and heavy vehicles being ‘a very important component of Australia’s economy’.109 There were also concerns about how the new legislation would fit with existing legislation. In its submission to the Department of Infrastructure, Regional Development and Cities, 2018 Public Consultation on the new Road Vehicle Standards legislation, the Heavy Vehicle Industry Australia (HVIA) was concerned that ‘the current draft legislation and rules may result in confusion/ difficulties in the interaction between the Road Vehicle Standards Act and the Heavy Vehicle National Law’.110

Numerous bodies have contended that clarity is lacking and some provisions in the new legislation are confusing. For example, the extent to which components are regulated under the new legislation was regarded as unclear by NatRoad:

… section 7 deals with the regulation of some road vehicle components. The extent of regulation is confusing. The provision is very complex. The EM, for example, says in a somewhat circular manner: This Bill regulates approved road vehicle components that have a road vehicle component type approval…

The Bill should…be clearer and should better indicate the intention expressed in the EM [Explanatory Memorandum] that the regulation of components is on an opt-in basis and that it is not intended that a component would be approved if it is for general sale directly to consumers. 111

105. Caravan Industry Association of Australia (CIAA), Submission to Senate Rural and Regional Affairs and Transport Legislation Committee, Inquiry into the Road Vehicle Standards Bill 2018 and related bills [provisions], 17 April 2018, p. 2; Australian Historic Motoring Federation, Submission to Department of Infrastructure, Regional Development and Cities, 2018 Public Consultation on the new Road Vehicle Standards legislation, 16 February 2018, p. 3.; VicRoads, Submission to Department of Infrastructure, Regional Development and Cities, 2018 Public Consultation on the new Road Vehicle Standards legislation, February 2018, p. 1.; National Road Transport Association (NatRoad), Submission to Senate Rural and Regional Affairs and Transport Legislation Committee, Inquiry into the Road Vehicle Standards Bill 2018 and related bills [provisions], 17 April 2018, p. 3; Heavy Vehicle Industry Australia (HVIA), Submission to Senate Rural and Regional Affairs and Transport Legislation Committee, Inquiry into the Road Vehicle Standards Bill 2018 and related bills [provisions], 17 April 2018, p. 2. 106. Australian Automotive Dealer Association (AADA), Submission to Department of Infrastructure, Regional Development and

Cities, 2018 Public Consultation on the new Road Vehicle Standards legislation, 23 February 2018, p. 8; NatRoad, Submission, op. cit., p. 7. 107. Truck Industry Council (TIC), Submission to Senate Rural and Regional Affairs and Transport Legislation Committee, Inquiry into the Road Vehicle Standards Bill 2018 and related bills [provisions], 17 April 2018, p. 8. 108. The RAWS Association, Submission to Senate Rural and Regional Affairs and Transport Legislation Committee, Inquiry into the

Road Vehicle Standards Bill 2018 and related bills [provisions], 17 April 2018, p. 2. 109. NatRoad, Submission, op. cit., pp. 5-6. 110. HVIA, Submission to Department of Infrastructure, Regional Development and Cities, 2018 Public Consultation on the new

Road Vehicle Standards legislation, 16 February 2018, p. 2. 111. NatRoad, Submission, op. cit., p. 8.

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The provisions in the Road Vehicle Standards Bill related to modification of vehicles have also raised concern. As well as a perceived lack of clarity in the legislation, bodies such as HVIA are concerned that application of these provisions could result in safety problems and industry disruption in relation to heavy vehicles, although this could potentially be addressed in the Rules.112

Financial implications The Explanatory Memoranda for the Road Vehicle Standards Bill and Consequential Provisions Bill state that the Bills will not have a significant financial impact on the Commonwealth.113 The three Charges Bills (Charges (General) Bill, Charges (Customs) Bill and the Charges (Excise) Bill) ‘provide a framework for recovery [of] costs associated with the administration of the Road Vehicle Standards Bill’.114 This will offset the costs imposed on the Commonwealth from regulating road vehicle importation and supply.115 =

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 considers that the Road Vehicle Standards Bill, Consequential Provisions Bill, Charges (General) Bill, Charges (Customs) Bill and the Charges (Excise) Bill are compatible.116

Parliamentary Joint Committee on Human Rights The Parliamentary Joint Committee on Human Rights was concerned that the Road Vehicle Standards Bills potentially limited three human rights. The Committee was concerned that the inclusion of a use immunity but not derivative use immunity in clause 42 could infringe on the human right to not incriminate oneself and that subclauses 16(3), 24(3)-(4), 32(2) and 43(2) reverse the burden of proof, affecting the right to presumption of innocence (both discussed above in Senate Standing Committee for the Scrutiny of Bills). The Committee was also concerned that the ‘coercive evidence gathering powers’ in clause 41 (where disclosure notices can require information; discussed in Senate Standing Committee for the Scrutiny of Bills and Key Issues and Provisions) could limit the right to privacy.117 The Committee sought further information from the Minister on the compatibility of these matters with the raised human rights, including whether the limitations to the rights are ‘reasonable and proportionate measure[s] to achieve the stated objective[s]’.118

The Parliamentary Joint Committee on Human Rights did not raise any human rights concerns for the Consequential Provisions Bill, Charges (General) Bill, Charges (Customs) Bill) or the Charges (Excise) Bill.119

112. HVIA, Submission to Senate Rural and Regional Affairs and Transport Legislation Committee, op. cit., pp. 2-4. 113. Explanatory Memorandum, Road Vehicle Standards Bill, p. 15; Explanatory Memorandum, Consequential Provisions Bill, p. 7. 114. Explanatory Memorandum, Charges (General) Bill, Charges (Customs) Bill) and the Charges (Excise) Bill, p. 3. 115. Ibid. 116. The Statement of Compatibility with Human Rights can be found at pages 16-20 of the Explanatory Memorandum to the Road

Vehicle Standards Bill, pages 8-9 of the Explanatory Memorandum to the Consequential Provisions Bill and pages 4-5 of the Explanatory Memorandum to the Charges (General) Bill, Charges (Customs) Bill) and the Charges (Excise) Bill. 117. Parliamentary Joint Committee on Human Rights, Human rights scrutiny report, 4, 8 May 2018, p. 25. 118. Ibid., pp. 22, 24-5. 119. Parliamentary Joint Committee on Human Rights, Human rights scrutiny report, 2, 13 February 2018, p. 42.

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Key issues and provisions

The Road Vehicle Standards Bill The Road Vehicle Standards Bill is the main Bill in the package of Bills introducing the new road vehicles scheme.120 One major issue that applies to the whole Bill is that little detail is included in the primary legislation. Instead, the Bill provides an overarching framework and the detail of how the scheme will operate is left to ‘rules’ made by the Minister under clause 82 of the Bill. Major parts of the Bill, including, for example, requirements for meeting the entry pathway to be entered on the Register of Approved Vehicles (RAV) or Specialist and Enthusiast Vehicles Register (SEVs Register) are left to the rules. Although the rules will be a legislative instrument, disallowable by either House of Parliament, this greatly reduces the level of parliamentary scrutiny that can apply to the scope and actual operation of the scheme and limits present clarity of the scheme.121 Despite the public consultation that has been carried out on the new legislative package, including the draft rules, interest groups such as the Motor Trades Association of Australia Limited (MTAA) are concerned at the lack of clarity for many parts of the Bill.122

Preliminary Provisions Part 1 of the Road Vehicle Standards Bill contains the preliminary provisions for the new legislative framework for Regulation of the importation and supply to market of road vehicles, and provision of some road vehicle components. The preliminary provisions include the objects of the regime in clause 3 and relevant definitions in clause 5. This includes a definition of ‘motor vehicle’ as a vehicle that either uses or is designed to use as the main means of propulsion ‘volatile spirit, gas, oil, electricity or any other power (other than human or animal power)’ or more than one of these powers. The definition excludes vehicles used exclusively on a railway or tramway.

Clauses 6 and 7 define what is regulated under the Bill: clause 6 contains the meaning of road vehicle, while clause 7 contains the meaning of road vehicle component.

Definition of road vehicle The meaning of road vehicle is broad, encompassing under subclause 6(1) any of the following:

(a) a motor vehicle designed at least mainly for transport on public roads

(b) a trailer or vehicle (including wheeled equipment) designed to be towed by a motor vehicle on public roads

(c) a vehicle within a class of vehicles determined to be road vehicles by the Secretary under subclause 6(5) and not determined by the Secretary to not be a road vehicle under paragraph 6(6)(b)

(d) a vehicle determined to be a road vehicle by the Secretary under paragraph 6(6)(a)

(e) any partially completed or unassembled vehicle that would otherwise fall into any of the previous categories.

This ensures that not just motorbikes, cars and heavy vehicles but also items like caravans are regulated through this Bill.

120. Unless otherwise identified, references to clauses in this part of the Digest are to clauses of the Road Vehicles Standards Bill. 121. Legislation Act 2003, section 42. 122. Motor Trades Association of Australia Limited (MTAA), Submission to Department of Infrastructure, Regional Development and Cities, 2018 Public Consultation on the new Road Vehicle Standards legislation, 13 February 2018.

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Subclause 6(3) states that when determining if a vehicle (or a towed vehicle or trailer) is designed at least mainly for transport on public roads under paragraphs 6(1)(a) and 6(1)(b), ‘regard is to be had only to the physical and operational features’. The Explanatory Memorandum explains that this an objective test, and that the subjective intent of the designer is not relevant.123 Subclause 6(2) provides that a vehicle becomes a road vehicle at the time it is entered on the RAV if:

• the person holds type approval for a vehicle of that type

• that type is not a road vehicle under subclause 6(1) and

• the person enters or authorises entry of a vehicle of that type on the RAV as permitted under the Road Vehicle Standards Bill.

Subclause 6(5) allows the Secretary to determine classes of vehicles that are or are not road vehicles. Under subclause 6(6), the Secretary may also determine that a specified vehicle is or is not a road vehicle. Subclause 6(8) further permits an instrument under subclauses 6(5) and 6(6) to make provision in relation to a matter through the incorporation of external instruments or documents to allow determinations to adopt industry standards.124

Definition of road vehicle component Subclause 7(1) provides that a road vehicle component is any of:

• ‘a component to be used in the manufacture of a road vehicle, including an assembly’ (paragraph 7(1)(a))

• a component that is within a class determined to be road vehicle components by the Secretary under subclause 7(3) and not determined to not be a road vehicle component by the Secretary under paragraph 7(4)(b) or

• a component determined to be a road vehicle component by the Secretary under paragraph 7(4)(a).

The Explanatory Memorandum explains that Regulation of components is intended to occur on an opt-in basis and that ‘it is not intended that all components…will be regulated by this Bill’.125 The Regulation of components will also only apply to those used in the original manufacturing process and not aftermarket spare parts. Interest groups, such as NatRoad, have mentioned that the legislation does not specify which components will need to be regulated, and that the explanation

in the Explanatory Memorandum that the ‘Bill regulates approved road vehicle components that have a road component type approval’ does not add clarity.126

Subclauses 7(3), 7(4), 7(6) and 7(7) provide the same powers to the Secretary respectively as in subclauses 6(5), 6(6), 6(8) and 6(9) (described above) except in relation to road vehicle components instead of road vehicles. As discussed earlier in this Digest, the Senate Scrutiny of Bills Committee raised a number of concerns with these provisions, including the broad discretion provided to the Secretary to determine what is regulated by the Bill and the incorporation of external documents. Some stakeholders such as NatRoad were also concerned by the accessibility of external documents incorporated into law:

123. Explanatory Memorandum, Road Vehicle Standards Bill, p. 23. 124. Subclause 6(9) states that subclause 6(8) has effect despite subsection 14(2) of the Legislation Act 2003. Subsection 14(2) of the Legislation Act 2003 states that ‘Unless the contrary intention appears, the legislative instrument or notifiable instrument may not make provision in relation to a matter by applying, adopting or incorporating any matter contained in an instrument

or other writing as in force or existing from time to time’. 125. Explanatory Memorandum, Road Vehicle Standards Bill, p. 24. 126. Ibid; NatRoad, Submission, op. cit., p. 8.

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There should be a duty on the Minister or the Secretary to have all documents so incorporated readily accessible to the public on a publicly available register displayed, say, on the Departmental web site or linked electronically within the instrument created.

The industry is already burdened with the requirement from time to time to access expensive Australian Standards and ISO documents. The cost of accessing other documents should not become a regulatory burden and hence NatRoad’s contention about accessibility. The preferred position is for instruments to be self-contained to the extent possible, accessible and in plain language.

127

Clause 10 states that the Bill has extraterritorial application, applying outside of Australia. The Explanatory Memorandum explains that this is required for the Bill to operate effectively, as the majority of road vehicle manufacturing occurs overseas and the Bill allows approval holders to be outside Australia.128

Regulation of road vehicles and road vehicle components Part 2 of the Road Vehicle Standards Bill provides the Regulation of road vehicles and components through:

• permitting the Minister to make national road vehicle standards

• creating the Registers of Approved Vehicles and Specialist and Enthusiast Vehicles

• creating offences and civil penalty provisions to enforce that only permitted vehicles are imported or provided to consumers

• permitting rules to be made to support the legislative framework and

• other related matters.

National Road Vehicle Standards Subclause 12(1) provides that the Minister may determine national road vehicle standards for vehicles or components that: make use of the road vehicle safe; limit gas, particles or noise emissions; protect vehicles from theft; provide security markings and/or promote energy savings. This will allow the Government to implement its intention of ‘applying appropriate safety, environmental performance and security standards to vehicles entering the Australian market for the first time’ and should allow the implementation of fuel efficiency standards for new cars if desired.129 This is similar to the current scheme in that the Minister also makes standards under the current regime (the Australian Design Rules), which will initially carry over into the new regime (as per the Consequential Amendments Bill). The standards determined under subclause 12(1) will be a disallowable legislative instrument.

Subclause 12(2) allows for the incorporation of external materials into the road vehicle standards, which the Explanatory Memorandum explains are generally international agreements. This aids harmonisation with international standards in an efficient manner.130 Incorporating the external

materials into the standards raises the same issues of the law changing without notice when the external documents change, access difficulties and expense, and lack of parliamentary scrutiny as discussed above. This was raised by the Senate Standing Committee for Scrutiny of Bills and is discussed further under Committee Consideration: Senate Standing Committee for the Scrutiny of Bills.

127. NatRoad, Submission, op. cit., p. 8. 128. Explanatory Memorandum, Road Vehicle Standards Bill, p. 25. 129. Fletcher, ‘Second Reading Speech: Road Vehicle Standards Bill 2018’, op. cit., p. 494. 130. Explanatory Memorandum, Road Vehicle Standards Bill, pp. 25-6.

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Register of Approved Vehicles The Register of Approved Vehicles (RAV) is established under Division 3 of Part 2 of the Road Vehicle Standards Bill. The RAV is intended to be main entry pathway for road vehicles into Australia. Clause 14 provides that the Secretary must ensure that the RAV is kept, and must be maintained electronically. Clause 15 states that a vehicle can be entered on the RAV if it meets the requirements of an entry pathway. Three entry pathways are specified in subclause 15(2):

• the type approval pathway

• the concessional RAV entry pathway or

• a pathway set out in the rules.

The Bill contains no further detail on what is involved in meeting the requirements of these pathways, despite the Bill prohibiting ‘the provision of a road vehicle in Australia unless that vehicle is on the register or a relevant exception applies’ and numerous offences in the Bill related to the RAV.131 However, clause 19 states that the rules must provide for the keeping of the RAV (including content and who may enter information) and the requirements of an entry pathway. These are the only items for which rules must be made in relation to the RAV.

Under clause 16, it is an offence to enter a non-compliant vehicle on the RAV. An exception is created by subclause 16(3) for situations when a vehicle would otherwise meet entry requirements, except for the use of a non-compliant component that the supplier said was approved. However, the evidential burden in relation to this exception is on the defendant, reversing the normal common law principle that the prosecution needs to prove the offence. The Senate Standing Committee for Scrutiny of Bills raised this issue; it is discussed further under Committee Consideration: Senate Standing Committee for the Scrutiny of Bills.

Subclause 16(4) provides that a person commits an offence if they contravene subclauses 16(1) or 16(2). Under subclause 16(5) the offence applies even if the contravention occurs overseas. The maximum penalty for the offence in clause 16 is 120 penalty units for an individual (currently equivalent to $25,200) and $126,000 for a body corporate.132 A civil penalty with the same maximum penalty is also created for a breach of subclauses 16(1) or (2).133 If a contravention of subclauses 16(1) or (2) is prosecuted as an offence, the prosecution will need to meet the criminal standard of proof, which is ‘beyond reasonable doubt’. If the contravention is to be addressed by seeking a civil penalty order, the civil standard of proof will apply, where the contravention must be established on the balance of probabilities. Although the maximum penalty is the same for both the offence and the civil penalty, additional non-monetary consequences, such as a criminal record, may flow from conviction for a criminal offence.

Section 88 of the Regulatory Powers (Standard Provisions) Act provides that a civil penalty order cannot be made against a person for contravention of a civil penalty provisions if the person has been convicted of an offence constituted by the same, or substantially the same, conduct. However, criminal proceedings may be commenced against a person for conduct that is the same, or substantially the same, as conduct that would constitute a contravention of a civil penalty

131. Fletcher, ‘Second Reading Speech: Road Vehicle Standards Bill 2018’, op. cit., p. 495. 132. Subclause 16(4); As of May 2018, one penalty unit is equal to $210: Crimes Act 1914, section 4AA. Subsection 4B(3) of the Crimes Act 1914 provides that the maximum penalty that may be imposed on a corporation is five times the maximum penalty that could be imposed on an individual for the same offence, unless the legislation in which the offence appears indicates a

contrary intention. See also clause 35 of the Road Standards Bill, discussed below. 133. Subclause 16(6). Subsection 82(5) of the Regulatory Powers (Standard Provisions) Act 2014 provides that a body corporate is liable to a maximum penalty that is five times the penalty specified for a civil penalty provision. Subclause 54(1) of the Road

Standards Bill provides that the civil penalty provisions in the Bill are enforceable under Part 4 of the Regulatory Powers Act.

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provision, regardless of whether a civil penalty order has been made against the person in relation to the contravention.134

Clause 17 creates an offence for dishonestly or improperly entering information on the RAV, with a maximum penalty of 120 penalty units or $25,200 for an individual and $126,000 for a body corporate. Clause 18 creates an offence for incorrectly entered material on the RAV, with a maximum penalty of 60 penalty units or $12,600 for an individual and $126,000 for a body corporate. Both these offences also apply to people outside of Australia.135 The Explanatory Memorandum explains that for clauses 17 and 18, a separate penalty applies each time a vehicle is entered incorrectly.136 Concern has been raised by stakeholders in relation to the possible compounding of penalties for the same error repeated multiple times:

… the fact that there might be one mistake in respect of 50 vehicles that are replicated on the register resulting in 50 contraventions per clause 18 seems too harsh. With the current value of a penalty unit at $210.00 (from 1 July 2017) and the maximum fine of 60 penalty units the incorrect information being inadvertently recorded has a potential fine in those circumstances of $630,000…

137

A person contravenes subclause 24(1) if they provide a vehicle to another person for the first time in Australia and it is not on the RAV. This conduct may constitute an offence (subclause 24(5)) or a breach of a civil penalty provision (subclause 24(6)). The maximum penalty for both is 120 penalty units ($25,200) for an individual or $126,000 for a body corporate.138 Exceptions are listed in subclauses 24(3) and 24(4) and include, for example, if the road vehicle is provided to another person to store it or if the person holds a relevant non-RAV entry import approval.139 However, these exceptions again reverse the evidentiary burden of proof. The Senate Standing Committee for Scrutiny of Bills raised this issue; it is discussed further under Committee Consideration: Senate Standing Committee for the Scrutiny of Bills.

Specialist and Enthusiast Vehicles (SEVs) Register Clause 20 provides that the Secretary must keep a register known as the Register of Specialist and Enthusiast Vehicles (SEVs Register) in electronic form, which is available on the Department’s website. The note under subclause 20(1) states that the ‘SEVs Register relates to one of the eligibility criteria of the concessional RAV entry approval pathway’. Clause 21 provides that rules must be made for the keeping of the register and may be made in relation to SEVs Register application. No further information on the criteria is included in the legislation, with the Explanatory Memorandum explaining that eligibility criteria will be in the Rules.140

Importation of Road Vehicles Clause 22 deals with importation of vehicles into Australia, which given the lack of car manufacturing into Australia, will apply to the majority of Australian road vehicles. Subclause 22(2) provides a person is allowed to import a road vehicle if:

134. Section 90 of the Regulatory Powers (Standard Provisions) Act 2014. 135. Subclauses 17(3) and 18(4) apply extended geographical jurisdiction category D to these offences. This means that the offence applies whether or not the conduct constituting the alleged offence, or a result of such conduct, occurs in Australia. See section 15.4 of the Criminal Code Act 1995.

136. Explanatory Memorandum, Road Vehicle Standards Bill, pp. 29-30. 137. NatRoad, Submission, op. cit., p. 6. 138. Subclause 24(6). 139. Paragraph 24(3)(c) and 24(4)(a). 140. Explanatory Memorandum, Road Vehicle Standards Bill, p. 31.

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• the person is the holder of an in force road vehicle type approval and the road vehicle is the type covered in the type approval

• the person is authorised in writing by the holder of the in force road vehicle type approval and the road vehicle is the type covered by the type approval

• the person is the holder of an in force import approval and the vehicle is specified in the approval or

• a situation in the rules applies at the time of importation.

It is an offence to import a road vehicle without relevant approval. The maximum penalty for an individual is 120 penalty units ($25,200) or $126,000 for a body corporate.141 A civil penalty with the same maximum penalty is also created for a breach of subclauses 22(1).142

Clause 23 allows that rules may be made in relation to granting approvals for importing road vehicles, conditions and changes of approvals or obligations of former holders of approvals.

Modifying road vehicles Division 7 of Part 2 applies to modifications of road vehicles. Clause 25 allows the rules to provide the circumstances under which a vehicle on the RAV may be modified. There are no circumstances provided in the Bill in which a vehicle on the RAV has permission to be modified (although the Explanatory Memorandum provides limited examples).143 Clause 26 provides that a person commits an offence or is liable to a civil penalty if:

• he or she modifies or gives a vehicle to another person who modifies it

• the vehicle is on the RAV

• it is modified before being provided to a customer in Australia for the first time

• the modification causes the vehicle to not meet the entry pathway requirements for RAV that applied when the vehicle was entered on RAV and

• the modification is not otherwise allowed by the rules.

Both the offence and civil penalty provision have a maximum penalty of 120 penalty units ($25,200) for an individual and $126,000 for a body corporate.144 This appears to ban any premarket modifications to road vehicles unless they are specified in the rules, which has worried numerous interest groups. For example, HVIA is concerned that ‘Division 7 of the Bill may not be sufficiently flexible to deal with normal practices in the Heavy Vehicle industry’.145 Stakeholders have also raised concerns that the market for modifying normal cars into campervans before selling them will be lost as it will no longer be legal, and that modifications done to help disabled people drive will no longer be allowed pre-market.146 The ‘[r]isk to Australian jobs due to falling demand for expensive conversions of campers from regular vehicles’ was one of the reasons that the Road Vehicle Standards Bill and associated Bills was referred to inquiry by the Selection of Bills

141. Subclause 22(3). 142. Subclause 22(4). 143. Explanatory Memorandum, Road Vehicle Standards Bill, pp. 33-4. 144. Subclauses 24(4) and (5). 145. HVIA, Submission to Department of Infrastructure, Regional Development and Cities, op. cit., p. 4. 146. The RAWS Association, Submission, op. cit., p. 7.

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Committee.147 The Government has responded to this concern, announcing that it will now allow importation of ‘base vehicles’ to be converted to campervans.148

There are a number of other offence and civil penalty provisions in the Bill related to Regulation of road vehicles and components in divisions 8 and 9 of Part 2. These include:

• the misrepresentation of a road vehicle component as being approved

• breach of an approval condition

• breach of record-keeping obligations and

• false or misleading declarations or information.149

Clause 35, which is in Division 9 of Part 2 of the Road Vehicle Standards Bill, makes provision in relation to the pecuniary penalty that may be imposed for an offence in Part 2. Subsection 4B(3) of the Crimes Act 1914 provides that the maximum penalty that may be imposed on a corporation is five times the maximum penalty that could be imposed on an individual for the same offence, unless the legislation in which the offence appears indicates a contrary intention. However, the

corporate multiplier does not, under subsection 4B(3), apply where, as a matter of law, only a corporation can commit an offence.150 Clause 35 provides that, despite subsection 4B(3) of the Crimes Act, a penalty of five times the amount specified for the offence may be imposed for an offence in circumstances where the offence can only be committed by a body corporate.

Recalls Part 3 provides the power for recalls to be made of road vehicles or approved road vehicle components if required for safety reasons or if they do not comply with the national road vehicle standards. Clause 37 provides that rules must be made for this purpose. The rules may also provide for issuing recall notices, compulsory or voluntary recalls or notification requirements of recalls.

Division 3 of Part 3 contains offences and civil penalty provisions related to recalls, with penalties applying for non-compliance. Clause 38 applies to compliance with recall notices. A person commits an offence or is liable to a civil penalty under subclause 38(1) if he or she refuses or fails to do something required by an in force recall notice for road vehicles or approved components. Under subclause 38(2), a person commits an offence or is liable to a civil penalty if, in trade or commerce, they supply vehicles or components of the kind to which an in force recall notice applies. The offences under these provisions are subject to strict liability under subclause 38(3), with a maximum penalty of 5,250 penalty units for a body corporate or 1,050 for a non-body corporate (equivalent to $1,102,500 and $220,500, respectively).151 The prosecution is not required to prove fault for any of the physical elements of a strict liability offence, but the defence of mistake of fact is available.152

As raised by the Scrutiny of Bills Committee (and discussed earlier), these are substantial penalties for a strict liability offence, where the person does not have to intend to have engaged in the

147. Senate Standing Committee for Selection of Bills, Report, 4, 2018, op. cit., Appendix 4. 148. DIRDC, ‘Government response to Issues raised during 2018 consultation on Road Vehicle Standards Legislation’, DIRDC website, last updated 18 May 2018. 149. Clauses 27-32. 150. Attorney-General’s Department, A guide to framing Commonwealth offences, infringement notices and enforcement powers,

op. cit., p. 40. This is because in such a circumstance there would not be a penalty that could be imposed on an individual, as required under the terms of subsection 4B(3) as the starting point for the calculation of the body corporate penalty. 151. The same maximum penalties apply to the civil penalty provision in subclause 38(4). 152. Section 6.1 of the Criminal Code Act 1995. See also section 9.2.

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particular conduct. However, the Minister explained that severe penalties were required given that failure to comply with the notice is a public risk, and that the penalty needs to ensure that it is not more attractive for someone to not comply with a probably expensive recall notice.153 Under clauses 39 and 40, refusal or failure to give the Minister a copy of the compulsory recall notice or voluntary recall notice, respectively, if required to under the rules constitutes an offence and a civil penalty provision. Both the offence and the civil penalty have maximum penalties of 16 penalty units for an individual and 80 penalty units for a corporation ($3,360 and $16,800 respectively).

Division 4 of Part 3 relates to the issue of disclosure notices requiring information when safety concerns or concern about non-compliance with national road standards exists. Penalties apply for non-disclosure or providing false or misleading information. Subclause 41(1) provides that the Minister or certain other people may give a disclosure notice to a supplier of road vehicles or approved components if the notice-giver reasonably believes:

• relevant vehicles or components may cause injury

• a reasonably foreseeable use of the vehicle or component, even if not being used in the intended manner, may harm someone or

• vehicles or components of that kind do not comply with the national road vehicle standards and

• the supplier is capable of giving relevant information or evidence.

Subclause 42(1) then provides that the information requested in the disclosure notice must be given even if it incriminates the person or exposes them to a penalty. However, subclause 42(2) provides use immunity (but not derivative use immunity) for the individual from the self-incriminating information. The issue of self-incrimination was raised by the Senate Standing Committee for Scrutiny of Bills; see Committee Consideration: Senate Standing Committee for the Scrutiny of Bills for further information.

Compliance and enforcement Part 4 provides for enforcement of the new regime through application of relevant provisions of the Regulatory Powers (Standard Provisions) Act 2014 (the Regulatory Powers Act). Inspectors are granted monitoring, investigation and enforcement powers so as to be able to enforce the obligations created under the Road Vehicle Standards Bill. Monitoring powers are provided under Part 2 of the Regulatory Powers Act while investigation powers are provided under Part 3 of the Regulatory Powers Act. Enforcement, including civil penalties, infringement notices and injunctions, are provided under Parts 4 to 7 of the Regulatory Powers Act.154 The Bill does provide for some modifications of the application of the Regulatory Powers Act, including additional powers to test samples on premises entered under Parts 2 and 3 of the Regulatory Powers Act (clauses 51 and 53) and changes to penalties applying under infringement notices (clause 56).

Clauses 50 and 52 raise the issue of broad delegation of administrative powers. These clauses ‘seek to trigger the monitoring and investigation powers under the Regulatory Powers (Standard Provisions) Act 2014’ for offences related to the Motor Vehicle Standards Bill.155 Subclauses 50(5) and 52(4) seek to allow ‘other people’ to assist the authorised people carrying out the functions or duties related to the monitoring and investigation powers, and there is no guidance included on

153. Senate Standing Committee for the Scrutiny of Bills, Scrutiny digest, 3, op. cit., p. 259. 154. For further information on the Regulatory Powers Act, see Raymond, Regulatory Powers (Standardisation Reform) Bill 2016, op. cit. 155. Senate Standing Committee for the Scrutiny of Bills, Scrutiny digest, 2, op. cit., p. 38.

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required skills for these assistants, meaning that technically anyone could be an assistant.156 The Senate Standing Committee for Scrutiny of Bills raised this issue; it is discussed further under Committee Consideration: Senate Standing Committee for the Scrutiny of Bills, above.

Administration and miscellaneous Part 5 provides for the administration of the new framework. Included in this is clause 62, which allows the Minister to arrange for computer programs to be used to make decisions. Subclause 62(1) provides that computer programs can be used by the Minister for any purposes for which the minister may, or must, under the [Bill] make a decision, exercise any power or comply with any obligation, or do anything else related to this. Under subclause 62(2), anything done by the computer program in the above circumstances is taken to have been done by the Minister. Subclause 63(1) then allows the Minister to substitute a decision for one made by the program if:

• the program was not working correctly when the decision was made (paragraph 63(1)(a))

• the substituted decision could have been made under the same provision of the Bill (paragraph 63(1)(b)) and

• the substituted decision is more favourable to the applicant (paragraph 63(1)(c)).

However, subclause 63(2) states that the Minister, even if requested, does not have to consider whether to use this power in respect of any decision. There is no explanation in the Explanatory Memorandum for this ‘no-duty-to-consider’ clause.157 Essentially, this means that there is no unequivocal review right included in the legislation for computer errors and, depending on the Rules in force at the time, could result in applicants needing to undergo the expense and stress of going to court due to a computer error, which seems inappropriate. This was raised by the Scrutiny of Bills Committee and is further discussed in that section.

Division 5 of Part 5 allows for delegation of power by the Minister and Secretary. The Bill allows for this delegation of administrative powers to be very broad. Subclause 73(5) permits any of the Minister’s powers and functions under the Rules to be delegated to the Secretary or any Australian Public Service (APS) employee, with the exceptions of issuing a recall or determining ‘specified matters by legislative instrument’.158 Likewise, subclause 74(5) allows all the Secretary’s powers and functions under the Rules to be delegated to any APS employee. The Explanatory Memorandum does not explain why these powers of delegation are so broad, allowing most of the Minister’s and Secretary’s granted powers and functions to be delegated to the most junior public servant in the public service. This matter was raised by the Scrutiny of Bills Committee, as discussed earlier in this Digest.

Part 6 deals with miscellaneous matters, including interactions with other laws. This includes under clause 77 that a national road vehicle standard is taken as a safety standard under the Australian Consumer Law. Clause 81 provides for immunity from legal actions. Subclause 81(1) prevents legal actions against the Commonwealth due to any loss or damage resulting from reliance on the entry of a vehicle on RAV or SEVs Register, any test done under the Bill, any statement or action which could be understood to say that a road vehicle or component complied with the Bill or any approval under the Bill. In addition, subclause 81(2) prevents proceedings (whether criminal or civil) against the Minister, the Secretary, an inspector or a Departmental APS

156. Senate Standing Committee for the Scrutiny of Bills, Scrutiny digest, 3, op. cit., p. 264. 157. Senate Standing Committee for the Scrutiny of Bills, Scrutiny digest, 2, op. cit., p. 39. 158. Subclause 73(6).

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employee for anything done or not done in good faith under the Bill. The Explanatory Memorandum provides no explanation for this. The Scrutiny of Bills Committee raised this issue; see Committee Consideration: Senate Standing Committee for the Scrutiny of Bills for more detail.

The Consequential Provisions Bill The Consequential Provisions Bill provides the transitional law required to give industry time to change from the old regulatory regime to the new one under the Road Vehicle Standards Bill. It also repeals the Motor Vehicle Standards Act and contains consequential amendments to replace Commonwealth legislative references to the old law with references to the new scheme. The transitional period has two stages of 12 months. Schedule 1 applies for the first 12 months while Schedules 2 and 3 begin 12 months later.

Schedule 2 repeals the whole of the Motor Vehicle Standards Act. Schedule 1 provides that the road vehicle standards in force under the Motor Vehicle Standards Act are taken to be in force under clause 12 of the Road Vehicle Standards Bill for 12 months after Royal Assent of the Road Vehicle Standards Bill.

Schedule 3 contains the transitional provisions that begin on repeal of the Motor Vehicle Standards Act. Item 2 provides that the vehicle standards in force under section 7 of the Motor Vehicle Standards Act (known as the Australian Design Rules) immediately before commencement will be taken to have been made under section 12 of the Road Vehicle Standards Act. Numerous provisions apply to ensure:

• approvals granted under the old law will continue in force during the transitional period (of 12 months, commencing 12 months after Royal Assent) subject to the provisions of the old law159

• that applications made before commencement of the new law, and not yet decided, will be decided based on the old law160 and

• the new law does not apply to actions taken under these approvals during the transitional period.161

For example, subitem 11(1) provides that approvals to supply nonstandard vehicles that were in force immediately before commencement of the new regime will be taken to be in force during the transitional period. Likewise, under subitem 11(2), if an application to supply nonstandard vehicles was made but not yet decided by the Minister at the time of commencement, then the Minister must decide the application under the old law. Similar provisions apply to registered automotive workshops under item 19.

Item 29 provides that the Minister may make transitional rules if needed, subject to certain restrictions. For example, the transitional rules cannot impose a tax.162

Schedule 4 contains consequential amendments to other Commonwealth legislation to replace references relevant to the Motor Vehicle Standards Act with those applicable to the new Road Vehicle Standards Act.163

159. See, for example, subitems 4(1), 6(1) and 9(1) of Schedule 3 to the Consequential Provisions Bill. 160. See, for example, subitems 4(2), 6(2) and 9(2) of Schedule 3 to the Consequential Provisions Bill. 161. See, for example, subitems 4(3), 6(3) and 9(3) of Schedule 3 to the Consequential Provisions Bill. 162. Paragraph 29(2)(c). 163. These changes will apply to the Age Discrimination Act 2004, A New Tax System (Luxury Car Tax) Act 1999, Customs Act 1901,

Fuel Tax Act 2006, Interstate Road Transport Act 1985, Interstate Road Transport Charge Act 1985, National Environment Protection Council Act 1994 and Trans-Tasman Mutual Recognition Act 1997.

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The Charges (General), Charges (Customs) and Charges (Excise) Bills The three charges Bills are:

• Road Vehicle Standards Charges (Imposition-General) Bill

• Road Vehicle Standards Charges (Imposition-Customs) Bill and

• Road Vehicle Standards Charges (Imposition-Excise) Bill.

Clause 6 of the Charges (General) and Charges (Customs) Bills and clause 5 of the Charges (Excise) Bill provide authority for the Commonwealth to impose charges connected with the administration of the Road Vehicle Standards Act. The Bills do not specify the amount of the charges or the activities for which they can be charged. Instead, clause 7 of the Charges (General) and Charges (Customs) Bills and clause 6 of the Charges (Excise) Bill specify that the charges may be prescribed by Regulation (as either a specific amount or a method to calculate the amount). Clause 8 of the Charges (General) and Charges (Customs) Bills and clause 7 of the Charges (Excise) Bill provide for exemptions from these charges to be made in the Regulations.

The Explanatory Memorandum accompanying the Bills confirms that the Regulations imposing the charges will be disallowable by the Parliament.164 It also explains that using Regulations to determine the charges is justified as it will allow ‘the relevant Minister to consult with stakeholders on the amounts’ and ‘make appropriate and timely adjustments to the charges’ while providing ‘a level of parliamentary scrutiny for the charges’.165 As discussed in further detail earlier in this Digest, the Senate Standing Committee for the Scrutiny of Bills is concerned that the

Charges Bills do not specify a maximum charge or provide guidance for the calculation of the charges.166

164. Explanatory Memorandum, Road Vehicle Standards Charges (Imposition-General) Bill 2018, p. 2. 165. Ibid. 166. Senate Standing Committee for the Scrutiny of Bills, Scrutiny digest, 2, op. cit., p. 46; Senate Standing Committee for the Scrutiny of Bills, Scrutiny digest, 3, op. cit., p. 281.

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