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2008
THE PARLIAMENT OF THE COMMONWEALTH OF AUSTRALIA
HOUSE OF REPRESENTATIVES
TRADE PRACTICES AMENDMENT (ACCESS DECLARATIONS) BILL 2008
EXPLANATORY MEMORANDUM
(Circulated by authority of the Minister for Broadband, Communications
and the Digital Economy, Senator the Hon. Stephen Conroy)
TRADE PRACTICES AMENDMENT (ACCESS DECLARATIONS) BILL 2008
OUTLINE
The Trade Practices Amendment (Access Declarations) Bill 2008 (the Bill) amends
sections 152AL and 152ALA of the Trade Practices Act 1974 (the TPA) to clarify that
access declarations, and extension notices which extend the period of access
declarations, are not legislative instruments for the purposes of the Legislative
Instruments Act 2003 (the LIA).
Sections 152AL and 152ALA are in Part XIC of the TPA, which contains the
telecommunications-specific access regime. Access declarations are made by the
Australian Competition and Consumer Commission (ACCC) under subsection
152AL(3) of the TPA. In an access declaration, the ACCC declares a listed carriage
service or a service that facilitates the provision of a listed carriage service. These
declared services are subject to the access obligations in Part XIC of the TPA. There are
eleven access declarations currently in force, covering eleven key services that are
fundamental to telecommunications competition.
On the understanding that access declarations are not legislative instruments for the
purposes of the LIA, the ACCC has not registered any access declarations on the
Federal Register of Legislative Instruments, nor tabled them in both Houses of
Parliament, which are requirements that the LIA imposes for legislative instruments.
Unregistered legislative instruments are unenforceable by or against the
Commonwealth, or by or against any other person or body, in accordance with sections
31 and 32 of the LIA (as applicable).
A recent Federal Court decision, Roche Products Pty Limited v National Drugs and
Poisons Schedule Committee [2007] FCA 1352, may have implications for access
declarations. On the basis of that decision, it is possible that access declarations may be
open to legal challenge on the basis that they are legislative instruments for the purposes
of the LIA and are invalid as they have not been registered or tabled as required by the
LIA.
The primary objective of the Bill, therefore, is to provide certainty to the
telecommunications sector by clarifying that access declarations (including variations
and revocations of access declarations) and extensions to the period of access
declarations, are not, and are taken never to have been, legislative instruments for the
purposes of the LIA.
If, in the absence of the Bill, a court were to decide that all access declarations hitherto
made by the ACCC are invalid due to their not having been registered and tabled in
accordance with the LIA, this would be likely to cause serious disruption to the
operation of the Part XIC access regime. In particular:
- the access regime would be rendered inoperative (because there would not be any
declared services for it to apply to);
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- all arbitration determinations hitherto made by the ACCC under Division 8 of
Part XIC would be invalid (because they depend on the existence of valid access
declarations);
- commercially negotiated access agreements between access providers and access
seekers may be liable to be rescinded by either party (on the ground that they had
been entered into on the basis of an erroneous assumption that the relevant access
declaration was valid); and
- access providers may have legal claims for compensation (under restitutionary
principles) against access seekers in respect of access they had provided under
invalid arbitration determinations and rescinded access agreements.
This Bill provides an opportunity to clarify that access declarations and extension
notices are not legislative instruments for the purposes of the LIA for the avoidance of
doubt. The Bill includes a `just terms' provision which will protect the constitutional
validity of the provisions in the Bill and provide for compensation in the event that they
are found to give rise to an acquisition of property from a person otherwise than on just
terms.
Part IIIA of the TPA contains provisions which govern a separate access regime relating
to services provided by means of a facility. In effect, Part IIIA establishes rights for
third parties to share the use of certain infrastructure services of national significance
such as the rail transport service. As the Bill does not address the status of access
declarations under Part IIIA of the TPA, no inference should be drawn as to the status
of these declarations (see subsection 15AE(5) of the Acts Interpretation Act 1901).
FINANCIAL IMPACT STATEMENT
The Bill is not expected to have any financial impact on Commonwealth expenditure or
revenue.
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NOTES ON CLAUSES
Clause 1 - Short title
Clause 1 provides that the Bill, when enacted, may be cited as the Trade Practices
Amendment (Access Declarations) Act 2008.
Clause 2 - Commencement
Clause 2 of the Bill provides that the Act will commence on the day it receives Royal
Assent.
Clause 3 - Schedule(s)
Clause 3 is a machinery provision that explains the effect of the single Schedule to the
Bill. The Schedule contains amendments to the TPA.
Schedule 1--Amendments to the Trade Practices Act 1974
Item 1 - At the end of section 152AL
Access declarations are made by the Australian Competition and Consumer
Commission (ACCC) under subsection 152AL(3) of the TPA. Subsections 152AL(4)
to (8) provide for various matters relating to access declarations, including effect of
declarations and gazettal of declarations.
Item 1 inserts new subsections 152AL(9), (10) , (11), (12), (13) and (14) at the end of
subsection 152AL(8).
New subsection 152AL(9) provides that a declaration made under section 152AL is not,
and is taken never to have been, a legislative instrument for the purposes of the LIA.
New subsections 152AL(10) and (11) provide that a variation or revocation of such a
declaration is also not, and is taken never to have been, a legislative instrument for the
purposes of the LIA.
New subsection 152AL(12) provides that if a declaration or a variation or revocation of
a declaration was made before the commencement of new subsection 152AL(12) and
the declaration ceased to be in force before that commencement date, the declaration,
variation or revocation is taken never to have been a legislative instrument for the
purposes of the LIA. As a number of declarations that were made prior to the
commencement of the Bill have expired (having reached their expiry date) or been
revoked by the ACCC, new subsection 152AL(12) will apply so that the expired or
revoked declarations are taken never to have been a legislative instrument.
To avoid any argument that any former access declaration can never have been in force
because of the failure to register it under the LIA, new subsection 152AL(13) provides
that, in respect of these declarations, the assumption is that the LIA had never been
enacted.
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As the purpose of the inclusion of subsections 152AL(9), (10), (11) and (12) is to
merely confirm that declarations and variations and revocations of declarations are not
legislative instruments for the purposes of the LIA, new subsection 152AL(14) provides
that those subsections are enacted for the avoidance of doubt.
A high level of accountability applies to the making of access declarations by the
ACCC under subsection 152AL(3) of the TPA. Subsections 152AL(4) to (8) provide
for various matters relating to access declarations, including the effect of declarations
and gazettal of declarations. As a matter of practice, the ACCC also posts access
declarations on its website. Access declarations are therefore easily accessible to the
public.
Part XIC requires the ACCC to hold a public inquiry before making an access
declaration. Adequate consultation requirements therefore also apply to the making of
such a declaration.
Item 2 - At the end of section 152ALA
Under subsections 152ALA(1) and (2) a declaration made under section 152AL must
specify an expiry date which must occur within five years of the making of the
declaration. The expiry date of a declaration may be extended by an extension notice
under subsection 152ALA(4) for a period of not more than five years and the ACCC
must publish extension notices in the Gazette.
Item 2 of Schedule 1 to the Bill inserts new subsections 152ALA(10), (11), (12) and
(13) at the end of subsection 152ALA(9). The effect of new subsection 152ALA(10) is
to provide that an extension notice under subsection 152ALA(4) is not, and is taken
never to have been, a legislative instrument for the purposes of the LIA. New
subsection 152ALA(11) makes it clear that this will also apply to an extension notice
where the declaration that was extended by the notice has ceased to be in force before
the commencement of this new subsection 152ALA(11). To avoid any argument that
an extended declaration can never have been in force because of the failure to register it
under the LIA, new subsection 152ALA(12) provides that, in respect of these
declarations, the assumption is that the LIA had never been enacted.
As the purpose of the inclusion of subsections 152ALA(10) and (11) is to merely
confirm that extension notices are not legislative instruments for the purposes of the
LIA, new subsection 152ALA(13) provides that those subsections are enacted for the
avoidance of doubt.
Item 3 - At the end of Division 2 of Part XIC
Item 3 adds a new section 152AQC to Division 2 of Part XIC to protect the
constitutional validity of the provisions in the Bill and to provide for the payment of
compensation in the event that they are found to give rise to an acquisition of a person's
property otherwise than on just terms. New subsection 152AQC(1) provides that the
Commonwealth is liable to pay a reasonable amount of compensation to a person if the
operation of any or all of the specified provisions would result in an acquisition of that
person's property otherwise than on just terms. In the event that the Commonwealth
and the person do not agree on the amount of compensation, new subsection
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152AQC(2) provides that the person may institute proceedings in the Federal Court and
the Federal Court will determine the amount of reasonable compensation. New
subsection 152AQC(3) inserts definitions of `acquisition of property' and `just terms'
and provides that these terms will have the same meaning as in paragraph 51(xxxi) of
the Constitution.
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