Michael Sukkar (Deakin, Liberal Party, Assistant Treasurer) Share this | Link to this | Hansard source

I present a supplementary explanatory memorandum to the bill. I move government amendments (1) to (3) as circulated together:

(1) Schedule 3, item 1, page 6 (lines 6 and 7), omit the item, substitute:

1 Subsection 51AE(2)

Repeal the subsection, substitute:

(2) If regulations prescribe an industry code (other than a code that relates to the industry of franchising), the industry code may prescribe a pecuniary penalty not exceeding 600 penalty units for a contravention of a civil penalty provision of the code.

(2A) If regulations prescribe an industry code that relates to the industry of franchising, the industry code may do the following:

(a) prescribe that the pecuniary penalty for a contravention of a civil penalty provision of the code by a body corporate is the greatest of the following:

(i) $10,000,000;

(ii) if the Court can determine the value of the benefit that the body corporate, and any body corporate related to the body corporate, has obtained directly or indirectly and that is reasonably attributable to the contravention—3 times the value of that benefit;

(iii) if the Court cannot determine the value of that benefit—10% of the annual turnover of the body corporate during the period of 12 months ending at the end of the month in which the contravention occurred;

(b) prescribe that the pecuniary penalty for a contravention of a civil penalty provision of the code by a person who is not a body corporate is $500,000;

(c) if the code does not prescribe a pecuniary penalty mentioned in paragraph (a) or (b) for a contravention of a civil penalty provision of the code—prescribe a pecuniary penalty not exceeding 600 penalty units for the contravention.

(2B) An expression used paragraph (2A)(a) has the same meaning as in paragraph 76(1A)(b).

(2) Schedule 3, item 2, page 6 (after line 14), at the end of the item, add:

(3) To avoid doubt, nothing in this Schedule affects the validity of regulations made under the Competition and Consumer Act 2010 before the commencement of this item.

(3) Schedule 4, page 7 (lines 1 to 26), omit the Schedule, substitute:

Schedule 4—Modification power

Coronavirus Economic Response Package Omnibus (Measures No. 2) Act 2020

1 Schedule 5

Repeal the Schedule, substitute:

Schedule 5—Modification of information and other requirements

1 Modification of information and other requirements

(1) This item applies in relation to a provision (an affected provision) of an Act or a legislative instrument that requires or permits any of the following matters (a relevant matter):

(a) the giving of information in writing;

(b) the signature of a person;

(c) the production of a document by a person;

(d) the recording of information;

(e) the retention of documents or information;

(f) the witnessing of signatures;

(g) the certification of matters by witnesses;

(h) the verification of the identity of witnesses;

(i) the attestation of documents.

(2) A responsible Minister for an affected provision may, by legislative instrument, determine that, to the extent that the affected provision relates to a relevant matter:

(a) the affected provision is varied as specified in the determination in relation to a period specified in the determination; or

(b) the affected provision does not apply in relation to a period specified in the determination; or

(c) the affected provision does not apply, and that another provision specified in the determination applies instead, in relation to a period specified in the determination.

(3) The period specified in a determination made under subitem (2) may be a period that starts before this item commences.

(4) A responsible Minister for an affected provision must not make a determination under subitem (2) in relation to the affected provision unless the responsible Minister is satisfied that the determination is in response to circumstances relating to the coronavirus known as COVID-19.

(5) For the purposes of this item, a responsible Minister for an affected provision is:

(a) if the affected provision is a provision of an Act—any Minister who administers that Act; or

(b) if the affected provision is a provision of a legislative instrument—any Minister who administers the enabling legislation (within the meaning of the Legislation Act 2003) under which that legislative instrument is made.

(6) A determination made under subitem (2) has effect accordingly.

(7) A determination made under subitem (2) has no operation after 31 December 2021.

(8) This item is repealed at the end of 31 December 2021.

These amendments make minor changes to schedule 3, the industry code penalties under part IVB of the Competition and Consumer Act, and amendments to schedule 4 with respect to the modification power.

Stephen Jones (Whitlam, Australian Labor Party, Shadow Assistant Treasurer) Share this | Link to this | Hansard source

Labor actually welcomes the government's change of mind on the amendments moved in relation to schedule 3. These go to recommendations that were made by the ACCC, when the parliamentary joint committee reviewed the operation of the penalty provisions within the franchising code and related instruments. It's worth retelling the submission of the ACCC to that inquiry. It made the point that its ability to seek civil pecuniary penalties and issue infringement notices was fundamental to the ACCC's enforcement toolkit. The lack of consequences for breaching the franchising codes was undermining the ACCC's ability to ensure code compliance. Where penalties were insufficient, the franchisors were likely to factor that into their egregious behaviour and just build that into the cost of doing business, or doing business unfairly, in respect of their franchisees. Where penalties were unavailable, there's no incentive for a franchisor to comply with the codes. The ACCC noted that the penalties currently available under franchising code were small in comparison to those that were available under the Australian Consumer Law.

The amendment that the minister brings before the House goes some way to addressing that anomaly, and we support it. Indeed we made it well-known at the second reading stage of this bill that, if the government didn't do this, we would be moving amendments here and in the other place to that effect. Labor will be supporting this amendment.

Question agreed to.

Bill, as amended, agreed to.