House of Representatives

Explanatory Memorandum

(Circulated by the authority of the Minister for the Environment and Energy, the Hon Josh Frydenberg MP)

STATEMENT OF COMPATIBILITY WITH HUMAN RIGHTS - PART 3 HUMAN RIGHTS (PARLIAMENTARY SCRUTINY) ACT 2011

Statement of Compatibility with Human Rights

Prepared in accordance with Part 3 of the Human Rights (Parliamentary Scrutiny) Act 2011

Product Emissions Standards Bill 2017

Product Emissions Standards (Excise) Charges Bill 2017

Product Emissions Standards (Customs) Charges Bill 2017

Product Emissions Standards (Consequential Provisions) Bill 2017

These Bills are compatible with the human rights and freedoms recognised or declared in the international instruments listed in section 3 of the Human Rights (Parliamentary Scrutiny) Act 2011

Overview of the Bills

The Bill establishes a national framework to enable Australia to address the adverse impacts of air pollution from certain products on human and environmental health.

The Bill will facilitate this by:

(a)

enabling the Minister to prescribe products as emissions-controlled products and make rules relating to those products;

(b)

providing mechanisms in the rules for emissions-controlled products to be certified to specified emissions standards;

(c)

providing a mechanism for the rules to exempt persons or products from the operation of one or more provisions of the Bill;

(d)

establishing offences and civil penalty provisions relating to the import of an emissions-controlled product to Australia, or supply of that product within Australia, if the product is not certified or marked in accordance with the rules for that product;

(e)

triggering the compliance and enforcement provisions of the Regulatory Powers Act and providing for additional compliance and enforcement powers to support the objectives of the Bill;

(f)

enabling the sharing of information obtained under the Bill with other agencies and the publication of certain information relating to an emissions-controlled product;

(g)

enabling the delegation of the Minister's and the Secretary's functions and powers under the Bill, or the Regulatory Powers Act (as the case may be); and

(h)

requiring a review of the operation of the Bill at regular intervals.

The Excise Charges Bill and the Customs Charges Bill complement the Bill by establishing a mechanism for imposing a charge on the import or domestic manufacture of emissions-controlled products to recover the costs of implementing the product emissions standards framework where appropriate.

The Consequential Provisions Bill makes a consequential amendment to the Customs Act clarifying that emissions-controlled products imported or exported in contravention of the Bill are not forfeited to the Crown under section 229 of that Act.

Human Rights Implications

The Excise Charges Bill, the Customs Charges Bill and the Consequential Provisions Bill do not engage any human rights and therefore do not limit any rights.

The Bill engages the following human rights:

(a)

the right to an effective remedy in Article 2(3) of the ICCPR;

(b)

the right to a fair trial and fair hearing in Article 14(1) of the ICCPR;

(c)

the right to the presumption of innocence in Article 14(2) of the ICCPR; and

(d)

the right to privacy in Article 17 of the ICCPR.

Right to an effective remedy

Article 2(3) of the ICCPR ensures that any person whose rights or freedoms are violated shall have an effective remedy, and that a person in claiming such a remedy shall have his or her rights determined by a competent judicial, administrative or legislative authority.

Clause 51 of the Bill enables the Minister to make rules prescribing matters required or permitted by the Bill to be prescribed by the rules or necessary or convenient to be prescribed for carrying out or giving effect to the Bill. The rules may prescribe a product as an emissions-controlled product (clause 9), provide for an emissions-controlled product to be certified and specify any requirements associated with the certification of an emissions-controlled product (clause 10). The rules may also provide for the charging of fees for services provided in the performance of functions under the Bill (paragraph 51(2)(a)). A minimum requirement for certification is that the emissions-controlled product meets the emission standard set out in the rules for that product.

The rules may also exempt persons or emissions-controlled products from the operation of one or more of the provisions of the Bill (clause 11).

Paragraph 51(2)(b) of the Bill enables the rules to provide for the review of decisions made under this Act. The definition of this Act in clause 7 of the Bill will include any instruments, including rules, made under the Bill.

It is anticipated that the rules for emissions-controlled products would provide for the merits review of a range of decisions made under those rules. These decisions may include, but would not be limited to, the following types of decisions:

(a)

decisions to certify, or refuse to certify, emissions-controlled products;

(b)

decisions regarding the suspension or revocation of certification of an emissions-controlled product; and

(c)

decisions to grant, or refuse to grant, an exemption, or decisions specifying circumstances in which the exemption applies.

It is appropriate that the mechanisms enabling the review of decisions be in the same document as the power to make the decision itself. As such, the rules will provide for the review of decisions rather than the Bill.

As the Bill enables the rules to provide for the review of decisions, the Bill promotes and protects the right to an effective remedy in Article 2(3) of the ICCPR by providing a mechanism by which affected persons are able to seek a review of these types of decisions.

Right to a fair trial

Article 14(1) of the ICCPR guarantees the right to a fair trial and fair hearing in relation to both criminal and civil proceedings.

Criminal process rights

Clauses 24 and 25 of the Bill trigger the monitoring powers in Part 2 (Monitoring) of the Regulatory Powers Act and the investigation powers in Part 3 (Investigation) of the Regulatory Powers Act, respectively, which causes offences in that Act to apply in relation to monitoring and investigation. The fair rights, minimum guarantees in the determination of a criminal charge and other criminal process rights contained in Article 14 of the ICCPR are engaged. Part 2 (Monitoring) and Part 3 (Investigation) of the Regulatory Powers Act provide questioning powers to authorised officers. Under subsection 24(3) of the Regulatory Powers Act, where entry is authorised by a monitoring warrant, the authorised person may require any person on the premises to answer questions or produce documents relating to information or provisions subject to monitoring. If the person fails to do so, this is an offence under subsection 24(5) of the Regulatory Powers Act, with a maximum penalty of 30 penalty units. Similarly, under section 54(3) of the Regulatory Powers Act, an authorised person who enters premises under an investigation warrant may require persons on the premises to answer questions or produce documents relating to evidential material of the kind specified in the warrant. If the person fails to do so, this is an offence under subsection 54(2) of the Regulatory Powers Act, with a maximum penalty of 30 penalty units.

These offence provisions do not limit the person's access to a fair trial or limit the other criminal process rights in any way. Sections 17 and 47 of the Regulatory Powers Act make it clear that the privileges against self-incrimination and legal professional privilege have not been abrogated by the monitoring and investigation powers provisions, including the offence provisions. These protections guarantee the criminal process rights protected in paragraphs 14(3)(d) and (g) of the ICCPR. The usual guarantees and criminal process rights will apply to these offences and are not abrogated by any provisions in the Bill or triggered provisions of the Regulatory Powers Act. Accordingly, sections 24 and 54 of the Regulatory Powers Act, as applied to the Bill by clauses 24 and 25, are compatible with human rights.

Article 14 and civil penalty provisions

Clause 26 of the Bill triggers the civil penalty provisions in Part 4 of the Regulatory Powers Act. Civil penalty provisions contained in the Bill will be enforceable under that Part of the Regulatory Powers Act.

Under clause 26, an inspector appointed under the Bill may apply to a relevant court for a civil penalty order requiring a person to pay to the Commonwealth a pecuniary penalty for a contravention of a civil penalty provision.

The Bill creates a number of civil penalty provisions relating to the enforcement of product emission standards (see clauses 13(4), 14(3), 15(4), 16(3), 17(4) and 18(3) of Part 3), record-keeping (see clause 20(4), 21(6) and 22(7) of Part 4), and compliance audits (see clause 44(7) of Part 7).

Triggering the civil penalty provision of the Regulatory Powers Act could engage criminal process rights if the imposition of civil penalties is classified as 'criminal' under international human rights law. Article 14 of the ICCPR requires that, in the determination of criminal charges, everyone shall be entitled to a fair and public hearing by a competent, independent and impartial tribunal established by law.

Determining whether penalties could be considered to be criminal under international human rights law requires consideration of the classification of the penalty provisions under Australian domestic law, the nature and purpose of the penalties, and the severity of the penalties.

The penalty provisions of the Bill expressly classify the penalties as civil penalties. Those provisions create solely pecuniary penalties in the form of a debt payable to the Commonwealth. The purpose of these penalties is to encourage compliance with the requirements for the import, supply and marking of emissions-controlled products, record-keeping and compliance audits. The civil penalty provisions of the Bill do not impose criminal liability, and do not lead to the creation of a criminal record. The penalties only apply to the regulatory regime of the Bill, rather than the public in general. Further, the imposition of the civil penalties is not dependent on a finding of guilt. These factors all suggest that the civil penalties imposed by the Bill are civil rather than criminal in nature.

The maximum penalties that may be imposed in civil penalty orders are 80 penalty units for some provisions and 120 penalty units for others. Where the penalties are higher, this reflects the more serious implications or results of the contravention. Under subsection 82(5) of the Regulatory Powers Act, as applied to the Bill by clause 26, the maximum penalties which apply to individuals are the same as those specified in the civil penalty provision of the Bill. For bodies corporate, the penalties will be no more than five times the penalty specified for the civil penalty provision; being 400 penalty units and 600 penalty units. The penalties do not carry the consequence of offences under the Bill, which would involve a criminal record and can result in imprisonment for contravention of some provisions.

These penalties are not so severe that they could be considered criminal in nature.

Accordingly, the criminal process rights provided for by Article 14 of the ICCPR are not engaged by the provisions of the Bill relating to civil penalty orders.

Clause 26 of the Bill, which triggers Part 4 of the Regulatory Powers Act, engages, but does not limit, the right to a fair and public hearing in civil proceedings provided for by Article 14(1) of the ICCPR. Under section 82 of the Regulatory Powers Act, civil penalty orders can only be granted by a relevant court, which must consider all relevant matters before determining the amount of the penalty. Accordingly, the right to a fair hearing is not limited.

Article 14 and infringement notices

Clause 27 of the Bill triggers the infringement notice provisions in Part 5 of the Regulatory Powers Act. These provisions will enable an inspector appointed under the Bill to issue an infringement notice under Part 5 of the Regulatory Powers Act where the inspector believes, on reasonable grounds, that a civil penalty provision of the Bill has been contravened or an offence of strict liability has been committed.

An infringement notice issued under Part 5 of the Regulatory Powers Act is a notice of a pecuniary penalty imposed on a person. It sets out the particulars of an alleged contravention of a law. An infringement notice gives the person to whom the notice is issued the option of paying the penalty set out in the notice, or electing to have the matter dealt by a court. If the person does not pay the amount in the notice, they may be prosecuted if the notice relates to an offence provision, or proceedings for a civil penalty order may be brought against them if the notice relates to a civil penalty provision. This engages the right to a fair and public hearing and the other criminal process rights and minimum guarantees in Article 14 of the ICCPR. As the person may elect to have the matter heard by a court, rather than pay the penalty, the rights to a fair and public hearing, in both civil and criminal matters, are not limited. Clause 27 does not limit the minimum guarantees in criminal proceedings or other process rights provided for by Article 14 of the ICCPR.

Accordingly, the infringement notice provisions under clause 27 of the Bill are compatible with the right to a fair and public trial.

Article 14 and enforceable undertakings

Clause 28 of the Bill triggers the enforceable undertakings provisions in Part 6 of the Regulatory Powers Act. This will enable an inspector appointed under the Bill to accept and enforce undertakings relating to compliance with an offence or civil penalty provision of the Bill. If an inspector is satisfied that the person has breached the undertaking, the inspector may apply to a relevant court for an order relating to the undertaking under section 115 of the Regulatory Powers Act.

Triggering the enforceable undertakings provisions of the Regulatory Powers Act in relation to the offences and civil penalty provisions under the Bill engages the right to a fair and public hearing and other criminal process rights and minimum guarantees in Article 14 of the ICCPR. Article 14(1) of the ICCPR ensures that everyone shall be entitled to a fair and public hearing by a competent, independent and impartial tribunal established by law. Under Part 6 of the Regulatory Powers Act, an order enforcing an undertaking can only be made by a court. Accordingly, the right to a fair and public hearing is not limited.

Article 14(1) of the ICCPR also provides a right to a fair and public hearing in civil matters. As orders to enforce an undertaking can only be made by a relevant court under section 115 of the Regulatory Powers Act, the right to a fair hearing in civil matters provided for by Article 14(1) of the ICCPR is not limited.

Accordingly, clause 28, which triggers the enforceable undertakings provisions of the Regulatory Powers Act, is compatible with human rights.

Article 14 and injunctions

Clause 29 of the Bill triggers the injunctions provisions in Part 7 of the Regulatory Powers Act. This will enable an inspector appointed under the Bill to apply to a relevant court for an injunction to restrain a person from engaging in conduct or requiring a person to do a thing. An inspector may apply to a relevant court for an interim inunction. The injunction provisions are triggered in relation to the offence and civil penalty provisions of the Bill.

Triggering the injunction provision of the Regulatory Powers Act in relation to the offences and civil penalty provisions of the Bill engages the rights to a fair trial and public hearing in both civil and criminal proceedings. Article 14(1) of the ICCPR ensures that everyone shall be entitled to a fair and public hearing by a competent, independent and impartial tribunal established by law. Under Part 7 of the Regulatory Powers Act, an injunction can only be granted by a court. Thus, the right to a fair and public hearing by a competent, independent and impartial tribunal is not limited. Clause 29 does not limit any of the other criminal process rights or minimum guarantees in Article 14 of the ICCPR.

Right to the presumption of innocence

Article 14(2) of the ICCPR ensures that everyone charged with a criminal offence shall have the right to be presumed innocent until proved guilty accordingly to law.

Strict liability

Strict liability offences engage and limit the presumption of innocence as they allow for the imposition of criminal liability without the need to prove fault. However, the defence of mistake of fact is still available to the defendant and the existence of strict liability does not make any other defence unavailable.

Part 3 of the Bill (Enforcing product emissions standards) applies strict liability to offences relating to the import and supply of uncertified emissions-controlled products, and to offences relating to the marking of emissions-controlled products as certified. These strict liability offences have a maximum penalty of 60 penalty units. The Bill also applies strict liability to the offences in Part 4 relating to record-keeping (which have a maximum penalties of 40 and 60 penalty units) and the offence in clause 44 relating to compliance audits (which has a maximum penalty of 40 penalty units.

Application of strict liability to these offences has been set with consideration given to the guidelines regarding the circumstance in which strict liability is appropriate as set out in A Guide to Framing Commonwealth Offences, Civil Penalties and Enforcement Powers. The strict liability offences have also been framed to comply with the principles set out in the Senate Scrutiny of Bills Committee Sixth Report of 2002: Application of Absolute and Strict Liability Offences in Commonwealth Legislation. The penalties for the strict liability offences in the Bill do not include imprisonment, and do not exceed 60 penalty units for an individual. An infringement notice may also be issued for a contravention of a strict liability offence.

The use of strict liability offences in the product emissions standards framework are necessary to ensure the integrity of the regulatory regime to prevent the potential harm to the environment and human health resulting from emissions from non-compliant products.

Reversal of the burden of proof

Generally, consistency with the presumption of innocence requires the prosecution to prove each element of a criminal offence beyond reasonable doubt. An offence provision which requires the defendant to carry an evidential or legal burden of proof, commonly referred to as 'a reverse burden', with regard to the existence of some fact engages the presumption of innocence.

Clause 33 of the Bill creates an offence for a person to engage in conduct that results in an emissions-controlled product that is the subject of a forfeiture notice under clause 32, to be moved, altered, or interfered with. Pursuant to clause 39, a forfeited emissions-controlled product must be dealt with and disposed of in accordance with the directions of the Minister. Subclause 33(2) clarifies that the offence does not apply if the person engages in the conduct in accordance with a direction given to the person by the Minister. A person seeking to rely on this defence will bear an evidential burden in relation to the matter. This is the reverse of the principle in criminal law that the prosecution must prove every element of the offence.

The reversal is justified in this instance, as the matter to be proved (namely that the person's conduct was in accordance with a direction give to the person by the Minister) is a matter that would be in the particular knowledge of the defendant. It is expected that it would not be unreasonably difficult for the defendant to discharge the evidentiary burden in this circumstance.

The use of strict liability offences and the reversal of the burden of proof in the Bill are reasonable, necessary and proportionate responses which reflect the seriousness of the conduct, the potential harm to the environment and human health from the use of non-compliant emissions-controlled products. The use of strict liability offences and the reversal of the burden of proof is also proportionate given in some cases, the regulation of emissions from products will assist in giving effect to Australia's obligations under one or more of the Climate Change Conventions. Accordingly, the Bill is consistent with the right to the presumption of innocence in Article 14(2) of the ICCPR.

Right to privacy

Article 17 of the ICCPR prohibits arbitrary or unlawful interference with an individual's privacy, family, home or correspondence. The United Nations Human Rights Committee has given a liberal interpretation to the term 'home', which includes a person's workplace. The right to privacy can be limited to achieve a legitimate objective where the limitations are lawful and not arbitrary. In order for an interference with the right to privacy to be permissible, the interference must be authorised by law, be for a reason consistent with the ICCPR and be reasonable in the circumstances.

The object of the Bill is to regulate emissions from certain products by setting emissions standards. In regulating those products, it is an object of the Bill to improve air quality in Australia in order to deliver associated health and environmental benefits. In some circumstances, the regulation of emission from products may also assist in giving effect to Australia's obligations under one or more of the Climate Change Conventions.

Monitoring and investigation powers

The entry, monitoring, search, seizure and information gathering powers in the triggered provisions of the Regulatory Powers Act are provided by law. The monitoring and investigation powers are necessary to enable the monitoring of compliance with the Bill and collection of evidential material relating to contraventions of the Bill. The use of these powers is constrained, ensuring that their use is not arbitrary, as follows:

(a)

the powers cannot be exercised without consent being given to the entry into the premises, or under warrant granted by a magistrate. Where entry is by the consent of the occupier, consent must be informed and voluntary, and can be withdrawn at any time.

(b)

Monitoring and investigation warrants can only be issued where the issuing officer is satisfied of certain matters, by oath or affirmation, of the inspector.

(c)

An inspector cannot enter premises under warrant unless their identify card is shown to the occupier of the premises, and they are provided with a copy of the warrant.

Accordingly, the monitoring and investigation powers are necessary, proportionate and reasonable in the pursuance of the legitimate objectives of the Bill.

Forfeiture of products

Part 6 of the Bill, which provides for the forfeiture of emissions-controlled products engages the right to privacy. Clause 32 of the Bill enables an inspector to seize an emissions-controlled product that has been forfeited under clause 31, and clause 34 enables an inspector to give a forfeiture notice to the owner of an emissions-controlled product, stating that the product has been seized. If the owner cannot be identified, the inspector may give the forfeiture notice to the person from whom the emissions-controlled product was seized. This could involve entry into a workplace or home.

The forfeiture provisions are provided by law. The forfeiture powers are necessary to pursue the legitimate objectives of the Bill by ensuring that non-compliant emissions-controlled products are not available for use. The use of these powers is constrained, ensuring that their use is not arbitrary, as follows:

(a)

Emissions-controlled products are only forfeited to the Commonwealth under clause 31 after a relevant court has found that a contravention of Part 3 of the Bill has occurred in relation to those products.

(b)

The forfeiture provisions of Division 3 only apply if an emissions-controlled product has been seized under the investigation powers of Part 3 of the Regulatory Powers Act and the inspector reasonably suspects a provision of Part 3 of the Bill has been contravened in relation to the product.

(c)

Clause 37 of the Bill also provides a right of compensation in circumstances where an emissions-controlled product was forfeited under clause 36 and a relevant court is satisfied that the requirements of Part 3 of the Regulatory Powers Act relating to the exercise of investigation powers was not complied with, or the relevant court is satisfied that a provision of Part 3 of the Bill was not contravened.

Accordingly, the forfeiture powers are necessary, proportionate and reasonable in the pursuance of the legitimate objectives of the Bill.

Publication of information

Clause 42 of the Bill enables the Secretary to publish information relating to a certified emissions-controlled product. Information that may be published includes, but is not limited to, information that identifies the product and the manufacturer of the product, information about emissions from the product and information about the certification of the product.

Under clause 42, the Secretary may also publish information relating to an exemption of an emissions-controlled product or a person from one or more provisions of the Bill. The type of information that may be published includes, but is not limited to, the circumstances in which the exemption applies, the reasons for the exemption and the person who applied for the exemption.

Regardless of the type of emissions-controlled product, is it expected that the information that may be published under this clause presents little risk that personal information will be inappropriately used or disclosed. The amount of personal information collected and published is expected to be minimal, as most certification applicants will be companies which manufacture emissions-controlled products and applicants for exemptions are likely to be importers of emissions-controlled products.

Any personal information would be managed in an open and transparent way, consistent with the Department's Privacy Policy, and the Australian Privacy Principles contained in Schedule 1 of the Privacy Act 1988. Under the Department's Privacy Policy, appropriate controls exist in relation to the use and storage of personal information. For example, only information necessary to carry out the scheme will be collected and published.

Further, any risk can be minimised by alerting people through a privacy notice when they apply for a certification or exemption that certain information may be published at the completion of the process.

The publication of the information contemplated by clause 42 of the Bill, including the publication of an individual's personal information would be outweighed by the objects of the Bill. The publication of the information will also promote compliance and public confidence in the regulatory regime.

Disclosure of Information

Clause 43 of the Bill allows the Secretary to disclose information obtained under the Bill to the Australian Border Force and other agencies, bodies or persons prescribed by the rules. The Secretary may disclose information if the Secretary reasonably believes the information will assist or enable the agency to exercise its powers, or perform its functions or duties.

Subclause 51(6) contains a safeguard by requiring the Minister to consult with, and have regard to any submissions from, the Information Commissioner before making any rules prescribing agencies, persons or bodies with whom information may be shared. This will ensure that any rules made by the Minister concerning the disclosure of information comply with relevant privacy obligations, thus protecting the privacy rights of individuals.

The clauses discussed above, which limit the right to privacy are reasonably, necessary and proportionate to achieve the legitimate objective of regulating emissions from emissions-controlled products. Accordingly, these aspects of the Bill are consistent with the right to privacy in Article 17 of the ICCPR.

Conclusion

The Bill is compatible with human rights because it promotes the right to an effective remedy under Article 2(3) of the ICCPR. To the extent that it engages and limits other human rights (including Article 14(1), Article 14(2) and Article 17), those limitations are reasonable, necessary and proportionate to achieve the legitimate aims of the Bill.