Untitled document
Essential Services Commission Amendment Act 2008
No. 15 of 2008
table of provisions
Section Page
1Purpose
2Commencement
3Section 1 substituted—Purpose
1Purpose
4
Amendment of section 4—Determinations in relation to
regulated industries
5Section 8 substituted and new section 8A inserted
8Objective of the Commission
8AMatters which the Commission must have regard to
6Repeal of provisions relating to specific functions
7Amendment of section 14—Commission must publish Charter
8Amendment of section 28—Meetings of the Commission
9Amendment of section 33—Price determinations
10Amendment of section 34—Other regulatory powers
11New Part 3A inserted—Third Party Access Regimes
Part 3A—third party access regimes
35AObject of Part
35BApplication of Part
35CPricing principles applying in respect of regulated
access prices35DTime limit for determinations relating to third party infrastructure access regimes
12Section 36 substituted—Application of Part
36Application of this Part
13New section 36A inserted—Commission must have regard to certain matters
36ACommission must have regard to certain matters
14Amendment of section 37—General power to obtain
information and documents15New section 37A inserted—Provision of information relating
to regulated entities37AProvision of information relating to regulated entities
16Amendment of section 38—Restriction of disclosure of confidential information
17Amendment of section 41—Minister may refer matter for
inquiry18New section 41A inserted—Minister may limit use of powers under section 37
41AMinister may limit use of powers under section 37
19Amendment of section 42—Notice of inquiry
20Section 44 repealed—Powers relating to inquiries
21New Part 6 inserted—Codes of Practice
Part 6—codes of Practice
47Power to make Codes of Practice
48Power to apply, adopt or incorporate
49Regulatory scrutiny of Codes of Practice
50Availability of Codes of Practice
51Tabling and disallowance
22Amendment of section 53—Enforcement orders
23New section 54A inserted—Civil penalty
54ACivil penalty
24Amendment of section 55—Right of appeal
25Amendment of section 56—Appeal panel
26Amendment of section 66—Review
27Consequential amendment of the Rail Corporations
Act 199628Consequential amendment of the Water Industry Act 1994
29Repeal of Amending Act
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Endnotes
Essential Services Commission Amendment Act 2008
No. 15 of 2008
[Assented to 23 April 2008]
The Parliament of Victoria enacts:
1Purpose
The purpose of this Act is to amend the Essential Services Commission Act 2001 to improve the operation of the Act following a review of the Act in accordance with section 66 of the Act.
2Commencement
(1)Subject to subsection (2), this Act comes into operation on a day or days to be proclaimed.
(2)If a provision of this Act does not come into operation before 1 July 2009, it comes into operation on that day.
3Section 1 substituted—Purpose
For section 1 of the Essential Services Commission Act 2001 substitute—
"1 Purpose
The purpose of this Act is to enable the Essential Services Commission to perform the regulatory and advisory functions that are conferred on the Commission in a manner that provides incentives for dynamic, productive and allocative efficiency and promotes the long term interests of Victorian consumers.".
4Amendment of section 4—Determinations in relation to regulated industries
(1)In section 4(2)(c) of the Essential Services Commission Act 2001 for "section 34." substitute "section 34;".
(2)After section 4(2)(c) of the Essential Services Commission Act 2001 insert—
"(d)decisions or classes of decisions of the Commission under the powers conferred by the Order that are to be determinations for the purposes of this Act.".
5Section 8 substituted and new section 8A inserted
For section 8 of the Essential Services Commission Act 2001 substitute—
"8 Objective of the Commission
(1)In performing its functions and exercising its powers, the objective of the Commission is to promote the long term interests of Victorian consumers.
(2)Without derogating from subsection (1), in performing its functions and exercising its powers in relation to essential services, the Commission must in seeking to achieve the objective specified in subsection (1) have regard to the price, quality and reliability of essential services.
8AMatters which the Commission must have regard to
(1)In seeking to achieve the objective specified in section 8, the Commission must have regard to the following matters to the extent that they are relevant in any particular case—
(a)efficiency in the industry and incentives for long term investment;
(b)the financial viability of the industry;
(c)the degree of, and scope for, competition within the industry, including countervailing market power and information asymmetries;
(d)the relevant health, safety, environmental and social legislation applying to the industry;
(e)the benefits and costs of regulation (including externalities and the gains from competition and efficiency) for—
(i)consumers and users of products or services (including low income and vulnerable consumers);
(ii)regulated entities;
(f)consistency in regulation between States and on a national basis;
(g)any matters specified in the empowering instrument.
(2)Without derogating from section 8 or subsection (1), the Commission must also when performing its functions and exercising its powers in relation to a regulated industry do so in a manner that the Commission considers best achieves any objectives specified in the empowering instrument.".
6Repeal of provisions relating to specific functions
(1)Sections 10A and 10B of the Essential Services Commission Act 2001 are repealed.
(2)In section 3 of the Essential Services Commission Act 2001, the definitions of insurance, insurance business, insurance industry and statutory insurer are repealed.
(3)Section 37(5A) of the Essential Services Commission Act 2001 is repealed.
7Amendment of section 14—Commission must publish Charter
In section 14(1) of the Essential Services Commission Act 2001 after "determinations" insert "and other regulatory decisions".
8Amendment of section 28—Meetings of the Commission
After section 28(4) of the Essential Services Commission Act 2001 insert—
"(4A)The Commission may transact any of its business at a meeting at which the Commissioners or any of the Commissioners participate by audio link or audio visual link.
(4B)A Commissioner who participates in a meeting in accordance with subsection (4A) is to be taken to be present at the meeting.
(4C)For the purposes of subsection (4A)—
audio link means facilities (including telephone) that enable audio communication between persons at different locations;
audio visual link means facilities (including closed-circuit television) that enable audio and visual communication between persons at different locations.".
9Amendment of section 33—Price determinations
For sections 33(3) and 33(4) of the Essential Services Commission Act 2001 substitute—
"(3)In making a determination under this section, the Commission must have regard to—
(a)the particular circumstances of the regulated industry and the prescribed goods and services for which the determination is being made;
(b)the efficient costs of producing or supplying regulated goods or services and of complying with relevant legislation and relevant health, safety, environmental and social legislation applying to the regulated industry;
(c)the return on assets in the regulated industry;
(d)any relevant interstate and international benchmarks for prices, costs and return on assets in comparable industries;
(e)any other factors that the Commission considers relevant.
(4)In making a determination under this section, the Commission must ensure that—
(a)the expected costs of the proposed regulation do not exceed the expected benefits; and
(b)the determination takes into account and clearly articulates any trade-offs between costs and service standards.".
10Amendment of section 34—Other regulatory powers
In section 34(2) of the Essential Services Commission Act 2001 after "determination" insert "or other regulatory decision".
11New Part 3A inserted—Third Party Access Regimes
After Part 3 of the Essential Services Commission Act 2001 insert—
"Part 3A—third party access regimes
35AObject of Part
The object of this Part is to promote the economically efficient operation of, use of and investment in, the infrastructure by means of which services are provided, thereby promoting effective competition in upstream and downstream markets.
35BApplication of Part
This Part applies to a regulated industry which has an access regime.
35CPricing principles applying in respect of regulated access prices
The pricing principles relating to the price of access to a service are—
(a)that regulated access prices should—
(i)be set so as to generate expected revenue for a regulated service or services that is at least sufficient to meet the efficient costs of providing access to the regulated service or services; and
(ii)include a return on investment commensurate with the regulatory and commercial risks involved; and
(b)that the access price structures should—
(i)allow multi-part pricing and price discrimination when it aids efficiency; and
(ii)not allow a vertically integrated access provider to set terms and conditions that discriminate in favour of its downstream operations, except to the extent that the cost of providing access to other operators is higher; and
(c)that access pricing regimes should provide incentives to reduce costs or otherwise improve productivity.
35DTime limit for determinations relating to third party infrastructure access regimes
(1)Subject to this section, if the Commission has been provided with sufficient information, the Commission must make a determination relating to a third party infrastructure access regime within 6 months after receiving the application or proposal.
(2)The Commission may in accordance with subsection (3) suspend the time limit applying under subsection (1) for a period not exceeding 2 months if—
(a)the Commission does not have sufficient information and any reasonable request for further information has not been complied with; or
(b)further time is required to enable consultation with third parties and the public; or
(c)any other ground specified in the guidelines applies.
(3)If the Commission proposes to suspend the time limit applying under subsection (1), the Commission must—
(a)notify—
(i)the Minister and the parties by notice in writing; and
(ii)the public by a notice published in a daily newspaper circulating generally in Victoria;
(b)specify in the notice—
(i)the reason why the time limit is being suspended; and
(ii)the date by which the Commission proposes to use its best endeavours to make a decision on the application or proposal.
(4)The Commission may suspend the time limit applying under subsection (1) by a further period not exceeding 2 months if the Commission—
(a)first obtains the approval of the Minister; and
(b)complies with subsection (3).
(5)Despite subsection (2)(a), the Commission may make a determination within the time limit applying under subsection (1) on the information available to the Commission if the service provider of a significant infrastructure facility has not provided the further information requested within the specified period.".
12Section 36 substituted—Application of Part
For section 36 of the Essential Services Commission Act 2001 substitute—
"36 Application of this Part
Subject to any provisions to the contrary in any relevant legislation, this Part applies to or in respect of any information or document that is provided to the Commission.".
13New section 36A inserted—Commission must have regard to certain matters
After section 36 of the Essential Services Commission Act 2001 insert—
"36A Commission must have regard to certain matters
In exercising the powers conferred on the Commission under this Part, the Commission must have regard to—
(a)the relevance of the information or document; and
(b)the estimated compliance costs.".
14Amendment of section 37—General power to obtain information and documents
(1)For section 37(1) of the Essential Services Commission Act 2001 substitute—
"(1)If the Commission considers that it is necessary to do so for the purposes of performing its functions or exercising its powers, the Commission may require a person that the Commission has reason to believe has any relevant information or document to provide that information or document to the Commission.
(1A)For the purposes of subsection (1), the Commission may require the person to appear before the Commission to provide the information or document.".
(2)After section 37(2)(c) of the Essential Services Commission Act 2001 insert—
"(ca)whether or not the person is required to appear before the Commission; and".
15New section 37A inserted—Provision of information relating to regulated entities
After section 37 of the Essential Services Commission Act 2001 insert—
"37A Provision of information relating to regulated entities
(1)A regulated entity must provide information relating to the regulated entity requested by the Commission by written notice to the Commission in the manner and form specified in the notice.
(2)If information relating to a regulated entity is held by a third party, the Commission may require the regulated entity to enter into an arrangement with the third party under which the third party is to provide the information to the Commission.
(3)The Commission may specify the kind or class of information which a regulated entity must maintain for the purposes of this section in a Code of Practice.".
16Amendment of section 38—Restriction of disclosure of confidential information
(1)In section 38(1)(a) of the Essential Services Commission Act 2001 for "44" substitute "37A".
(2)After section 38(1) of the Essential Services Commission Act 2001 insert—
"(1A)Before the Commission makes a decision under subsection (2), the Commission must—
(a)give the person giving the information or document an opportunity to make a submission to the Commission specifying—
(i)why the information or document is of a confidential or commercially-sensitive nature; and
(ii)the detriment that would be caused by the disclosure of the information or document; and
(b)consider any submission made by that person.".
17Amendment of section 41—Minister may refer matter for inquiry
After section 41(1) of the Essential Services Commission Act 2001 insert—
"(1A)The Minister is responsible for referring any matter to the Commission for an inquiry unless relevant legislation provides that the Minister administering the relevant legislation may refer a matter to the Commission for an inquiry.
(1B)Before referring a matter to the Commission for an inquiry, the Minister must consult with any Minister who has responsibilities in respect of that matter.".
18New section 41A inserted—Minister may limit use of powers under section 37
After section 41 of the Essential Services Commission Act 2001 insert—
"41A Minister may limit use of powers under section 37
If any inquiry is to be conducted into a matter that does not relate to a regulated industry, the Minister may give the Commission specific directions in respect of the conduct of the inquiry which limit the use of the powers conferred on the Commission under section 37 in the manner specified in the specific directions.".
19Amendment of section 42—Notice of inquiry
After section 42(2) of the Essential Services Commission Act 2001 insert—
"(2A)The Commission may specify in the notice under subsection (2) that if a submission is not received within the period specified under subsection (2)(c), the Commission may decide not to consider the submission.".
20Section 44 repealed—Powers relating to inquiries
Section 44 of the Essential Services Commission Act 2001 is repealed.
21New Part 6 inserted—Codes of Practice
After Part 5 of the Essential Services Commission Act 2001 insert—
"Part 6—codes of Practice
47Power to make Codes of Practice
(1)The Commission may make, amend or revoke Codes of Practice in accordance with this Part for the purpose of performing regulatory functions in respect of a regulated industry.
(2)Without limiting the generality of subsection (1), a Code of Practice may provide for any matter relating to—
(a)requiring a specified regulated entity or a specified class of regulated entity to develop, issue and comply with customer-related standards, procedures, policies and practices (including with respect to the payment of compensation to customers) in accordance with the Code of Practice;
(b)specifying minimum customer-related standards, procedures, policies and practices for inclusion by a specified regulated entity or a specified class of regulated entity in a customer charter for specific services;
(c)requiring a specified regulated entity or a specified class of regulated entity to enter into an agreement with another specified regulated entity or another specified class of regulated entity for the purpose of ensuring that obligations relating to customer-related standards can be met;
(d)specifying principles for the negotiation of agreements required under paragraph (c) between regulated entities in relation to standards and conditions of service and supply;
(e)requiring regulated entities to maintain specified accounting records and to prepare accounts according to specified principles.
(3)A Code of Practice may establish principles giving practical guidance in relation to the performance of the functions and the exercise of the powers of the Commission.
(4)A Code of Practice may—
(a)impose a duty on any person;
(b)direct how any matter or thing is to be done;
(c)create an enforceable legal right;
(d)impose any liability or penalty, including proportionate penalties for failures to comply with requirements imposed by the Code of Practice.
(5)A Code of Practice is not a determination.
(6)A reference in this Part to—
(a)a proposed Code of Practice includes a reference to a proposed amendment to a Code of Practice;
(b)a Code of Practice includes a reference to an amendment to a Code of Practice.
48Power to apply, adopt or incorporate
(1)A Code of Practice may apply, adopt or incorporate any matter contained in any document, code, standard, rule, specification or method formulated, issued, prescribed or published by any authority or body whether—
(a)wholly or partially or as amended by the Code of Practice; or
(b)as formulated, issued, prescribed or published at the time the Code of Practice is made or at any time before then; or
(c)as formulated, issued, prescribed or published from time to time.
(2)If a Code of Practice has applied, adopted or incorporated any matter contained in any document, code, standard, rule, specification or method as formulated, issued, prescribed or published from time to time and that document, code, standard, rule, specification or method is at any time amended, until the Commission causes notice to be published in the Government Gazette of that amendment, the document, code, standard, rule, specification or method is to be taken not to have been so amended.
(3)Without limiting the generality of subsection (1), a Code of Practice may apply, adopt or incorporate by reference any benchmarks, standards or technical references.
49Regulatory scrutiny of Codes of Practice
(1)This section applies in respect of the making or amending of a Code of Practice under this Part or under any relevant legislation.
(2)The Commission must prepare a regulatory statement in respect of a proposed Code of Practice.
(3)A regulatory statement must include—
(a)a statement of the objectives of the proposed Code of Practice;
(b)an evaluation of the costs and benefits of the proposed Code of Practice;
(c)an evaluation of alternative means of achieving those objectives;
(d)a draft copy of the proposed Code of Practice.
(4)The evaluation of the costs and benefits must include an assessment of the economic, environmental and social impact and the likely administration and compliance costs including resource allocation costs.
(5)The Chairperson must ensure the adequacy of the regulatory statement and of the assessment included in the regulatory statement.
(6)The Chairperson must ensure that a notice in accordance with subsection (7) is published in—
(a)the Government Gazette; and
(b)a daily newspaper circulating generally throughout Victoria; and
(c)in any trade, professional or public interest publications as the Chairperson considers appropriate.
(7)A notice must—
(a)state the reason for, and the objectives of, the proposed Code of Practice;
(b)summarise the results of the regulatory statement;
(c)specify where a copy of the regulatory statement and of the proposed Code of Practice can be obtained;
(d)invite public comments or submissions within such time (being not less than 28 days from the publication of the notice) as is specified in the notice.
(8)The Chairperson must ensure that all comments and submissions are considered before the proposed Code of Practice is made.
(9)The Chairperson must ensure that appropriate notice is given of the decision to make, or not to make, a proposed Code of Practice.
(10)Before a Code of Practice is made, the Chairperson must give a certificate in writing specifying—
(a)that the requirements relating to regulatory statements have been complied with; and
(b)that in his or her opinion the regulatory statement adequately assesses the likely impact of the proposed Code of Practice.
(11)The Chairperson must ensure that a copy of the regulatory statement and the compliance certificate is given to the Scrutiny of Acts and Regulations Committee of the Parliament as soon as practicable after the Code of Practice is made.
50Availability of Codes of Practice
(1)Upon the making of a Code of Practice, the Commission must cause—
(a)a copy of the Code of Practice; and
(b)a notice specifying—
(i)the date of commencement of the Code of Practice; and
(ii)the place where copies of the Code of Practice may be obtained—
to be published in the Government Gazette.
(2)A Code of Practice or a provision of a Code of Practice comes into operation at the beginning of the day specified in the notice under subsection (1) which must be a day that is later than the day on which the Government Gazette is published.
51Tabling and disallowance
(1)On or before the 6th sitting day after notice of the making of a Code of Practice is published in the Government Gazette, the Commission must ensure that a copy of the Code of Practice is laid before each House of the Parliament.
(2)A failure to comply with subsection (1) does not affect the operation or effect of the Code of Practice but the Scrutiny of Acts and Regulations Committee of the Parliament may report the failure to each House of the Parliament.
(3)A Code of Practice may be disallowed in whole or in part by either House of Parliament.
(4)Part 5 of the Subordinate Legislation Act 1994 applies to a Code of Practice as if—
(a)a reference in that Part to a "statutory rule" were a reference to the "Code of Practice"; and
(b)a reference in section 23(1)(c) of that Part to "section 15(1)" were a reference to "section 51(1) of the Essential Services Commission Act 2001".".
22Amendment of section 53—Enforcement orders
(1)In section 53(1) of the Essential Services Commission Act 2001—
(a)in paragraph (b) for "licence—" substitute "licence; or";
(b)after paragraph (b) insert—
"(c)a Code of Practice applying under Part 6 or under relevant legislation—".
(2)In sections 53(2)(a) and 53(5)(a) of the Essential Services Commission Act 2001 for "or licence condition" substitute ", licence condition or Code of Practice".
23New section 54A inserted—Civil penalty
After section 54 of the Essential Services Commission Act 2001 insert—
"54A Civil penalty
(1)This section applies if—
(a)a person has contravened or is contravening—
(i)a determination; or
(ii)if the Commission is under the relevant legislation or by virtue of an Order made under section 4 responsible for licensing, the conditions of a licence; or
(iii)a Code of Practice applying under Part 6 or under relevant legislation; and
(b)the Commission considers that the contravention is not of a trivial nature.
(2)The Commission may serve a notice on the person—
(a)requiring the person—
(i)to cease contravening; or
(ii)if the contravention has already occurred, to take such actions as are specified in the notice to rectify the contravention—
within the period specified in the notice; and
(b)advising the person that if the person fails to comply with the notice the person is liable to pay to the Consolidated Fund, as a pecuniary penalty, the amount specified by the Commission in the notice.
(3)A pecuniary penalty imposed under this section cannot exceed an amount equal to 120 penalty units.
(4)This section does not limit the application of section 53.".
24Amendment of section 55—Right of appeal
(1)After section 55(1) of the Essential Services Commission Act 2001 insert—
"(1A)For the purposes of subsection (1), a person who represents a consumer or user group is to be taken to be a person who is entitled to appeal against the requirement, decision or determination in accordance with this section.".
(2)In section 55(3) of the Essential Services Commission Act 2001—
(a)in paragraph (a), for "7" substitute "14";
(b)in paragraph (b), for "14" substitute "21".
(3)After section 55(4) of the Essential Services Commission Act 2001 insert—
"(5)If a person lodges an appeal under subsection (1)(b), the Commission must not take any action to give effect to the decision until the appeal is determined.
(6)If a person lodges an appeal under subsection (1)(c), the determination continues in effect until the appeal is determined.".
25Amendment of section 56—Appeal panel
(1)After section 56(2) of the Essential Services Commission Act 2001 insert—
"(2A)When constituting an appeal panel, the Registrar must use his or her best endeavours to constitute the appeal panel consisting of—
(a)a chairperson who has experience in conducting contested hearings; and
(b)at least one member who has technical or industry experience or knowledge relevant to the appeal.".
(2)For section 56(7)(a) of the Essential Services Commission Act 2001 substitute—
"(a)in the case of an appeal under section 55(1)(a), may in granting the appeal—
(i)cancel the requirement; or
(ii)vary the requirement; or
(iii)set aside the requirement and remit it to the Commission for amendment of the requirement in accordance with the decision and recommendations (if any) of the appeal panel;".
(3)After section 56(9) of the Essential Services Commission Act 2001 insert—
"(9A)Subject to subsection (10), a party to an appeal must give an appeal panel any information that the appeal panel may request.".
26Amendment of section 66—Review
For section 66(1) of the Essential Services Commission Act 2001 substitute—
"(1)The Minister must ensure that a further review of this Act is completed by 31 December 2016.".
27Consequential amendment of the Rail Corporations Act 1996
Division 9 of Part 2A of the Rail Corporations Act 1996 is repealed.
28Consequential amendment of the Water Industry Act 1994
Sections 4F(3) and 4F(4) of the Water Industry Act 1994 are repealed.
29Repeal of Amending Act
This Act is repealed on 1 July 2010.
Note
The repeal of this Act does not affect the continuing operation of the amendments made by it (see section 15(1) of the Interpretation of Legislation Act 1984).
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Endnotes
Minister's second reading speech—
Legislative Assembly: 13 March 2008
Legislative Council: 10 April 2008
The long title for the Bill for this Act was "A Bill for an Act to amend the Essential Services Commission Act 2001, to consequentially amend the Rail Corporations Act 1996 and the Water Industry Act 1994 and for other purposes."
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