EXPLANATORY STATEMENT
Australian Meat and Live-stock Industry Act 1997
Australian Meat and Live-stock Industry (Beef Export to the USA – Quota Years 2016-2022) Order 2015
Legislative Authority
The Australian Meat and Live-stock Industry (Beef Export to the USA – Quota Years 2016-2022) Order 2015 (the order) is made under section 17 of the Australian Meat and Live-stock Industry Act 1997 (the AMLI Act). Under section 17 of the AMLI Act, the Secretary may, by legislative instrument, make orders to be complied with by the holder of export licences. Section 27 of the AMLI Act relevantly provides that orders under section 17 may provide for the establishment and administration of a system of quotas, including the method to be used in granting quota under s 6(1) of the Australian Meat and Live-stock (Quotas) Act 1990.
Purpose
The purpose of the order is to provide for the administration of a system of quotas for the export of beef tariff free to the USA.
Background
The order outlines the quota administrative processes that operate on an annual basis. For the purpose of this order, the quota year runs from 1 January to 31 December.
The quota arrangements are managed on a first-come-first-served (FCFS) basis with a trigger threshold applying if USA beef quota certificates are granted equalling 85 per cent of the access amount before 1 October in any quota year. (The access amount for a quota year is set out in section 6 of the order and is the total amount of beef that can be exported to the USA at the zero tariff rate for that year.) If it appears the trigger threshold will be reached, eligible exporters will be informed of their Provisional Trigger Entitlement (PTE) prior to the trigger threshold. The PTE for an exporter is calculated in accordance with section 9 of the order. Where the trigger threshold is not reached, the FCFS arrangements will continue for the remainder of that quota year.
An exporter requires a USA beef quota certificate (quota certificate) to land the product tariff free in the USA. The order details the procedure for acquiring such a certificate and the rules that apply to the calculation, use, non-use and transfer of PTE.
Impact and Effect
This order repeals and replaces the Australian Meat and Live-stock Industry (Beef Export to the USA—Quota Years 2015-2021) Order 2014 (the 2014 order) and is made for the purpose of clarifying the operation of the quota administrative system. The key differences between this order and the 2014 order are as follows.
The order allows for a ‘trigger threshold’ as opposed to a ‘trigger day’, clarifying at what point applications are not eligible for the FCFS quota arrangements (under Part 2 of the order).
The order also improves the clarity surrounding the process of quota allocation once the 85 per cent trigger threshold has been reached (under Part 3 of the order).
The order also includes a definition of ‘export deadline’ for a quota certificate and sets out the Secretary’s discretionary powers to vary and cancel quota certificates under Parts 2 and 3 of the order if the export is not completed (or not going to be completed) by the export deadline. (The export is complete when the goods are landed outside Australia – i.e., in this case, in the USA.)
The changes to Part 3 (Approvals after trigger threshold reached) clarify the rules surrounding transfer of PTE among exporters, and allocation of these transfers as part of an exporter’s quota entitlement. Further changes to Part 3 also clarify the granting of a partial quota certificate and the use of uncommitted quota.
Under section 17 of the order, the exporter may apply to the Administrative Appeals Tribunal for review of the Secretary’s discretionary decisions to vary, not vary, cancel or not cancel a quota certificate.
The fact that the department uses an electronic system to grant quota certificates has been made explicit throughout the document (see, for example, subsection 7(6)). As the certificate is not provided directly to the applicant through that system (rather it is transmitted to the USA), the Order also provides for the applicant be notified of the grant of a certificate on the day on which it is granted. Equivalent provisions apply to the variation and cancellation of quota certificates.
In addition, several minor amendments were made to improve the readability of the order.
Consultation
The USA beef quota system is managed by the department on an industry-agreed cost recovery basis. The current administrative system was put in place in 2006 following a review of the 2002 arrangements. The relevant order implementing that administrative system was re-made annually until the 2014 order. This order is being made to replace the 2014 order to clarify some issues with the operation of the 2014 order which were largely mechanical in nature. The key changes which have been incorporated in this order were discussed and agreed with the Australian Meat Industry Council.
The Office of Best Practice Regulation was consulted (OBPR ID 19915).
Details
Details of the order are set out in Attachment A.
The order is 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.
The provisions in the order do not raise any human rights issues as they relate to the administration of a system for allocation of quota to export beef to the USA at zero tariff. A full statement of compatibility is set out in Attachment B.
The order is a legislative instrument for the purposes of the Legislative Instruments Act 2003.
Attachment A
Details of the Australian Meat & Live-stock Industry (Beef Export to the USA – Quota Years 2016-2022) Order 2015
Section 1 – Name
This section provides that the name of the order is the Australian Meat & Live-stock Industry (Beef Export to the USA – Quota Years 2016-2022) Order 2015.
Section 2 – Commencement
This section provides that the order commences the day after registration.
Section 3 – Authority
This section provides that the order is made under section 17 of the Australian Meat and Live-stock Industry Act 1997.
Section 4 – Schedules
This section provides that each instrument specified in a Schedule is amended or repealed as set out in the Schedule.
Section 5 – Purpose
This section states the purpose for which the order was made, which is to set out conditions under which quota beef can be exported to the USA at zero tariff.
Section 6 – Definitions
This section provides definitions of terms used within the order, as set out below.
Access amount, for a quota year, means:
(a) for 2016—418 214 000 kilograms; or
(b) for 2017 and 2018—423 214 000 kilograms; or
(c) for 2019—428 214 000 kilograms; or
(d) for 2020—433 214 000 kilograms; or
(e) for 2021—438 214 000 kilograms; or
(f) for 2022—448 214 000 kilograms.
consignment means a single shipment of quota beef (by sea or air) by an exporter to a single consignee.
eligible export, in relation to a quota year, means an export to the USA of quota beef during the 2-year period that:
(a) begins on the 1 November that occurs 26 months before the start of the quota year; and
(b) ends on 31 October immediately before the start of the quota year.
EXDOC means the electronic documentation system maintained by the Department.
export deadline, in relation to a consignment of quota beef covered by a US beef quota certificate, means:
(a) if the US beef quota certificate is granted on or after 1 October in the quota year for which the consignment is to be exported—the end of the quota year; or
(b) in any other case—the end of the period of 3 months beginning on the day the US beef quota certificate is granted for the consignment.
exporter means the holder of a meat export licence, issued under section 10 of the Australian Meat and Live-stock Industry Act 1997, that permits the holder to export a beef product to the USA.
processed meat has the same meaning as in the Harmonized Tariff Schedule of the United States.
Note 1: The definition in Chapter 2 of the Harmonized Tariff Schedule is as follows: “The term ‘processed’ covers meats which have been ground or comminuted, diced or cut into sizes for stew meat or similar uses, rolled and skewered, or specially processed into fancy cuts, special shapes, or otherwise made ready for particular uses by the retail consumer.”.
Note 2: The Harmonized Tariff Schedule of the United States is part of 19 USC Chapter 4 (the Tariff Act of 1930). Its implementation was authorised by 19 USC Chapter 18. The full Harmonized Tariff Schedule could in 2015 be viewed on the United States International Trade Commission’s website (http://www.usitc.gov).
PTE (short for provisional trigger entitlement), for an exporter for a quota year, means the amount calculated under section 9.
QA Unit means the section of the Department known as the Quota Administration Unit.
Note: The address of the Department’s QA Unit is given in section 18.
quota beef means fresh, chilled or frozen meat derived from cattle that is classified in any of the following classifications of the Harmonized Tariff Schedule of the United States:
(a) 0201.10.10;
(b) 0201.20.10;
(c) 0201.20.30;
(d) 0201.20.50;
(e) 0201.30.10;
(f) 0201.30.30;
(g) 0201.30.50;
(h) 0202.10.10;
(i) 0202.20.10;
(j) 0202.20.30;
(k) 0202.20.50;
(l) 0202.30.10;
(m) 0202.30.30;
(n) 0202.30.50;
(o) 9913.02.05;
but does not include any of the following:
(p) edible offal;
(q) canned or processed meat;
(r) meat loaded onto a ship as part of the ship’s stores.
Note: The Harmonized Tariff Schedule of the United States is part of 19 USC Chapter 4 (the Tariff Act of 1930). Its implementation was authorised by 19 USC Chapter 18. The full Harmonized Tariff Schedule could in 2015 be viewed on the United States International Trade Commission’s website (http://www.usitc.gov).
quota year means a calendar year beginning on or after 1 January 2016.
trigger threshold, in relation to a quota year in which, before 1 October of the quota year, the total weight of quota beef for which US beef quota certificates have been granted equals 85% of the access amount, is 85% of the access amount for the quota year.
uncommitted quota, for a quota year in which the trigger threshold is reached, means any part of the access amount for the quota year that is:
(a) not covered by a US beef quota certificate; and
(b) not part of the quota allocated to any exporter under section 13.
Note 1: Quota beef covered by a US beef quota certificate granted under section 7 that is cancelled on or after the day the trigger threshold is reached for a quota year becomes uncommitted quota: see subsection 8(7).
Note 2: Quota beef covered by a US beef quota certificate granted under section 15 that is cancelled becomes uncommitted quota: see subsection 16(7).
USA includes Puerto Rico.
US beef quota certificate means a certificate authorising the entry of beef into the USA at a tariff rate of zero.
working day means a day that is not any of the following:
(a) a Saturday or Sunday;
(b) a public holiday in the Australian Capital Territory;
(c) a day in the period beginning on 27 December and ending on 31 December in a year.
Part 2 – Approvals until trigger threshold reached
Section 7 - Approvals to export quota beef until trigger threshold reached
This section outlines how an exporter applies for and is granted an approval and quota certificate to export a consignment of quota beef in a quota year, until the 85 per cent trigger threshold is reached. The trigger threshold is reached in a quota year if, before 1 October in that year, the total weight of quota beef for which quota certificates have been granted equals 85% of the access amount (see definition of ‘trigger threshold’ in section 6).
Section 8 – What happens if export cannot be completed?
This section outlines the possible consequences of not exporting a consignment of quota beef by the export deadline (including the Secretary’s powers to vary and cancel certificates). The section also provides for what occurs to the tonnage of quota beef if a certificate is cancelled.
Part 3 – Approvals after trigger threshold reached
Section 9 – Calculation of exporter’s PTE
This section outlines how the amount of an exporter’s PTE for the quota year is calculated.
Section 10 – Notice before trigger threshold reached – exporter’s PTE
This section sets out requirements for the Secretary to notify eligible exporters if the Secretary believes it is likely that the 85 per cent trigger threshold will be reached prior to 1 October in the quota year. The notice must include matters such as the amount (if any) of the exporter’s PTE for the quota year.
Section 11 – Notice about trigger threshold being reached and intended use of exporter’s PTE
This section requires the Secretary to notify each exporter that has made an eligible export in relation to the quota year that the trigger threshold has been reached, the day on which this occurred and, where applicable, the amount of the exporter’s PTE that they are authorised to deal with. It also outlines that an exporter must notify the department if they intend to deal with some or all of their PTE and the amount of the PTE that the exporter intends to export.
Section 12 – Transfer of exporter’s PTE
This section outlines the requirements for transfer of PTE amongst exporters. The section outlines the timing restrictions that apply to this, and the requirement for the exporter to notify the department of such transfers.
Section 13 – Allocation of quota
This section outlines that the Secretary must allocate, as quota, to an exporter any amount of PTE that the exporter has notified the QA Unit that they intend to use (under paragraph 11(2)(b)) and that has not been transferred to another exporter. The Secretary must also allocate, as quota, PTE amounts that have been transferred to the exporter by another exporter in accordance with section 12.
Section 14 – Use of allocated quota
This section outlines the process for an exporter to apply for, and the Secretary to grant, approvals and quota certificates using the quota allocated to them under section 13. The approvals and certificates must not exceed the quota amount allocated to the exporter.
Section 15 – Use of uncommitted quota
This section outlines how an exporter applies for and is granted approvals and quota certificates to export consignments of quota beef to the USA using uncommitted quota. (There is a definition of ‘uncommitted quota’ in section 6.) To be able to use uncommitted quota under this this section, the exporter must not have remaining quota allocation which they could use under section 14.
Section 16 – What happens if export cannot be completed?
This section outlines the possible consequences of not exporting a consignment of quota beef by the export deadline (including the Secretary’s powers to vary and cancel certificates). The section also provides for what occurs to the tonnage of quota beef if a certificate is cancelled.
Part 4 – Miscellaneous
Section 17 – Review of certain decisions
This section provides a mechanism for exporters to apply to the Administrative Appeals Tribunal for review of a decision of the Secretary made under section 8 or 16.
Section 18 – Where to send notices
This section provides contact details for the QA Unit.
Section 19 – Repeal
This section provides a date at which this order will be repealed.
Part 5 – Application and transitional provisions
Section 20 – Definitions
This section provides definitions of terms used in Part 5 of the order. These are set out below.
2014 order means the Australian Meat and Live-stock Industry (Beef Export to the USA—Quota Years 2015-2021) Order 2014, as in force immediately before the commencement of this instrument.
2015 quota year means the calendar year beginning on 1 January 2015.
Section 21 – Application – repeal of 2014 order
This section clarifies that the repeal of the 2014 order applies in relation to exports of quota beef for a quota year beginning on or after 1 January 2016.
Section 22 – Transitional – applications relating to quota beef to be exported on or after
1 January 2016
This section allows for an application for approval made under the 2014 order, for an export in the 2016 quota year, to be treated as an application for the purposes of section 7 of this new order. This enables applications that have already been made to be approved under this new order without applicants having to make a new application.
Section 23 – Transitional – approvals relating to quota beef to be exported on or after
1 January 2016
This section allows approvals and quota certificates granted under section 7 of the 2014 order, for the 2016 quota year, to be treated as approvals and certificates for the purposes of section of this new order.
Schedule 1 – Repeals
This schedule repeals the 2014 order.
Attachment B
Statement of Compatibility with Human Rights
Prepared in accordance with Part 3 of the Human Rights (Parliamentary Scrutiny) Act 2011
Australian Meat and Live-stock Industry (Beef Export to the USA – Quota Years 2016-2022) Order 2015
This Legislative Instrument is 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 Legislative Instrument
Each year the United States of America (US) grants Australia a country specific quota for beef exports. Shipments made in-quota allow product to enter at a zero tariff rate. The order provide for the administration of a system of allocating this quota to exporters of beef to the USA.
The order repeals and replaces the Australian Meat and Live-stock Industry (Beef Export to the USA—Quota Years 2015-2021) Order 2014. It broadly continues existing arrangements for future quota years while clarifying some issues relating to the administration of that system.
Human rights implications
This Legislative Instrument does not engage any of the applicable rights or freedoms.
Conclusion
This Legislative Instrument is compatible with human rights as it does not raise any human rights issues.
Daryl Quinlivan
Secretary of the Department of Agriculture and Water Resources