Dairy Industry Stabilization Levy Regulations (Amendment)

Legislation au C2004L04259 Regulations Not in force Legislative Instrument

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EXPLANATORY STATEMENT

STATUTORY RULES 1982 No. 159

Issued by the Authority of the Minister of State for Home Affairs and Environment for and on behalf of the Minister of State for Primary Industry

DAIRY INDUSTRY STABILIZATION LEVY REGULATIONS (AMENDMENT)

The Dairy Industry Stabilization Levy Act 1977, which forms an integral part of the marketing arrangements for the dairy industry, provides for levies to be imposed on the production of prescribed dairy products.

Section 11 of the Act provides that the Governor-General may make regulations, inter alia, for the purpose of:

(a) exempting from levy any prescribed variety of cheese under section 5;

(b) prescribing a date from which levy is to be imposed with respect to each kind of dairy product under sub-section 6(1) and 6(2);

(c) fixing the operative rates of levy for each kind of dairy product under section 7;


(d) exempting from levy a minimum quantity of a specified kind of dairy product produced in a prescribed period and the exempting from levy of dairy products of a prescribed class under section 9.

Sub-section 11 (3), however, requires the Governor-General to take into consideration any relevant recommendations made by the Australian Dairy Corporation, as provided for in sub-section 11(2).

The Australian Dairy Corporation, after consultation with the Australian Dairy Industry Advisory Committee, has recommended that Monterey cheese be removed from the schedule of levy exempt cheeses, because it is considered production has risen to a point where it could adversely affect sales of leviable cheeses.

The Corporation has recommended that Gouda cheese be exempt from levy on the grounds that it is not strictly competitive with Cheddar and exports of Gouda cheese are no longer significant.

The regulations provide for the removal of Monterey as a variety of cheese exempted from levy and inclusion of Gouda as a variety exempt from levy under section 5 of the Act, from 1 July 1982.


The purpose of the levies is to protect the domestic price structure for prescribed dairy products and through their disbursement to provide each manufacturer with an equalised return from domestic and export sales of such products.

The rate of levy for each prescribed product is based on the difference between the domestic bulk wholesale price and the assessed average export price for that product.

In accordance with sub-section 11(2) of the Dairy Industry Stabilization Levy Act 1977, the Australian Dairy Corporation, after consultation with the Australian Dairy Industry Advisory Committee, has recommended levy rates to apply from 1 July 1982.

The purpose of the proposed regulations is to impose, from 1 July 1982, the following rates of levy:

 

Rate ($ per tonne)

Buttermilk powder

300

Casein

760

Cheese

640

Modified skimmilk powder

300

Skimmilk and buttermilk powder mixture

300

Skimmilk powder

300

Whole milk powder

500


The rates of levy for butter, butteroil, processed butteroil and processed cheese are not varied.

However, the assessed average export prices for all prescribed products except skimmilk powder/buttermilk powder/mixtures are to be increased for the 1982/83 season. The rates of levy recommended will provide, therefore, for an increase in the domestic bulk wholesale prices of $150 per tonne for butter; $140 per tonne for cheese; $105 per tonne for whole milk powder; $65 per tonne for skimmilk powder, modified skimmilk powder, buttermilk powder and skimmilk and buttermilk powder mixture; and $130 per tonne for casein.

The regulations also provide for the continuation of the current exemption from levy under sub-sections 9(1) and (2) of processed butteroil, where production does not exceed 30,000 tonnes, and of processed cheese, where production does not exceed 60,000 tonnes, during the year commencing on 1 July 1982.

In considering the rates of levy for prescribed dairy products, the Australian Dairy Corporation undertook a review of the current domestic bulk wholesale prices for the respective products. The Corporation considered that the domestic market could bear the above price increases without materially affecting current consumption and that the price increases were needed to ensure that increased farm costs

could be met.

Overview

The Dairy Industry Stabilization Levy Regulations (Amendment) Statutory Rules 1982, issued under the authority of the Minister of State for Home Affairs and Environment on behalf of the Minister of State for Primary Industry, aim to amend the existing regulations established by the Dairy Industry Stabilization Levy Act 1977. This Act, enacted to safeguard the domestic price structure for prescribed dairy products, allows for the imposition of levies on the production of these products. The primary policy objective is to provide a stabilised return to manufacturers from both domestic and export sales of these products by ensuring that domestic wholesale prices are aligned with average export prices. The 1982 amendments, recommended by the Australian Dairy Corporation in consultation with the Australian Dairy Industry Advisory Committee, adjust the levy rates for certain dairy products and modify the exemptions applicable to some varieties of cheese, reflecting changes in production levels and market dynamics to maintain a fair and competitive pricing environment.

Scope and Application

The Dairy Industry Stabilization Levy Regulations (Amendment) is a piece of Australian legislation that amends the existing Dairy Industry Stabilization Levy Regulations under the Dairy Industry Stabilization Levy Act 1977. This Act pertains to the dairy industry, specifically focusing on the imposition of levies on the production of prescribed dairy products to maintain a stable domestic price structure and provide equitable returns to manufacturers from both domestic and export sales. The regulations apply to entities involved in the production of these dairy products, including manufacturers and processors within the industry. The geographic reach of these regulations is national, as they are administered under the Commonwealth of Australia. The Act allows for exemptions and thresholds to be set, and these are determined through subordinate instruments, taking into consideration recommendations from the Australian Dairy Corporation and the Australian Dairy Industry Advisory Committee. The proposed amendments to the regulations, effective from 1 July 1982, include changes to the exemption list for certain types of cheese, adjustments to the rates of levy for various dairy products, and the continuation of exemptions for certain quantities of processed butteroil and processed cheese.

Key Provisions

The primary sections of the Dairy Industry Stabilization Levy Regulations (Amendment) involve the adjustment of levies on various dairy products. Specifically, section 5 of the Act has been amended to remove Monterey cheese from the list of varieties exempt from levy and to include Gouda cheese as a variety exempt from levy, effective from 1 July 1982. These changes reflect the Australian Dairy Corporation's recommendations based on considerations of market competition and production levels. Moreover, section 11 of the Act, which provides for the imposition of levies, has been used to establish new levy rates for various dairy products, as recommended by the Corporation and effective from the same date. These rates are designed to align domestic wholesale prices with export prices, thereby stabilizing the market and ensuring equitable returns for manufacturers. The Dairy Industry Stabilization Levy Regulations impose several obligations on parties within the dairy industry. Manufacturers of prescribed dairy products must comply with the newly established levy rates and ensure that they are appropriately accounted for in their pricing and production strategies. Additionally, entities must adhere to the exemptions as outlined, particularly regarding the production thresholds for processed butteroil and processed cheese. These obligations are crucial for maintaining the balance within the dairy market and ensuring that the levies serve their intended purpose of stabilizing prices and returns. Failure to comply with the provisions set out in these regulations may result in various consequences. The Act does not explicitly detail specific offences or penalties within the explanatory statement, but under general principles of statutory compliance, non-compliance could lead to enforcement actions by relevant authorities. This may include fines or other penalties imposed by the courts. The severity of these penalties would depend on the nature and extent of the breach, but they are intended to ensure adherence to the regulations and the objectives they aim to achieve.

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