EXPLANATORY STATEMENT
Export Control Act 1982
Export Control (Japan-Australia Economic Partnership Agreement Tariff Rate Quotas) Order 2016.
Legislative Authority
This order is made under Section 23A of the Export Control Act 1982 (the Export Control Act). The Export Control Act provides the Secretary of the Australian Government Department of Agriculture and Water Resources (the department) with the capacity to create orders providing for, or in relation to, the establishment and administration of a system or systems of tariff rate quotas for the export of goods.
The power to make the Export Control (Japan-Australia Economic Partnership Agreement Tariff Rate Quotas) Order 2016 (the order) under the Export Control Act was delegated by the Secretary on 4 March 2016, enabling timely creation of the order.
Purpose
The purpose of the order is to set out the administrative arrangements for the system of tariff rate quotas for the export of quota goods from Australia to Japan under the Japan-Australia Economic Partnership Agreement (the Agreement).
Background
The Agreement commenced on 15 January 2015 and eliminates or reduces Japanese tariffs on key Australian goods, including a range of agricultural products.
Reduced tariff arrangements are available on an annual quota basis for 19 commodities. The department administers quota for eight of the 19 commodities:
Prescribed goods:
- bovine offal
- preserved meats (sausage)
- preserved meats (other)
- pork
- poultry
Non-prescribed goods:
- honey
- orange juice
- apple juice
Since the commencement of the Agreement, the department has administered quotas through the following legislation:
- Export Control Act 1982; Sections 20 and 23
- Export Control (Meat and Meat Products) Orders 2005; Sch 8 14.1
- Export Control (Poultry Meat and Poultry Meat Products) Orders 2010; Sch 8 14
- Export Control (Prescribed Goods – General) Order 2005; Sch 8.05 (1)
The above legislative regime was sufficient in the short term, but a longer term arrangement was necessary. As a result, the Export Control Amendment (Quotas) Act 2015 (the Quotas Act), which received royal assent on 11 December 2015, was introduced to consolidate the legislation that governs tariff rate export quotas into a single Act that covers all tariff rate quota commodities.
The Quotas Act amended the Export Control Act to include section 23A which enables the Secretary to make orders providing for, or in relation to, the establishment and administration of a system, or systems, of tariff rate quotas for the export of goods. Orders may be made to cover goods currently subject to quota regulation but could also cover any other goods that quotas may apply to in the future. The Quotas Act complements the government’s strategic approach for capturing premium markets outlined in the Agricultural Competitiveness White Paper and builds on the gains from recent free trade agreements with our major trading partners.
This Order is the first to be made under the new section 23A of the Export Control Act.
Impact and Effect
The order provides for administrative arrangements to ensure fair and equitable access by regular quota users and new entrants to the Japan market. The impact of the order is minimal as it provides for quota to be administered as it has been, under the previous orders.
For the purpose of this order the quota year is from 1 April to 31 March.
The bovine offal quota is allocated quarterly on a first-come-first-served basis until the quarterly tonnage limit is reached. All other commodities in this Order are allocated on a first-come-first-served basis until an annual tonnage limit is reached.
Consultation
The department consulted the affected quota industries through their peak industry bodies, throughout the first year of the Agreement’s operation. Regular teleconferences and meetings took place to ensure industry awareness of the changes made by the Quotas Act, and to ensure that the transition of existing quota arrangements under the newly created section 23A of the Export Control Act were understood and fully supported. These administrative arrangements were implemented at the beginning of 2015 at the request of each industry (including the bovine offal industry).
The department consulted with the Office of Best Practice Regulation (OBPR) and was advised that a RIS is not required as the changes are minor and machinery in nature, OBPR ID:19443.
The Order is compatible with human rights and freedoms recognised or declared under section 3 of the Human Rights (Parliamentary Scrutiny) Act 2011. A full statement of compatibility is set out in Attachment A.
The Order is a legislative instrument for the purposes of the Legislation Act 2003.
Details of the Export Control (Japan-Australia Economic Partnership Agreement Tariff Rate Quotas) Order 2016.
Section 1 – Name
This section provides that the name of the Order is the Export Control (Japan-Australia Economic Partnership Agreement Tariff Rate Quotas) Order 2016.
Section 2 – Commencement
This section provides for the Order to commence on 10 March 2016.
Section 3 – Authority
This section provides that the Order is made under section 23A of the Export Control Act 1982.
Section 4 – Definitions
This section provides definitions of terms used within the order, as set out below:
Act means the Export Control Act 1982.
annual access amount has the meaning given by subsection 6(1).
apple juice means apple juice of a kind that may be exported from Australia to Japan at a reduced tariff rate under the Japan‑Australia Economic Partnership Agreement.
bovine offal means edible offal of bovine animals that may be exported from Australia to Japan at a reduced tariff rate under the Japan‑Australia Economic Partnership Agreement.
EXDOC means the electronic documentation system maintained by the Department.
honey means honey that may be exported from Australia to Japan at a reduced tariff rate under the Japan‑Australia Economic Partnership Agreement.
initial decision has the meaning given by subsections 14(1) and (2).
Japan‑Australia Economic Partnership Agreement means the Japan‑Australia Economic Partnership Agreement, done in Canberra on 8 July 2014, as amended from time to time.
Note: The Agreement could in 2016 be viewed in the Australian Treaties Library on the AustLII website (http://www.austlii.edu.au).
orange juice means orange juice of a kind that may be exported from Australia to Japan at a reduced tariff rate under the Japan‑Australia Economic Partnership Agreement.
pork means meat, internal organs or preparations of swine that may be exported from Australia to Japan at a reduced tariff rate under the Japan‑Australia Economic Partnership Agreement.
poultry means meat or preparations of poultry that may be exported from Australia to Japan at a reduced tariff rate under the Japan‑Australia Economic Partnership Agreement.
preserved meats (other) means preparations of bovine animals (including beef jerky, but not including goods that are preserved meats (sausage)) that may be exported from Australia to Japan at a reduced tariff rate under the Japan‑Australia Economic Partnership Agreement.
preserved meats (sausage) means any of the following goods made from bovine animals or swine that may be exported from Australia to Japan at a reduced tariff rate under the Japan‑Australia Economic Partnership Agreement:
(a) sausages;
(b) homogenised preparations;
(c) liver paste.
quarter means a period of 3 months beginning on 1 April, 1 July, 1 October or 1 January.
quarterly access amount has the meaning given by subsection 6(3) affected by subsection 6(5).
quota goods means any of the following kinds of goods:
(a) apple juice;
(b) bovine offal;
(c) honey;
(d) orange juice;
(e) pork;
(f) poultry;
(g) preserved meats (other);
(h) preserved meats (sausage).
Quota Unit means the section of the Department that is responsible for managing tariff rate quotas under the Japan‑Australia Economic Partnership Agreement.
quota year means a period of 12 months beginning on 1 April.
relevant liability means:
(a) a fee imposed under the Export Control (Fees) Order 2015 that is due and payable; or
(b) a charge prescribed by the Export Charges (Imposition—Customs) Regulation 2015 that is due and payable; or
(c) a charge prescribed by the Export Charges (Imposition—General) Regulation 2015 that is due and payable.
tariff rate quota certificate means a tariff rate quota certificate issued under this instrument.
uncommitted access amount:
(a) for a kind of quota goods for a quota year—has the meaning given by subsection 6(2); and
(b) for a kind of quota goods for a quarter of a quota year—has the meaning given by subsection 6(4).
Section 5 – When is an export of a consignment complete
This section provides for clarification on when an export is considered to be completed.
Section 6 – Access Amounts
This section provides definitions of access amounts used within the order, as set out below:
Annual amounts
annual access amount for a kind of quota goods for a quota year is the total weight of the goods that may be exported from Australia to Japan in the year at a reduced tariff rate under the Japan‑Australia Economic Partnership Agreement.
uncommitted access amount for a kind of quota goods for a quota year is the amount of the annual access amount for the goods for the quota year in relation to which a tariff rate quota certificate has not been issued.
Quarterly amounts
quarterly access amount for a kind of quota goods for a quarter of a quota year is the annual access amount for the goods for the quota year divided by 4.
uncommitted access amount for a kind of quota goods for a quarter of a quota year is the amount of the quarterly access amount for the goods for the quarter in relation to which a tariff rate quota certificate has not been issued.
If, at the end of the first, second or third quarter (the current quarter) of a quota year, the uncommitted access amount for a kind of quota goods for the current quarter is an amount greater than zero, the quarterly access amount for the goods for the next quarter is increased by the uncommitted access amount for the goods for the current quarter.
Section 7 – Purpose of this instrument
This section outlines the purpose of the instrument, which is to allow for the administration of Japan quota certificates as required under the Japan-Australia Economic Partnership Agreement.
Part 2 –Tariff rate quota certificates
Section 8 – Application for tariff rate quota certificate
Section 8 provides for applications for tariff rate quota certificates to be made to the Secretary. The section provides that:
1) an exporter can apply for a tariff rate quota certificate for the export of quota goods to Japan
2) applications will not be accepted prior to 10 March for the new quota year (or 3 weeks prior to the goods being shipped)
3) an application must be received through the department’s electronic system, EXDOC, or in the approved form. EXDOC is a computer system that is accessed by exporters for the purposes of exporting prescribed goods (in this instance bovine offal, poultry, pork and preserved meats – both kinds)
4) should the Secretary need further information in order to process the application, then the Secretary may request that the information be sent to the Quota Unit
5) a quota application can be withdrawn at any point prior to the Secretary making a decision to grant a certificate.
Section 9 – Applications dealt with on first come first served basis
This section provides for applications to be dealt with on a first come first served basis. Applications are received through the department’s electronic system, EXDOC, or in the approved form. Should an application be received which is incomplete, then it will enter the first come first served queue once all information has been received. This allows for the fair and equitable distribution of quota amongst applications.
Section 10 – Issue of tariff rate quota certificate – annual quotas
This section outlines how tariff rate quota certificates are issued in relation to an application received by the Secretary.
A quota certificate must be issued if the uncommitted access amount is greater than zero. However, the secretary may decide not to issue a certificate taking into account:
- failure of the applicant to comply with an audit and/or requests
- failure to hold an applicable licence e.g. meat export licence
- failure to pay the required fees and charges
- notification that the applicant is not financially viable, or is unlikely to remain so
- whether it would not be in the best interests of industry to issue a certificate
- where the consignment is not covered by the remaining quota amount, and it is deemed unviable to issue a partial certificate.
Where the uncommitted access amount is greater than that requested, the Secretary must issue a certificate for the consignment.
Where the uncommitted access amount is less than what is applied for and the Secretary decides to issue a quota certificate, the quota certificate will reflect the remaining uncommitted access amount.
Section 11 – Issue of tariff rate quota certificate — quarterly quotas
This section outlines how tariff rate quota certificates are issued in relation to an application received by the Secretary for the export of a consignment of bovine offal.
A quota certificate must be issued for the bovine offal consignment for the relevant quarter, if the uncommitted access amount is more than zero. However, the secretary may decide not to issue a certificate taking into account:
- failure of the applicant to comply with an audit and/or requests
- failure to hold an applicable licence e.g. meat export licence
- failure to pay the required fees and charges
- notification that the applicant is not financially viable, or is unlikely to remain so
- whether it would not be in the best interests of industry to issue a certificate
- where the consignment is not covered by the remaining quota amount, and it is deemed unviable to issue a partial certificate.
Where the uncommitted access amount is greater than that requested, the Secretary must issue a certificate for the consignment. Where the uncommitted access amount is less than what is applied for and the Secretary decides to issue a quota certificate, the quota certificate will reflect the remaining uncommitted access amount.
This section also provides that quota certificates issued before 1 April are taken to have been issued in relation to the first quarter of the quota year.
Section 12 – Tariff rate quota certificate is not transferable or variable
This section outlines that a tariff rate quota certificate is not transferable and may not be varied. Variations are not acceptable under the Agreement and any errors would result in a cancellation and reissue.
Section 13 – Cancellation of tariff rate quota certificate
This section allows a person who has been issued a tariff rate quota certificate to apply for the cancellation of the certificate.
The Secretary may cancel the certificate if:
- the certificate is incorrect in any respect
- the consignment was not exported to Japan within a period of 6 weeks after the certificate was issued
- the applicant has failed to comply with an audit and/or requests
- the person does not hold an applicable licence e.g. meat export licence
- the person has failed to pay the required fees and charges
- the Secretary becomes aware that the exporter’s business is not financially viable, or is unlikely to remain so
- the secretary believes cancelling the certificate is in the best interests of the industry. This is to ensure the ongoing viability of the trade with Japan.
Subsection 13(3) allows for the cancellation of a certificate at any time before the export of the goods is complete.
Subsection 13(4) allows for cancellations to be considered as never issued, for the purposes of determining the uncommitted access amounts.
Part 3 – Review of decisions
Section 14 Application of reconsideration by Secretary
This section allows a person to apply to the Secretary to reconsider a decision to cancel a tariff rate quota certificate. The application for reconsideration must be in writing, set out the reasons for the application and be lodged within 28 days of the initial decision coming to the notice of the applicant, unless advised otherwise by the Secretary.
Section 15 – Secretary to reconsider decision
This section outlines how the Secretary (on receipt of an application) must reconsider the initial decision to not issue, or cancel a tariff rate quota certificate.
Section 16 – Effect of Secretary’s decision
This section outlines the effect of the Secretary’s decision made under section 15, and specifies that the applicant must be notified of the outcome in writing, within 45 days of the application being received.
Section 17 – Application to Administrative Appeals Tribunal
Subsection 17(1) provides for applications to the Administrative Appeals Tribunal for review of decisions of the Secretary under section 15.
Any application made under subsection (1) must be made by the person who applied for a certificate, or the person to whom the certificate was issued. The application can relate to a decision not to issue a certificate, or to cancel a certificate.
Section 17 also provides that any decision made by the Administrative Appeals Tribunal should take into account the uncommitted access amount at the time of making their decision. This is to ensure that the Administrative Appeals Tribunal does not decide to issue a quota certificate when there is no quota left to issue.
Part 4 – Miscellaneous
Section 18 – Audits
This section provides for the auditing of tariff rate quota certificates issued to a person. Audits are to be carried out by a person approved by the Secretary. Auditing will be used to determine the legitimacy of export operations for example determining that exporters are using the quota and not sitting on it, ensuring that quota is not being abused by exporters. It is not likely to be a regular process, and would be used only when the department became aware of suspicious behaviour. Should a person not provide information requested during the audit, it may result in cancellation of a quota certificate or affect their ability to be granted a quota certificate in the future.
Section 19 – Decisions made by computer
This section allows the Secretary to use computer programs to make a decision relating to tariff rate quota certificates. This power is consistent with the powers set out in subsections 280(6) and (7) of the Biosecurity Act 2015. It will enable quota decisions and certificates to be issued at times and in ways that are convenient to exporters while still enabling government control and oversight of the process.
Attachment A
Statement of Compatibility with Human Rights
Prepared in accordance with Part 3 of the Human Rights (Parliamentary Scrutiny) Act 2011
Export Control (Japan-Australia Economic Partnership Agreement Tariff Rate Quotas) Order 2016.
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
The purpose of the Export Control (Japan-Australia Economic Partnership Agreement Tariff Rate Quotas) Order 2016 is to set out the administrative arrangements for the system of tariff rate quotas for the export of quota goods from Australia to Japan under the Japan-Australia Economic Partnership Agreement.
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.
Jennifer Cupit
Assistant Secretary
Residues and Food Branch
Exports Division
Department of Agriculture and Water Resources