Petroleum Retail Marketing Sites Regulations (Amendment) 1998 No. 140
Explanatory Statement
Statutory rules 1998 No. 140
Issued by the authority of the Minister for Industry, Science and Tourism
Petroleum Retail Marketing Sites Act 1980
Petroleum Retail Marketing Sites Regulations (Amendment)
Section 15 of the Petroleum Retail Marketing Sites Act 1980 (the Act) provides that the Governor-General may make regulations for the purposes of the Act.
Section 12 of the Act provides a person with the right to obtain an injunction when a prescribed oil company (oil company named in the regulations) operates above its quota. Section 12 is the only provision in the Act where a possibility of a private right exists.
The Act is designed to restrain vertical integration (ie. firms producing related goods and services in a supply chain) by the major oil companies, in order to encourage competition between resellers at the retail level. The Act establishes quotas on the number of retail outlets which each company may directly operate.
The Petroleum Retail Marketing Sites Regulations (Amendment) ("the proposed Regulations") amend the Petroleum Marketing Sites Regulations ("the principal Regulations"), to allow a temporary increase in BP Australia Ltd's allocation from 87 to 102 sites for the period 1 January 1998 to 30 June 1998.
The term "retail site" is defined in Section 3, the Interpretation Section of the Act, as "premises at which motor fuel is sold by retail", in other words, a petrol station which sells petrol in retail trade.
The site increase is to operate retrospectively from 1 January 1998 to coincide with the date at which BP Australia exceeded its quota by being unable to divest itself of 15 excess retail sites in Victoria and will operate until 30 June 1998. These sites were acquired together with the 100 per cent ownership of distributor Woolman Petroleum Pty. A temporary increase from 87 to 102 was already approved by the Governor-General for the period 1 August 1997 to 30 June 1997.
The reason for increasing the allocation of sites from 87 to 102 is that BP Australia has been unable to sell off 15 excess retail sites located in Victoria, where suitable buyers are lacking due to market uncertainty and increased competition.
The operative part of the amendment (regulation 3) commences retrospectively to 1 January 1998.
Subsection 48(2) of the Acts Interpretation Act 1901 (the Interpretation Act) provides that a retrospective regulation may not adversely affect the rights of a person (other than the Commonwealth or an authority of the Commonwealth).
The Attorney-General's Department is of the view that the right to obtain an injunction conferred by section 12 of the Act is unlikely to constitute a "right" for the purposes of section 48(2)(a) of the Interpretation Act.
However, to ensure section 48 of the Interpretation Act is not infringed, a savings provision has been included (regulation 5) which preserves any tights existing under section 12 of the Act between the date the regulations are taken to have commenced and the date of their notification in the Gazette.
Overview
The Petroleum Retail Marketing Sites Regulations (Amendment) 1998 No. 140 was enacted to address a temporary shortfall in BP Australia Ltd's ability to divest excess retail sites within the allocated quota, thereby allowing a temporary increase in the number of sites it could operate. This amendment arose from BP Australia's acquisition of Woolman Petroleum Pty, which included 15 additional retail sites in Victoria, leading to a temporary quota increase from 87 to 102 sites, effective from 1 January 1998 until 30 June 1998. The Petroleum Retail Marketing Sites Act 1980 was established to restrain vertical integration by major oil companies and to encourage competition at the retail level by imposing quotas on the number of retail outlets each company can directly operate. The enactment was authorised by the Minister for Industry, Science and Tourism, with the policy objective being to manage BP Australia's temporary quota excess due to market conditions in Victoria.
Scope and Application
The Petroleum Retail Marketing Sites Regulations (Amendment) 1998 No. 140, issued under the authority of the Minister for Industry, Science and Tourism, amends the Petroleum Retail Marketing Sites Regulations to temporarily increase BP Australia Ltd's allocation of retail sites from 87 to 102 for the period 1 January 1998 to 30 June 1998. This amendment is made pursuant to section 15 of the Petroleum Retail Marketing Sites Act 1980, which grants the Governor-General the power to make regulations for the purposes of the Act. The Act primarily aims to restrain vertical integration by major oil companies to promote competition at the retail level, establishing quotas on the number of retail outlets each company can directly operate. The term "retail site" is defined in the Interpretation Section of the Act as premises where motor fuel is sold by retail, essentially a petrol station selling petrol in the retail trade.
The amendment addresses BP Australia's inability to divest 15 excess retail sites in Victoria due to market uncertainty and increased competition. The temporary increase in quota operates retrospectively from 1 January 1998 to align with the date BP Australia exceeded its quota, continuing until 30 June 1998. To safeguard against any potential adverse effects on existing rights under section 12 of the Act, a savings provision has been included, ensuring compliance with subsection 48(2) of the Acts Interpretation Act 1901. This provision preserves any rights existing under section 12 between the date the regulations are taken to have commenced and the date of their notification in the Gazette.
Key Provisions
The Petroleum Retail Marketing Sites Regulations (Amendment) 1998 No. 140, under the Petroleum Retail Marketing Sites Act 1980, makes specific changes to the quota limits of BP Australia Ltd for the operation of retail sites. Regulation 3 increases BP Australia's quota from 87 to 102 sites, effective retrospectively from 1 January 1998 to 30 June 1998. This adjustment was necessitated by BP Australia's failure to divest 15 excess sites in Victoria due to market conditions and heightened competition. This amendment permits BP Australia to temporarily operate more sites than originally permitted, aiming to prevent disruptions in their operations and market presence. The primary purpose of these changes is to accommodate BP Australia's specific situation without broadly affecting the intent of the Act, which seeks to limit vertical integration by major oil companies to promote competition among resellers.
The Act imposes specific obligations on the parties it governs. For example, Section 12 of the Act provides that a person can obtain an injunction if a prescribed oil company operates above its quota. The Regulations (Amendment) ensures that this right remains intact through a savings provision (regulation 5). Additionally, the Act mandates that oil companies must adhere to the quotas set forth to prevent monopolistic practices and foster a competitive retail market. The Act also requires the Minister for Industry, Science and Tourism to make regulations as necessary to achieve these goals, and the Amendment Regulations reflect this authority by adjusting BP Australia's quota.
Breaches of the Petroleum Retail Marketing Sites Act 1980 can lead to various consequences. Operating above the prescribed quota without permission can result in civil penalties, with the specifics of these penalties not detailed in the Amendment Regulations but generally governed by the Act. Additionally, any actions taken by oil companies that contravene the intent of the Act, such as attempting to circumvent the quota limits, could result in legal action, including injunctions or other remedies. The Act does not specify criminal penalties, focusing instead on civil and administrative enforcement to ensure compliance with the quota limits. The maximum penalties for breaches are not explicitly stated in the Amendment Regulations but would be aligned with the broader provisions of the Act and any applicable laws regarding administrative penalties for non-compliance.