EXPLANATORY STATEMENT
Therapeutic Goods Amendment (Medical Devices and Other Measures) Act 2009
Proclamation
Subsection 2(1) of the Therapeutic Goods Amendment (Medical Devices and Other Measures) Act 2009 (the Act) provides that Schedule 3 to the Act commences on a single day to be fixed by Proclamation. Item 3 of subsection 2(1) provides that if any of the provisions of Schedule 3 do not commence within the period of six months beginning on the day the Act receives the Royal Assent, they commence on the first day after the end of that period. The Act received the Royal Assent on 17 June 2009.
The purpose of the Proclamation is to fix 1 December 2009 as the day on which Schedule 3 to the Act commences.
Schedule 3 to the Act replaces the existing “fit and proper person” test in the Therapeutic Goods Act 1989 (the TG Act) with more specific statutory grounds for the making of decisions in relation to the manufacturing of medical devices and other therapeutic goods. Schedule 3 will also allow the Secretary of the Department of Health and Ageing
(the Secretary) to require information from applicants for and holders of manufacturing licences and conformity assessment certificates regarding their suitability to retain such licences or certificates.
The existing fit and proper person test requires the Secretary to consider a broad range of conduct (including third parties’ conduct) by a broad range of persons, exercise significant discretion and balance relevant factors. It has been difficult to administer and criticised by some in the industry as complex and intrusive. The new requirements are narrower, more transparent and are expected to be easier to administer.
Public consultation on proposed changes to the existing “fit and proper person test” occurred during the development of the proposed joint regulatory scheme for therapeutic goods between Australia and New Zealand, which was postponed in July 2007 as a result of the New Zealand Government’s decision not to proceed with their enabling legislation due to insufficient parliamentary support. Further consultation occurred in mid 2008 following the Australian Government’s decision to pursue reforms to the Australian therapeutic goods regulatory framework while the trans-Tasman scheme remained on hold.
The Proclamation is a legislative instrument for the purposes of the Legislative Instruments Act 2003.
Overview
The Therapeutic Goods Amendment (Medical Devices and Other Measures) Act 2009, enacted by the Parliament of Australia, was introduced to address the inefficiencies and criticisms associated with the existing "fit and proper person" test under the Therapeutic Goods Act 1989. This test, which required the Secretary of the Department of Health and Ageing to consider a broad range of conduct by various persons, was seen as complex and intrusive, making it difficult to administer. The new Act aims to replace this test with more specific statutory grounds for decision-making related to the manufacturing of medical devices and other therapeutic goods, while also allowing the Secretary to request information from licence applicants and holders about their suitability to retain such licences. This change is expected to make the regulatory process more transparent and easier to administer. The Proclamation issued under the Act fixes 1 December 2009 as the commencement date for these amendments.
Scope and Application
The Therapeutic Goods Amendment (Medical Devices and Other Measures) Act 2009 applies to persons and entities involved in the manufacturing of medical devices and other therapeutic goods in Australia. Specifically, it targets applicants for and holders of manufacturing licences and conformity assessment certificates, requiring them to meet new statutory grounds for suitability as opposed to the previous "fit and proper person" test. This change is designed to streamline the regulatory process and make it more transparent and easier to administer. The Act’s jurisdictional reach is national, extending across all states and territories in Australia. The new statutory grounds replace the broad discretion previously required under the Therapeutic Goods Act 1989, which was often criticised for being complex and intrusive. The Act also allows the Secretary of the Department of Health and Ageing to demand specific information from licence and certificate holders to assess their ongoing suitability. The new provisions are intended to take effect on 1 December 2009, as proclaimed, although they may commence later if within the six-month period after Royal Assent. The changes are part of broader reforms to the Australian therapeutic goods regulatory framework, following consultations in mid-2008 after the postponement of the joint regulatory scheme with New Zealand.
Key Provisions
The main operative sections of the Therapeutic Goods Amendment (Medical Devices and Other Measures) Act 2009 (section 2(1)) provide for the commencement of Schedule 3, which replaces the existing "fit and proper person" test with more specific statutory grounds for decisions related to the manufacturing of medical devices and other therapeutic goods (section 3). This schedule also allows the Secretary of the Department of Health and Ageing to request information from applicants and holders of manufacturing licences and conformity assessment certificates regarding their suitability to retain such licenses or certificates (section 4). The purpose of this legislative change is to create a narrower, more transparent, and easier-to-administer process for decision-making in this area, thereby addressing criticisms of the complexity and intrusiveness of the previous test.
The Act imposes several obligations and requirements on the parties or entities it governs. Firstly, it requires the Secretary to consider specific statutory grounds instead of the broad "fit and proper person" test when making decisions related to the manufacturing of medical devices and other therapeutic goods (section 3). This includes assessing whether the applicant or licence holder has been convicted of certain offences, whether they have a history of non-compliance with relevant laws, or whether they have demonstrated a lack of competence or integrity in the manufacturing process. Secondly, the Act allows the Secretary to request information from applicants and licence holders regarding their suitability to retain such licences or certificates (section 4). This may include financial information, details about their manufacturing processes, and information about any previous breaches of relevant legislation.
Failure to comply with the obligations and requirements set out in the Act may result in various offences, penalties, or consequences. While the Explanatory Statement does not provide specific details about these consequences, it is reasonable to assume that breaches of the Act could lead to the revocation or suspension of manufacturing licences or conformity assessment certificates. In more severe cases, criminal charges may be brought against individuals or companies found to be in breach of the Act's provisions. The maximum penalties for such offences would depend on the specific nature of the breach and the relevant legislation governing the matter. It is essential for parties and entities governed by the Act to ensure compliance with its requirements to avoid any potential legal or financial consequences.