EXPLANATORY STATEMENT
Statutory Rules 1987 No. 245
Issued by the Authority of the Attorney-General
TRADE PRACTICES (PRIMARY PRODUCTS EXEMPTIONS) REGULATIONS (AMENDMENT)
These Regulations, made under section 172 of the Trade Practices Act 1974 (the Act) which provides the Governor-General with a regulation making power, amend the Trade Practices (Primary Products Exemptions) Regulations.
Paragraph 172(2)(a) of the Act provides (inter alia) that the regulations may, either unconditionally or subject to such conditions as are specified in the regulations, exempt from the application of the Act or the provisions of the Act specified in the regulations, conduct engaged in by a specified organisation or body that performs functions in relation to the marketing of primary products.
These regulations were made following a review of regulations 9 and 10 of the Trade Practices (Primary Products Exemptions) Regulations. These two regulations operated to exempt (for an indefinite period) certain activities of primary product marketing bodies from the operation of section 45 of the Act (contracts, arrangements or understandings restricting dealings or affecting competition). The Attorney-General reviewed both regulations in consultation with the Minister for Primary Industries and Energy under Guidelines previously adopted by the Government. A copy of those guidelines attached.
Regulation 1 substitutes a new regulation 9 which:
• continues the present exemption in relation to conduct engaged in by the Australian Dried Fruits Association in making an arrangement with producers of dried fruit in relation to the participation of those producers in a scheme of equalisation of returns to those producers and in administering and giving effect to that scheme; and
• restricts the Association to recommending prices and terms and conditions upon which dried fruit is to be supplied by producers of dried fruit and upon which persons employed as selling agents of producers of dried fruit shall be so employed (existing regulation 9 enables the Association to declare such prices and terms and conditions).
Regulation 2 substitutes a new regulation 10 which continues the present exemption for conducting the national Banana Marketing Development Scheme (the Scheme). This Scheme provides for removal of bananas from the market where they do not meet minimum quality standards or in oversupply situations. New regulation 10 differs from the repealed regulation 10:
• by specifying the participants in the Scheme;
• by setting out conditions under which the Scheme will operate; and
• by no longer permitting the declaration of minimum wholesale prices.
• by not operating in the event of coercion of a banana grower to participate in the Scheme.
The operation of both regulations is limited to a period of 5 years.
ATTACHMENT
Guidelines and Procedures for consideration of Applications by Primary Product Marketing Bodies for Exemption from certain provisions of the Trade Practices Act
Procedures
Procedures for the consideration of applications for the granting or renewal from certain provisions of the Trade Practices Act of exemptions for primary product marketing bodies pursuant to the Trade Practices (Primary Products Exemptions) Regulations:
• applications for exemption to be made to the Attorney-General,
• following consideration of applications, Attorney-General’s Department and the Department of Primary Industries and Energy prepare a joint report for the Attorney-General’s consideration,
• in preparing the joint report, the Departments identify parties with a possible interest in the application and seek their views, and
• the applicant has the opportunity to respond to views opposing the granting of the exemption.
Guidelines
The following guidelines will be applied when considering exemption applications by primary product marketing bodies:
• Exemptions must be necessary for promoting stability in the production or marketing of primary products, or for purposes connected with export marketing.
• An exempted scheme must be capable of achieving these purposes and involve the least reduction in competition necessary to achieve those objectives.
• Exemptions would operate for a maximum of five years, but would be capable of renewal, where appropriate, following further examination.
• Exemptions would be limited to sections 45, 45B (both dealing with agreements) and 47 (exclusive dealing) (other than s. 47(6), (7), (8)(c) and (9)(d).
• Exemption would not be considered if proceedings under the Act had been commenced in respect of the conduct sought to be exempted.
Only in exceptional or unforeseen circumstances would exemptions be granted outside these guidelines.