Barnaby Joyce (Queensland, National Party) Share this | Link to this | Hansard source

Through you, Chair, are there any other sections of the Trade Practices Act 1974 that are going to be affected by this bill, apart from section 53C? Is it envisaged that any other changes will be foreshadowed in the near future?

Ursula Stephens (NSW, Australian Labor Party, Parliamentary Secretary Assisting the Prime Minister for Social Inclusion) Share this | Link to this | Hansard source

At this stage, I cannot advise you that there are other sections of the Trade Practices Act that are being considered. In relation to section 53, you were not in the chamber when I addressed Senator Xenophon’s concerns. Section 75AZF(2) makes these issues a criminal provision. In my summing-up notes I said that component pricing is currently regulated primarily by section 53 of the Trade Practices Act and that this amendment is actually clarifying the operation of that position. Section 75AZF(2) makes this a criminal offence provision. My understanding is that at this stage there is no intention to amend further sections of the act in relation to this issue.

Barnaby Joyce (Queensland, National Party) Share this | Link to this | Hansard source

I note that you also mentioned the associated criminal offence provisions under 75AZF of the Trade Practices Act. Who would they currently apply to? Do they apply to the directors or do they apply to other people in the process of the sale? What is the extent of those penalties in points and maximum years?

Ursula Stephens (NSW, Australian Labor Party, Parliamentary Secretary Assisting the Prime Minister for Social Inclusion) Share this | Link to this | Hansard source

You are asking me the tough questions, Senator Joyce. I will find that in the legislation for you. I understand that the penalty is 10,000 penalty units and it does not attract a jail term at this stage. Perhaps that provides a little bit of clarity for you.

Barnaby Joyce (Queensland, National Party) Share this | Link to this | Hansard source

If a person is aggravating and consistent in their breach of the act, does that incur any other considerations of sections that might be in breach? I acknowledge that you say that the penalty is 10,000 units and that no jail term is ever prescribed, but in aggravated cases what is the course of action?

Ursula Stephens (NSW, Australian Labor Party, Parliamentary Secretary Assisting the Prime Minister for Social Inclusion) Share this | Link to this | Hansard source

I think it is important to note for the record that this kind of criminal activity, in breaching this proposed trade practices amendment act, would attract a penalty for individuals of up to $220,000 and, in the situation of corporations, a fine of up to $1.1 million, which should act as a disincentive.

Barnaby Joyce (Queensland, National Party) Share this | Link to this | Hansard source

Thank you for that. The issue concerning financial services covered by this bill has also been mentioned. I refer to section 12DD of Australian Securities and Investments Commission Act 2001. Seeing this area is not covered by this bill, what is foreshadowed by the government to deal with this issue?

Ursula Stephens (NSW, Australian Labor Party, Parliamentary Secretary Assisting the Prime Minister for Social Inclusion) Share this | Link to this | Hansard source

As I mentioned in my speech summing up the second reading debate, financial services are exempt because the financial disclosure regime is covered by the Australian Securities and Investments Commission Act 2001. In fact, it is under section 12DD of the ASIC Act, which mirrors section 53C of the Trade Practices Act in relation to financial services. This bill does not amend the ASIC Act, so the existing disclosure regime in respect of financial services will continue. Firstly, to overlay the new provision with the existing disclosure requirements in the financial services regime has been assessed as being both complicated and in many cases unnecessary. In particular, the total price for credit products and other financial services often depends on the amount of credit purchased or the size of the investment made. Accordingly, it would often be impossible for a business to quantify a total price in advance. Secondly, there are already extensive mandatory disclosure regimes for financial services under Commonwealth, state and territory legislation, including of course under the Uniform Consumer Credit Code, so any amendments to the ASIC Act would be likely to create confusion as to the operation of these regimes.

Barnaby Joyce (Queensland, National Party) Share this | Link to this | Hansard source

What would be the approach of the government or the appropriate examining authorities in determining where the provision of one product ceases and the inception of another product starts? For instance, if someone were delivering cattle to a saleyard, at what point in time would there be the determinant that they are no longer under the pricing of cattle at the saleyard but they are under the pricing of a government charge for inspection fees? How do we differentiate between the conclusion of one product and the start of another? How do we stop that position then being manipulated in such a way that you do not have clarity in pricing where once more you have the sale of multiple products? What will be the process whereby government will identify that and say, ‘That is a unit of a product in its entirety and you must price it from that point of its service delivery to that other point’?

Ursula Stephens (NSW, Australian Labor Party, Parliamentary Secretary Assisting the Prime Minister for Social Inclusion) Share this | Link to this | Hansard source

Thank you, Senator Joyce. That is an important question because it goes to the way in which people will start to interpret and apply this bill. The provision actually applies at the time of the representation. Once people understand that point, it will be clear as to the circumstances that you describe, which would be part of a continuum of the sale process. So it actually applies at the time of representation.

Barnaby Joyce (Queensland, National Party) Share this | Link to this | Hansard source

I know that postage and handling are still excluded from this change to section 53. What will be the definition of postage and handling? How do we make sure that handling as an issue is also not embellished?

Ursula Stephens (NSW, Australian Labor Party, Parliamentary Secretary Assisting the Prime Minister for Social Inclusion) Share this | Link to this | Hansard source

This was an issue that was canvassed very widely through the stakeholder consultation process. It was argued in that process that including the postage and handling costs would actually create additional compliance burdens, particularly for online businesses, for very little consumer benefit. ‘Genuine postage and handling costs’ is a concept that is relatively well understood by consumers. The bill provides that the charges for sending goods from the supplier to the consumer do not need to be included in the total price. However, if the postage cost is known by the business and the postage is compulsory, the provision requires that the business actually disclose that price in their representation, either as part of the total price or as a separate component, so that the consumer understands exactly what they are paying for.

Barnaby Joyce (Queensland, National Party) Share this | Link to this | Hansard source

In that extensive consultation process, did anyone actually have a problem with the legislation as it was drafted? Can you give us any sort of indication of any sense of concern about where the government was taking section 53? Was there any concern at all?

Ursula Stephens (NSW, Australian Labor Party, Parliamentary Secretary Assisting the Prime Minister for Social Inclusion) Share this | Link to this | Hansard source

I am sorry, Senator Joyce, that I cannot actually find any briefing around that issue. I have now sought some information for you, and thank you for your patience. There was extensive consultation. I now have a document that outlines how well the consultation process was undertaken and how extensive it was. Almost universally there was support for greater clarity for consumers. There was some concern by the Business Council of Australia that there may be some compliance costs and I would imagine that even you, someone who is a great advocate for consumers and for clarity, would recognise that they do have an interest that they are trying to protect. But from those that we all seek to represent we had genuine support for the exposure draft. The changes that were incorporated into the final draft reflect the extensive consultation around the issues.

Barnaby Joyce (Queensland, National Party) Share this | Link to this | Hansard source

If it is not impertinent, what were the numbers—as a ballpark figure—involved with that extensive consultation process?

Ursula Stephens (NSW, Australian Labor Party, Parliamentary Secretary Assisting the Prime Minister for Social Inclusion) Share this | Link to this | Hansard source

There were 23 significant submissions provided on the exposure draft. They ranged from the Law Council of Australia to a state government, through to the areas of great concern around airlines raised by previous speakers in the debate. For example, Flight Centre provided a submission. Of course, the ACCC made a substantial submission on the way in which they wanted the Trade Practices Act to continue to be interpreted. There were also some individual submissions from CHOICE, the Consumer Action Law Centre, the Real Estate Institute of Australia and the Property Council of Australia. There were a significant range of key stakeholders.

Barnaby Joyce (Queensland, National Party) Share this | Link to this | Hansard source

You said that the Business Council of Australia had problems with regard to costing. You referred to the fact that most people changed prices all the time. Was there an indication that, now that we have clarity in pricing, we might actually move to clarity of where the goods actually come from? In this way, we could clearly identify which goods are made predominantly in Australia in terms of quantity and value as opposed to those made elsewhere. The other area of serious concern is the slow degradation of the Made in Australia brand. Is it the government’s view that, seeing that there is strong support for clarity in pricing, there would also be very strong support for clarity in identification of where the goods are actually made?

Ursula Stephens (NSW, Australian Labor Party, Parliamentary Secretary Assisting the Prime Minister for Social Inclusion) Share this | Link to this | Hansard source

Thank you, Senator Joyce. I know that this is an area that you have an ongoing interest in—both protecting the Made in Australia brand and ensuring that producers within Australia, whether they are in the manufacturing sector or anywhere else in the supply chain, are appropriately recognised and supported. However, in relation to the specific question that you have raised with me, that issue is outside the scope of this bill. It was not considered in the drafting of the legislation. As I know you are well aware, the country of origin provisions are actually contained in a different section of the Trade Practices Act.

Barnaby Joyce (Queensland, National Party) Share this | Link to this | Hansard source

I would just like to thank Senator Stephens for her assistance in this. I acknowledge that this piece of legislation is widely supported. We now look forward to clarity in country of origin coming forward. That is a serious issue. Obviously, there are other issues at hand here tonight which might be affecting the way we discuss this issue but, now that those issues are covered, I think that really puts this issue to bed. Thank you very much for that.

Bill agreed to.

Bill reported without amendment; report adopted.