Australia Council (Consequential and Transitional Provisions) Bill 2013

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Australia Council (Consequential and Transitional Provisions) Bill 2013

Introduced into the House of Representatives on 20 March 2013

Portfolio: Arts

Summary of committee view

1.1        The committee seeks clarification as to whether the legal burden imposed by the civil penalty provision in the bill is compatible with the right to a fair hearing.

Overview

1.2        This bill was introduced together with the Australia Council Bill 2103.

1.3        The bill will repeal the Australia Council Act 1975 and enable the Australia Council to continue to operate during the transition period. In particular, it will provide for the continuation of certain appointments made under the existing legislation, the continuation of existing employment terms and conditions, the transfer of assets and liabilities and the treatment of any extant legal proceedings.

Compatibility with human rights

1.4        The bill is accompanied by a self-contained statement of compatibility which states that the inclusion of a civil penalty provision in the bill does not engage criminal proceeding rights and concludes that it is compatible with human rights.

Civil penalty regime as involving the imposition of a criminal penalty

1.5        Item 13(1) of the bill will require the members of the new Board of the Australia Council to prepare, on behalf of the old Council, an annual report in accordance with the Commonwealth Authorities and Companies Act 1997 (CAC Act) for the transitional reporting period. Members of the new Board will be subject to a civil penalty of up to $200,000 if they contravene the final annual reporting requirements or fail to take reasonable steps to comply with the requirements.[1] If the contravention relates to an omission in the required financial statements, the Board member will bear the legal burden for proving that the omission was immaterial and did not affect the giving of a true and fair view of the matters required to be covered in the final annual report.[2]

1.6        The committee has previously raised concerns about the human rights compatibility of civil penalty regimes.[3] These concerns were that such penalties could be classified as ‘criminal’ penalties under human rights law,[4] and that this would potentially give rise to inconsistency with the criminal proceeding guarantees contained in article 14 of the International Covenant on Civil and Political Rights (ICCPR). Of particular concern were the application of the rules of procedure and evidence applicable in civil proceedings to civil penalty proceedings (if these were held to be ‘criminal’), and the possibility that a person could be subjected to both a criminal conviction and a civil penalty in relation to the same conduct (violating the guarantee that a person cannot be subject to a criminal penalty twice for the same offence). These concerns also arise in the context of the civil penalty provision in this bill.

1.7        The statement of compatibility contends that the bill does not engage criminal proceeding rights, noting that the bill will require any contravention of the reporting requirements to be considered a civil matter, that the bill provides for a maximum pecuniary penalty, and that no criminal conviction results from a finding of liability. The committee, however, notes, in accordance with international jurisprudence, that the domestic classification of a penalty is of limited significance.

1.8        The statement of compatibility also notes that pecuniary penalty orders will only be imposed for serious contraventions.[5] The committee does not consider that this aspect of the bill assists in evaluating whether civil penalty procedures are ‘criminal’ in nature under human rights law. 

1.9        The evaluation of civil penalty provisions should also take account of: (i) the nature of the penalty, that is, whether it is part of a regulatory scheme which governs certain classes of persons who have voluntarily undertaken particular obligations; and (ii) the severity of the penalty to which a person may be exposed.

1.10      Given that these civil penalty provisions appear in a regulatory context, it is arguable that the penalties are not 'criminal' in nature. Although the penalties are large, it may be argued that they are not excessive in view of the public interests that are being protected.

1.11      The committee is, however, concerned that these provisions impose a legal burden on the defendant and that the matters that the defendant is required to prove appear to relate to matters which may not be peculiarly within the defendant's knowledge. While the criminal process rights in article 14 of the ICCPR may not be engaged in this instance, the guarantees of the right to a fair hearing in article 14(1) of the ICCPR still apply and an assessment of the fairness and reasonableness of requiring the respondent to discharge legal or evidential burdens of proof still needs to be undertaken.

1.12      The committee intends to write to the Minister for the Arts to seek a justification for the imposition of a legal burden in item 13(1) of the bill before forming a view on its compatibility with the right to a fair hearing in article 14(1) of the ICCPR. The committee requests that the justification provided should include information as to whether an evidential burden may offer a less restrictive alternative for achieving the provision’s purpose.

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