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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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