ADMINISTRATIVE REVIEW COUNCIL
ADMINISTRATIVE ACCOUNTABILITY IN
BUSINESS AREAS SUBJECT TO COMPLEX AND
SPECIFIC REGULATION
November 2008
Any inquiries about this report should be directed to:
The Executive Director
Administrative Review Council
Robert Garran Offices
National Circuit
Barton ACT 2600
Telephone:
Facsimile:
Email:
Internet:
02 6250 5800
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arc.can@ag.gov.au
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© Commonwealth of Australia 2008
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1968, no part may be reproduced by any process without written permission.
ISBN 1 921241 616
ADMINISTRATIVE REVIEW COUNCIL
14 November 2008
The Hon Robert McClelland MP
Attorney-General
Parliament House
CANBERRA ACT 2600
Dear Attorney-General
I have pleasure in submitting to you the Council’s response to the terms of reference
provided to the Council by your predecessor in office, the Hon Philip Ruddock MP,
concerning the most effective and efficient administrative accountability mechanisms
in business areas subject to complex and specific regulation.
In this report the Council considers accountability for regulatory decision making by
government agencies and by industry bodies and other non-government entities
through co- and self-regulation. It also considers accountability mechanisms for
regulatory decisions made with reference to both ‘black letter’ law and ‘soft law’
business rules.
The report confirms the Council’s previous approach to the categories of decisions
that should be subject to merits review and notes the adaptations that can be made to
tribunal processes in the review of complex regulatory decisions in business areas.
Yours sincerely
Jillian Segal AM
President
The Administrative Review Council
The following people were members of the Administrative Review Council at the
time of publication:

Jillian Segal AM (President)

Justice Garry Downes AM

Professor John McMillan

Professor David Weisbrot AM

Barbara Belcher

Ian Carnell

Robert Cornall AO

Professor Robin Creyke

Andrew Metcalfe

Linda Pearson

Dr Melissa Perry QC

Brigadier Bill Rolfe AO (rtd).
Although his term of appointment had ended, Peter Anderson remained a member
of the relevant Council sub-committee until the completion of this report.
The Council thanks its Executive Director, Margaret Harrison-Smith, and consultant
Claire Grose for their contributions to the report.
Terms of reference
The then Attorney-General, the Hon Philip Ruddock MP, issued to the Council the
following terms of reference on 9 August 2006:
I, Philip Ruddock, Attorney-General of Australia, HAVING REGARD TO:

The increasing complexity of regulatory regimes which apply to
Australian business

The role of the Commonwealth administrative law system in promoting
lawfulness and accountability in government decision making including
government decision making relating to business regulation and review;
and

The importance of maintaining the most efficient and effective
interaction between the administrative review system and government
business regulation.
REFER to the Administrative Review Council for inquiry and report under
the Administrative Appeals Tribunal Act 1975, the most effective and efficient
administrative accountability mechanisms for decisions in areas of complex
and specific business regulation.
(1) In carrying out its inquiry, having regard to administrative rules and
principles, the Council will consider:
(a) the circumstances in which administrative review mechanisms
should be available for decisions in areas of complex and specific
business regulation
(b) the adaptations, if any, that may be desirable to merits review
processes to maximise the efficiency and effectiveness of such
processes in areas of complex and specific business regulation
(c) the potential for the development of a framework of national
guideline principles for administrative review, including merits
review, of decisions in areas of complex and specific regulation; and
(d) any other relevant matters.
(2) In carrying out its inquiry, the Council will consult with relevant
government agencies, courts and tribunals, their client groups, the legal
profession and other interested organisations and individuals.
(3) The Council may report in stages or in one report with a first report to be
produced by no later than 30 September 2007.
Administrative accountability in business areas subject to complex and specific regulation
vii
Contents
Terms of reference .......................................................................................................v
Summary ..................................................................................................................... ix
1
Introduction ......................................................................................................1
Background ................................................................................................................. 1
Scope of this report .................................................................................................... 2
Consultation................................................................................................................ 2
2
The regulatory landscape ................................................................................4
Effective and efficient accountability mechanisms ............................................... 4
The tools of regulation .............................................................................................. 5
Standards Australia ................................................................................................. 10
3
Administrative review of business rules ......................................................11
The need for broad parameters .............................................................................. 11
Accountability to individuals: government agencies ......................................... 11
The reach of administrative law ............................................................................ 12
Administrative accountability and soft law developed and used by
government agencies ............................................................................................... 13
Administrative accountability and non-government soft law .......................... 14
4
Accountability: review mechanisms in areas of co- and selfregulation ........................................................................................................16
The Australian Securities Exchange ...................................................................... 16
The Takeovers Panel ................................................................................................ 18
Industry codes and dispute resolution ................................................................. 19
Monitoring and external review ............................................................................ 22
viii
Administrative accountability in business areas subject to complex and specific regulation
5
Accountability: development and monitoring .............................................27
Consultation in relation to business regulation ................................................... 28
Other best-practice regulation requirements ....................................................... 29
Consultation in relation to soft law regulation developed by industry
bodies and others ..................................................................................................... 29
Drafting of regulatory materials ............................................................................ 30
Internal and external monitoring of business rules ............................................ 31
6
Availability of and adaptations to merits review ........................................34
What is merits review? ............................................................................................ 34
What decisions should be subject to merits review? .......................................... 34
Adaptations to merits review processes ............................................................... 36
7
Concluding comments ...................................................................................40
A framework of guideline principles .................................................................... 40
Specific matters ........................................................................................................ 41
Appendix A
Organisations consulted and submissions received ........................ 42
Appendix B
Section 51 of the Administrative Appeals Tribunal Act ................. 44
Administrative accountability in business areas subject to complex and specific regulation
ix
Summary
Using the formal federal system of administrative law as its benchmark, the
Administrative Review Council considers in this report the most effective and
efficient accountability mechanisms for regulatory decisions made in areas of
complex business regulation.
Federal administrative law provides important accountability mechanisms when
government and government agencies make decisions that affect private interests,
including decisions relating to government regulation of business and other
activities.
Among the formal administrative law accountability mechanisms for decisions by
regulatory agencies are judicial review under the Administrative Decisions (Judicial
Review) Act 1977 (Cth), s 75(v) of the Constitution, and s 39B of the Judiciary Act 1903
(Cth); merits review, such as review by the Administrative Appeals Tribunal; and
review by investigatory bodies such as the Commonwealth Ombudsman pursuant to
the Ombudsman Act 1976 (Cth). These formal mechanisms are referred to generically
in this report as administrative law review mechanisms.
In the report the Council confirms the approach adopted in its earlier guideline
publication What Decisions Should Be Subject to Merits Review?—that, with very
limited exceptions, a decision of government that will or is likely to affect the
interests of a person should be subject to merits review.
The Council also considers that at present the Administrative Appeals Tribunal has
the capacity to adapt merits review processes in order to ensure that they do not
impose unwarranted burdens on business. People with the necessary expertise and
ability to deal with matters arising in connection with complex business regulation
can be and are appointed to the AAT.
As the following diagram shows, however, a complex regulatory environment is
likely to be characterised not only by regulation by government agencies but also by
co- and self-regulation by industry bodies and other non-government entities.
Although integral to effective and efficient business regulation, decisions made by
such entities in the course of co- and self-regulation fall largely outside the reach of
the formal administrative law review mechanisms just referred to. In these areas,
accountability can be achieved, for example, through review by industry
ombudsmen, through peer review, or through monitoring and review by regulatory
agencies.
The Council is strongly of the view that administrative accountability need not be
diminished when there is a move to a different form of regulation such as selfregulation or co-regulation.
x
Pyramid of Business Rules
Accountability Mechanisms
Administrative law
accountability mechanisms;
consultation; sound drafting
standards; parliamentary
scrutiny; periodic review
Some administrative
law accountability
mechanisms;
consultation; reporting
Black
letter
law
Legislation
Legislative Instruments
Government soft law codes,
guidelines, and so on
Non-government soft law
codes, guidelines, and so on
Aspirational edicts
Peer review; external and
internal dispute resolution;
other restraints (eg contract);
often consultation; review;
reporting requirements
Administrative law
accountability mechanisms
generally not applicable
B
l
a
c
k
L
e
t
t
e
r
L
a
w
Business
rules
Soft
law
Administrative accountability in business areas subject to complex and specific regulation
Administrative law
accountability mechanisms;
consultation; sound drafting
standards; parliamentary
scrutiny
Administrative accountability in business areas subject to complex and specific regulation
xi
Soft law
Non-legislative materials—such as codes of practice and codes of ethics developed
by industry bodies and other non-government entities involved in self-regulation of
business areas or regulation in conjunction with government (co-regulation)—are
important regulatory tools. They are referred to in this report as ‘soft law’; the
expression also takes in the guidelines, codes and other non-legislative materials that
are used increasingly by government regulatory agencies.
Soft law is not binding by force of statute but may be binding in other ways—for
example, through agreement. As a result, failure to comply with soft law rules can
have legal consequences for individuals and corporations. Government soft law is
generally not subject to the range of administrative law review mechanisms
applicable to the ‘black letter’ law that is also administered by government agencies.
The Council makes many references in this report to ‘business rules’. Unless
otherwise specified, these references cover legislation (including subordinate
legislation), soft law materials developed by government agencies, and soft law
materials developed by industry bodies and other non-government entities for the
purposes of co- and self-regulation.
Accountability and the application of business rules
It is the Council’s view that the application of all business rules should be consistent
with the administrative law values of lawfulness, fairness, rationality, openness (or
transparency) and efficiency. All decisions that are made on the basis of business
rules and that affect or are likely to affect individual interests should be subject to
effective accountability and review mechanisms. The Council considers, however,
that effectiveness and efficiency would not be enhanced if one were to seek to extend
the full range of administrative law review mechanisms to regulatory decisions made
by industry and other non-government entities on the basis of soft law.
The conclusion the Council reached is that, although differing from administrative
law review mechanisms, redress mechanisms such as peer review and external
dispute-resolution schemes associated with the application of soft law business rules
can be effective and efficient. The Council also concluded that, if developed with
regard to the following guideline principles, these redress mechanisms might be
consistent with administrative law values in significant respects.
A further conclusion is that administrative review and other redress mechanisms
available in business areas should be responsive to changes in regulatory needs as
business areas evolve.
Additionally, the Council considers that sound consultation and drafting practices
for all business rules—together with regular internal and external review of the
rules—are integral to ensuring an effective level of accountability for the making of
such rules. All the processes involved in the development of business rules should be
consistent with administrative law values.
xii
Administrative accountability in business areas subject to complex and specific regulation
These views are brought together in the following framework of guideline principles
and recommended actions for government agencies and industry bodies and other
non-government entities involved in the development and application of business
rules.
The principles and actions are directed at achieving effectiveness and efficiency in
the development, application, review and monitoring of business rules. They are also
amenable to application to rules in other regulatory areas.
Framework of guideline principles and recommended actions
The development of business rules
1. The development of all business rules should be open and transparent, and there
should exist procedures for effective and timely consultation with people whose
interests are likely to be affected by the application of the rules.
In general, consultation with interested parties should occur at all stages in the
development of business rules. The nature of this consultation should reflect the
character, scope and effect of a business rule.
The circumstances in which consultation will not be appropriate are limited—for
example, where prior public notification would be inappropriate because the rule is
designed to foreclose a tax avoidance loophole or to prevent an imminent threat to
financial markets.
The Australian Government’s Best Practice Regulation Handbook outlines procedures
designed to ensure that government agencies consult fully in the development of
business rules arising under both legislation and soft law.
The Government should also endorse a set of consultation benchmarks developed by
industry bodies and other non-government entities to guide them in the
development of co- and self-regulatory soft law business rules. To ensure their
effectiveness and efficiency, the benchmarks should be consistent with the
consultation procedures described in the Best Practice Regulation Handbook.
2. All business rules should be expressed in clear, understandable language and be
readily accessible.
Legislation, including legislative instruments to which the Legislative Instruments Act
2003 (Cth) applies, is subject to rigorous drafting standards and parliamentary
scrutiny.
To ensure their effectiveness and efficiency, government and non-government soft
law business rules should also be drafted in plain language, the drafting process
being overseen by someone with legal training and expertise in the relevant area.
All new and amended business rules and complaint-handling and review
mechanisms should be widely accessible to those to whom they relate. The
information should be available on a well-publicised internet site and in print.
Administrative accountability in business areas subject to complex and specific regulation
xiii
Targeted education programs should be considered where new or amended business
rules effect major changes to the regulatory environment.
The application of business rules
3. All business rules should be applied in a manner consistent with the
administrative law values of lawfulness, fairness, rationality, openness (or
transparency) and efficiency.
Government regulation of business areas must comply with the administrative law
values of lawfulness, fairness, rationality, openness (or transparency) and efficiency.
Application of those values provides essential protection for individual interests and
bolsters public confidence in regulatory decisions. Application of the values in
business areas subject to co- and self-regulation is also essential.
Review of business rules
4. There should be an opportunity to seek review of any decision that applies a
business rule in a way that directly affects the rights or interests of a person or
business.
Administrative law review is generally available if the decision of a government
agency affects or is likely to affect a person or business in an individual manner.
A right to seek review of a decision should similarly exist where the application of a
non-government business rule has a direct effect on the individual rights or
entitlements of a person or business as a result of a decision that relates specifically
to that person or business.
The mechanisms for seeking review might differ from the administrative law review
mechanisms that apply to government regulation. Examples of the sorts of
mechanisms that can be adopted to achieve these ends are peer review, remedies
under codes, and industry dispute-resolution schemes.
A balance should be maintained between cost and accountability in all review
mechanisms for decisions made with regard to business rules.
Monitoring of business rules
5. There should be continuing monitoring of the accountability mechanisms that
apply to action taken on the basis of soft law business rules, whether the action is
taken by a government or a non-government agency.
Government regulation and decision making are generally subject to administrative
law review mechanisms. A range of internal and external monitoring and reporting
requirements apply to the operation of such mechanisms.
Regulation by non-government bodies and co-regulation by government and nongovernment bodies are subject to different accountability requirements. Continuing
monitoring and internal quality controls should apply to those accountability
xiv
Administrative accountability in business areas subject to complex and specific regulation
requirements, to ensure that business rules are applied properly and in accordance
with administrative law values.
In the case of co- or self-regulation, an independent external evaluation should be
conducted within at least three years of the introduction of business rules and at
regular intervals thereafter, to gauge the effectiveness of the accountability
mechanisms applying to the regulation.
Administrative accountability in business areas subject to complex and specific regulation
1
1
Introduction
On 9 August 2006 the then Attorney-General, the Hon Philip Ruddock MP, issued to
the Administrative Review Council terms of reference asking the Council to inquire
into and report on—under the Administrative Appeals Tribunal Act 1975 (Cth)—the
most effective and efficient accountability mechanisms for decisions in business areas
subject to complex and specific regulation.
The Council was asked to consider the circumstances in which administrative review
mechanisms should be available in business areas, the adaptations to merits review
that could be made to maximise its efficiency and effectiveness, and the potential for
developing guideline principles for administrative accountability in such areas.
The regulatory landscape in business areas is typically characterised by a complex
mix of government regulation and co- and self-regulation by industry bodies and
private entities. The terms of reference therefore offered the Council the opportunity
to explore the extent to which administrative law review mechanisms and values
should extend into areas that are regulated by non-government entities through
codes, standards, and so on, and that are substantially beyond the reach of
administrative law.
In responding to this opportunity, the Council considered it important to encourage
a cohesive and consistent approach designed to ensure that accountability
mechanisms within a regulatory space share a degree of consistency across the
regulatory spectrum.
Background
The increasing complexity of business regulation is well documented. An apparent
catalyst for the Attorney-General’s reference to the Council was the August 2006
report of the Taskforce on Reducing Regulatory Burdens on Business, Rethinking
Regulation.1
That report identified inconsistent, complex and excessive regulation in a number of
business sectors. It also recognised the need for a balanced, consistent and
transparent approach to regulatory decision making and enforcement.2 Further, it
recognised the role of administrative law in encouraging good decision making by
government agencies and the role that accountability mechanisms such as judicial
review, merits review and ombudsman review can play in ensuring good regulation
and in boosting stakeholder confidence.
1
2
Rethinking Regulation—report of the Taskforce on Reducing Regulatory Burdens on Business,
Commonwealth of Australia, Canberra, January 2006.
ibid., p. 93.
2
Administrative accountability in business areas subject to complex and specific regulation
In particular, the taskforce recommended that, in order to determine the types of
regulatory decisions that should be subject to merits review, an approach based on
the Council’s guidelines publication, What Decisions Should be Subject to Merits
Review? should be adopted.3
The momentum generated by Rethinking Regulation and other initiatives continues,
the prevailing environment being one that is directed at ensuring ‘that new
regulation is enacted only where absolutely necessary and at a minimum cost to
consumers and business’.4
Scope of this report
The Council’s report focuses on a limited number of regulatory areas. The findings
will, however, be relevant to other business areas subject to complex and specific
regulation.
The report documents a complex regulatory landscape in which legislation is
supplemented by soft law codes and guideline materials generated by government
regulators and industry groups and other non-government entities involved in coand self-regulation.
The effectiveness and efficiency of a range of administrative law and nonadministrative law accountability mechanisms are assessed against the
administrative law values of lawfulness, fairness, rationality, openness (or
transparency) and efficiency and in relation to administrative law review
mechanisms such as merits review by tribunals.
The report confirms that the accountability mechanisms for soft law regulation of
business areas by industry groups and other non-government entities should reflect
administrative law values. Additionally, it identifies a framework of guideline
principles, consistent with administrative law values, the Council considers will
promote effective, efficient and accountable soft law regulation.
The report also explores the potential for adapting merits review in areas where
business is subject to complex and specific regulation.
Consultation
In February 2008 the Council developed an issues paper entitled Administrative
Accountability in Areas where Business Activities Are Subject to Complex Regulation.
The Council used the paper as the basis for discussion at three forums focusing on
existing accountability mechanisms for business regulation by government agencies
and industry groups and other non-government entities. Participants described the
3
4
ibid.
The Hon Lindsay Tanner MP, Minister for Finance and Deregulation, ‘Relieving the burden on
business’, Address to the Sydney Institute, 26 February 2008, p. 2,
<http://www.financeminister.gov.au/speeches/2008/sp_20080226.html>.
Administrative accountability in business areas subject to complex and specific regulation
range of regulatory mechanisms operating in their area and the underlying policy
development processes.
All participants emphasised the importance of effective consultation with
stakeholders at all stages of the regulatory cycle as an element of regulatory
accountability.5 Good drafting practices were also seen to be a crucial element of
effective and efficient regulation.
The consultations confirmed that administrative law values are often embedded in
regulatory practices and accountability mechanisms in a variety of ways.
The Council extends its sincere thanks to the individuals and representatives of
organisations who attended the forums, met with the Council, and provided often
extensive written submissions to this review. These contributions were invaluable.
Appendix A lists all those the Council consulted in developing this report.
Appendix B sets out the functions of the Council under s 51 of the Administrative
Appeals Tribunal Act 1975 (Cth).
5
Also reflected in Rethinking Regulation, op. cit., p. 147 and rec. 7.1.
3
4
2
Administrative accountability in business areas subject to complex and specific regulation
The regulatory landscape
This chapter provides an overview of the regulatory landscape in business areas
subject to complex regulation.
For the purposes of this report, the Council interpreted ‘regulation’ in the terms of
reference as meaning any ‘business rule’6 endorsed by government or by an industry
group or other non-government entity where there is an expectation of compliance.7
Consistent with the definition of ‘business rules’ for the purposes of this report,
within this definition regulation ranges from government regulation in accordance
with ‘black letter’ law, where non-compliance can lead to stiff penalties and
sometimes even to imprisonment, through to light-touch ‘soft law’ regulation (selfregulatory charters, for example) developed and administered by industry bodies.8
In a complex regulatory environment, different types of regulation are likely to coexist in a single business area. Moreover, the regulatory landscape is not static. To be
‘effective’ in responding to identified problems and ‘efficient’ in maximising
regulatory benefit taking account of costs9, regulation must be pitched at the right
level as a business area develops and matures.
In considering new or revised regulation, a range of feasible policy options
(including self-regulatory and co-regulatory approaches) should be identified and
their benefits and costs (including compliance costs) assessed within an appropriate
framework.10
Effective and efficient accountability mechanisms
The terms of reference ask the Council to report on the most ‘effective and efficient
accountability mechanisms’ for decisions in business areas subject to complex and
specific regulation.
Effectiveness and efficiency are at once distinguishable and interdependent concepts,
suggestive of a fine balance between the expenditure of physical and/or financial
effort and the achievement of a desired outcome. As concepts, they are rarely
mutually exclusive. Indeed, this is the case with administrative accountability
6
7
8
9
10
For this report ‘business rules’ covers legislation (including subordinate legislation), soft law
materials developed by government agencies, and soft law materials developed by industry bodies
and other non-government entities for the purposes of co- and self-regulation.
This definition builds on the definition of ‘regulation’ as ‘[a]ny “business rule” endorsed by
government or by an industry group where there is an expectation of compliance’ in Australian
Government, Best Practice Regulation Handbook, August 2007, p. XIII.
For example, the Australian Associated Motor Insurers Customer Charter,
<http://www.aami.com.au/aaami_customer_service/customer_charter.asp.>
That is, regulatory and compliance costs—Best Practice Regulation Handbook, op. cit., p. 1.
Rethinking Regulation: Australian government response, 15 August 2006.
Administrative accountability in business areas subject to complex and specific regulation
5
mechanisms, where regulated and regulator share an interest in striking the best
balance between effective and efficient regulation, openness and accountability,
fairness and the upholding of individual rights.
In determining what constitutes an ‘effective and efficient’ administrative
accountability mechanism for the purposes of this report, the Council seeks to
identify a suitable balance between these differently weighted yet related concepts.
The tools of regulation
Business is regulated principally by legislation administered by government
agencies. Legislation in this context includes subordinate legislation (for example,
regulations made by the Executive when it has statutory power to do so) as well as
laws enacted by the Parliament and is, of course, subject to interpretation by the
courts.
Soft law (often referred to as quasi-regulation or grey letter law) is also increasingly
used by government agencies as a regulatory tool. It is the vehicle used for co- and
self-regulation by industry groups and other non-government entities.
Soft law
‘Soft law’ refers to a vast and varied range of instruments, among them codes of
practice, advisory notes, guidelines and rules of conduct11, recommendations12,
operational memorandums, directives and oral instructions, employee handbooks13,
rules, manuals, correspondence, circulars, protocols, bulletins, and training
materials.14 Although using different vehicles, a number of project participants
agreed that in practice soft law can be as influential in modifying behaviour as black
letter law.
The huge variety of instruments that can potentially fall within the definition of soft
law strongly suggests the need for further delineation. Soft law has been described in
terms of rules of conduct or commitment that are set out in instruments that are
without legal force although not devoid of all legal effect and that are intended to
have some practical effect on behaviour.15
11
12
13
14
15
Office of Regulation Review, Report of the Commonwealth Interdepartmental Committee on Quasiregulation, 1997, p. ix—the Grey Letter Law report.
L Senden, ‘Soft law, self-regulation and co-regulation in European law: where do they meet?’,
Electronic Journal of Comparative Law, vol. 9.1, January 2005, pp. 1, 23.
L Sossin, ‘The politics of soft law: how judicial decisions influence bureaucracy in Canada’, in
S Halliday & M Hertogh (eds), Judicial Review and Bureaucratic Impact: international and interdisciplinary perspectives, Cambridge University Press, London, 2004, p. 130.
L Sossin & Smith, ‘Hard choices and soft law: ethical codes, policy guidelines and the rule of the
courts in regulating government’, (2003) 40 Alberta Law Review, p. 867, 871.
A summary of words of definition is included in Senden, ‘Soft law, self-regulation and coregulation in European law’, op. cit., p. 130.
6
Administrative accountability in business areas subject to complex and specific regulation
Soft law regulation and government agencies
In the hands of government agencies, soft law can aptly be described as ‘the range of
rules, instruments and standards where government influences business to comply,
but which does not form part of explicit government regulation’.16 It has also been
described as ‘the principal administrative mechanism used to elaborate the legal
standards and political values underlying bureaucratic decision making’.17
To fall within these definitions soft law does not have to be directly generated by
government: even a voluntary industry code of conduct or standard can constitute
soft law where government involvement in developing the code pressures business
to comply.18
The agencies the Council consulted said the advantage of government agencies
regulating (at least in part) through the vehicle of soft law lies with soft law’s
encouragement of a consensual, rather than adversarial, approach to achieving joint
industry–government and consumer objectives; its potential for achieving objectives
in more collaborative ways than black letter law; and its avoidance of the formality
and ‘inscrutability’ of much legislation.19
Soft law can also be helpful in fleshing out broad legal principles and clarifying
regulatory requirements. It can, however, represent unnecessary ‘red tape’.20 For
example, guidelines placing an entity in a ‘high-risk’ category might result in that
entity being subjected to increased surveillance through auditing or create additional
barriers before services can be accessed.21 As illustrated by departmental directives,
people often find it difficult to distinguish between the mandatory and nonmandatory elements of soft law business rules.22
There is an extensive and increasing range of soft law materials produced by
government agencies. Several examples brought to the Council’s attention during the
consultation process are the Australian Competition and Consumer Commission’s
Merger Guidelines23 and Authorisation Guidelines24 and the Australian Securities and
Investments Commission’s extensive range of regulatory guides.25 The Australian
Prudential Regulation Authority’s Prudential Practice Guides are also examples of
soft law materials.
16
17
18
19
20
21
22
23
24
25
Grey Letter Law report, op. cit., p. 7.
Sossin, ‘The politics of soft law’, op. cit., p. 137.
See Best Practice Regulation, op. cit., p. XIII.
Grey Letter Law report, op. cit., p. xv.
See Rethinking Regulation, op. cit., p. 7.
This example was provided at one of the Council’s consultation forums.
Section 13(5) of the Public Service Act 1999 (Cth) provides, ‘An APS employee must comply with any
lawful and reasonable direction given by someone in the employee’s agency who has authority to
give direction’. This has been relied on by the Australian Taxation Office to issue corporate practice
statements expressed to be directions of the commissioner, breach of which could lead to action for
breach of the Australian Public Service Code of Conduct.
Australian Competition and Consumer Commission, Merger Guidelines, ACCC, Canberra, June
1999. The guidelines were being updated at the date of consultation. Provision of materials in
accordance with the guidelines is mutually beneficial insofar as the ACCC does not have to exercise
its coercive information-gathering powers.
Australian Competition and Consumer Commission, March 2007.
Copies of all ASIC regulatory guides are available at <http:www.asic.gov.au>.
Administrative accountability in business areas subject to complex and specific regulation
7
The 1997 National Code of Practice for the Construction Industry, developed jointly
by the then Department of Employment and Workplace Relations and the Australian
Procurement and Construction Council26, is a further example of soft law. The code
applies to all construction projects funded by the Australian Government. In July
2005 application of the code was extended to all Australian-based construction
activities of entities that receive construction contracts funded or partly funded by
the Australian Government. The code illustrates how soft law can be used to reduce
red tape insofar as the code applies nationally, and it stands in stark contrast, for
example, to the plethora of planning laws that apply in the different jurisdictions at
the state, territory and local levels of government.
Failure to comply with soft law guidelines such as those referred to can in many
instances lead to regulatory action under the legislation in connection with which the
soft law has been developed and in relation to which it seeks to provide clarification.
Soft law regulation and industry bodies
As noted, soft law is also the vehicle for self-regulation by industry bodies and other
non-government entities.
Self-regulation occurs where members of a market sector voluntarily bind
themselves by a mutually agreed set of rules. The rules govern the relationship of
members with the general public, clients, customers and other stakeholders and are
enforced by the industry itself, rather than by government or a body established by
government.
Soft law self-regulatory business rules can provide greater flexibility than regulation
by way of black letter law. They can be more quickly revised; they can reflect
industry bodies’ understanding of the business environment; and they can
encourage direct stakeholder involvement in, and acceptance of, the regulatory
process. On the other hand, they are subject to fewer administrative law
accountability checks than black letter law.
It has been said that self-regulation should be considered where there is no strong
public interest concern. For example, this can be the case where one or more of the
following exists:

There is no public health and safety concern.

The problem is a low-risk event of low impact or significance.

The incentives (industry survival, market advantage) are sufficient for the
problem to be fixed by the market itself.27
Among the areas in which industry-administered self-regulatory schemes exist at the
national level are advertising, broadcasting and media, direct marketing, financial
26
27
The code is available at: <http://www.workplace.gov.au/workplace/
Organisation/Industry/BuildingConstruction/>.
Grey Letter Law report, op. cit., p. xx.
8
Administrative accountability in business areas subject to complex and specific regulation
services, general industry schemes, pharmaceuticals and proprietary medicines,
professional associations, retail sector schemes, and telecommunications.
Self-regulatory schemes can range from simple codes of ethics to schemes
incorporating codes drafted with legislative precision and accompanied by
sophisticated customer dispute-resolution mechanisms.28
Legislative instruments
Because of the broad definition of ‘legislative instrument’ in the Legislative
Instruments Act 2003 (Cth)29, a potentially large amount of soft law material has been
registered under that Act.30 Subject to this overlap, soft law produced by government
agencies is to be distinguished from registered instruments.
Decisions made in the exercise of powers conferred by legislative instruments can be
subject to merits review by a tribunal. They can also be amenable to judicial review
under the Administrative Decisions (Judicial Review) Act 1977 (Cth) and s 75(v) of the
Constitution.31
Under the Legislative Instruments Act consultation ‘considered by rule-makers to be
appropriate and that is reasonably practicable to be undertaken’ is required before
the making of legislative instruments.32 The form that consultation can take is set out
in s 17(3) of the Act. It includes notification either directly or indirectly by way of
advertisement of people who are or are likely to be affected by the proposed
instrument and envisages inviting submissions or attendance at public hearings.
Two examples of situations where consultation may be unnecessary or inappropriate
are urgent situations and in relation to instruments of a minor or machinery nature
that do not substantially affect existing arrangements (s 18). The reasons for nonconsultation must be set out in the explanatory statement presented to parliament in
anticipation of the tabling of a legislative instrument.33 The system is not without its
critics: some say there are too many exemptions and that the interface with the
consultation requirements for business administered by the Office of Best Practice
Regulation needs to be refined.34
28
29
30
31
32
33
34
Taskforce on Industry Self-regulation, Industry Self-regulation in Consumer Markets, TIS, Canberra,
August 2000, p. 23—the Industry Self-regulation report.
A legislative instrument is defined in s 5(1) as an instrument in writing, that is of a legislative
character, and that is or was made in the exercise of a power delegated by the parliament.
The Act is being reviewed—see <http://www.ag.gov.au/lia-review>.
Section 75(v) of the Constitution confers original jurisdiction on the High Court ‘in all cases in
which a writ of Mandamus or prohibition or an injunction is sought against an officer of the
Commonwealth’. Subject to certain exclusions, the same jurisdiction is conferred on the Federal
Court under s 39B of the Judiciary Act 1903 (Cth).
Legislative Instruments Act 2003 (Cth), s 17. See also the discussion of legislative instruments at p. 30.
As noted, the Act is being reviewed. It is expected that the review will consider the effectiveness of
the consultation requirements under the Act.
See also Chapter 5 of this report.
Administrative accountability in business areas subject to complex and specific regulation
9
Co-regulation
Self-regulation in cooperation with government (referred to here as ‘co-regulation’) is
an important supplement to black letter law in complex regulatory areas.
A typical co-regulatory framework will involve a legislative framework that sets
minimum standards and that is supplemented by industry codes or other
mechanisms developed by industry bodies or other non-government entities. These
codes and other mechanisms might be monitored or validated by a government
regulator.
In this way co-regulation seeks to combine the advantages of the predictability and
binding nature of legislation with a more flexible self-regulatory approach. A further
advantage of this form of regulation is the extent to which it permits harnessing of
stakeholder expertise beyond the reach of most government agencies.
The schemes of industry codes and standards established under Part 6 of the
Telecommunications Act 1997 (Cth) and the Broadcasting Services Act 1992 (Cth) are
examples of co-regulation. Both Acts contain regulatory policy statements
supporting the establishment of codes by industry sectors35 and encouraging selfregulation.36
The supervisory functions performed by the Australian Securities Exchange under
the oversight of and in cooperation with the Australian Securities and Investments
Commission under the Corporations Act 2001 (Cth) provide another example of coregulation.
The privacy codes in Part IIIAA of the Privacy Act 1988 (Cth) represent yet another
co-regulatory approach. The Privacy Act outlines a specific set of requirements that
the codes must contain, as well as minimum procedural requirements in relation to
complaints and enforcement mechanisms. There is also a statutory mechanism for
review by the Privacy Commissioner of decisions made under an approved code.
Examples of self-regulatory materials without direct legislative connections are the
Australian Direct Marketing Association Code of Practice37, the Medicines Australia
Code of Conduct38, the Motor Vehicle Insurance and Repair Industry Code of
Conduct39, and the national system of advertising self-regulation administered by the
Advertising Standards Board. Among the codes coming within the advertising
standards system are the Australian Association of National Advertisers Code of
Ethics and the Advertising to Children Code. These regulatory materials are, of
course, all examples of soft law.
Like government agencies, self-regulating industry bodies and other nongovernment entities produce secondary guideline materials to supplement their
35
36
37
38
39
See s 112 Telecommunications Act 1997 (Cth) and s 59 Broadcasting Services Act 1992 (Cth).
For example, s 4 Telecommunications Act 1997 (Cth).
See <http://www.adma.com.au/asp/index.asp?pgid=1985>. The code is authorised under s 88(1)
of the Trade Practices Act by the Australian Competition and Consumer Commission.
See <http://www.medicinesaustralia.com.au/pages/page16.asp>.
See <http://www.abrcode.com.au/forms/CodeofConduct.pdf>.
10
Administrative accountability in business areas subject to complex and specific regulation
primary soft law mechanisms. Examples are the Medicines Australia Code of
Conduct Guidelines40 and the Banking and Finance Division of the Financial
Ombudsman Service’s Policies and Procedures Manual and bulletins, which, among
other things, set out the division’s approach to particular types of disputes.41
Some of these subsidiary materials are specifically authorised by principal industry
body materials. The Banking and Finance Division’s terms of reference42 allow the
Ombudsman to develop guidelines for interpreting the terms of reference.43
Standards Australia
A further example of soft law is provided by the Australian Standards, which are
technical and business standards developed by Standards Australia.44 Although
voluntary, compliance with the standards can become mandatory through inclusion
in legislation.45 The standards can also be accepted by courts as relevant to
determining the standard of care in an industry for the purposes of a negligence
action.46
40
41
42
43
44
45
46
See <http://www.medicinesaustralia.com.au/pages/page16.asp>.
See <http://www.fos.org.au>.
The terms of reference relate to the structure and operation of the scheme and the powers and
duties of the Financial Ombudsman Service.
Clause 12.6 of the terms of reference—see
<http://www.fos.org.au/centric/home_page/about_us/terms_of_reference.jsp>.
Through a memorandum of understanding with the Australian Government, Standards Australia
is recognised as the peak non-government standards development body in Australia. There are
about 7000 standards, covering a large range of topics. Standards Australia has recently announced
a New Business Model to transform how Australian Standards are developed involving new and
more strategic ways of engaging with stakeholders, a net benefit assessment applied to every
project (benefits versus cost), new technology and new development pathways). Further
information is available at <http://www.standards.org.au/>.
For example, the Corporations Regulations 2001 (Cth), the Gene Technology Regulations 2001
(Cth), and the Health and Safety (Commonwealth Employment) (National Standards) Amendment
Regulations (No. 2) 2004.
See, for example, Anne Christina Benton v Tea Tree Plaza Nominees (1995) 64 SASR 494, in which a
voluntary Australian Standard on kerb height was one of the factors taken into account by the court
in determining negligence.
Administrative accountability in business areas subject to complex and specific regulation
3
11
Administrative review of business rules
In this chapter the Council considers the circumstances in which external
administrative review mechanisms should be available, focusing on regulatory
decisions that affect people or businesses in an individual manner. It also considers
the right to challenge those decisions, having regard to the availability of
administrative review under the federal system of administrative law.
The need for broad parameters
The broad range of regulatory types described in Chapter 2 can be explained on the
basis that one size does not necessarily fit all: what will be efficient and effective in
one context or at a particular time will not necessarily always be so. The same applies
to accountability mechanisms: what will work in one regulatory environment will
not necessarily be effective and efficient in another.
The prevailing view of project participants was that a sophisticated external review
scheme is not required, for example, for actions of a straightforward or
uncontroversial nature taken under a code of ethics or a charter. The Council agrees
that accountability should be responsive to the level of regulation, but it also needs to
have regard to other factors, including the extent to which the interests and
entitlements of individuals (including corporations) are affected and the nature of
those interests and entitlements.
Accountability to individuals: government agencies
Accountability to individuals for government regulation by legislation or under
executive power is achieved principally through the administrative law system,
which provides a number of options for administrative review that individuals can
turn to, depending on the circumstances of their case. Individuals have the right to
do the following:

47
challenge the lawfulness of government decisions by way of judicial review
–
under specific legislative provisions including the Administrative Decisions
(Judicial Review) Act 1977 47
–
under s 75(v) of the Australian Constitution
Note, however, that there are exceptions to those decisions that can be challenged under the ADJR
Act: see the definition of a ‘decision to which this Act applies’ in s 3(1) of the Act, together with
Schedule 1, and s 9 of the Act.
12
Administrative accountability in business areas subject to complex and specific regulation

in general, seek statements of reasons under the Administrative Decisions
(Judicial Review) Act—thereby affording transparency to government decision
making and giving efficacy to the primary right to seek judicial review

in relation to a wide range of decisions under federal legislation, seek review of
the merits of those decisions by an independent tribunal—including (as
applicable) the Administrative Appeals Tribunal and the Australian Competition
Tribunal

seek investigation of administrative action by bodies such as the Commonwealth
Ombudsman, the Privacy Commissioner and the Australian Human Rights
Commission.
Transparency in government processes and accountability for government decision
making are promoted and augmented by the right to seek access to documents under
the Freedom of Information Act 1982 (Cth) and provisions relating to the appropriate
use and storage of information under the Privacy Act 1988 (Cth) and the Archives Act
1983 (Cth).
Together, those mechanisms reflect the administrative law values of lawfulness,
fairness, rationality, openness (or transparency) and efficiency, to which, in the
Council’s view, members of the Australian public are entitled in the exercise of
public power by government agencies.
The Australian Human Rights Commission, established under the Human Rights and
Equal Opportunity Act 1986 (Cth), also provides for individuals a means of resolving
complaints of discrimination or breaches of human rights under federal laws
conferring functions on the Commission.
The reach of administrative law
Administrative law is concerned with the exercise of ‘public power’. It involves in
most instances the exercise of power by government ministers and officers of
government departments and agencies. This understanding of the scope of public
power is reflected in much of the legislation underpinning the federal system of
administrative law.
There are, however, exceptions. The Privacy Act 1988 (Cth), for example, extends to
private organisations (including non-profit organisations) with an annual turnover
exceeding $3 million and to health service providers.48 A further exception is
provided by human rights legislation49, by virtue of which individuals may seek
recourse for acts of discrimination against non-government entities through the
Australian Human Rights Commission.
48
49
Further extension into the private sector has been recommended by the Australian Law Reform
Commission—see For Your Information: Australian privacy law and practice, Report no. 108, ALRC,
Sydney, May 2008.
For example, the Age Discrimination Act 2004 (Cth), the Disability Discrimination Act 1992 (Cth), the
Racial Discrimination Act 1975 (Cth) and the Sex Discrimination Act 1984 (Cth) all extend to the
discriminatory actions of private entities.
Administrative accountability in business areas subject to complex and specific regulation
13
The jurisdiction of the Commonwealth Ombudsman under the Ombudsman Act 1976
(Cth) was extended in 2005 to take account of the fact that many government services
are now provided to the public by non-government bodies on behalf of and pursuant
to a contract with a government agency. A complaint to the Commonwealth
Ombudsman about the delivery of such a service is to be treated as a complaint
against the government agency on whose part the service is being provided. Another
amendment to the Ombudsman Act, in 2006, established the office of the Postal
Industry Ombudsman (a position held by the Commonwealth Ombudsman), whose
jurisdiction extends to private sector postal operators who register to participate in
the scheme.
The examples illustrate that administrative law mechanisms can be altered to take
account of the changed environment in which government operates. The underlying
message, which the Council strongly endorses, is that administrative accountability
need not be diminished when there is a move to a different form of regulation, such
as self-regulation or co-regulation.
Administrative accountability and soft law developed and used by
government agencies
Application of administrative law to soft law administered by government agencies
presents a mixed picture. It is necessary to consider each administrative law review
mechanism in turn.
As to judicial review, the Administrative Decisions (Judicial Review) Act 1977 (Cth)
applies only to decisions made ‘under an enactment’. It is thus not possible directly
under that Act to seek review of a decision either to make a soft law instrument or to
exercise a function conferred by a soft law instrument. Questions of legality that
involve soft law instruments can nevertheless arise in proceedings under the Act. For
example, a decision that has been influenced by a soft law instrument could be
invalid if the instrument introduces an irrelevant consideration into the decision or if
the instrument (or policy) is applied inflexibly to the disregard of the individual
merits of the case.50 Similarly, failure to consult a person in accordance with an
expectation created by a soft law instrument could give rise to a breach of natural
justice.51
The same principles about lawful conduct will apply in review proceedings
commenced in the High Court under s 75(v) of the Constitution or in the Federal
Court under s 39B of the Judiciary Act 1903 (Cth). An important difference, however,
is that review proceedings of this kind can extend to decisions made by an officer of
the Commonwealth in the exercise of pure (that is, non-statutory) executive power.
The restriction imposed by the Administrative Decisions (Judicial Review) Act—that
the decision to be reviewed was ‘made under an enactment’—does not apply, and
50
51
Re Drake and Minister for Immigration and Ethnic Affairs (No. 2) (1979) 2 ALD 634; Drake v Minister for
Immigration and Ethnic Affairs (1976) 46 FLR 409, 420.
Minister for Immigration, Local Government and Ethnic Affairs v Gray (1994) 50 FCR 189. See also Salemi
v MacKellar (No. 2) (1977) 137 CLR 396; Henzell v Centrelink [2006] FCA 1844 in relation to legitimate
expectation.
14
Administrative accountability in business areas subject to complex and specific regulation
there is consequently greater scope for seeking review of a decision to either make or
administer a non-statutory soft law instrument.
The jurisdiction of the Administrative Appeals Tribunal (and, generally, of other
tribunals) is restricted to decisions made under legislation, in respect of which a right
of appeal is conferred.
There is no similar restriction on the jurisdiction of the Commonwealth
Ombudsman, the Privacy Commissioner or the Australian Human Rights
Commission. Each can investigate administrative actions that have been taken
pursuant to either legislation or an executive instrument (such as a soft law
instrument) made or administered by a government agency.
The Council’s consultations confirmed that, despite their non-binding character, soft
law ‘guidelines’, ‘practice notes’, and so on, developed by government agencies are
treated in practice little differently from black letter law. Some of those consulted
said that only people with ‘deep pockets’ would be in a position to mount a legal
challenge to the validity of soft law produced by government agencies.
Administrative accountability and non-government soft law
Apart from the exceptions to the general rule under the Privacy Act and human
rights legislation, soft law administered by industry bodies and other nongovernment entities falls completely outside the scope of administrative law.
The basis for accountability for primary soft law materials—codes, and so on—
derives substantially from sources other than administrative law, business entities
binding themselves to compliance with standards and obligations set out in selfregulatory instruments. In these circumstances failure to comply with soft law could
have legal consequences for individuals and corporations. An example of this is
found in the statutory scheme whereby superannuation trustees agree to be bound
by decisions of the Superannuation Complaints Tribunal, thereby enabling the trust
to obtain the benefit of particular tax concessions.52
Self-regulatory schemes feature a range of non–administrative law accountability
mechanisms designed to foster compliance on the part of their members and to
provide for people whose interests are affected a means of redress. These include
peer review systems such as the Takeovers Panel and the Disciplinary Tribunal of the
Australian Securities Exchange, industry-based dispute-resolution schemes, codes of
practice or codes of ethics, customer service charters, and internal complaintresolution mechanisms.
Although they differ in important respects from administrative law review
mechanisms, soft law accountability and review mechanisms can be consistent in
important respects with the administrative law values of lawfulness, fairness,
rationality, openness (or transparency) and efficiency.
52
Attorney-General (Cth) v Breckler (1999) 197 CLR 83.
Administrative accountability in business areas subject to complex and specific regulation
15
The Council does not consider it would necessarily be effective or efficient to seek to
extend administrative law review mechanisms to these areas of co- and selfregulation. It would, however, be reasonable to assume that such soft law rules
should give rise to an appropriate form of accountability. This was also the
prevailing view put forward during the Council’s consultations.
16
4
Administrative accountability in business areas subject to complex and specific regulation
Accountability: monitoring and review
mechanisms in areas of co- and selfregulation
In this chapter the Council looks at a number of the review mechanisms available to
people or businesses whose rights or interests are or are likely be affected in an
individual manner by a decision made by an industry body or other nongovernment entity. A right of review is just as important in these circumstances as it
is for a regulatory decision by a government agency. The chapter focuses particularly
on the extent to which each review mechanism reflects the administrative law values
of lawfulness, fairness, rationality, openness (or transparency) and efficiency.
The examples used illustrate the extensive and complex monitoring and review
mechanisms that exist to ensure the appropriate application of business rules.
Among these mechanisms are the following:

the peer review systems used by the Australian Securities Exchange53 and the
Takeovers Panel54

self-regulatory codes of conduct, including ASIC-approved industry codes of
conduct55

external review systems, including those approved by ASIC56

the Financial Ombudsman Service Limited57

the Telecommunication Industry Ombudsman.58
‘Peer review’ can be described as the examination of one member’s performance or
practices by another or by other members of the group.
The Australian Securities Exchange
Under its market rules—a form of soft law—and pursuant to powers delegated by its
board59, the ASX has established a Disciplinary Tribunal that, although constituted
under the market rules, is independent of the ASX.60
53
54
55
56
57
58
See <http://www.asx.com.au/>.
See <http://www.takeovers.gov.au/>.
See <http://www.asic.gov.au/asic/ASIC.NSF/byHeadline/Codes%20of%20practice>.
See
<http://www.asic.gov.au/asic/asic.nsf/byheadline/Complaints+resolution+schemes?openDocu
ment>.
See <http://www. http://www.fos.org.au/centric/home_page.jsp> for information about the
divisions of the Financial Ombudsman Service.
See <http://www.tio.com.au/>.
Administrative accountability in business areas subject to complex and specific regulation
17
The tribunal is vested with responsibility, through a peer review process, for hearing
and determining alleged breaches of ASX rules by market participants and
allegations of unprofessional conduct on the part of stockbrokers.
For proceedings before it the tribunal is constituted from a panel of at least
10 industry professionals nominated by the ASX, taking into account their
qualifications, skills and experience. Panel members must abide by a code of ethics
that covers matters such as integrity, fairness, independence, conflicts of interest and
confidentiality. They must also attend training courses designed to deepen their
understanding of how tribunal hearings are conducted and what is expected of
members of the tribunal in making determinations and imposing penalties on their
peers.
Tribunal proceedings are initiated by the ASX following an internal investigation.
The broker in question is entitled to appear before the tribunal.
The ASX has borrowed key elements from administrative law in establishing the
Disciplinary Tribunal and deciding that the tribunal is to handle its proceedings in a
way that accords procedural fairness to those who come before it.
Panel members are to be independent of the ASX group that instigates proceedings
before the tribunal and are to have a good understanding of financial markets and
their operation. The broker against whom the allegations are made, must be given
full particulars of the alleged misconduct, has a right to be heard, and has a right of
appeal. Disciplinary Tribunal members are required to determine each matter on its
merits.
Among the penalties that can be imposed by the Disciplinary Tribunal are censure,
suspension, participating in an education or compliance program, and fines. Tribunal
determinations are made public. An appeal tribunal, chaired by a leading barrister
and independent of the ASX, hears appeals against decisions of the Disciplinary
Tribunal.
Details of all disciplinary matters are published on the ASX website. This includes
details of the penalty imposed, how the breach occurred, and the actions taken by the
named party since identification of the breach.
59
60
ASX Market Rules 28.3.2 and 28.3.7 set out the powers the tribunal can exercise.
In Chapmans v Australian Stock Exchange (1996) 67 FCR 402 it was held that a decision by the ASX
under its listing requirements to delist a company from the exchange was not a reviewable decision
made under an instrument. The court held that it was not enough that the exchange, originally a
private body, had been given statutory recognition under the then Securities Act 1980 (Cth).
18
Administrative accountability in business areas subject to complex and specific regulation
The Takeovers Panel
The Takeovers Panel is the primary forum for resolving disputes about a takeover
bid until the bid period has ended. The panel is a peer review body, its part-time
members being appointed from among the active members of Australia’s takeovers
and business communities.61
The panel is established under s 171 of the Australian Securities and Investments
Commission Act 2001 (Cth). It is given various powers under Part 6.10 of the
Corporations Act 2001 (Cth). Its primary power is to declare when circumstances in
relation to a takeover or to the control of an Australian company are unacceptable. It
also has the power to make orders to protect the rights of people (especially target
company shareholders) during a takeover bid and to ensure that a takeover bid
proceeds (as far as possible) in the way it would have proceeded had the
unacceptable circumstances not arisen.
The panel reviews ASIC decisions to grant exemptions and modifications to Chapter
6 (Takeovers) of the Corporations Act as it applies to a takeover bid. This function
replaces merits review by the Administrative Appeals Tribunal.
Panel members are appointed on the strength of their knowledge or experience in at
least one of the fields of business, administration of companies, financial markets,
financial products and services, law, economics and accounting.62
When a matter is referred to it, the panel must decide whether it will initiate
proceedings in relation to the matter. If it decides to do so, the substantive president
of the panel appoints three members to be the ‘sitting panel’. The panel (constituted
by different members) also reviews its own decisions, in which event the review
decision is final. In each case review is of the merits of the decision, which may be
affirmed, varied, set aside and substituted, or set aside and sent back for
reconsideration.
The panel makes soft law rules that govern its proceedings. Although the rules of
evidence do not apply, the panel is bound to follow the rules of procedural fairness
(to the extent that they are not inconsistent with the panel’s legislation63) and has
power to ensure the confidentiality of information that is commercially sensitive.64
Panel proceedings must be fair and reasonable and be conducted with as little
formality and in as timely a manner as the law and proper consideration of matters
before the panel permit.65
61
62
63
64
65
A useful insight into the Panel’s powers is provided in the recent decision of the High Court in
Attorney-General (Cth) v Alinta Limited (2008) 82 ALJR 382.
Australian Securities and Investments Commission Act 2001 (Cth), s 172(4).
ibid., s 195(4). The rules are available at
<http://www.takeovers.gov.au/display.asp?ContentID=122>.
Australian Securities and Investments Commission Act 2001 (Cth), ss 186, 190.
Australian Securities and Investments Commission Regulations 2001 (Cth), r 13. One study found
that over five years decisions of the panel took an average of a little over two weeks—see Emma
Armson, ‘An empirical study of the first five years of the Takeovers Panel’, Sydney Law Review,
vol. 27, no. 4 December 2005, pp. 665, 676.
Administrative accountability in business areas subject to complex and specific regulation
19
The panel publishes statements of reasons for its decisions. A distinctive feature of its
operations has been the frequent practice of accepting undertakings rather than
making declarations of unacceptable circumstances and/or orders.66
Proceedings are primarily determined on written submissions. The panel may,
however, convene a conference. It has significant powers at a conference, including
powers to take evidence on oath, subpoena witnesses, examine witnesses and
subpoena documents.
The panel also has power to make rules clarifying and supplementing Chapter 6 of
the Corporations Act.67 It issues guidance notes on how it will exercise its powers;
this includes guidance on consultation procedures and merits review, public
consultation and conflict of interest.68 The guidance notes have been said to give the
market greater certainty, deal with important matters, and help panel members make
decisions in a timely, consistent and predictable way.
Accountability in takeovers is achieved through the authority of a specialist review
body, where actions of the regulatory agency and parties to takeovers are explained
and justified to those who have the knowledge to understand and evaluate the
actions.69
Industry codes and dispute resolution
In areas of business regulation the co-regulatory interconnections between selfregulatory mechanisms and government legislation can be complex. This is well
illustrated by the scheme for approving voluntary codes.
ASIC approval and monitoring of voluntary financial services sector codes of
conduct
The Corporations Act and the ASIC Act establish a framework for the approval and
monitoring by ASIC of financial services industry codes of conduct. Development of
codes by industry is wholly voluntary, the benefit being in their endorsement by
ASIC.
To be approved, a code must meet the requirements set out in ASIC Regulatory
Guide 183, Approval of Financial Services Sector Codes of Conduct.70 Among the nonlegislative matters that may be taken into account by ASIC in approving a code are
whether the code provides for adequate dispute-resolution procedures, remedies and
66
67
68
69
70
Armson, op. cit., p. 680. Decisions of the panel are also subject to judicial review, albeit that judicial
review in the Federal Court is limited in certain circumstances. The jurisdiction of the High Court
under s 75(5) is expressly preserved (and could not, of course, have been limited in any event by
parliament).
This power exists under s 658C of the Corporations Act 2001 (Cth).
Available at <http://www.takeovers.gov.au/display.asp?ContentID=122>.
See, generally, Armson, op. cit.
Corporations Act 2001 (Cth) s 912A and ASIC Regulatory Guide 183, issued 23 February 2005 and
amended 4 March 2005.
20
Administrative accountability in business areas subject to complex and specific regulation
sanctions.71 There are at present no ASIC-approved industry codes under the
Corporations Act, although there have been in the past.72
Additionally, under s 12A(3) of the ASIC Act, ASIC has the function of monitoring
and promoting market integrity and consumer protection in relation to the payments
system. Two ways of doing this are by promoting the adoption of approved industry
standards and codes of practice and by promoting sound customer–banker
relationships, including through monitoring the operation of and compliance with
industry codes of practice.
This monitoring and promotional role supports ASIC’s role in administering the
Electronic Funds Transfer Code of Conduct, which became ASIC’s responsibility in
1998 in response to the recommendations of the Financial System Inquiry.73 Clause 24
of the code provides for regular review by ASIC.
Other industry codes
Among the voluntary industry codes in the financial area are the Financial Planning
Code of Ethics and Rules of Professional Conduct74, the General Insurance Code of
Conduct75, the General Insurance Brokers Code of Conduct76, the Code of Banking
Practice77, and the Credit Union Code of Practice.78
Many industry associations, such as the Financial Planning Association of Australia,
the Australian Financial Markets Association, and Investment and Financial Services
Australia, have developed codes of ethics and conduct to be adhered to by members
as a condition of membership of the organisation. The codes are reviewed regularly
and updated to reflect current market conditions.
71
72
73
74
75
76
77
78
Regulatory Guide 183.62–183.72.
The General Insurance Code of Practice was approved by ASIC on 3 August 2000 under s 12FA of
the ASIC Act (which was repealed and replaced by s 1101A of the Corporations Act in 2001). See
ASIC Information Release, ‘ASIC approves general insurance code of practice and insurance
enquiries and complaints scheme’, 3 August 2000. The code was revised in 2005, and the revised
code was implemented in 2006. Following discussions with ASIC, the Insurance Council of
Australia decided not to seek approval for the revised code under the Corporations Act.
Financial System Inquiry, Financial System Inquiry Final Report, Australian Government Publishing
Service, Canberra, 1997.
See <http://www.fpa.asn.au/FPA_Content.aspx?Doc_id=1032>.
See <http://www.asic.gov.au/fido/fido.nsf/byheadline/
General+Insurance+Code+of+Practice+fido+page?opendocument>.
See <http://www.asic.gov.au/fido/fido.nsf/byheadline/
General+Insurance+Brokers’+Code+of+Practice?opendocument>.
See <http://www.bankers.asn.au/Default.aspx?ArticleID=446> .
See <http://www.abacus.org.au/credit_unions/docs/CodePractice.pdf>.
Administrative accountability in business areas subject to complex and specific regulation
21
Financial Planning Association
The Financial Planning Association Code of Ethics covers topics such as integrity,
competence, fairness, confidentiality and objectivity, and the Rules of Professional
Conduct complement the code by promoting high standards of professional
behaviour.79
The Professional Standards and Ethics Committee monitors compliance with the
code. Alleged breaches are investigated by FPA staff and, where appropriate, are
referred to a disciplinary committee for hearing and determination.
Sanctions include fines, suspension and expulsion from membership. Consumers
may take claims for financial loss suffered as a result of a breach of FPA professional
standards to the Financial Industry Complaint Service. Disciplinary powers derive
from the FPA constitution, to which a financial planner agrees to be bound on joining
the association.
The FPA board strives to be accountable to its members by ensuring that the
association’s governance structure and decision-making processes are transparent,
open and inclusive, so that members can be confident that the association works for
their benefit.
Australian Financial Markets Association
The Australian Financial Markets Association codes80 cover topics such as reputation,
confidentiality, fairness, honesty and conflicts of interest. The codes apply to all
member organisations and their representatives, who agree to abide by them in the
conduct of their business. The code of ethics raises members’ awareness of the
relevant considerations and promotes responsible decision making; the code of
conduct identifies rules of behaviour to be followed by members in their business
dealings. Observance of the codes is monitored by the AFMA Self-Regulatory
Committee.
Investment and Financial Services Association
The Investment and Financial Services Association represents the retail and
wholesale funds management, superannuation and life insurance industries and has
over 145 members. All members must comply with the IFSA code of ethics and
conduct81 and commit to adapting the standards of conduct for use more generally in
their own organisations.
The code covers matters such as integrity, fairness, competence and conflicts of
interest. Members self-report on compliance with the IFSA code and standards. Each
year members must lodge with IFSA a resolution of their board confirming that it is
satisfied the member has complied with the code and all other IFSA standards that
79
80
81
The code, rules and other standards are available at <http://www.fpa.asn.au>.
Available at <http://www.afma.com.au>
The code and other standards are available at <http://www.ifsa.com.au>. The code was updated
with effect from 1 July 2007.
22
Administrative accountability in business areas subject to complex and specific regulation
are relevant to the organisation’s business. Failure to lodge the resolution is itself a
breach of the code.
Compliance with the code is monitored by peer review. The Standards Oversight
Disciplinary Committee, comprising three members of the IFSA board, can take
disciplinary action against a member who fails to comply with a standard. The
penalties include private or public censure, suspension of membership and expulsion
from membership. There is a right of appeal to the full IFSA board. IFSA reports that
to date it has investigated potential breaches of the code, but the committee has not
yet had occasion to discipline any member.
Summary
These examples show that industry associations take self-regulation seriously. They
have developed systems designed to ensure that their governing bodies and staff are
accountable to members, both in establishing codes and standards to which members
agree to be bound and in monitoring and enforcing compliance with those codes and
standards. The systems strongly resonate with well-established administrative law
processes and draw to a large extent on administrative law values.
Monitoring and external review
Most codes have associated dispute-resolution schemes for use in circumstances
where people believe an industry code has been breached. The Motor Vehicle
Insurance and Repair Industry Code of Conduct82 is illustrative.
Although mandated by legislation in New South Wales, in other Australian
jurisdictions the code is a voluntary national code that applies to all smash repairers
and insurance companies that subscribe to it. The code is intended to promote
transparent, informed, effective and cooperative relationships between smash
repairers and insurance companies, based on mutual respect and open
communication.
The code is administered by the Code Administration Committee, which, among
other things, is charged with the task of developing a protocol for the appointment,
establishment and operation of a national panel of mediators, monitoring compliance
with the code, and producing a publicly available annual report on the code; a copy
of the annual report must be provided to the relevant Australian government
minister.
The code provides for two stages of dispute resolution. In the first instance disputes
should be raised under internal dispute resolution. Should a dispute not be resolved
in this way, the code provides for an external dispute-resolution process, which is
available through the LEADR group of mediators. The process rests on the provision
of full written details of the matters in dispute and supporting evidence of the
concern and the redress sought.
82
See <http://www.abrcode.com.au/>.
Administrative accountability in business areas subject to complex and specific regulation
23
Dispute-resolution schemes
Corporations that provide financial services or sell financial products are required to
be members of one or more external dispute-resolution schemes. To date, ASIC has
approved eight such schemes, although three have now merged to form the Financial
Ombudsman Service.83
The considerations ASIC is required to take into account when determining whether
to approve an external dispute-resolution scheme are set out in the Corporations
Regulations84 and are expanded on in ASIC Regulatory Guide 139, Approval of
External Complaints Resolution Schemes.
In order to gain approval a scheme must produce decisions that are fair and seen to
be fair by observing the principles of procedural fairness, by making decisions on the
information before it, and by having specific criteria on which its decisions are based.
The ASIC Regulatory Guide incorporates the key principles set out in the Benchmarks
for Industry-based Customer Dispute Resolution Schemes85—consistency with the
requirements outlined in the regulations, accessibility, independence, fairness,
accountability, efficiency and effectiveness.
The guide supplements the principles in certain respects: in relation to decision
making, it specifies that as a general rule written reasons should be given for a
decision and that, in reaching a decision about a complaint, a scheme should not be
entitled to rely on information that is not available to all parties.86
It is also the responsibility of an external dispute-resolution scheme to identify
systemic problems and to specify time frames for internal review of complaints with
reference to the time frames specified in the Australian Standard ‘Customer
Satisfaction—guidelines for complaints handling in organisations’ (ISO 10002: 2004,
MOD). The scheme must also publish its determinations and information about
complaints, highlighting any systemic industry problems, and conduct periodic
independent reviews of the scheme’s performance; a period of three years is
specified in the guidelines.
83
84
85
86
The Financial Ombudsman Service resulted from the ASIC-approved merger of the Insurance
Ombudsman Service, the Banking and Financial Services Ombudsman and the Financial Industry
Complaints Service Ltd. The other approved schemes are the Credit Ombudsman Service Limited,
the Credit Union Dispute Resolution Centre, the Financial Co-operative Dispute Resolution
Scheme, and the Insurance Brokers Disputes Ltd. If all the services provided by a corporation are
covered by the statutory Superannuation Complaints Tribunal it is not necessary for the
corporation to join an approved scheme.
Corporations Regulations 2001 (Cth), r 7.6.02.
Department of Industry, Science and Tourism, Benchmarks for Industry-based Customer Dispute
Resolution Schemes, DIST, Canberra, 1997.
See ASIC Regulatory Guide 139, Approval of External Complaints Resolution Schemes, RG 139.47.
24
Administrative accountability in business areas subject to complex and specific regulation
The Financial Ombudsman Service
The Financial Ombudsman Service was established on 1 July 2008 through the ASICapproved merger of the Insurance Ombudsman Service, the Banking and Financial
Services Ombudsman and the Financial Industry Complaints Service Ltd. It consists
of three divisions, covering the previous jurisdiction of the three services.87
The Investments, Life Insurance and Superannuation Division Rules88 set out the
principles of fairness that are to guide resolution of consumer complaints handled
under the scheme. The principles include resolving complaints in accordance with
the law in a cooperative, efficient and timely way. They make provision for the
exchange of information between the parties to the complaint, stipulate that
complaints be in writing and be supported by any relevant documents, and allow for
assistance with drafting and lodging a complaint.
The process involves conciliation and, if this is unsuccessful, referral to a panel or an
adjudicator. Proceedings are inquisitorial, the panel or the adjudicator is not bound
by the rules of evidence, and the rules of procedural fairness apply. Except where
inappropriate—in the case of suspected fraud, for example—the panel or adjudicator
must issue written reasons for their decisions.
Before approaching the Financial Ombudsman Service a complainant must have
unsuccessfully sought review of their decision by the relevant scheme member. The
rules require members’ internal processes to comply with the Australian Standard
‘Customer Satisfaction—guidelines for complaints handling in organisations’ (ISO
10002: 2004, MOD). The processes must also be consistent with any relevant ASIC
guidelines.
The Banking and Finance Division89 handles disputes primarily between banks and
consumers and involving amounts of $280 000 or less. Disputes are to be decided
having regard to applicable law, industry codes or guidelines, good industry practice
and fairness in all the circumstances. If a dispute relates to privacy, the Banking and
Finance Ombudsman may make any decisions the Privacy Commissioner may make
under s 52 of the Privacy Act 1988 (Cth).
Case managers investigate disputes and issue findings. The parties to a dispute may
accept the finding or appeal to the Banking and Finance Ombudsman to review the
decision and make a recommendation. The ombudsman also has power to make a
determination that is contractually binding on the scheme member if the disputant
accepts the determination. There has, however, been no need for the ombudsman to
exercise this power to date.
Generally, disputes are resolved on findings made by case managers. There are very
few appeals. Case managers also examine and resolve problems (systemic problems)
raised in a dispute referred to the Banking and Finance Division that appear to affect
87
88
89
See <http://www.fos.org.au/centric/home_page/about_us/terms_of_reference.jsp>.
New rules with increased monetary limits for complaints came into effect on 1 July 2008.
The division currently has 106 members.
Administrative accountability in business areas subject to complex and specific regulation
25
other customers of the scheme member, in addition to the disputant. The division
reports quarterly to ASIC on its activities.
The Telecommunications Industry Ombudsman Scheme
The Telecommunications Act 1997 (Cth) provides that, with the Telecommunications
Industry Ombudsman’s consent, an industry code or standard may confer functions
or powers on the ombudsman.90 Some of the matters that may be dealt with in codes,
including the internal handling of complaints, are listed in the Act.91
Registration of a code by the Australian Communications and Media Authority is
subject to, among other things, a balancing of public interest considerations against
the potential for the imposition of undue financial and administrative burdens on
industry participants.92 With matters of substantial relevance to the community, the
authority must be satisfied that there are appropriate community safeguards for the
matters covered by the code.93
The office of the Telecommunications Industry Ombudsman is established under the
Telecommunications (Consumer Protection and Service Standards) Act 1999 (Cth). Certain
carriers and carriage service provides must enter into the scheme, while membership
must be open to all. All members must comply with the scheme.94
The activities of the TIO are guided by the principles of accessibility, independence,
fairness, accountability, efficiency and effectiveness, as set out in the Benchmarks for
Industry-Based Customer Dispute Resolution Schemes. In practical terms this translates
to the following objectives:

ready access to the TIO’s services by individual consumers

independence from all parties at all times

decision making that is fair and seen to be fair

accountability in decision making—including the provision of clear and
reasonable explanations for all actions and decisions

adherence to processes that are efficient, clear and understandable as well as fair
and equitable

maintenance of fair and accurate records.
90
Telecommunications Act 1997 (Cth), s 114.
ibid., s 113.
ibid., s 112(2).
ibid., s 111(1)(d).
See Part 6 of the Act.
91
92
93
94
26
Administrative accountability in business areas subject to complex and specific regulation
Guidance is also derived from the law, good industry practice and what is fair and
reasonable in all the circumstances.95 The TIO publishes position statements setting
out its approach to investigating and resolving particular complaints.96
95
96
See <http://www.tio.com.au/POLICIES/organisation%20culture%20%objectives.htm>.
See <http://www.tio.com.au/policies/indexc.htm>.
Administrative accountability in business areas subject to complex and specific regulation
5
27
Accountability: development and
monitoring
In this chapter the Council considers methods of achieving accountability that are
consistent with administrative law values although not, in themselves, elements of
the Australian system of administrative law. Accountability in this context covers
situations in which the development or application of a business rule could affect
individuals or businesses but not in an individual manner.
For regulation in the form of black letter law, in addition to relying on administrative
review mechanisms, broad accountability can also be achieved through the
parliamentary process, including through review by parliamentary committees and
through the tabling requirements of the Legislative Instruments Act 2003 (Cth).
Consultation on policy and its means of implementation is another important
method of ensuring administrative accountability and transparency in the
development of business rules.97 During the Council’s stakeholder forums and
discussions with interested parties, consultation was consistently raised as a vital
element in the development of business rules, be they in the form of legislation or
soft law. As the Council said in its report Rule Making by Commonwealth Agencies:
… consultation prior to law making is consistent with the principles of
procedural fairness as it enables individuals and groups with a particular
interest to put their views. It serves the public interest by enabling decisions
to be made in the light of competing interests and requires government to
account for its proposals. In the final analysis, rules made following
consultation are likely to be more considered and better for having been
exposed to the community before being made. 98
Longstanding consultation requirements for government policy departments
developing legislative policy are set out in the Cabinet Handbook and the Legislation
Handbook.99
The Legislation Handbook recognises that external consultation will not be required in
all circumstances. Consultation would not normally be necessary in relation to
proposed legislation altering fees or benefits only in accordance with the Budget,
proposed legislation that would contain only minor machinery provisions not
fundamentally altering existing legislative arrangements, or proposed legislation in
97
98
99
‘Road testing’ regulations encourages effective and efficient regulation.
Administrative Review Council, Rule Making by Commonwealth Agencies, Report no. 35, ARC,
Canberra, 1992, [5.2].
Department of the Prime Minister and Cabinet, Cabinet Handbook, 5th edn, DPM&C, Canberra,
March 2004, [5.1–5.14]. (Cabinet approval must be obtained for all significant policy proposals
involving legislation.) Commonwealth of Australia, Legislation Handbook, 1999 (incl. update of
1 May 2000), Canberra, [1.7–1.11].
28
Administrative accountability in business areas subject to complex and specific regulation
relation to which consultation would give a person or organisation consulted an
advantage over others not consulted.100
As noted in Chapter 2, there are also requirements for consultation under the
Legislative Instruments Act if the proposed instrument is likely to have a direct or a
substantial indirect effect on business or restrict competition.101 Failure to consult
does not affect the validity of the legislative instrument.102
Consultation in relation to business regulation
Despite the existence of these mechanisms, there was clear acknowledgment in
Rethinking Regulation of the need for effective consultation with regulated parties at
all stages in the development of regulations.103 That report stated that the majority of
business groups saw existing consultation practices as ‘the most important deficiency
in regulation making’.104 Efficient consultation is not simply a process: it has an
important qualitative aspect and a capacity for those consulted to affect decisions by
regulators.
Following publication of Rethinking Regulation, the previous Australian government
made a commitment to improving mechanisms for consultation with business and
supporting consultation on the development of business rules with all relevant
stakeholders105—an approach maintained by the current Government.106
The approach involves adoption of a whole-of-government policy on consultation
and is set out in the Best Practice Regulation Handbook, developed by the Office of Best
Practice Regulation. It is envisaged that the nature of consultation about business
rules should be commensurate with the size and potential impact of the proposal107,
and the handbook lists seven best-practice principles—continuity, targeting,
appropriate timeliness, accessibility, transparency, consistency and flexibility, and
evaluation and review by policy agencies—to be applied in the development of
business rules.108
Three consultation mechanisms have also been generated for application in the
development of business rules—annual regulatory plans, a business consultation
website109, and green papers and exposure drafts.110 The requirements extend to soft
100
101
102
103
104
105
106
107
108
109
Legislation Handbook, op. cit., [1.10].
Section 17(1). Section 18 provides an exception to this rule in circumstances where consultation may
be unnecessary or inappropriate. Possible exceptions include instruments of a minor or machinery
nature and that do not substantially alter existing arrangements, instruments required as a matter
of urgency and instruments required because of an matter of national security, and instruments
giving effect to certain matters referred to in the Budget.
Section 19.
Rethinking Regulation, op. cit., p.147.
ibid., p. 150.
Re-thinking Regulation: Australian government response, op. cit.
See speech by the Hon Lindsay Tanner, op. cit.
Office of Best Practice Regulation, Best Practice Regulation Handbook, OBPR, Canberra, August 2007
[4.1].
ibid., [1.3].
See <http://consultation.business.gov.au/consultation/>.
Administrative accountability in business areas subject to complex and specific regulation
29
law materials produced by government agencies. As noted, the Council’s
consultations suggest that the development of soft law is taken seriously by agencies.
Rethinking Regulation highlights three useful consultation guides—a 2002 Board of
Taxation report that identifies a number of principles for effective tax consultation111,
the UK Government’s 2004 Code of Practice on Consultation112, and the International
Council of Securities Associations’ Statement on Consultation Practices.113
The Government’s business consultation requirements represent a more targeted
version of the UK code, which applies to all public consultations involving UK
government departments and agencies. Conversely, the requirements apply more
widely than the principles in the Board of Taxation report or the International
Council of Securities Associations statement.
Other best-practice regulation requirements
The best-practice consultation strategy is an element of a larger ‘post–Rethinking
Regulation’ strategy; in it, government has mandated a three-tier system for assessing
regulation.
Administered by the Office of Best Practice Regulation, the strategy makes provision
for limited analysis for proposals with no or low compliance costs, quantification of
business compliance costs for proposals entailing medium compliance costs, and indepth analysis (involving preparation of a regulation impact statement) for proposals
that will have a significant impact on business, individuals or the economy.
Both legislation and soft law materials with a likely impact on business are required
by government to comply with the best-practice guidelines.
Consultation in relation to soft law regulation developed by
industry bodies and others
The measures just described do not extend to soft law materials developed by
industry bodies and other non-government entities. Consultation is, however,
equally critical in these areas, at the very least to ensure the credibility of the scheme
and to identify what needs to be dealt with, including the broader social or public
policy objectives. The consultation should cover the revision and amendment of soft
law materials, not only their initial development.
110
111
112
113
Office of Best Practice Regulation, op. cit., [4.1 – 4.5].
Board of Taxation, Government Consultation with the Community on the Development of Taxation
Legislation: a report to the Treasurer and the Minister for Revenue and Assistant Treasurer, BOT, March
2002, <http://www.taxboard.gov.au/content/review.asp>.
See <http://www.cabinet-office.gov.uk/regulation/consultation/code.htm. The code is currently
under review—see Cabinet Office, Effective Consultation, Cabinet Office, London, December 2007,
<http://www.consultations.gov.uk>.
International Council of Securities Associations, Statement on Regulatory and Self-Regulatory
Consultation Practices, ICSA, October 2004,
<http://www.icsa.bz/html/statements_and_letters.html>.
30
Administrative accountability in business areas subject to complex and specific regulation
In some instances in areas of co-regulation, consultation is required by policy or
legislation. An example of it being required by policy is ASIC Regulatory Guide 183,
Approval of Financial Services Sector Codes of Conduct, which sets out a number of
actions that should be taken in the development of a code for the financial services
sector. These include at the outset identifying all relevant stakeholders, effectively
consulting with stakeholders to identify the matters at issue and debate suitable
responses, and adopting transparent procedures such as issuing a discussion paper,
recommendations and/or a draft code for public consultation.114
When assessing a code for registration, the Australian Communications and Media
Authority must be satisfied that the public, industry, the Australian Competition and
Consumer Commission, the Telecommunications Industry Ombudsman, a consumer
representative organisation and, for privacy codes, the Privacy Commissioner have
all been consulted.115
The Council sees value in the development of a set of government-endorsed
benchmarks setting out best-practice guidelines for consultation in the development
of self-regulatory codes and other instruments.116
Drafting of regulatory materials
The clarity with which a regulation is drafted is central to ensuring its effectiveness
and efficiency.
Rigorous drafting standards are applied by the Commonwealth Office of the
Parliamentary Counsel when drafting statutes and by the Office of Legislative
Drafting and Publishing in the Commonwealth Attorney-General’s Department
when drafting regulations. Measures are also included in the Legislative Instruments
Act to encourage high drafting standards for legislative instruments (s 16).
During the Council’s consultations agencies said they have checks and balances to
ensure that soft law materials are well drafted and that lawyers are involved, at least
in an overseeing role. One agency said there are 39 steps in its soft law development
process; another said its business rules can take up to 15 months to develop.
Nonetheless, soft law business rules are drafted in agencies and, unlike legislative
instruments, there is usually no requirement for them to be tabled in parliament for
consideration by the Scrutiny of Bills Committee. In the absence of these safeguards,
the Council’s consultations confirmed the view that adequate consultation with
stakeholders is a crucial part of the development of clear and intelligible business
rules.
The Taskforce on Industry Self Regulation recognised the need for clear drafting of
soft law for the purposes of self-regulation, concluding, ‘As a general rule …
114
115
116
See ASIC Regulatory Guide 183, op. cit., 183.51.
Telecommunications Act 1997 (Cth), s 117(1)(f)–(k).
The Industry Benchmarks for Industry-based Customer Dispute Resolution Schemes, op. cit., provide a
precedent for this.
Administrative accountability in business areas subject to complex and specific regulation
31
standards in a self-regulatory scheme ought to be specific and written in a plain and
easy to understand manner’. The taskforce considered this ‘would ensure that
consumers understand their rights and industries understand their obligations’ and
that ‘clarity in the documentation will also assist dispute schemes interpret legal
rights’.117
During the Council’s consultation process several forum participants noted that
some soft law rules could be extremely technical and impenetrable. The situation
was said to be improving, though, there being increasing use of lawyers with
expertise in drafting and a familiarity with the relevant area of business to oversee
the drafting process. Other forum participants suggested that their codes and other
soft law materials were developed with great care and a considerable degree of
consultation.
It was also noted that soft law rules are relatively easy to amend if they are found not
to be working in the way intended. This is undoubtedly the case, but the Council
considers this should not ‘open the door’ to less than rigorous drafting standards. It
is essential that all forms of regulation be clearly drafted in plain language, so that
business understands its obligations and those whose interests are affected
understand their rights. It is also essential that soft law business rules be regularly
reviewed and updated and that they be internally consistent.
Further, in view of the evolving nature of business regulation, the Council considers
it important that soft law business rules be subject to regular review to ensure their
continuing effectiveness.
Internal and external monitoring of business rules
Government monitoring
On some occasions contentious legislation or legislation that is perhaps traversing
new areas can be made subject to a sunset clause.118 Provision can also be made for
review of legislation after a specified period of operation.119 Under s 50 of the
Legislative Instruments Act, with some exceptions, instruments automatically cease
10 years after their date of commencement or registration.120
Monitoring can also be done in other ways. For instance, the Integrity Advisor
established by the Australian Taxation Office advises on matters such as:
117
118
119
120
Industry Self-regulation report, op. cit., p. 66.
A sunset clause is a safeguard and an accountability measure allowing legislation to be reviewed
and re-enacted at a nominated time.
The Anti-Terrorism Act (No. 2) 2005 (Cth) states that the provisions allowing for the issuing of
control and preventative detention orders are subject to a 10-year sunset clause. The Act also
provides for review of Schedules to the Act by the Council of Australian Governments after five
years. Section 59 of the Legislative Instruments Act provides for review of the operation of that Act
after three years.
As part of the current review of the Act, the Review Committee has been asked to consider
recommendation 7.26 of the Rethinking Regulation report, which recommends reducing the sunset
time frame from 10 years to five following implementation.
32
Administrative accountability in business areas subject to complex and specific regulation

compliance with the law—tax law and other law such as administrative law

conformity with government and ATO policies

upholding and promoting the Australian Public Service Values and conforming
with the Code of Conduct

meeting standards of professionalism, including compliance with the Taxpayers’
Charter.
Non-government monitoring
Provision for periodic review is also made in industry business rules.
The Council’s consultations revealed strong endorsement of this practice and clear
recognition of the importance of ensuring that rules continue to reflect community
and professional standards and current government legislation. The Rethinking
Regulation report said monitoring of self-regulation was ‘essential to ensure that it is
still relevant to the industry addressing specific problems and improving market
outcomes’.121
The Council’s consultations confirmed that such processes exist in many selfregulatory areas. For example, it is a condition of approval by ASIC of financial
services sector codes of conduct that such codes be independently reviewed at no
more than three-year intervals. The review process must entail seeking stakeholders’
views on the operation of the code.122
As noted, ASIC Regulatory Guide 139, Approval of External Dispute Resolution Schemes,
requires codes to include provision for independent review of the operation and
procedures of schemes at least every three years.123 The requirement is accordingly
reflected in clause 5.3(c) of the Constitution of the Financial Ombudsman Service,
which requires the directors of the service to commission independent reviews of the
operations and procedures of the service’s dispute-resolution scheme to meet
obligations under the Corporations Act.
Provision is made under the General Insurance Code of Practice for monitoring
compliance with the code and its operations by the Insurance Brokers’ Compliance
Council and for a formal review of the code by the council in consultation with
government, consumers and the industry every three years.
The code administration committee established under the Motor Vehicle Insurance
and Repair Industry Code of Conduct was charged with conducting an initial
internal review of the operation of the code 12 months after its commencement on
121
122
123
Industry Self-regulation report, op. cit., p. 6.
ASIC Regulatory Guide 183, 183.79–81. The consultation requirements outlined in 183.51 must be
followed.
Regulatory Guide 139.92–94.
Administrative accountability in business areas subject to complex and specific regulation
33
1 December 2006.124 After that time the code provides for external review every three
years.125
124
125
The Committee’s Motor Vehicle and Repair Industry Code of Conduct 2007 annual report
incorporates this review—see <http://www.abrcode.com.au/>.
See <http://www.abrcode.com.au/>.
34
6
Administrative accountability in business areas subject to complex and specific regulation
Availability of and adaptations to merits
review
In this chapter the Council responds to its terms of reference by considering the
circumstances in which merits review should be available for decisions by
government decision makers in business areas subject to complex and specific
regulation and the adaptations that might be made to merits review processes to
make them more effective and efficient.
What is merits review?
In making decisions on the merits, a tribunal takes into account law, facts and policy.
Merits review requires the tribunal to determine the correct or preferable decision,
taking account of the law, the facts and any relevant policy. In arriving at its
decision, a tribunal is often said to ‘stand in the shoes’ of the decision maker.
Another feature of merits review is, however, that it is often de novo, which means
that the tribunal may make its decision on the basis of new material that was not
before the original decision maker.
The nature of merits review in the Administrative Appeals Tribunal was recently the
subject of detailed consideration by the High Court, which held that, in determining
what was the correct or preferable decision, the tribunal was not restricted to a
consideration of the events up to the date on which the primary decision maker had
made its decision but could consider subsequent events.126
The right to apply for merits review of a decision must be specifically assigned by
legislation. In this sense, legislation can restrict the types of decisions that are
reviewable or place conditions on the right to review. Not all tribunals are explicitly
given the power by legislation to conduct a de novo merits review, although, unless
specified otherwise, there will be that capacity.127
What decisions should be subject to merits review?
The Legislation Handbook requires that policy-making departments consult with the
Administrative Review Council via the Commonwealth Attorney-General’s
Department if legislation has implications for administrative review.128
The Council’s views on the types of decisions that should be subject to merits review
are set out in What Decisions Should Be Subject to Merits Review?129 This guideline
126
127
128
Shi v Migration Agents Regulation Authority [2008] HCA 31, particularly Kiefel J [140–1] and Crennan
J [117]. See also Kirby J [30–42] and Hayne and Heydon JJ [117].
For further discussion of merits review, see Robin Creyke, in Matthew Groves, H P Lee (eds),
Australian Administrative Law, Fundamentals, Principles and Doctrines, 2007, ch. 5.
Commonwealth of Australia, Legislation Handbook, 1999, op. cit., [4.8]. See also [6.33].
Administrative accountability in business areas subject to complex and specific regulation
35
publication is widely relied on by government departments and agencies when they
are developing legislation with administrative law implications.
As a matter of principle, the Council considers that a decision that will or is likely to
affect the interests of a person should be subject to merits review. This view is
limited only by the small category of decisions that are, by their nature, unsuitable
for merits review and by particular factors that might justify excluding merits review
of a decision that otherwise meets the Council’s test.
In What Decisions Should Be Subject to Merits Review? the Council identifies two types
of decisions it considers unsuitable for merits review:

legislation-like decisions of broad application—which are subject to the
accountability safeguards that apply to a legislative decision

decisions that automatically follow from the occurrence of a set of
circumstances—which leaves no room for merits review to operate.130
The Council also identifies a number of decisions for which the exclusion of merits
review might be justified. These include preliminary or procedural decisions131,
decisions allocating a finite resource between competing applicants132, and policy
decisions of high political content.133
The Council includes in this grouping financial decisions with a significant public
interest and either:

a need to take rapid action to restore or maintain investor confidence in the
market
or

an aspect that makes the decision essentially a government financial policy
decision rather than a decision about the merits of a particular application.134
What Decisions Should Be Subject to Merits Review? received strong endorsement from
the Taskforce on Reducing Regulatory Burdens on Business, which recommended it
to government for use in identifying which regulatory decisions should be subject to
merits review.135
While noting the need for merits review to be ‘well targeted’ to ensure that it ‘does
not restrict the ability of regulators to respond to major risks such as systemic
instability’136, the taskforce supported the availability of independent ‘merit review
129
130
131
132
133
134
135
136
Administrative Review Council, What Decisions Should Be Subject to Merits Review?, ARC, Canberra,
1999.
ibid., [3.3– 3.7].
ibid., [4.3 – 4.7].
ibid., [4.11 – 4.19].
ibid., [4.22 – 4.30].
ibid., [4.34 – 4.38].
Rethinking Regulation, op. cit., p. 93. See also rec. 5.7.
ibid., p. 93.
36
Administrative accountability in business areas subject to complex and specific regulation
of any administrative decisions that can significantly affect the interests of
individuals or enterprises’137 and noted, ‘Merit review by an independent third party
not only enhances the accountability of regulators, it can also promote better decision
making over time and increase business confidence’.138
The taskforce considered that, where feasible, straightforward review mechanisms
and provision for the timely resolution of disputes would promote greater
transparency and consistency in administrative decision making and engender
confidence in financial and corporate regulatory regimes.139
It recommended the availability of merits review for decisions of APRA, ASIC and
the Reserve Bank of Australia.140 What Decisions Should Be Subject to Merits Review?
was subsequently relied on by government when developing the merits review
framework for APRA decisions provided for in the Financial Sector Legislation
Amendment (Review of Prudential Decisions) Act 2008 (Cth).
Many regulatory decisions—for example, in the telecommunications and the trade
practices areas141—can have a significant impact on individual business enterprises.
The Council’s review of complex business regulation suggests that there could be
regulatory areas such as these where review of the extent to which merits review is
and should be available would be timely.
Adaptations to merits review processes
An important consideration in relation to the use of review mechanisms is that they
do not, of themselves, result in the imposition of unnecessary red tape or additional
burdens on business.
The Council’s terms of reference also require it to consider ‘the adaptations, if any,
that may be desirable to merits review processes to maximise the efficiency and
effectiveness of such processes’.
In dealing with this question, the Council focused on the flexibility of the concept of
merits review and on the range of tribunal practices and procedures that can be
brought to bear in the review of decisions in business areas subject to complex
regulation.
Flexibility, comparatively informal procedures, and an ability to tailor proceedings to
the needs of applicants are features of tribunals.142 Additionally, as a general rule,
137
138
139
140
141
142
ibid., p. 163.
ibid.
ibid.
ibid., p. 163, rec. 5.7.
The taskforce considered that the minimal comments it received in relation to the ACCC were a
consequence of other reviews having recently taken place—for example, the Review of the
Competition Provisions of the Trade Practices Act and the Exports and Infrastructure Taskforce’s
Rethinking Regulation review.
See speech by the Attorney-General, the Hon Robert McClelland MP, to the 11th Annual Australian
Institute of Judicial Administration Tribunals Conference, Surfers Paradise, 6 June 2008.
Administrative accountability in business areas subject to complex and specific regulation
37
tribunals are not bound by the formal rules of evidence, and their proceedings are
less formal than those of a court.
A tribunal vested with full merits review powers is usually required to take a more
investigative approach. The findings of fact the tribunal makes ‘are those that it,
rather than the claimant, and let alone adversarial parties, considers to be necessary
for it to make its decision’.143 Tribunals can also obtain evidence before, during and
after a hearing.144
This is counterbalanced by the frequent requirement that a tribunal operate in a way
that is fair, just, economical, informal and quick. The investigative nature of many
tribunal proceedings does not mean that there is no burden of proof on applicants or
government agencies. Furthermore, evidence must be probative and generally must
meet the civil standard of proof.145
Tribunal flexibility
The Administrative Appeals Tribunal illustrates the flexibility that can be achieved
within administrative tribunals. The AAT has jurisdiction under more than 400 Acts
and legislative instruments; this includes jurisdiction in many complex and
specialised areas.
The AAT’s efficiency, flexibility and responsiveness to this large and varied remit
was enhanced in 2005 by a number of amendments to the Administrative Appeals
Tribunal Act. The idea underlying the amendments was that, within its statutory
obligation to be ‘fair, just, economical, informal and quick’, it was for the AAT to
determine in each case how that was to be achieved.
The 2005 amendments provided for an expansion of the powers of the president of
the tribunal in order to facilitate more effective case management, expansion of the
range of alternative dispute-resolution processes available to the tribunal, removing
restrictions on the constitution of the tribunal for particular hearings, and giving the
president greater flexibility in managing the tribunal’s workload. The AAT Act gives
the tribunal the power to limit the scope of a review by limiting ‘the questions of fact,
the evidence and the issues’ it considers.146
The Council’s consultations revealed the importance people attach to the level of
expertise available among members of tribunals. For example, several of those the
Council consulted were strongly of the view that the specialised Australian
Competition Tribunal had the expertise to hear the matters assigned to it.
143
144
145
146
SZFDE v Minister for Immigration and Multicultural Affairs v Wang (2003) 215 CLR 518 at 540–1 [71].
Section 33(1)(c) of the Administrative Appeals Tribunal Act authorises the tribunal to ‘inform itself
on any matter in such manner as it thinks appropriate’.
For further discussion of merits review, see Robin Creyke, op. cit., p. 77. See also Administrative
Review Council, Decision Making: evidence, facts and findings, Best-practice Guide 3, ARC, Canberra,
2007.
Administrative Appeals Tribunal Act 1975 (Cth), s 25(4A).
38
Administrative accountability in business areas subject to complex and specific regulation
The importance of the availability of specialist tribunal members for certain
categories of reviews—such as reviews involving difficult technical, legal, medical,
actuarial or scientific matters—has long been recognised.147 Among other categories
of reviews that might require adjustments to be made to the constitution (and
procedures) of merits review tribunals are reviews with a potentially significant
impact on government revenue and reviews of unusual public importance or
involving complex questions of law and/or fact.148
The capacity exists to appoint to the Administrative Appeals Tribunal people with
diverse expertise, and this does in fact occur. This is something, however, that the
AAT, as a tribunal of general jurisdiction, continues to promote. Where de novo
merits review is available, it is important to ensure that tribunal members have not
only the relevant expertise but also the capacity to deal with the potentially high
level of detail.
Legislative adaptations to merits review
Legislative adaptations such as the following can also be made to merits review
processes:

imposing preconditions on the availability of review processes

specifying the individuals or entities that may apply for review

limiting the grounds on which review may be sought

imposing time limits on applications for merits review and on tribunals in the
conduct of reviews

precluding consideration by a tribunal of any matter that was not raised before
the original decision maker

tailoring the powers and remedies available on review

specifying the evidence the review body may take into account.
Some of these adaptations were raised for consideration by the Ministerial Council
on Energy in its May 2006 Review of Decision-making in the Gas and Electricity
Regulatory Frameworks. They are reflected in the approach to merits review
subsequently adopted in the National Gas Law, set out in the Schedule to the
National Gas (South Australia) Act 2008. That law is to be mirrored in the legislation of
all other states and territories apart from Western Australia.149
147
148
149
Steering Committee for the Review of the Administrative Appeals Tribunal, Report of the Review of
the Administrative Appeals Tribunal, SCRAAT, Canberra, 1991, [6.84].
ibid. [6.63–6.82].
Western Australia has developed complementary legislation to give effect to the National Gas
Law—see <http://www.aph.gov.au/library/Pubs/bd/2007-08/08bd092.htm>.
Administrative accountability in business areas subject to complex and specific regulation
39
The Council’s views
The Council takes the view that the approach adopted in relation to the
Administrative Appeals Tribunal—that of providing to the tribunal itself the
flexibility to adapt its procedures to the particular needs of each hearing—is
generally preferable to inflexible legislative limitations.
Legislative adaptations to merits review processes have the potential sometimes to
jeopardise the ultimate objective of merits review, which is correct or preferable
decision making. For example, in the interest of preventing delays and speeding up
hearings, legislative limits can be imposed on the documents that can be reviewed by
a tribunal. This can, however, result in the parties seeing no other option but to
present a mass of evidence before the regulator in the first instance in order to cover
every conceivable argument that might be raised.
Practical difficulties can also arise at the primary decision-making stage if limitations
are imposed on the materials to which the parties may refer but those limitations do
not apply to submissions that may subsequently be presented to the tribunal in
conducting a merits review of the decision reached. In such a circumstance there is
an incentive for a complainant not to state their position fully at the primary
decision-making stage.
Although they encourage tribunals to deal with matters expeditiously, time limits on
tribunals’ handling of reviews might also reduce tribunal effectiveness and
efficiency. Time limits that are too tight can place pressure on the parties in relation
to drafting submissions, and so on, and the tribunal, faced with insufficient time to
carry out a comprehensive review of all the matters raised, might provide only
limited direction to business or the regulator.
Some project participants expressed support for the limitations that exist in the
Australian Competition Tribunal to review on the record. Consistent with its
approach in What Decisions Should Be Subject to Merits Review?, however, the Council
considers that in most instances full de novo merits review is appropriate.150 If
tribunal review is limited to review on the record, there is a concern that agencies
could be swamped with materials for consideration in the first instance. This would
be inefficient. The Council acknowledges, though, that in some situations where the
making of a decision has been preceded by an extensive inquiry process this may
provide a legitimate basis for excluding merits review. As noted in What Decisions
Should Be Subject to Merits Review?, processes such as public inquiries and
consultations requiring the participation of many people would come within this
category.151 In such circumstances, tribunal review of the subsequent decision might
become unwieldy and time-consuming.
150
151
This approach coincides with that in the recent decision of the High Court in Shi v Migration Agents
Registration Authority [2008] HCA 31. See especially Kirby J [41–42] and Hayne and Heydon JJ [98–
101].
What Decisions Should Be Subject to Merits Review?, op. cit., [4.53–4.55].
40
7
Administrative accountability in business areas subject to complex and specific regulation
Concluding comments
The terms of reference for this project require the Council to consider and report on
the most effective and efficient administrative accountability mechanisms for
decisions in areas of complex and specific business regulation. In particular, the
Council was asked to consider the following:

the circumstances in which administrative review mechanisms should be
available

the adaptations, if any, that may be desirable to merits review processes to
maximise their efficiency and effectiveness

the potential for the development of a framework of guideline principles for
administrative review

any other relevant matters.
A framework of guideline principles
The Council encapsulates its response to the terms of reference in the framework of
guideline principles and recommended actions set out in the summary of this report.
To foster the most effective and efficient accountability mechanisms for regulation
across the business spectrum, the principles advocate the application of
administrative law values to business rules at the development, application,
monitoring and review stages, regardless of whether the rules have been developed
and applied by government agencies, industry bodies or other non-government
entities.
The principles also reflect the Council’s opinion that accountability mechanisms
should be responsive to the regulatory environment. Where individual rights or
entitlements are affected, the principles suggest that administrative law review
mechanisms, or other redress mechanisms consistent with administrative law values,
should be available. The mechanisms used in co- and self-regulated areas should be
consistent with the nature of that form of regulation.
Where there is no potential for individual rights or entitlements to be directly
affected, the principles suggest that other accountability processes—such as adequate
consultation, sound drafting, and regular monitoring and review—might be
sufficient.
Consultation requirements are already embedded in areas subject to regulation by
government agencies through black letter law and soft law. The guideline principles
suggest that similar consultation requirements should be adopted in areas subject to
regulation by industry bodies and other non-government entities.
Administrative accountability in business areas subject to complex and specific regulation
41
Specific matters
The Council’s view on the specific matters raised for consideration in the terms of
reference can be summarised as follows.
The Council does not propose any changes to the availability of administrative
review mechanisms in areas of complex business regulation. The current
mechanisms apply to a large number of decisions, especially those made by
government agencies when applying both black letter and soft law business rules.
The mechanisms do not generally apply to some other categories of decisions—such
as decisions made by industry bodies or non-government entities under co- and selfregulatory schemes. Other review mechanisms directed at the protection of
individual rights that operate in those areas can, however, play a similar role in the
effective and efficient upholding of administrative law values. Among such
mechanisms are peer review, enforcement of industry codes, and industry disputeresolution schemes.
In relation to any adaptations to merits review processes that might be desirable to
maximise the efficiency and effectiveness of such processes, the Council considers
that existing merits review and Administrative Appeals Tribunal processes are
sufficiently adaptable and accordingly makes no suggestion for change.
In the interests of effectiveness and efficiency, the Council considers that the
government should encourage industry bodies and other non-government entities to
develop an equivalent to the consultation requirements applicable to black letter law
and government soft law materials under the Australian Government’s Best Practice
Guidelines. Those consultation requirements should apply to non-government soft
law business rules.
Additionally, the drafting of all business rules should be of a high standard, and the
rules should be subject to regular review by people who have expertise in drafting
and are familiar with the business area in question.
Administrative accountability mechanisms should also be subject to regular
monitoring, to ensure that they are working effectively and efficiently and that they
remain appropriate having regard to evolving business environments.
All these views are reflected in the Council’s framework of guideline principles and
recommended actions.
42
Administrative accountability in business areas subject to complex and specific regulation
Appendix A
Organisations consulted and
submissions received
The Council held consultations with and/or received submissions from the
following organisations:

ACT Independent Competition and Regulatory Commission

Administrative Appeals Tribunal

Australian Communications and Media Authority

Australian Competition and Consumer Commission

Australian Competition Tribunal

Australian Direct Marketing Association

Australian Energy Market

Australian Prudential Regulation Authority

Australian Securities and Investments Commission

Australian Securities Exchange

Australian Taxation Office

Banking and Financial Services Ombudsman

Business Council of Australia

Choice

Department of Finance and Deregulation

Department of the Treasury

Department of Water and Energy—New South Wales

Energy and Water Ombudsman—Victoria

Energy Safe Victoria

Essential Services Commission

First State Super

Franchise Council of Australia

Group of 100 Secretariat

Independent Pricing and Regulatory Tribunal of New South Wales

Institute of Chartered Accountants

Insurance Council of Australia

Investment and Financial Services Association

Law Council of Australia

Office of Best Practice Regulation

Office of the Commonwealth Ombudsman

Standards Australia

Superannuation Complaints Tribunal

Taxation Institute of Australia
Administrative accountability in business areas subject to complex and specific regulation

Telstra

The Association of Super Funds
43
44
Administrative accountability in business areas subject to complex and specific regulation
Appendix B
Section 51 of the Administrative
Appeals Tribunal Act
Section 51 of the Administrative Appeals Tribunal Act 1975 describes the functions and
powers of the Administrative Review Council:
(1) The functions of the Council are:
(aa) to keep the Commonwealth administrative law system under review,
monitor developments in administrative law and recommend to the
Minister improvements that might be made to the system; and
(ab) to inquire into the adequacy of the procedures used by authorities of
the Commonwealth and other persons who exercise administrative
discretions or make administrative decisions, and consult with and
advise them about those procedures, for the purpose of ensuring that
the discretions are exercised, or the decisions are made, in a just and
equitable manner; and
(a) to ascertain, and keep under review, the classes of administrative
decisions that are not the subject of review by a court, tribunal or
other body; and
(b) to make recommendations to the Minister as to whether any of those
classes of decisions should be the subject of review by a court,
tribunal or other body and, if so, as to the appropriate court, tribunal
or other body to make that review; and
(c) to inquire into the adequacy of the law and practice relating to the
review by courts of administrative decisions and to make
recommendations to the Minister as to any improvements that might
be made in that law or practice; and
(d) to inquire into:
(i) the qualification required for membership of authorities of the
Commonwealth, and the qualifications required by other
persons, engaged in the review of administrative decisions; and
(ii) the extent of the jurisdiction to review administrative decisions
that is conferred on those authorities and other persons; and
(iii) the adequacy of the procedures used by those authorities and
other persons in the exercise of that jurisdiction;
and to consult with and advise those authorities and other persons
about the procedures used by them as mentioned in subparagraph
(iii) and recommend to the Minister any improvements that might be
Administrative accountability in business areas subject to complex and specific regulation
made in respect of any of the matters referred to in subparagraphs
(i), (ii) and (iii); and
(e) to make recommendations to the Minister as to the manner in which
tribunals engaged in the review of administrative decisions should
be constituted; and
(f) to make recommendations to the Minister as to the desirability of
administrative decisions that are the subject of review by tribunals
other than the Administrative Appeals Tribunal being made the
subject of review by the Administrative Appeals Tribunal; and
(g) to facilitate the training of members of authorities of the
Commonwealth and other persons in exercising administrative
discretions or making administrative decisions; and
(h) to promote knowledge about the Commonwealth administrative law
system; and
(i) to consider, and report to the Minister on, matters referred to the
Council by the Minister.
(2) The Council may do all things necessary or convenient to be done for or
in connexion with the performance of its functions.
(3) If the Council holds an inquiry, or gives any advice, referred to in
paragraph (1)(ab), the Council must give the Minister a copy of any
findings made by the Council in the inquiry or a copy of the advice, as
the case may be.
45