Essential Services Commission Amendment Act 2008
Essential Services Commission Amendment Act
2008
No. 15 of 2008
TABLE OF PROVISIONS
Section Page
1 Purpose 1
2 Commencement 1
3 Section 1 substituted—Purpose 2
1 Purpose 2
4 Amendment of section 4—Determinations in relation to
regulated industries 2
5 Section 8 substituted and new section 8A inserted 2
8 Objective of the Commission 2
8A Matters which the Commission must have regard to 3
6 Repeal of provisions relating to specific functions 4
7 Amendment of section 14—Commission must publish Charter 4
8 Amendment of section 28—Meetings of the Commission 4
9 Amendment of section 33—Price determinations 5
10 Amendment of section 34—Other regulatory powers 6
11 New Part 3A inserted—Third Party Access Regimes 6
PART 3A—THIRD PARTY ACCESS REGIMES 6
35A Object of Part 6
35B Application of Part 6
35C Pricing principles applying in respect of regulated
access prices 7
35D Time limit for determinations relating to third party
infrastructure access regimes 8
12 Section 36 substituted—Application of Part 9
36 Application of this Part 9
13 New section 36A inserted—Commission must have regard to
certain matters 10
36A Commission must have regard to certain matters 10
14 Amendment of section 37—General power to obtain
information and documents 10
15 New section 37A inserted—Provision of information relating
to regulated entities 11
37A Provision of information relating to regulated entities 11
16 Amendment of section 38—Restriction of disclosure of
confidential information 11
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Section Page
17 Amendment of section 41—Minister may refer matter for
inquiry 12
18 New section 41A inserted—Minister may limit use of powers
under section 37 12
41A Minister may limit use of powers under section 37 12
19 Amendment of section 42—Notice of inquiry 13
20 Section 44 repealed—Powers relating to inquiries 13
21 New Part 6 inserted—Codes of Practice 13
PART 6—CODES OF PRACTICE 13
47 Power to make Codes of Practice 13
48 Power to apply, adopt or incorporate 15
49 Regulatory scrutiny of Codes of Practice 16
50 Availability of Codes of Practice 18
51 Tabling and disallowance 19
22 Amendment of section 53—Enforcement orders 19
23 New section 54A inserted—Civil penalty 20
54A Civil penalty 20
24 Amendment of section 55—Right of appeal 21
25 Amendment of section 56—Appeal panel 22
26 Amendment of section 66—Review 23
27 Consequential amendment of the Rail Corporations
Act 1996 23
28 Consequential amendment of the Water Industry Act 1994 23
29 Repeal of Amending Act 23
═══════════════
ENDNOTES 24
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Victoria
Essential Services Commission
Amendment Act 2008†
No. 15 of 2008
[Assented to 23 April 2008]
The Parliament of Victoria enacts:
1 Purpose
The purpose of this Act is to amend the Essential
Services Commission Act 2001 to improve the
operation of the Act following a review of the Act
in accordance with section 66 of the Act.
2 Commencement
(1) Subject to subsection (2), this Act comes into
operation on a day or days to be proclaimed.
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(2) If a provision of this Act does not come into
operation before 1 July 2009, it comes into
operation on that day.
3 Section 1 substituted—Purpose
For section 1 of the Essential Services
Commission Act 2001 substitute—
See:
Act No.
62/2001.
Reprint No. 2
as at
10 May 2007
and
amending
Act No.
70/2007.
LawToday:
www.
legislation.
vic.gov.au
"1 Purpose
The purpose of this Act is to enable the
Essential Services Commission to perform
the regulatory and advisory functions that are
conferred on the Commission in a manner
that provides incentives for dynamic,
productive and allocative efficiency and
promotes the long term interests of Victorian
consumers.".
4 Amendment of section 4—Determinations in
relation to regulated industries
(1) In section 4(2)(c) of the Essential Services
Commission Act 2001 for "section 34."
substitute "section 34;".
(2) After section 4(2)(c) of the Essential Services
Commission Act 2001 insert—
"(d) decisions or classes of decisions of the
Commission under the powers conferred by
the Order that are to be determinations for
the purposes of this Act.".
5 Section 8 substituted and new section 8A inserted
For section 8 of the Essential Services
Commission Act 2001 substitute—
"8 Objective of the Commission
(1) In performing its functions and exercising its
powers, the objective of the Commission is
to promote the long term interests of
Victorian consumers.
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(2) Without derogating from subsection (1), in
performing its functions and exercising its
powers in relation to essential services, the
Commission must in seeking to achieve the
objective specified in subsection (1) have
regard to the price, quality and reliability of
essential services.
8A Matters which the Commission must have
regard to
(1) In seeking to achieve the objective specified
in section 8, the Commission must have
regard to the following matters to the extent
that they are relevant in any particular case—
(a) efficiency in the industry and incentives
for long term investment;
(b) the financial viability of the industry;
(c) the degree of, and scope for,
competition within the industry,
including countervailing market power
and information asymmetries;
(d) the relevant health, safety,
environmental and social legislation
applying to the industry;
(e) the benefits and costs of regulation
(including externalities and the gains
from competition and efficiency) for—
(i) consumers and users of products
or services (including low income
and vulnerable consumers);
(ii) regulated entities;
(f) consistency in regulation between
States and on a national basis;
(g) any matters specified in the
empowering instrument.
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(2) Without derogating from section 8 or
subsection (1), the Commission must also
when performing its functions and exercising
its powers in relation to a regulated industry
do so in a manner that the Commission
considers best achieves any objectives
specified in the empowering instrument.".
6 Repeal of provisions relating to specific functions
(1) Sections 10A and 10B of the Essential Services
Commission Act 2001 are repealed.
(2) In section 3 of the Essential Services
Commission Act 2001, the definitions of
insurance, insurance business, insurance
industry and statutory insurer are repealed.
(3) Section 37(5A) of the Essential Services
Commission Act 2001 is repealed.
7 Amendment of section 14—Commission must
publish Charter
In section 14(1) of the Essential Services
Commission Act 2001 after "determinations"
insert "and other regulatory decisions".
8 Amendment of section 28—Meetings of the
Commission
After section 28(4) of the Essential Services
Commission Act 2001 insert—
"(4A) The Commission may transact any of its
business at a meeting at which the
Commissioners or any of the Commissioners
participate by audio link or audio visual link.
(4B) A Commissioner who participates in a
meeting in accordance with subsection (4A)
is to be taken to be present at the meeting.
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(4C) For the purposes of subsection (4A)—
audio link means facilities (including
telephone) that enable audio
communication between persons at
different locations;
audio visual link means facilities (including
closed-circuit television) that enable
audio and visual communication
between persons at different
locations.".
9 Amendment of section 33—Price determinations
For sections 33(3) and 33(4) of the Essential
Services Commission Act 2001 substitute—
"(3) In making a determination under this section,
the Commission must have regard to—
(a) the particular circumstances of the
regulated industry and the prescribed
goods and services for which the
determination is being made;
(b) the efficient costs of producing or
supplying regulated goods or services
and of complying with relevant
legislation and relevant health, safety,
environmental and social legislation
applying to the regulated industry;
(c) the return on assets in the regulated
industry;
(d) any relevant interstate and international
benchmarks for prices, costs and return
on assets in comparable industries;
(e) any other factors that the Commission
considers relevant.
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(4) In making a determination under this section,
the Commission must ensure that—
(a) the expected costs of the proposed
regulation do not exceed the expected
benefits; and
(b) the determination takes into account
and clearly articulates any trade-offs
between costs and service standards.".
10 Amendment of section 34—Other regulatory powers
In section 34(2) of the Essential Services
Commission Act 2001 after "determination"
insert "or other regulatory decision".
11 New Part 3A inserted—Third Party Access Regimes
After Part 3 of the Essential Services
Commission Act 2001 insert—
"PART 3A—THIRD PARTY ACCESS REGIMES
35A Object of Part
The object of this Part is to promote the
economically efficient operation of, use of
and investment in, the infrastructure by
means of which services are provided,
thereby promoting effective competition in
upstream and downstream markets.
35B Application of Part
This Part applies to a regulated industry
which has an access regime.
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35C Pricing principles applying in respect of
regulated access prices
The pricing principles relating to the price of
access to a service are—
(a) that regulated access prices should—
(i) be set so as to generate expected
revenue for a regulated service or
services that is at least sufficient
to meet the efficient costs of
providing access to the regulated
service or services; and
(ii) include a return on investment
commensurate with the regulatory
and commercial risks involved;
and
(b) that the access price structures
should—
(i) allow multi-part pricing and price
discrimination when it aids
efficiency; and
(ii) not allow a vertically integrated
access provider to set terms and
conditions that discriminate in
favour of its downstream
operations, except to the extent
that the cost of providing access to
other operators is higher; and
(c) that access pricing regimes should
provide incentives to reduce costs or
otherwise improve productivity.
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35D Time limit for determinations relating to
third party infrastructure access regimes
(1) Subject to this section, if the Commission
has been provided with sufficient
information, the Commission must make a
determination relating to a third party
infrastructure access regime within 6 months
after receiving the application or proposal.
(2) The Commission may in accordance with
subsection (3) suspend the time limit
applying under subsection (1) for a period
not exceeding 2 months if—
(a) the Commission does not have
sufficient information and any
reasonable request for further
information has not been complied
with; or
(b) further time is required to enable
consultation with third parties and the
public; or
(c) any other ground specified in the
guidelines applies.
(3) If the Commission proposes to suspend the
time limit applying under subsection (1), the
Commission must—
(a) notify—
(i) the Minister and the parties by
notice in writing; and
(ii) the public by a notice published in
a daily newspaper circulating
generally in Victoria;
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(b) specify in the notice—
(i) the reason why the time limit is
being suspended; and
(ii) the date by which the Commission
proposes to use its best
endeavours to make a decision on
the application or proposal.
(4) The Commission may suspend the time limit
applying under subsection (1) by a further
period not exceeding 2 months if the
Commission—
(a) first obtains the approval of the
Minister; and
(b) complies with subsection (3).
(5) Despite subsection (2)(a), the Commission
may make a determination within the time
limit applying under subsection (1) on the
information available to the Commission if
the service provider of a significant
infrastructure facility has not provided the
further information requested within the
specified period.".
12 Section 36 substituted—Application of Part
For section 36 of the Essential Services
Commission Act 2001 substitute—
"36 Application of this Part
Subject to any provisions to the contrary in
any relevant legislation, this Part applies to
or in respect of any information or document
that is provided to the Commission.".
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13 New section 36A inserted—Commission must have
regard to certain matters
After section 36 of the Essential Services
Commission Act 2001 insert—
"36A Commission must have regard to certain
matters
In exercising the powers conferred on the
Commission under this Part, the Commission
must have regard to—
(a) the relevance of the information or
document; and
(b) the estimated compliance costs.".
14 Amendment of section 37—General power to obtain
information and documents
(1) For section 37(1) of the Essential Services
Commission Act 2001 substitute—
"(1) If the Commission considers that it is
necessary to do so for the purposes of
performing its functions or exercising its
powers, the Commission may require a
person that the Commission has reason to
believe has any relevant information or
document to provide that information or
document to the Commission.
(1A) For the purposes of subsection (1), the
Commission may require the person to
appear before the Commission to provide the
information or document.".
(2) After section 37(2)(c) of the Essential Services
Commission Act 2001 insert—
"(ca) whether or not the person is required to
appear before the Commission; and".
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15 New section 37A inserted—Provision of information
relating to regulated entities
After section 37 of the Essential Services
Commission Act 2001 insert—
"37A Provision of information relating to
regulated entities
(1) A regulated entity must provide information
relating to the regulated entity requested by
the Commission by written notice to the
Commission in the manner and form
specified in the notice.
(2) If information relating to a regulated entity is
held by a third party, the Commission may
require the regulated entity to enter into an
arrangement with the third party under which
the third party is to provide the information
to the Commission.
(3) The Commission may specify the kind or
class of information which a regulated entity
must maintain for the purposes of this
section in a Code of Practice.".
16 Amendment of section 38—Restriction of disclosure
of confidential information
(1) In section 38(1)(a) of the Essential Services
Commission Act 2001 for "44" substitute "37A".
(2) After section 38(1) of the Essential Services
Commission Act 2001 insert—
"(1A) Before the Commission makes a decision
under subsection (2), the Commission
must—
(a) give the person giving the information
or document an opportunity to make a
submission to the Commission
specifying—
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(i) why the information or document
is of a confidential or
commercially-sensitive nature;
and
(ii) the detriment that would be
caused by the disclosure of the
information or document; and
(b) consider any submission made by that
person.".
17 Amendment of section 41—Minister may refer
matter for inquiry
After section 41(1) of the Essential Services
Commission Act 2001 insert—
"(1A) The Minister is responsible for referring any
matter to the Commission for an inquiry
unless relevant legislation provides that the
Minister administering the relevant
legislation may refer a matter to the
Commission for an inquiry.
(1B) Before referring a matter to the Commission
for an inquiry, the Minister must consult
with any Minister who has responsibilities in
respect of that matter.".
18 New section 41A inserted—Minister may limit use
of powers under section 37
After section 41 of the Essential Services
Commission Act 2001 insert—
"41A Minister may limit use of powers under
section 37
If any inquiry is to be conducted into a
matter that does not relate to a regulated
industry, the Minister may give the
Commission specific directions in respect of
the conduct of the inquiry which limit the
use of the powers conferred on the
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Commission under section 37 in the manner
specified in the specific directions.".
19 Amendment of section 42—Notice of inquiry
After section 42(2) of the Essential Services
Commission Act 2001 insert—
"(2A) The Commission may specify in the notice
under subsection (2) that if a submission is
not received within the period specified
under subsection (2)(c), the Commission
may decide not to consider the submission.".
20 Section 44 repealed—Powers relating to inquiries
Section 44 of the Essential Services Commission
Act 2001 is repealed.
21 New Part 6 inserted—Codes of Practice
After Part 5 of the Essential Services
Commission Act 2001 insert—
"PART 6—CODES OF PRACTICE
47 Power to make Codes of Practice
(1) The Commission may make, amend or
revoke Codes of Practice in accordance with
this Part for the purpose of performing
regulatory functions in respect of a regulated
industry.
(2) Without limiting the generality of subsection
(1), a Code of Practice may provide for any
matter relating to—
(a) requiring a specified regulated entity or
a specified class of regulated entity to
develop, issue and comply with
customer-related standards, procedures,
policies and practices (including with
respect to the payment of compensation
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to customers) in accordance with the
Code of Practice;
(b) specifying minimum customer-related
standards, procedures, policies and
practices for inclusion by a specified
regulated entity or a specified class of
regulated entity in a customer charter
for specific services;
(c) requiring a specified regulated entity or
a specified class of regulated entity to
enter into an agreement with another
specified regulated entity or another
specified class of regulated entity for
the purpose of ensuring that obligations
relating to customer-related standards
can be met;
(d) specifying principles for the negotiation
of agreements required under
paragraph (c) between regulated entities
in relation to standards and conditions
of service and supply;
(e) requiring regulated entities to maintain
specified accounting records and to
prepare accounts according to specified
principles.
(3) A Code of Practice may establish principles
giving practical guidance in relation to the
performance of the functions and the
exercise of the powers of the Commission.
(4) A Code of Practice may—
(a) impose a duty on any person;
(b) direct how any matter or thing is to be
done;
(c) create an enforceable legal right;
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(d) impose any liability or penalty,
including proportionate penalties for
failures to comply with requirements
imposed by the Code of Practice.
(5) A Code of Practice is not a determination.
(6) A reference in this Part to—
(a) a proposed Code of Practice includes a
reference to a proposed amendment to a
Code of Practice;
(b) a Code of Practice includes a reference
to an amendment to a Code of Practice.
48 Power to apply, adopt or incorporate
(1) A Code of Practice may apply, adopt or
incorporate any matter contained in any
document, code, standard, rule, specification
or method formulated, issued, prescribed or
published by any authority or body
whether—
(a) wholly or partially or as amended by
the Code of Practice; or
(b) as formulated, issued, prescribed or
published at the time the Code of
Practice is made or at any time before
then; or
(c) as formulated, issued, prescribed or
published from time to time.
(2) If a Code of Practice has applied, adopted or
incorporated any matter contained in any
document, code, standard, rule, specification
or method as formulated, issued, prescribed
or published from time to time and that
document, code, standard, rule, specification
or method is at any time amended, until the
Commission causes notice to be published in
the Government Gazette of that amendment,
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the document, code, standard, rule,
specification or method is to be taken not to
have been so amended.
(3) Without limiting the generality of subsection
(1), a Code of Practice may apply, adopt or
incorporate by reference any benchmarks,
standards or technical references.
49 Regulatory scrutiny of Codes of Practice
(1) This section applies in respect of the making
or amending of a Code of Practice under this
Part or under any relevant legislation.
(2) The Commission must prepare a regulatory
statement in respect of a proposed Code of
Practice.
(3) A regulatory statement must include—
(a) a statement of the objectives of the
proposed Code of Practice;
(b) an evaluation of the costs and benefits
of the proposed Code of Practice;
(c) an evaluation of alternative means of
achieving those objectives;
(d) a draft copy of the proposed Code of
Practice.
(4) The evaluation of the costs and benefits must
include an assessment of the economic,
environmental and social impact and the
likely administration and compliance costs
including resource allocation costs.
(5) The Chairperson must ensure the adequacy
of the regulatory statement and of the
assessment included in the regulatory
statement.
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(6) The Chairperson must ensure that a notice in
accordance with subsection (7) is published
in—
(a) the Government Gazette; and
(b) a daily newspaper circulating generally
throughout Victoria; and
(c) in any trade, professional or public
interest publications as the Chairperson
considers appropriate.
(7) A notice must—
(a) state the reason for, and the objectives
of, the proposed Code of Practice;
(b) summarise the results of the regulatory
statement;
(c) specify where a copy of the regulatory
statement and of the proposed Code of
Practice can be obtained;
(d) invite public comments or submissions
within such time (being not less than
28 days from the publication of the
notice) as is specified in the notice.
(8) The Chairperson must ensure that all
comments and submissions are considered
before the proposed Code of Practice is
made.
(9) The Chairperson must ensure that
appropriate notice is given of the decision to
make, or not to make, a proposed Code of
Practice.
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(10) Before a Code of Practice is made, the
Chairperson must give a certificate in writing
specifying—
(a) that the requirements relating to
regulatory statements have been
complied with; and
(b) that in his or her opinion the regulatory
statement adequately assesses the likely
impact of the proposed Code of
Practice.
(11) The Chairperson must ensure that a copy of
the regulatory statement and the compliance
certificate is given to the Scrutiny of Acts
and Regulations Committee of the
Parliament as soon as practicable after the
Code of Practice is made.
50 Availability of Codes of Practice
(1) Upon the making of a Code of Practice, the
Commission must cause—
(a) a copy of the Code of Practice; and
(b) a notice specifying—
(i) the date of commencement of the
Code of Practice; and
(ii) the place where copies of the
Code of Practice may be
obtained—
to be published in the Government Gazette.
(2) A Code of Practice or a provision of a Code
of Practice comes into operation at the
beginning of the day specified in the notice
under subsection (1) which must be a day
that is later than the day on which the
Government Gazette is published.
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51 Tabling and disallowance
(1) On or before the 6th sitting day after notice
of the making of a Code of Practice is
published in the Government Gazette, the
Commission must ensure that a copy of the
Code of Practice is laid before each House of
the Parliament.
(2) A failure to comply with subsection (1) does
not affect the operation or effect of the Code
of Practice but the Scrutiny of Acts and
Regulations Committee of the Parliament
may report the failure to each House of the
Parliament.
(3) A Code of Practice may be disallowed in
whole or in part by either House of
Parliament.
(4) Part 5 of the Subordinate Legislation Act
1994 applies to a Code of Practice as if—
(a) a reference in that Part to a "statutory
rule" were a reference to the "Code of
Practice"; and
(b) a reference in section 23(1)(c) of that
Part to "section 15(1)" were a reference
to "section 51(1) of the Essential
Services Commission Act 2001".".
22 Amendment of section 53—Enforcement orders
(1) In section 53(1) of the Essential Services
Commission Act 2001—
(a) in paragraph (b) for "licence—" substitute
"licence; or";
(b) after paragraph (b) insert—
"(c) a Code of Practice applying under
Part 6 or under relevant legislation—".
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(2) In sections 53(2)(a) and 53(5)(a) of the Essential
Services Commission Act 2001 for "or licence
condition" substitute ", licence condition or Code
of Practice".
23 New section 54A inserted—Civil penalty
After section 54 of the Essential Services
Commission Act 2001 insert—
"54A Civil penalty
(1) This section applies if—
(a) a person has contravened or is
contravening—
(i) a determination; or
(ii) if the Commission is under the
relevant legislation or by virtue of
an Order made under section 4
responsible for licensing, the
conditions of a licence; or
(iii) a Code of Practice applying under
Part 6 or under relevant
legislation; and
(b) the Commission considers that the
contravention is not of a trivial nature.
(2) The Commission may serve a notice on the
person—
(a) requiring the person—
(i) to cease contravening; or
(ii) if the contravention has already
occurred, to take such actions as
are specified in the notice to
rectify the contravention—
within the period specified in the
notice; and
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s. 24
(b) advising the person that if the person
fails to comply with the notice the
person is liable to pay to the
Consolidated Fund, as a pecuniary
penalty, the amount specified by the
Commission in the notice.
(3) A pecuniary penalty imposed under this
section cannot exceed an amount equal to
120 penalty units.
(4) This section does not limit the application of
section 53.".
24 Amendment of section 55—Right of appeal
(1) After section 55(1) of the Essential Services
Commission Act 2001 insert—
"(1A) For the purposes of subsection (1), a person
who represents a consumer or user group is
to be taken to be a person who is entitled to
appeal against the requirement, decision or
determination in accordance with this
section.".
(2) In section 55(3) of the Essential Services
Commission Act 2001—
(a) in paragraph (a), for "7" substitute "14";
(b) in paragraph (b), for "14" substitute "21".
(3) After section 55(4) of the Essential Services
Commission Act 2001 insert—
"(5) If a person lodges an appeal under subsection
(1)(b), the Commission must not take any
action to give effect to the decision until the
appeal is determined.
(6) If a person lodges an appeal under subsection
(1)(c), the determination continues in effect
until the appeal is determined.".
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25 Amendment of section 56—Appeal panel
(1) After section 56(2) of the Essential Services
Commission Act 2001 insert—
"(2A) When constituting an appeal panel, the
Registrar must use his or her best endeavours
to constitute the appeal panel consisting of—
(a) a chairperson who has experience in
conducting contested hearings; and
(b) at least one member who has technical
or industry experience or knowledge
relevant to the appeal.".
(2) For section 56(7)(a) of the Essential Services
Commission Act 2001 substitute—
"(a) in the case of an appeal under section
55(1)(a), may in granting the appeal—
(i) cancel the requirement; or
(ii) vary the requirement; or
(iii) set aside the requirement and remit it to
the Commission for amendment of the
requirement in accordance with the
decision and recommendations (if any)
of the appeal panel;".
(3) After section 56(9) of the Essential Services
Commission Act 2001 insert—
"(9A) Subject to subsection (10), a party to an
appeal must give an appeal panel any
information that the appeal panel may
request.".
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s. 26
26 Amendment of section 66—Review
For section 66(1) of the Essential Services
Commission Act 2001 substitute—
"(1) The Minister must ensure that a further
review of this Act is completed by
31 December 2016.".
27 Consequential amendment of the Rail Corporations
Act 1996
Division 9 of Part 2A of the Rail Corporations
Act 1996 is repealed.
28 Consequential amendment of the Water Industry
Act 1994
Sections 4F(3) and 4F(4) of the Water Industry
Act 1994 are repealed.
29 Repeal of Amending Act
This Act is repealed on 1 July 2010.
Note
The repeal of this Act does not affect the continuing operation of
the amendments made by it (see section 15(1) of the
Interpretation of Legislation Act 1984).
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Essential Services Commission Amendment Act 2008
No. 15 of 2008
Endnotes
ENDNOTES
† Minister's second reading speech—
Legislative Assembly: 13 March 2008
Legislative Council: 10 April 2008
The long title for the Bill for this Act was "A Bill for an Act to amend the
Essential Services Commission Act 2001, to consequentially amend the
Rail Corporations Act 1996 and the Water Industry Act 1994 and for
other purposes."
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