NATIONAL MEASUREMENT AMENDMENT BILL 2013 Explanatory Memorandum

Commonwealth of Australia Explanatory Memoranda

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NATIONAL MEASUREMENT AMENDMENT BILL 2013

2010-2011-2012-2013 THE PARLIAMENT OF THE COMMONWEALTH OF AUSTRALIA HOUSE OF REPRESENTATIVES NATIONAL MEASUREMENT AMENDMENT BILL 2013 EXPLANATORY MEMORANDUM (Circulated by authority of the Minister for Industry and Innovation, the Hon Greg Combet AM MP) 1

NATIONAL MEASUREMENT AMENDMENT BILL 2013 GENERAL OUTLINE The National Measurement Amendment Bill 2013 (the Bill) amends the National Measurement Act 1960 (the Act) to correct deficiencies in the trade measurement provisions that have been identified during the first two years of operation of the national trade measurement system. The proposed amendments are intended to facilitate the original intent of the Act and do not significantly expand its scope. Following a review of the State and Territory trade measurement systems, the Council of Australian Governments (COAG) determined in 2007 that a Commonwealth system of trade measurement should be introduced. Amendments to the National Measurement Act 1960 were made in December 2008 to give effect to that decision. The corresponding National Trade Measurement Regulations 2009 (the Regulations) were made in September 2009. The transition to a national system of trade measurement occurred on 1 July 2010. Further amendments to the Act were made in November 2010 to correct some unintended consequences from the translation of State and Territory trade measurement legislation into the Commonwealth legislation, and to clarify the application of strict liability offences. Under the amendments a new offence provision is introduced to ensure that trade measurement inspectors can give reasonable directions to the controllers of business vehicles so that inspections can be undertaken in accordance with the intent of the legislation. This mirrors the equivalent powers of State and Territory inspectors that were inadvertently not translated from the previous State and Territory uniform trade measurement legislation. The Bill also separates out the existing offence of repairing or adjusting an instrument without obliterating the verification mark from causing the repair or an adjustment to an instrument without obliterating the verification mark. This amendment does not penalise any additional behaviour but seeks to ensure that inappropriate behaviour can be correctly attributed to the person responsible for that behaviour. The Bill contains key amendments that provide discretion for trade measurement inspectors to allow the continued use for a limited period of measuring instruments for trade that do not meet the strict requirements of the Act where there is no material detriment to any affected person. A similar provision allows discretion for inspectors to allow for the continued sale of packaged goods for a limited period where there is no material detriment to the community. These provisions are intended to avoid overly onerous consequences for individuals or remote communities for minor technical breaches of the Act. Currently the definition of use for trade includes a measuring instrument used to determine a tax. The Bill seeks to clarify that this applies to the determination by measurement of a tax, whether or not it is the imposition of a tax or the determination of a tax credit. In addition, the Bill also contains a number of minor and technical amendments to facilitate the working of the Act. 2

FINANCIAL IMPACT STATEMENT There are no new financial impacts resulting from these amendments. 3

STATEMENT OF COMPATIBILITY WITH HUMAN RIGHTS Prepared in accordance with Part 3 of the Human Rights (Parliamentary Scrutiny) Act 2011 National Measurement Amendment Bill 2013 This Bill is compatible with the human rights and freedoms recognised or declared in the international instruments listed in section 3 of the Human Rights (Parliamentary Scrutiny) Act 2011. Overview of the Bill The Bill amends the National Measurement Act 1960 (the Act) to correct deficiencies that have been identified in the first two years of operation of the national trade measurement system. The principal objectives of the Act are to: provide for a system of verification of utility meters used for trade; establish a national system of units and standards of measurement of physical quantities; provide for the uniform use of those uniform units and standards of measurement throughout Australia; co-ordinate the operation of the national system of measurement; and provide the legal framework for a national system of trade measurement. The Bill amends the Act providing for: a discretion for trade measurement inspectors to allow the continued use of measuring instruments for trade or the continued sale of packaged goods where there is a minor technical infringement of the Act but no material detriment to any affected person; a new monitoring power that allows trade measurement inspectors to enter public areas of business premises when open for business to purchase any article for sale and collect information about trade measurement activities without having to identify himself or herself as an inspector. The purpose of this provision is to provide for trial purchases which was an effective method of investigation under the former State and Territory trade measurement legislation; a new power allowing an inspector to give a reasonable direction to the controller of a business vehicle or a person in the vehicle which may include a direction to move or drive the vehicle, remain in or leave the vehicle or unload or reload the vehicle ensuring that inspections can be practically exercised and in accordance with the intent of the legislation; a new offence provision that applies to the controller of a business vehicle or a person in the vehicle who does not comply with a reasonable direction, ensuring that inspections can be practically exercised and in accordance with the intent of the legislation; 4

a separation of the existing offence of repairing or adjusting an instrument without obliterating the verification mark from causing the repair or an adjustment to an instrument without obliterating the verification mark. This amendment does not penalise any additional behaviour but seeks to ensure that inappropriate behaviour can be correctly attributed to the person responsible for that behaviour. A number of minor and technical amendments to facilitate the working of the Act. Human Rights Implications The proposed measure engages the following human rights: The right to freedom of movement Article 12(1) of the International Convention on Civil and Political Rights (ICCPR) provides that everyone lawfully within the territory of a State shall, within that State have the right to liberty of movement and freedom to choose his residence. The power of a trade measurement inspector to give a reasonable direction to the controller of a vehicle to remain in, leave or return to the vehicle engages the right to freedom of movement. The power contained in this amendment allows a trade measurement inspector to give a reasonable direction to a controller of a business vehicle, when authorised to stop, detain and inspect the vehicle, for the purposes of exercising an inspectors existing powers of inspection under the Act. The Bill provides a reasonable direction may include a direction to the controller to remain in, leave or return to the vehicle. Failure to comply with a reasonable direction will be an offence. This may lead to an individual being temporarily restricted in their movement and will therefore constitute a limitation is placed on their right to freedom of movement under article 12 ICCPR. The right to freedom of movement is not, however, an absolute right. Article 12 provides for permissible limitations on the right to freedom of movement. Article 12(3) provides that that right shall not be subject to any restrictions except those that are provided by law, are necessary to protect national security, public order, public health or morals or the rights and freedoms of others and are consistent with the other rights recognised in the ICCPR. The Bill contains the necessary safeguards to ensure that the limitation is reasonable, necessary and proportionate to achieve a legitimate policy objective. The power of a trade measurement inspector to give a reasonable direction to remain in, leave or return to the vehicle is necessary to ensure that legitimate policy intention of trade measurement inspection can occur and allow for consumer protection. Without such a power, trade measurement inspectors may be inhibited from exercising their power to inspect a vehicle and its contents. Such inspections are a mechanism that enforces the trade measurement protections contained within the Act which in turn ensures that consumers are protected. This power is therefore necessary to ensure the protection of the rights of the community. 5

It is important to note that while the Bill will allow a trade measurement inspector to stop and detain a business vehicle in for permitted purposes, such a detention will only apply to the vehicle itself and will therefore not, by itself, restrict the movement of a person controlling the vehicle. This is because a trade measurement inspector would still need to give a reasonable direction to the controller of the vehicle to remain in, leave or return to the vehicle. Therefore, any restriction on the freedom of movement will only occur in limited circumstance. The Bill proportionately achieves the legitimate policy objective as the power of the trade inspector to give a reasonable direction will also be necessarily limited to the circumstances in which the trade measurement inspector is authorised to stop, detain and inspect a business vehicle. Currently the Act ensures that the power of an inspector to inspect a vehicle can only be carried out during a reasonable time of day and can only carried out for a permitted purpose. These purposes are to find out whether part IV,V,VI or VII of the Act has been complied with, to find out whether a condition of a servicing licence under Part X or a public weighbridge licence under Part XI has been complied with or find out whether a condition of appointment of a utility verifier under Part XIII has been complied with. The Bill provides a further safeguard against the limitation of the right as a trade measurement inspector must ensure that a vehicle is not detained for longer than is necessary and reasonable for the purpose of exercising their powers in relation to a vehicle. This means that a person can only be given a reasonable direction to remain in, leave or return to the vehicle for the limited time in which a trade measurement inspector is authorised to inspect the business vehicle. In conclusion, to the extent the Bill may limit the right to freedom of movement under article 12 of the ICCPR, this limitation is reasonable, necessary and proportionate The right to freedom from arbitrary detention The power of a trade measurement inspector to give a reasonable direction to the controller of a vehicle to remain in, leave or return to the vehicle engages the right to freedom from arbitrary detention. Article 9 of the ICCPR provides that no one shall be subjected to arbitrary arrest or detention and no one shall be deprived of his liberty except on such grounds and in accordance with such procedure as are established by law. As the power of the trade measurement inspectors may mean that a controller of a vehicle is directed to remain in, leave or return to the vehicle, this will be a limitation on the right to freedom from arbitrary detention. The right to freedom from arbitrary detention, however, can be limited when in accordance with such procedure as are established by law if the law and enforcement is not arbitrary. The law and the enforcement will not be arbitrary if it is reasonable necessary and proportionate in achieving a legitimate policy objective. As stated above, the power of a trade measurement inspector to give a reasonable direction to the controller of a vehicle to remain in, leave or return to the vehicle seeks 6

to achieve the legitimate policy intention of trade measurement inspection for the purposes of consumer protection. For the same reasons outlined above, the Bill will be: necessary to ensure that the existing power of a trade measurement inspector to inspect a vehicle and its contents can effectively be carried out; reasonable and proportionate as the Act ensures that the power of an inspector to inspect a vehicle can only be carried out during a reasonable time of day and can only carried out for a permitted purpose; necessarily limited to a period of time in which a trade measurement inspector is authorised to inspect the business vehicle; and It is also important to reiterate that when trade measurement inspector detains a vehicle, it will not automatically mean that the controller of the vehicle is detained Therefore, the limitation on the right to freedom from arbitrary detention is reasonable, necessary and proportionate. The right to privacy The power of the trade measurement inspectors to enter public areas of business premises to purchase any article for sale and collect information about trade measurement activities may engage the right to privacy. Article 17 of the ICCPR provides that no one shall be subjected to arbitrary or unlawful interference with their privacy. Privacy guarantees a right to secrecy from the public of personal information. Collecting, using, storing, disclosing or publishing personal information amounts to an interference with privacy. In order for the interference with privacy not to be arbitrary`, any interference with privacy must be in accordance with the provisions, aims and objectives of the ICCPR and should be reasonable in the particular circumstances. Reasonableness, in this context, incorporates notions of proportionality to the end sought and necessity in the circumstances. Laws that affect privacy should be precise, and not give decision- makers too much discretion in authorising interferences with privacy. The power of the trade measurement inspectors to collect information about trade measurement activities is limited to inspecting articles or packages available for sale, purchasing any article or package available for sale, inspecting or collecting written information made available to the public, discussing with anyone the features of the article or package that is available for sale and observing practices relating to the supply of an article or package for sale. In which case, the collection of personal information will only occur in the limited circumstances where an inspector collects written information made available to the public, discussing with anyone the features of the article or package that is available for sale and observing practices relating to the supply of an article or package for sale. Therefore, while it is possible for an inspector to collect personal information, it is likely this will only occur in limited circumstances. 7

These circumstances are further limited by the fact that the this power only allows measurement inspectors to enter the public area of a business, during the time that the business is open to the public and otherwise carry out functions that can be carried out by any member of the public (where any personal information collected is information that will already publically available). In addition, an individual`s privacy is safeguarded by the fact that the power of the trade measurement inspector can only be carried out for the purposes of finding out whether part IV, V, VI or VII of the Act have been complied with, to find out whether a condition of a servicing licence under Part X or a public weighbridge licence under Part XI has been complied with, or find out whether a condition of appointment of a utility verifier under Part XIII has been complied with. In addition, any collection, storage, use, disclosure or publishing of personal can only be done if consistent with the Privacy Act 1988. To the extent that personal information may be collected by a trade measurement inspector, it will be necessary, and not arbitrary, as it will be collected for the legitimate purpose of ensuring that an inspector can effectively investigate whether a particular business is compliant with the trade measurement provisions within the Act. This will in turn ensure consumer rights are protected protection. The power will be considered to be reasonable and proportionate give limited circumstances in which personal information can be collected as well as the inclusion of the above mentioned safeguards. Therefore, to the extent that the Bill allows for the collection of personal information, such an interference with privacy will be reasonable, necessary and proportionate. The right to the presumption of innocence Article 14(2) of the ICCPR provides that everyone charged with a criminal offence shall have the right to be presumed innocent until proved guilty according to law. The protections in Article 14(2) of the ICCPR only apply in criminal proceedings. Generally, consistency with the presumption of innocence requires the prosecution to prove each element of a criminal offence beyond reasonable doubt. Offence provisions which place an evidential or legal burden on the defendant in relation to a matter and no fault offences (such as strict liability offences) which allow for the imposition of criminal liability without the need to prove fault have been argued to engage the presumption of innocence. This is because offences that do not include fault offences will operate so that it is possible that the only way that a defendant can be found innocent of the offence is to positively prove that they have not committed the physical elements of the offence. This in turn shifts the burden of proof onto the defendant and will therefore be considered to be a limitation on the presumption of innocence. Article 14(2) of the ICCPR will not be violated so long as offences that reverse the burden of proof are done so in order to pursue a legitimate aim and be reasonable, necessary and proportionate to that aim. 8

One factor that is relevant to whether the reverse burden of proof is justified is whether or not the offences are regulatory rather than criminal in nature. This is because in a regulatory offence, individuals who voluntarily participate in regulated activity are deemed to have accepted certain conditions, particularly where those activities carry public health and safety risks, and to show why they are not at fault for infringements. Another relevant factor is the severity of the penalty (as per R v Johnstone [2003] UKHL 28), where the more sever the penalty, the more unlikely an offence that reverses the burden of proof can be justified. The Bill contains one new strict liability offence for a controller or a person within a business vehicle failing to comply with a reasonable direction given by a trade measurement inspector in the exercise of his or her powers to stop, detain and inspect a vehicle. This penalty is necessary as the past controllers of vehicles have engaged in behaviour such as parking their vehicles within a weighbridge, locking the vehicle and having returned at a later point. This has meant that the weighbridge was not able to function during the controller`s absence. Given that this kind of behaviour may have the effect of disrupting the effective enforcement of the Act, the strict liability offence is necessary to discourage this kind of behaviour, even if it is unintentional. The penalty for the strict liability offence is less than the penalty for the fault based offence, taking into account the fact that a person will unintentionally commit the strict liability offence. The penalty for a strict liability offence is 40 penalty units instead of 200 penalty units for a fault based offence. It is also important to note that section 18HL of the Act provides that if a person choses to pay the penalty when issued an infringement notice for such an offence, the penalty is reduced to a pecuniary penalty equal to 5 penalty units. This means that this offence is more justifiable given that the penalty can be as low as 5 penalty units. As the offence relates only to the carrying out of a business (where individuals voluntarily participate in regulated activities in which they can be deemed to have accepted certain conditions, particularly where those activities carry public health and safety risks), this offence will be considered to be regulatory in nature and is therefore more justifiable to the extent that it reverses the onus of proof. The Bill also amends the physical elements of existing strict liability offences contained in current sections18KA, 18KB and 18GQ. Current sections 18KA and 18KB relate the requirements on a person who sells an article for a price determined by a measurement when the purchaser is and is not present, respectively. The substantive amendments to these sections mean that the person selling an article will have the choice of giving the purchaser a written statement of the measurement instead of strictly being required to ensure that the information displayed by the measuring instrument is visible to the purchaser. In addition, new subsections 18KA and 18KB refers to the purchaser being present at the point when the measurement is made, whereas current subsections 18KA and 18KB refer to the purchaser being present at the point of sale. 9

While no additional offence is created by these insertions, new sections 18KA and 18KB contain offences that are essential in ensuring that the purchaser is fully informed about the measurements used in determining the price of goods determined by measurement. Given that a failure to comply with sections 18KA and 18KB may lead to the purchaser being uninformed about the determination of the price of their goods, the strict liability offence is necessary, even if it is unintentional. The penalty for the strict liability offence is less than the penalty for the fault based offence, taking into account the fact that a person will unintentionally commit the strict liability offence. The penalty for a strict liability offence is 40 penalty units instead of 200 penalty units for a fault based offence. It is also important to note that section 18HL of the Act provides that if a person choses to pay the penalty when issued an infringement notice for such an offence, the penalty is reduced to a pecuniary penalty equal to 5 penalty units. This means that this offence is more justifiable given that the penalty can be as low as 5 penalty units. As the offence relates only to the carrying out of a business, (where individuals voluntarily participate in regulated activities in which they can be deemed to have accepted certain conditions, particularly where those activities carry public health and safety risks) this offence will be considered to be regulatory in nature and is therefore more justifiable to the extent that it reverses the onus of proof. The Bill also amends current section 18GQ and inserts new section 18GPA which both include strict liability offences. Current section 18GQ provides for an offence for a person who fails to obliterate, or cause to be obliterated, a verification mark of an instrument used for trade if its metrological performance is affected by the adjustment or repair performed or caused by the person. The amendment to section 18GQ (contained in Items 3 to 9 of Schedule 2 of the Bill which is explained below) removes the element of the offence of performing the adjustment or repair by the person. This means that the amendments in Items 2 to 9 of Schedule 2 of the Bill do not penalise any additional behaviour but seeks to ensure that inappropriate behaviour can be correctly attributed to the person responsible for that behaviour. While new sections 18GPA and 18GQ do not penalise any additional behaviour, the offences contain in these sections are necessary to discourage the adjustment and repair of an instrument (to the extent that would affect its metrological performance) without obliterating the existing verification mark. This is because a verification mark may provide certainty to the users of instruments, and the consumers reliant on these instruments, that the instruments are verified and accurate. If the metrological function of the instrument is altered by a repair or adjustment, this may mean that the verification mark will no longer necessarily provide that the instrument is verified and accurate, meaning that users of instruments and consumers cannot be certain that the instrument is accurate. Given that such an adjustment or a repair may lead to the uncertainty of the accuracy of an instrument, the strict liability offence is necessary discourage such a repair or 10

adjustment, even if it is unintentional. The penalty for the strict liability offence is less than the penalty for the fault based offence, taking into account the fact that a person will unintentionally commit the strict liability offence. The penalty for a strict liability offence is 40 penalty units instead of 200 penalty units for a fault based offence. It is also important to note that section 18HL of the Act provides that if a person choses to pay the penalty when issued an infringement notice for such an offence, the penalty is reduced to a pecuniary penalty equal to 5 penalty units. This means that this offence is more justifiable given that the penalty can be as low as 5 penalty units. As the offence relates only to the carrying out of a business, (where individuals voluntarily participate in regulated activities in which they can be deemed to have accepted certain conditions, particularly where those activities carry public health and safety risks) this offence will be considered to be regulatory in nature and is therefore more justifiable to the extent that it reverses the onus of proof. Please note that the Bill also allows a trade measurement inspector to give a person a notice to remedy for minor technical infringements of the Act. The effect of these notices is that if a person complies with such a notice, they can rely on these notices as an exemption to certain offences under the Act. As per subsection 13.3(3) of the Criminal Code, a person who wishes to rely on the exemption provided by these notices bears an evidential burden of proof. This may be considered to be a violation of the right to the presumption of innocence for the same reasons that the reverse of the burden of proof for an offence may be considered to be a violation of this right. The power of a trade measurement inspector to give a person a notice to remedy will ensure that a trade measurement inspector will not automatically find that a person has breached the Act. As this measure will be beneficial to those persons who use measuring instruments for trade, the fact that they will bear an evidential burden of proof to rely on the exemption is appropriate as those persons are best placed to produce the evidence of their compliance with the notice to remedy. In conclusion, to the extent that the strict liability offences contained in the Bill reverse the onus of proof, the Bill will not violate the right of the presumption of innocence as the strict liability offences are in order to pursue a legitimate policy objective and is reasonable, necessary and proportionate to achieve this aim. Conclusion This Bill is compatible with human rights as to the extent that it limits human rights, these limitations are reasonable, necessary and proportionate. The Hon Greg Combet Minister for Industry and Innovation 11

NATIONAL MEASUREMENT AMENDMENT BILL 2013 NOTES ON CLAUSES Clause 1 - Short title Clause 1 provides that the Bill, when it is enacted, is to be cited as the National Measurement Amendment Act 2013. Clause 2 - Commencement Clause 2 provides that sections 1 to 3 of the Bill commence on the day the Act receives Royal Assent. The amendments to the National Measurement Act 1960 contained in Schedules 1 to 3 commence on the day after the Bill receives Royal Assent. Subclause 2(2) provides that information in column 3 of the table does not form part of the Bill. Information in column 3 may be inserted or varied in any published version of the Bill (once enacted). Clause 3 - Schedule(s) Clause 3 provides that each Act that is specified in a Schedule to the Bill is amended or repealed as set out in the applicable items in the Schedule concerned, and that any other item in a Schedule to the Bill has effect according to its terms. For the purposes of this explanatory memorandum the following terms have the following meanings: Inspector means trade measurement inspector Instrument means measuring instrument 12

Schedule 1--Powers of trade measurement inspectors Summary This Schedule amends Parts IV, V and VI of the Act to allow inspectors to issue a notice to remedy for certain trade measurement offences committed under these Parts, rather than automatically finding that a person has committed an offence under the Act. The inspector can only issue a notice to remedy if he or she reasonably believes that an offence has been committed and that despite the offence, no material detriment is suffered by the consumer. Alternatively, the inspector may also issue a notice if material detriment to the consumer could be avoided by issuing further conditions on the person during the remedy period of the notice. The notice to remedy will only operate for a certain period of time during which the person who would have otherwise committed an offence must take all reasonable steps to remedy the matter that gave rise to the offence. It is intended that the notices to remedy will allow trade inspectors the discretion to avoid automatically finding that a person has committed an offence for minor breaches of the Act. This will mean that operators of instruments used for trade will not be unnecessarily penalised and will avoid situations where an instrument will automatically no longer be permitted to be used. This is particularly important in remote communities as it will ensure that the limited instruments available can continue to operate despite minor breaches of the Act. This Schedule also amends Part IX of the Act to ensure that inspectors can investigate potential breaches of the Act in the public areas of business premises during business hours without announcing their presence, and to allow inspectors to issue directions to persons while inspecting vehicles. National Measurement Act 1960 Items 1 to 4 - Subsection 3(1) Items 1 to 4 insert definitions for fuel tax credit, like article, notice to remedy and remedy period to reflect the terms used as a result of the amendments contained in Schedule 1 of the Bill. Item 5 - At the end of subsections 18GA(1) and (2) Item 5 inserts a note for the benefit of the reader, advising that whether a measuring instrument is verified may be affected by a direction given under section 18GR. Item 6 - At the end of subsections 18GE(1) and (2) Item 6 inserts a note for the benefit of the readers, noting that new subsection 18GE(10) contains an exemption to the offences under subsections 18GE(1) and (2). Item 7 - At the end of section 18GE 13

Item 7 inserts new subsections 18GE(8) to 18GE(11) to allow inspectors to issue a notice to remedy for an offence committed under subsections 18GE(1) or 18GE(2). Offences under subsections 18GE(1) or 18GE(2) relate to where a person uses a measuring instrument for trade which gives an inaccurate measurement or gives other information inaccurately. New subsection 18GE(8) provides that an inspector may give a person a notice to remedy if the inspector reasonably believes that the person has contravened subsections 18GE(1) or 18GE(2). In order to issue a notice under subsection 18GE(8), the inspector must be satisfied that either the instrument could be used for trade during the remedy period without there being material detriment to an affected person, or that the instrument could be used for trade without there being any material detriment to an affected person if conditions contained in the notice (if any) are complied with. Under new subsection 18GE(11), an affected person` is defined as the person who is liable to pay consideration in respect of a transaction where the instrument is used. This essentially means that the consumer is the affected person. The effect of this is that the inspector will not be able to issue a notice to remedy if the consumer suffers material detriment from the continued operation of the instrument. To avoid doubt the person who is actually or apparently in control of the instrument is not an affected person. New subsection 18GE(9) allows an inspector to specify in the notice one or more conditions that must be complied with by the person to whom the notice is given during the remedy period. An inspector can only impose a condition if compliance with the condition would be reasonably likely to ensure that the instrument could be used for trade without there being any material detriment to an affected person. New subsection 18GE(10) provides an exception to the offences in subsections 18GE(1) or 18GE(2) if the person during the remedy period complies with the conditions (if any) specified in a notice to remedy and the person takes all reasonable steps to remedy matters that gave rise to the contravention of subsection 18GE(1) or 18GE(2). Note that a person who wishes to rely on the exemption in this section bears an evidential burden of proof as per subsection 13.3(3) of the Criminal Code. This means that it will be up to the person to prove that they have complied with the conditions in new subsection 18GE(10) in order to rely on the exemption. For further requirements that apply to a notice to remedy, see Item 33 of Schedule 1 of the Bill (as explained below). Item 8 - At the end of Division 3 of Part 4 Item 8 inserts new section 18GR to provide that a measuring instrument is not taken to have failed test procedures in certain circumstances. 14

The purpose of this provision is to allow inspectors to issue directions to a person using an instrument for trade that no longer operates within the appropriate limits of error as permitted under the Regulations (as per the requirements of section 18GK). The direction can only be given in limited circumstances and is intended to ensure that the instrument is not automatically considered to be an instrument that is not verified in these limited circumstances. This will ensure that the instrument may still be validly marked with a verification mark (as per subparagraph 18GG(1)(a)(i)) which will mean that, so long as the person complies with the direction, the person will not automatically commit an offence for using a verification mark when not permitted to do so (as per the offences under section 18GM). This will also mean that an inspector will not be required to obliterate a verification mark for the purposes of current section 18MM. Subsection 18GR(1) provides that section 18GR applies if: a person uses an instrument for trade; and an inspector becomes aware that: o the instrument no longer complies with the requirements for verification set out in section 18GK when tested in accordance with the national instrument test procedures; or o the instrument is one of a batch that no longer complies with the requirements for verification set out in section 18GK when tested. Subsection 18GR(2) provides that an inspector may give a person a direction requiring the person to take specified action in relation to the matter that gave rise to the failure of the instrument, or batch of instruments, when tested. Subsection 18GR(3) provides that a direction may only be given by the inspector if the inspector is satisfied that the matter that gave rise to the failure of the instrument, or the batch of instruments, when tested will not materially affect the accuracy of the instrument if the direction is complied with. Subsection 18GR(4) provides that a direction must be in writing, set out of the name of the person to whom it is given and the inspector who gave the direction, state that the direction is given under the Act, state the period within which the action must be taken, set out brief details of the reasons why the direction has been given, set out brief details of the matter that gave rise to the failure of the measuring instrument or batch of instruments when test, explain the consequences of failing to comply with the direction and set out any other matters prescribed by the regulations. The power to set out any other matters prescribed by the regulations is intended to allow some flexibility to include further requirements of a direction in the future. Subsection 18GR(5) provides that the period stated in the notice must be no more than 28 days and that this period begins on the day after the direction is given. Subsection 18GR(6) provides that where a direction in relation to a matter is given to a person and the person complies with the direction, then for the purpose of the Act and regulations the instrument, or batch of instruments, are taken not to have failed when tested because of that matter. 15

Note that a person who wishes to rely on the exemption in this section bears an evidential burden of proof as per subsection 13.3(3) of the Criminal Code. This means that it will be up to the person to prove that they have complied with the conditions in new subsection 18GR(2) in order to rely on the exemption. Subsection 18GR(7) makes it clear that giving a direction under this section to a person does not affect the liability of the person for a contravention of the Act or regulations that is alleged to have occurred before the direction was given. Subsection 18GR(8) provides that a direction under section 18GR is not a legislative instrument. This provision is merely to assist readers as a direction under section 18GR is of an administrative rather than a legislative nature and is therefore not a legislative instrument within the meaning of section 5 of the Legislative Instruments Act 2003. Item 9 - At the end of subsection 18HB(1), (2), (3) and to (4) Item 9 inserts a note for the benefit of the readers noting that new subsection 18HB(9) contains an exemption to offences under subsections 18HB(1) to (4). Item 10 - At the end of section 18HB Item 10 inserts new subsections 18HB(7) to 18HB(9) to allow inspectors to issue a notice to remedy for an offence committed under subsections 18HB(1) to 18HB(4). Under subsections 18HB(1) to 18HB(4), it is an offence to sell, possess, offer or expose for sale a packed article that must be sold by a price determined by measurement, and the price of the article is not so determined. Subsection 18HB(7) provides that an inspector may give a person a notice to remedy if the inspector believes that the person has contravened a provision of section 18HB and the inspector is satisfied that like articles could be sold during the remedy period for the notice without there being any material detriment to the purchaser. The inspector may also issue a notice to remedy if the like articles could be sold during the remedy period without there being any material detriment to the purchaser if conditions are complied with. Note that like article has the meaning given by subsection 18MMA(7) and is explained below in the discussion of Item 33 of Schedule 1 of the Bill. Subsection 18HB(8) provides that an inspector may specify in the notice conditions that must be complied with by the person during the remedy period. A condition can only be imposed if compliance with the condition would be reasonably likely to ensure that a like article could be sold during the remedy period without there being any material detriment to the purchaser. Subsection 18HB(9) provides that the offences contained in subsection 18HB(1) to 18HB(4) do not apply to a person in relation to like articles during the remedy period if the conditions (if any) are compiled within during the remedy period and the person 16

takes all reasonable steps to remedy the matters that gave rise to the contravention during the remedy period. Note that a person who wishes to rely on the exemption in this section bears an evidential burden of proof as per subsection 13.3(3) of the Criminal Code. This means that it will be up to the person to prove that they have complied with the conditions in subsection 18HB(8) in order to rely on the exemption. For further requirements that apply to a notice to remedy, see Item 33 of Schedule 1 of the Bill (as explained below). Item 11 - At the end of subsection 18HC(1) and (2) Item 11 inserts a note for the benefit of the readers noting that new subsection 18HC(6) contains an exemption to the offences under subsections 18HB(1) and (2). Item 12 - At the end of section 18HC Item 12 inserts new subsections 18HC(4) to 18HC(6) to allow trade measurement inspectors to issue a notice to remedy for an offence committed under subsections 18HC(1) or 18HC(2). Offences under subsections 18HC(1) or 18HC(2) relate to the sale of an article that must be sold at a price determined by measurement and price is not so determined. Subsection 18HC(4) provides that an inspector may give a person a notice to remedy if the inspector reasonably believes that the person has committed an offence contained in section 18HC and the inspector is satisfied that, despite the offence, like articles could be sold during the remedy period without there being any material detriment to the purchaser. The inspector may also issue a notice to remedy if like articles could be sold during the remedy period without there being any material detriment to the purchaser if conditions are complied with. Note that like article has the meaning given by subsection 18MMA(7) as inserted by Item 33 of Schedule 1 of the Bill (which is discussed below). Subsection 18HC(5) provides that an inspector may specify in the notice to remedy one or more conditions that must be complied with by the person. A condition can only be imposed if compliance with the condition would be reasonably likely to ensure that a like article could be sold during the remedy period without there being any material detriment to the purchaser. Subsection 18HC(6) provides that the offences in subsection 18HC(1) and 18HC(2) do not apply during the remedy period if the conditions (if any) are complied with during the remedy period and the person takes all reasonable steps to remedy the matters that gave rise to a contravention. Note that a defendant who wishes to rely on the exemption in this section bears an evidential burden of proof as per subsection 13.3(3) of the Criminal Code. This means that it will be up to the person to prove that they have complied with the conditions in subsection 18HC(5) in order to rely on the exemption. 17

For further requirements that apply to a notice to remedy, see Item 33 of Schedule 1 of the Bill (as explained below). Item 13 - Paragraph 18HD(1)(a) The amendment to paragraph 18HD(1)(a) contained in Item 13 is a technical correction to clarify that the physical element of the offence in paragraph 18HD(1)(a) is if the person sells an article (whether packed in advance ready for sale or otherwise) or a utility for a price determined by reference to measurement of the article or utility. Item 14 - At the end of subsection 18HD(1) Item 14 inserts a note for the benefit of the readers noting that new subsection 18HD(6) contains an exemption to the offence under subsection 18HD(1). Item 15 - At the end of section 18HD Item 15 inserts new subsections 18HD(4) to 18HD(6) to allow inspectors to issue a notice to remedy for an offence committed under subsections 18HD(1). The offence under subsection 18HD(1) relates to the sale of articles or utilities where a unit of measurement is prescribed to determine the price of the article or utility and that unit is not used. Subsection 18HD(4) provides that an inspector may give a person a notice to remedy if the inspector reasonably believes that the person has contravened subsection 18HD(1) in relation to the sale of an article or utility by reference to measurement of the article or utility in a unit of measurement that is not prescribed (termed the unauthorised unit). The inspector must also reasonably believe that, despite the contravention, like articles or the utility could be sold during the remedy period without there being any material detriment to the purchaser. Alternatively, the inspector may give a notice to remedy if he or she is satisfied that, despite the contravention, the like articles or utility could be sold during the remedy period without there being any material detriment to the purchaser if conditions in the notice are complied with. Subsection 18HD(5) provides that an inspector may specify in the notice to remedy one or more conditions that must be complied with by the person during the period for the notice. A condition may only be imposed if compliance with the condition would be reasonably likely to ensure that a like article or the utility could be sold during the remedy period by reference to measurement in the unauthorised unit without there being material detriment to the purchaser. Subsection 18HD(6) provides that the offence in subsection 18HD(1) does not apply to the person during the remedy period for the notice if the conditions, if any, are complied with during the remedy period and the person takes all reasonable steps to remedy the matters that give rise to the contravention. Note that a person who wishes to rely on the exemption in this section bears an evidential burden of proof as per subsection 13.3(3) of the Criminal Code. This means 18

that it will be up to the person to prove that they have complied with the conditions in subsection 18HD(5) in order to rely on the exemption. For further requirements that apply to a notice to remedy, see Item 33 of Schedule 1 of the Bill (as explained below). Item 16 - Paragraph 18HE(1)(a) Item 16 is a further technical correction to clarify that the physical element of the offence in paragraph 18HE(1)(a) is if the person sells an article (whether packed in advance ready for sale or otherwise) or a utility for a price determined by reference to measurement of the article or utility. Item 17 - At the end of subsection 18HG(1) and (2) Item 17 inserts a note for the benefit of the readers noting that new subsection 18HG(6) contains an exemption to the offences under subsections 18HG(1) and (2). Item 18 - At the end of section 18HG Item 18 inserts new subsections 18HG(4) to 18HG(7) to allow inspectors to issue a notice to remedy for an offence committed under subsections 18HG(1) or 18HG(2). Offences under subsections 18HG(1) or 18HG(2) relate to persons using an instrument for a purpose other than what it is prescribed for under the regulations. Subsection 18HG(4) provides that an inspector may give a person a notice to remedy if the inspector reasonably believes that the person has contravened subsection 18HG(1) or 18HG(2) by using an instrument for trade for a purpose that is not prescribed (the unauthorised purpose). The inspector must also be satisfied that, despite the contravention, the instrument could be used for trade for the unauthorised purpose during the remedy period without there being material detriment to an affected person. Alternatively, the inspector may also issue a notice to remedy if the inspector is satisfied that, despite the contravention, the instrument could be used for trade for the unauthorised purpose during the remedy period without there being any material detriment to an affected person if conditions are complied with. Note that subsection 18HG(7) provides an affected person in this section means a person whose liability to pay consideration in respect of a transaction may be determined using the instrument. For the sake of certainty, subsection 18HG(7) also provides that a person who is actually or apparently in control of the instrument is not an affected person. Subsection 18HG(5) provides that an inspector may specify in the notice to remedy one or more conditions that must be complied with by the person to whom the notice is given during the remedy period. A condition may only be imposed by the inspector if compliance with the condition would be reasonably likely to ensure that the instrument could be used for trade for the unauthorised prescribed purpose during the remedy period without there being any material detriment to an affected person. 19

Subsection 18HG(6) provides that the offences in subsection 18HG(1) and 18HG(2) do not apply to the person in relation to an instrument during the remedy period for the notice if the conditions (if any) are complied with during the remedy period and the person takes all reasonable steps to remedy the matters that gave rise to the contravention. Note that a person who wishes to rely on the exemption in this section bears an evidential burden of proof as per subsection 13.3(3) of the Criminal Code. This means that it will be up to the person to prove that they have complied with the conditions in subsection 18HG(6) in order to rely on the exemption. For further requirements that apply to a notice to remedy, see Item 33 of Schedule 1 of the Bill (as explained below). Items 19 to 23 Items 19 to 23 inserts a series of notes at the end of the subsections of Division 2 of Part VI of the Act for the benefit of the reader, noting that subsection 18JHA(3) contains an exemption to the offences in this division. Item 24 - At the end of Division 2 of Part VI Item 24 inserts new Subdivision 2-C-Notices to remedy, which contains new section 18JHA. Section 18JHA allows inspectors to issue a notice to remedy for an offence committed under Division 2 of Part VI of the Act. Division 2 of Part VI contains offences relating to the absence of required information marked on articles packed in advance for sale and the use of a prohibited expression marked on articles packed in advance for sale. Subsection 18JHA(1) provides that an inspector may give a person a notice to remedy if the inspector reasonably believes that the person has contravened a provision in Division 2 of Part VI of the Act in relation to an article packed in advance ready for sale. The inspector must also be satisfied that, despite the contravention, the like articles could be sold during the remedy period for the notice without there being any material detriment to the purchaser. Alternatively, the inspector may also issue a notice to remedy if the inspector is satisfied that the like articles could be sold during the remedy period for the notice without there being any material detriment to the purchaser if conditions are complied with. Note that like article has the meaning given by subsection 18MMA(7) as inserted by of Item 33 of Schedule 1 of the Bill (which is explained below). Subsection 18JHA(2) provides that an inspector may specify in the notice to remedy one or more conditions that must be complied with by the person during the remedy period. A condition may only be if compliance with the condition would be reasonably likely to ensure that a like article could be sold during the remedy period without there being any material detriment to the purchaser. Subsection 18JHA(3) provides that offences against Division 2 of Part VI do not apply to a person to whom a notice to remedy is given in relation to like articles 20

during the remedy period for the notice if conditions (if any) are complied with during the remedy period and the person takes all reasonable steps to remedy the matters that gave rise to the contravention. Note that a person who wishes to rely on the exemption in this section bears an evidential burden of proof as per subsection 13.3(3) of the Criminal Code. This means that it will be up to the person to prove that they have complied with the conditions in subsection 18JHA(2) in order to rely on the exemption. For further requirements that apply to a notice to remedy, see Item 33 of Schedule 1 of the Bill (as explained below). Item 25 - At the end of subsections 18JK(2) and (3) and 18JL(1) to (6) Item 25 inserts a series of notes at the end of subsections 18JK(2) and (3) and 18JL(1) to (6) for the benefit of the reader, noting that subsection 18JLA(3) contains an exemption to offences in subsections 18JK(2) and (3) and 18JL(1) to (6). Item 26 - At the end of Subdivision 3-B of Division 3 of Part VI Item 26 inserts new section 18JLA which allows inspectors to issue a notice to remedy for an offence committed under Subdivision 3-B of Part VI of the Act. Subdivision 3-B of Part VI contains offences relating the use of AQS marks other than in accordance with the Regulations and the use of a mark that is not an AQS mark, but that is likely to give the impression that it is an AQS mark. Subsection 18JLA(1) provides that an inspector may give a notice to remedy if the inspector reasonably believes that the person has contravened a provision in Subdivision 3-B of Part VI in relation to an article packed in advance ready for sale. The inspector must also be satisfied that, despite the contravention, like articles could be sold during the remedy period without there being any material detriment to the purchaser. Alternatively, the inspector may also issue a notice to remedy if the inspector is satisfied that like articles could be sold during the remedy period without there being any material detriment to the purchaser if conditions are complied with. Note that like article has the meaning given by subsection 18MMA(7) and is explained below in the discussion of Item 33 of Schedule 1 of the Bill. Subsection 18JLA(2) provides that an inspector may specify in the notice to remedy one or more conditions that must be complied with by the person during the remedy period for the notice. A condition may only be imposed if compliance with the condition would be reasonably likely to ensure that a like article could be sold during the remedy period without there being any material detriment to the purchaser. Subsection 18JLA(3) provides that offences against Subdivision 3-B of Part VI does not apply to a person to whom a notice to remedy is given in relation to like articles during the remedy period if the conditions (if any) are complied with during the remedy period and the person takes all reasonable steps to remedy the matters that gave rise to the contravention. 21

Note that a person who wishes to rely on the exemption in this subsection bears an evidential burden of proof as per subsection 13.3(3) of the Criminal Code. This means that it will be up to the person to prove that they have complied with the conditions in subsection 18JLA(3) in order to rely on the exemption. For further requirements that apply to a notice to remedy, see Item 33 of Schedule 1 of the Bill (as explained below). Item 27 - Section 18MD Item 27 repeals current section 18MD and substitutes for new section 18MD and also inserts new section 18MDA. New section 18MD provides an updated overview of Part IX of the Act which takes into account the amendments contained in items 27 to 32. Section 18MDA provides that an inspector may enter a public area of business premises (when the premises are open to the public) and inspect or purchase any article or package that is available for sale, inspect or collect written information that is available or made available to the public, discuss with any person the features of any article or package that is available for sale, and/or observe practices in relation to the supply of any article or package that is available for sale. These powers of inspection can only be used for a permitted purpose. These purposes are to find out whether part IV, V, VI or VII of the Act have been complied with, to find out whether a condition of a servicing licence under Part X or a public weighbridge licence under Part XI has been complied with, or find out whether a condition of appointment of a utility verifier under Part XIII has been complied with. The powers under section 18MDA are necessary to ensure that an inspector can carry out such investigative tasks without announcing their presence to the proprietors of business. This is necessary to ensure that an inspector can carry out an investigation from the perspective of the ordinary consumer to determine if a business is compliant with its obligations under the Act when businesses are not alerted to the presence of an inspector. This is necessary to ensure consumer protection with respect to the price of goods that are determined by weight. Note that section 18MDA will only permit an inspector to enter the public area, during the time that the business is open to the public. An inspector would only ever be able to enter the premise in the same way as the public does and would not be able to gain access to any other parts of the premises that are ordinarily closed to the public. Also note that the powers of the inspector under section 18MDA are functions that can be carried out by any member of the public and do not contain any powers that are coercive. In addition, any inspector exercising powers under section 18MDA would still be prohibited under current section 18MN from exercising these powers if he or she failed to comply with a request from the controller of the premises to produce his or her identity card. Furthermore, if an inspector enters a premise to exercise his or her powers under section 18MDA and, for any reason, begins to exercise other powers 22

under the Act (such as the powers of an inspector under sections 18ME or 18MF) then current subsection 18MQ(1) would apply to ensure that the inspector must announce to the controller that he or she is authorised to enter the premises and give any person at the premises an opportunity to allow entry to the premises. This section makes it clear that the powers given to inspectors under this section do not affect the right of the occupier of the business premises to refuse to allow an inspector to enter, or remain on, the premises. This section also makes it clear that the powers of inspectors under this section do not limit the powers of an inspector under any other provisions of Division 1or any other power of a person to enter a public area of business premises. Item 28 - Paragraph 18ME(1)(a) Item 28 amends paragraph 18ME(1)(a) to ensure that inspectors` monitoring powers include the ability to enter, stop, detain and inspect any business vehicle at any reasonable time of day. The powers to stop and detain are necessary to allow inspectors to actually inspect business vehicles and therefore this amendment only seeks to ensure that the power to inspect can be carried out. Item 29 - Paragraph 18MF(2)(a) Item 29 amends paragraph 18MF(2)(a) to ensure that inspectors may enter a business premise to stop, detain as well as inspect a business vehicle in order to exercise the powers set out in section 18MG in relation to looking for evidential material and to seize the evidential material if the inspectors find it on the premises or in the vehicle. The powers to stop and detain are necessary to allow inspectors to actually inspect business vehicles and therefore this amendment only seeks to ensure that the power to inspect can be carried out. Note that under current subsection 18MF, an inspector may only exercise these powers if the inspector has reasonable grounds for suspecting that there may be evidential material on any premises or in or on any business vehicle. Item 30 - After subsection 18MG(2) Item 30 inserts subsection 18MG(2A) which provides that when an inspector exercises powers under current subsection 18MG(2) in relation to a business vehicle, the inspector must ensure that the vehicle is not detained for longer than is necessary and reasonable for the purposes of exercising those powers in relation to the vehicle and anything in or on the vehicle. Item 31 - After section 18MI Item 31 inserts section 18MIA which provides that if an inspector is authorised to stop, detain and inspect a business vehicle under section 18ME or 18MF, the inspector may give reasonable directions to the controller of the vehicle (and any person in the vehicle) for the purposes of exercising those powers and the powers under section 18MG in relation to the vehicle or anything in or on the vehicle. This is necessary to 23

ensure inspectors are able to effectively and safely carry out authorised inspections of vehicle. Without limiting a reasonable direction that may be given, section 18MIA also provides that an inspector may direct the controller of a business vehicle (or a person in the vehicle) to move the vehicle to or from a particular area, remain in, leave or return to the vehicle, and/or unload or reload anything in or on the vehicle. This amendment will allow inspectors to direct vehicles to locations where an authorised inspection can be effectively and safely carried out. A person commits an offence requiring a fault element if the person intentionally, knowingly, recklessly or negligently does not comply with a direction (if any) under this section. The penalty for this offence is 200 penalty units. A person commits a strict liability offence if the person does not comply with a direction (if any) under this section. The penalty for this offence is 40 penalty units. The penalty rates for these offences are necessary to ensure that the controllers of vehicles effectively comply with a direction given under subsection 18MIA(1). As an example, in the past controllers of vehicles have parked their vehicles within a weighbridge, locked the vehicle and have returned at a later point, meaning that the weighbridge was not able to function during the controller`s absence. These penalty rates are therefore necessary to ensure that this kind of behaviour, and others that inhibit the effective and safe inspections of vehicles, are strongly discouraged. These penalties are also consistent with the penalties under current section 18MH and 18MI. Both a strict liability offence and a fault-based offence are necessary to ensure the safe and effective inspection of vehicles. The fault based offence is necessary to ensure that a person does not intentionally, knowingly, recklessly or negligently engage in the above mentioned behaviour. Given that this kind of behaviour may have the effect of disrupting the effective enforcement of the Act, the strict liability offence is also necessary to discourage this kind of behaviour, even if it is unintentional. The penalty for the strict liability offence is less than the penalty for the fault based offence, taking into account the fact that a person will unintentionally commit the strict liability offence. It is also important to note that section 18HL of the Act provides that if a person choses to pay the penalty when issued an infringement notice for such an offence, the penalty is reduced to a pecuniary penalty equal to 5 penalty units. Item 32 - At the end of section 18MM Item 32 inserts a note at the end of section 18MM to make it clear that an instrument may comply with the requirement for verification set out in section 18GK if the instrument is taken not to have failed when tested in accordance with the national instrument test procedures. This is a reference to the effect of section 18GR as inserted by Item 8 of the Bill (see above for further explanation of the operation of Item 8). Item 33 - At the end of Division 3 of Part IX 24

Item 33 inserts section 18MMA which provides for further requirements relating to a notice to remedy issued under the Act. Subsection 18MMA(1) provides that an inspector may give a person a notice to remedy if permitted to do so under the Act. Section 18MMA also provides that the notice must be in writing, set out the name of the person to whom it is given and the inspector who gave the notice, state the notice to remedy is a notice to remedy given under the Act, state the remedy period for the notice, set out brief details of the reasons why the notice has been given, specify the provisions which the inspector believes has been contravened, explain the consequences of failing to comply with the notice and set out any other matters prescribed by the regulations. The power to set out any other matters prescribed by the regulations is intended to allow some flexibility to include further requirements of a condition in the future. A notice to remedy may also include a condition, or conditions, permitted under this Act and the remedy period must be a period of no more than 28 days (which begins the day after the notice to remedy is given). Section 18MMA further provides that to avoid doubt, the giving of a notice to remedy to a person does not affect the liability of the person for a contravention of the Act that is alleged to have occurred before or after the remedy period of the notice. Section 18MMA also provides a definition of like articles. Accordingly, an article (the second article) is a like article in relation to another article to which the contravention relates (the first article) if the second article is the same or substantiality similar to the first article. If the first article is packed in advance ready for sale, the second article will be a like article if the second article is packed in advance ready for sale, is packaged in the same way (or a substantially similar way to the first article) and the markings on the second article`s package are the same (or substantially similar) to the markings on the first article. Section 18MMA also makes it clear that a direction under section 18MMA is not a legislative instrument. This provision is merely to assist readers as a direction under section 18MMA is of an administrative rather legislative nature and is therefore not a legislative instrument within the meaning of section 5 of the Legislative Instruments Act 2003. 25

Schedule 2--Offences relating to use and repair of measuring instruments Summary Schedule 2 amends the Act to separate out the offence of repairing or adjusting an instrument without obliterating the verification mark and causing a repair or an adjustment to an instrument without obliterating the verification mark. Schedule 2 also amends the requirements for selling articles determined by price while the consumer is and is not present to ensure that the consumer is able to receive the result of a measurement. National Measurement Act 1960 Item 1 - Paragraph 18GF(6)(e) Item 1 inserts a reference within the overview of Division 3 to new section 18GQA which provides for an offence for a failure to obliterate a verification mark of an instrument used for trade if its metrological performance is affected by the adjustment or repair. Item 2 - After section 18GP Item 2 inserts new section 18GPA. Current section 18GQ provides for an offence for a person who fails to obliterate, or cause to be obliterated, a verification mark of an instrument used for trade if its metrological performance is affected by the adjustment or repair performed or caused by the person. The amendment to section 18GQ (contained in Items 3 to 9 of Schedule 2 of the Bill which is explained below) removes the element of the offence of performing the adjustment or repair by the person. This means that the amendments in Items 2 to 9 of Schedule 2 of the Bill do not penalise any additional behaviour but seeks to ensure that inappropriate behaviour can be correctly attributed to the person responsible for that behaviour. The purpose of inserting section 18GPA, therefore, is to separate the offence for repairing or adjusting an instrument from the offence of causing the instrument to be adjusted or repaired (which both offences are currently contained in section 18GQ). Subsection 18GPA(1) provides that a person commits an offence if he or she intentionally, knowingly, recklessly, or negligently adjusts or repairs an instrument which is used for trade which affects the metrological performance of the instrument without obliterating any verification mark that was on the instrument immediately before the adjustment. The penalty for this offence is 200 penalty units. Subsection 18GPA(2) provides for an offence of strict liability containing the same physical elements in subsection 18GPA(1). The penalty for this offence is 40 penalty units. While section 18GPA does not penalise any additional behaviour, it is important to note that both a strict liability and a fault based offence is necessary to discourage the 26

adjustment and repair of an instrument (to the extent that would affect its metrological performance) without obliterating the existing verification mark. This is because a verification mark may provide certainty to the users of instruments, and the consumers reliant on these instruments, that the instruments are verified and accurate. If the metrological function of the instrument is altered by a repair or adjustment, this may mean that the verification mark will no longer necessarily provide that the instrument is verified and accurate, meaning that users of instruments and consumers cannot be certain that the instrument is accurate. The fault based offence is necessary to discourage a person from intentionally, knowingly, recklessly or negligently adjust or repair an instrument (to the extent that would affect its metrological performance) without obliterating the existing verification mark. Given that such an adjustment or a repair may lead to the uncertainty of the accuracy of an instrument, the strict liability offence is necessary discourage such a repair or adjustment, even if it is unintentional. The penalty for the strict liability offence is less than the penalty for the fault based offence, taking into account the fact that a person will unintentionally commit the strict liability offence. It is also important to note that section 18HL of the Act provides that if a person choses to pay the penalty when issued an infringement notice for such an offence, the penalty is reduced to a pecuniary penalty equal to 5 penalty units. Subsection 18GPA(3) makes it clear that the offence contained in subsection 18GPA(2) is an offence of strict liability. Note that section 6.1 of the Criminal Code provides that an offence of strict liability is an offence where there are no fault elements for any of the physical elements of the offence and the defence of mistake of fact under section 9.2 is available (as well as any other defence that may be available). Subsection 18GPA(4) provides that the offences contained in subsection 18GPA(1) and 18GPA(2) do not apply if the effect of the instrument can be corrected by normal operational adjustment of the instrument. Note that a person who wishes to rely on the exemption in subsection 18GPA(4) bears an evidential burden of proof as per subsection 13.3(3) of the Criminal Code. This means that it will be up to the person to prove that the instrument can be corrected by a normal operational adjustment. Also note that the penalty units for the offences in section 18GPA are consistent with the penalty units for current section 18GQ and will therefore mean that there will be no change in the rate of penalty for the offence for repairing or adjusting an instrument. Item 3 - Section 18GQ (heading) Item 3 renames the heading of section 18GQ from Obligation on repair of an instrument` to Obligation to obliterate verification mark--person who causes adjustment or repair of an instrument`. This amendment is to reflect the amendments to the Act contained in Items 4 to 9 of Schedule 2 of the Bill. 27

Item 4 - Paragraphs 18GQ(1)(a) and (b) Item 4 repeals paragraphs 18GQ(1)(a) and 18GQ(1)(b) and substitutes for new paragraphs 18GQ(1)(a) and 18GQ(1)(b) to ensure that the offences in section 18GQ only apply to person who cause an instrument to be adjusted or repaired and the measuring instrument is used for trade. This amendment is to limit the offence to a person causing the instrument to be adjusted or repaired where the offence of adjusting or repairing the instrument will be contained in new section 18GPA, as explained in Item 2 of Schedule 2 of the Bill. Item 5 - Paragraph 18GQ(1)(d) Item 5 repeals paragraph 18GQ(1)(d), as an offence relating to a person causing an instrument to be adjusted or repaired will be contained in new section 18GPA, as explained in Item 2 of Schedule 2 of the Bill. Item 6 - Paragraph 18GQ(1)(e) Item 6 amends paragraph 18GQ(1)(e) to make it clear that a person only commits an offence under subsection 18GQ(1) if the person does not obliterate, or cause to be obliterated, any verification mark that was on the instrument immediately before the adjustment or repair. The effect of this amendment is to ensure that if an adjustment or repair has taken place, the verification mark is to be removed so that it is clear that the instrument is no longer a verified instrument. Items 7 to 9 - Subsection 18GQ(2) Items 7 to 9 replicate the amendments contained in Items 4 to 6 with respect to the strict liability offence contained in subsection 18GQ(2). The purpose and effect of the amendments in Items 7 to 9 are the same for Items 4 to 6. Item 10 - Subsection 18K(2) Item 10 repeals and substitutes new subsection 18K(2) (which relates to the outline of Part VII of the Act) to reflect the amendments contained in Item 12 (see the explanation of these items below). Item 11 - Subsection 18K(3) Item 11 amends subsection 18K(3) (which relates to the outline of Part VII of the Act) to reflect the amendments contained in Item 12 (see the explanation of these items below). Item 12 - Section 18KA and 18KB Item 12 repeals current sections 18KA and 18KB and substitutes for new sections 18KA and 18KB. New subsection 18KA(1) provides that if a person sells an article for a price determined by reference to the measurement of the article (which is not packed in 28

advance ready for sale) and the purchaser is present when the measurement is made, the person must ensure that the measuring process and information displayed by the instrument is readily visible to the purchaser or give the purchaser a written statement of the measurement at the time the article is given to the purchaser. The substantial difference between this subsection and current subsection 18KA(1) is now the person selling an article will have the choice of giving the purchaser a written statement of the measurement. This option is not available under current subsection 18KA(1). In addition, new subsection 18KA(1) refers to the purchaser being present at the point when the measurement is made whereas current subsection 18KA(1) refers to the purchaser being present at the point of sale. This substantive change is required as it may not be the case that the measurement of the article occurs at the point of sale (where measurement may otherwise occur before the point of sale). It is therefore more relevant that the requirement made under new subsection 18KA(1) refers to the point of measurement, rather than at the point of sale. New subsection 18KA(2) provides that a person commits an offence if the person intentionally, knowingly, recklessly or negligently contravenes new subsection 18KA(1) where the physical elements of the offence are set out in that subsection. The penalty for this offence is 200 penalty units. Note that other than the amendments to the physical elements of the offence (as discussed above), current 18K(1) is also an offence that requires fault, and there is therefore no additional offence created by the amendments in Item 12. New Subsection 18KA(3) provides that a person commits an offence of strict liability if the person contravenes subsection 18K(1). The penalty for this offence is 40 penalty units. Other than the amendments to the physical elements of the offence (as discussed above), new subsection 18KA(3) replicates the legal effect of current subsections 18KA(2) and 18KA(3), and there is therefore no additional offence created by the insertion of the new section . Note that the penalty units for the offences in new section 18KA do not differ from the offences in current section 18KA. New subsection 18KB(1) provides that if a person sells an article for a price determined by reference to measurement (which is not packed in advance for sale) and the purchaser is not present when the measurement is made, the person must give the purchaser a written statement of the measurement at the time the article is given or delivered to the purchaser. The substantive difference between this subsection and current subsection 18KB(1) is that new subsection 18KB(1) refers to the purchaser not being present when the measurement is made (rather than not being present at the point of sale under current subsection 18KB(1)). As stated above, this change has been made as it may not be the case that the measurement of the article occurs at the point of sale (where measurement may otherwise occur before the point of sale). It is therefore more 29

relevant that the requirement made under new subsection 18KB(1) refers to the point of measurement, rather than at the point of sale. New subsection 18KB(2) provides that a person commits an offence if the person intentionally, knowingly, recklessly or negligently contravenes subsection 18KB(1) where the physical element of the offence is set out in that subsection. The penalty for this offence is 200 penalty units. Note that other than the amendments to the physical elements of the offence (as discussed above), current 18K(1) is also an offence that requires fault meaning that there is no additional offence created by the amendments in Item 12. New subsection 18KB(3) provides that a person commits an offence of strict liability if the person contravenes subsection 18KB(1). Other than the amendments to the physical elements of the offence (as discussed above), new subsection 18KB(3) replicates the legal effect of current subsections 18KB(2) and 18KB(3), meaning that there is no additional offence created by the amendments in Item 12. Also note that the penalty units for the offences in new section 18KB do not differ from the offences in current section 18KB. Note that section 6.1 of the Criminal Code provides that an offence of strict liability is an offence where there are no fault elements for any of the physical elements of the offence and the defence of mistake of fact under section 9.2 is available (as well as any other defence that may be available). While no additional offence is created by the insertion new sections 18KA and 18KB , it is important to note that both a strict liability and a fault based offence is necessary to ensure subsections 18KA(1) and 18KB(1) are complied with. Subsections 18KA(1) and 18KB(1) are essential in ensuring that the purchaser is fully informed about the measurements used in determining the price of goods determined by measurement. The fault based offence is necessary to discourage a person from intentionally, knowingly, recklessly or negligently preventing a purchaser from receiving this information. Given that a failure to comply with subsections 18KA(1) and 18KB(1) may lead to the purchaser being uninformed about the determination of the price of their goods, even if it is unintentional. The penalty for the strict liability offence is less than the penalty for the fault based offence, taking into account the fact that a person will unintentionally commit the strict liability offence. It is also important to note that section 18HL of the Act provides that if a person choses to pay the penalty when issued an infringement notice for such an offence, the penalty is reduced to a pecuniary penalty equal to 5 penalty units. Item 13 - Application Item 13 makes it clear that the amendments made by Item 12 of Schedule 2 of the Bill apply in relation to measurements made on or after the day this item commences. This will mean that if a measurement is made in advance of the point of sale before the commencement of Item 12, then the person who sells the article will be required 30

to comply with the Act as it applied immediately before the commencement of Item 12. 31

Schedule 3--Other amendments Summary Schedule 3 makes other amendments which include clarifying that an instrument used for calculating a tax credit will be within the definition of use for trade, and facilitating the transition of exempt utility meters under State and Territory law to being regulated under the Act. National Measurement Act 1960 Item 1 - Subsection 3(1) (the definition of Australian certified reference material) Item 1 amends the definition of Australian certified reference material to clarify that an Australian certified reference material is certified only for the period for which the certificate is in effect. Item 2 - Subsection 3(1) (the definition of certified measuring instrument) Item 2 amends the definition of certified measuring instrument to clarify that a certified measuring instrument is certified only for the period for which the certificate is in effect. Item 3 - Subsection 3(1) (the definition of reference standard of measurement) Item 3 amends the definition of reference standard of measurement to clarify that a standard of measurement is a reference standard of measurement only for the period for which the certificate of verification is in effect. Item 4 - Subsection 3(1) (paragraph (b) of the definition of use for trade) Item 4 makes a consequential amendment to paragraph (b) of the definition of use for trade given the amendment to the definition in Item 5 (see the explanation of this amendment below). Item 5 - Subsection 3(1) (at the end of paragraph (b) of the definition of use for trade) Item 5 amends the definition of use for trade by providing that if the regulations prescribe circumstances in which the use of an instrument for the purpose of determining the amount of a tax credit (including a fuel tax credit) or adjustment is a use for trade, then determining an amount in these kind of circumstances will be within the definition of use for trade. In circumstances where the regulations do prescribe that such a use of an instrument would be within the definition of use for trade, the provisions in the Act that apply to instruments in use for trade will apply to instruments that are used for determining the amount of tax credit (including a fuel tax credit) or adjustment in these circumstances. 32

This amendment reflects the original policy intention behind the Act, which was to ensure that if a measuring instrument is used for the purposes of calculating a tax credit or an adjustment, then this would be considered to be within the definition of use for trade. This amendment, however, ensures that this policy intent will not operate so broadly, as the regulation will prescribe that such a use of an instrument would only be within the definition of use for trade in certain circumstances. It is necessary that the regulations prescribe such circumstances to ensure that this policy intent will not apply to adversely affect the compliance costs on taxpayers. It is anticipated that the regulations would ensure that determining a tax credit (including a fuel tax credit) or adjustment will only be within the definition of use for trade where a significant tax credit or adjustment would be calculated by an instrument. It is not intended that ordinary consumers or small to medium businesses will be considered to be using an instrument within the definition of use for trade when calculating tax credits or adjustments. It is intended that such a regulation would be developed with advice from the Department of the Treasury and the Australian Taxation Office to ensure that the regulation would be consistent with current taxation policy. It is important to note that until such a regulation is made, then the use of an instrument for the purposes of calculating an amount of a tax credit or adjustment will not be within the definition of the use for trade. This will mean that this amendment will have no practical effect until such a regulation is made. In addition, such a regulation would be disallowable under section 42 of the Legislative Instruments Act 2003. Item 6 - Subsection 3(1) (definition of utility meter) Item 6 repeals the definition of utility meter and substitutes a new definition for utility meter. The Act currently defines utility meter as meaning an instrument that is a gas, electricity or water meter (which is the new definition of utility meter) but also excludes a meter that is included in a class of meters exempted from the operation of Part IV by the regulations. The new definition of utility meter does not exclude meters that are included in a class of meters exempted from the operation of Part IV by the regulations as this will now be included within the new definition of exempt utility meters as inserted by Item 11 of Schedule 3 of the Bill. Item 7 - After subsection 3(6) Item 7 inserts subsection 3(6A) to provide that the regulations may prescribe circumstances in which the use of an instrument for the purposes of determining the amount of a tax credit (including a fuel tax credit) or adjustment is a use for trade for the purposes of subparagraph (b)(iii) of the definition of use for trade in subsection 33

3(1). This is required given the amendments contained in Item 5 of Schedule 3 (as outlined above). Item 8 - Subsection 4A(1) Item 8 makes a consequential amendment to subsection 4A(1) given the amendments in Item 9 (see the explanation below). Item 9 - subsection 4A(1) Item 9 inserts subsection 4A(1A) to 4A(1E) in order to facilitate exempt utility meters being verified under the Act on a voluntary basis. Currently the verification of exempt utility meters is carried out under State and Territory law where it is intended that these utility meters will be transitioned to being verified under the Act. Subsections 4A(1A) to 4A(1E) facilitate this transition by allowing manufactures to voluntarily seek verification under the Act in anticipation of this transition, ensuring that once the transition comes into effect, their utility meters will already be verified. Subsection 4A(1A) provides that the Act and regulations are not intended to exclude or limit the concurrent operation of any State or Territory law to the extent the State and Territory law relates to verification of exempt utility meters for use for trade or approval patterns of exempt utility meters for use for trade. This will mean that exempt utility meters will still need to be verified according to the law of the relevant State or Territory, and all other State or Territory law that relates to exempt utility meters used for trade will still apply. Subsection 4A(1B) provides an exempt utility meter may be verified for use for trade under the Act. Subsection 4A(1C) provides that sections 18GM, 18GN and 18GO apply in relation to an exempt utility meter used for trade. Section 18GM, 18GN and 18GO contain offences relating to the improper use of verification marks. Verification marks operate to signify that an instrument is properly functioning and may detail how and by whom an instrument is required to operate. As an exempt utility that is verified under the Act will be issued a verification mark, it is necessary to ensure that such instruments have verification marks that are properly used. It is therefore necessary to ensure that sections 18GM, 18GN and 18GO apply in relation to an exempt utility meter used for trade. Subsection 4A(1D) provides that the pattern of an exempt utility meter may be approved for use for trade under section 19A of the Act. Subsection 4A(1E) provides that the Act and the regulations do not apply to an exempt utility meter used for trade, except as provided for in subsections 4A(1B) to 4A(1D). This limits the application of the Act to exempt utility meters, further 34

ensuring that there is no inconsistency between the Act and State and Territory law that relates to exempt utility meters for use for trade. Item 10 - Subsection 4A(2) (heading) Item 10 repeals the heading of subsection 4A(2) and substitutes for: Exception-concurrent operation of State and Territory laws relation to improper practices Item 11 - At the end of section 4A Item 11 amends section 4A to insert the definition of exempt utility meter, which means a utility meter that is included in a class of utility meters that are prescribed to be exempt under paragraph 20(1)(f). This amendment effectively mirrors the current definition of utility meters with respect to utility meters that are in a class of meters exempted from the operation of Part IV by the regulations (as explained above in relation to Item 6 of Schedule 3). Item 12 - Subsection 19AAA(1) Item 12 amends subsection 19AAA(1) to ensure that the text of subsection 19AAA(1) is cited as section19AAA. This is as a result of the amendments contained in Item 13. Item 13 - Subsection 19AAA(2) Item 13 repeals subsection 19AAA(2). Subsection 19AAA(2) has been made redundant since amendments were made to the Act under the National Measurement Amendment Act 2008. This subsection has mistakenly remained in force since that Act. Item 14 - Paragraph 20(1)(f) Item 14 repeals and substitutes paragraph 20(1)(f) to provide that the regulations may prescribe classes of utility meters that are exempt utility meters. Given that subsection 4A(1E) (as inserted by Item 9 of Schedule 3 of the Bill and explained above) operates to ensure that the Act and regulations only apply to exempt utility meters as provided for in subsection 4A(1B) to 4A(1D), this regulation has been simplified so that the regulations merely prescribe the class of utility meters that are to be exempt utility meters. Item 15 - Saving of the regulations Item 15 provides that the regulations relating to the definition of utility meter that exist prior to the commencement of this Bill continue in force on or after the commencement as if they were made under paragraph 20(1)(f). 35

This item is required given the changes to the definition of utility meter in Items 7 and 11 to ensure that the operation of the Trade Measurement Regulations 2009 are not affected by the amendments contained in the Bill. 36

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