Terms of reference

Background

The export of horticultural produce from Australia can be regulated. The objective of the regulation is to ensure that Australian horticultural industries maximise financial returns in overseas markets.

The relevant legislation comprises Sections 19-26 of the Horticulture Marketing and Research and Development Services Act 2001 (HMRDS Act), and its associated Regulations and Orders. Horticulture Australia Limited (HAL) administers the Export Efficiency arrangements, which are in effect, export controls.

The HMRDS Act provides for the Secretary of the Department of Agriculture Fisheries and Forestry to make Orders to specify the products and markets to which the Export Efficiency arrangements administered by HAL apply. Orders currently apply to the following markets:

• Oranges to all export markets
• Mandarins, tangelos, grapefruit, lemons and limes to the United States
• Apples to all export markets
• Pears to all export markets
• Dried grapes to all export markets

The Horticulture Marketing and Research and Development (Export Efficiency) Regulations 2002 allows HAL to specify the licence conditions that apply to the export of specific products to specific markets. These conditions are contained in a licensing document that HAL must make publicly available. Conditions may include, but are not limited to:

• Specific importing agents
• Quality, colour, shape or size
• Type of container or package
• Requirement to participate in an approved export program

Scope of the inquiry

The Deed of Agreement between the Commonwealth and HAL, entered into under the HRMDSAct,requires a review of the export efficiency regulations against National Competition Policy principles after 10 years of operation. The review is due for completion by April 2012.

The review will:

1. Report on the appropriate arrangements for the regulation of horticultural exports, if required, taking into account the principles of National Competition Policy, being that legislation/regulation which restrict competition should be retained only if:
   1. the benefits to the community as a whole outweigh the costs, and
   2. the objectives of the legislation/regulation can be achieved only by restricting competition.
2. The report should:
   1. identify and describe the nature and magnitude of the economic problem that the legislation/regulation addresses;
   2. identify the groups affected by the legislation/regulation;
   3. identify whether, and to what extent, the legislation/regulation restricts competition;
   4. clarify and assess the objectives of the legislation/regulation, and the extent to which the legislation/regulation has achieved these objectives or caused unintended consequences;
   5. identify any relevant alternatives that may be available to achieve the objective of the legislation/regulation, including non-legislative approaches or alternative approaches which may not restrict competition including quasi-regulation and self-regulation;
   6. analyse and, as far as reasonably practical, quantify the benefits, costs and overall effects of the legislation/regulation and alternatives identified in (e) above and; identify the impact on different groups likely to be affected by either the continuation of the current regulatory arrangements or implementation of viable alternatives;
   7. recommend a preferred option for regulation, if regulation is deemed appropriate, in light of principles set out in (1) and the analysis presented in 2 (a-f) and
   8. list the individuals and groups consulted during the review and outline their views.
3. In undertaking the review, the reviewer is to advertise nationally, consult with key interest groups and affected parties, and produce a report that will be published.
4. In making assessments and preparing the report, the reviewer is to have regard to the analytical requirements for regulation assessment by the Commonwealth, set out in the Best Practice Regulation Handbook.
5. In undertaking the review and preparing its report and associated recommendations, the reviewer is to note the Government’s intention to announce its responses to the recommendations, after obtaining advice from the Minister and if appropriate, after consideration by Cabinet.

Note: These Terms of Reference have been approved by a Steering Committee comprising representatives from the Commonwealth Departments of Agriculture, Fisheries and Forestry; Foreign Affairs and Trade; Innovation, Industry, Science and Research; and Finance and Deregulation.