Legal Affairs, Police, Corrective Services and Emergency Services Committee

LEGAL AFFAIRS, POLICE, CORRECTIVE SERVICES AND EMERGENCY SERVICES COMMITTEE

Report No.4: Examination of Business Names (Commonwealth Powers) Bill 2011

October 2011

LEGAL AFFAIRS, POLICE, CORRECTIVE SERVICES AND EMERGENCY SERVICES COMMITTEE

Acting Chair Hon Dean Wells MP, Member for Murrumba

Deputy Chair Mr John‐Paul Langbroek MP, Member for Surfers Paradise Members Mrs Julie Attwood MP, Member for Mount Ommaney Mr Jarrod Bleijie MP, Member for Kawana Mr Chris Foley MP, Member for Maryborough Mrs Betty Kiernan MP, Member for Mount Isa Staff Ms Amanda Powell – Research Director Ms Amanda Honeyman – Principal Research Officer Mrs Gail Easton – Executive Assistant

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EXAMINATION OF BUSINESS NAMES (COMMONWEALTH POWERS) BILL 2011 CONTENTS

Recommendations ...... 5

Additional Findings ...... 5

1. The Committee...... 6

2. The Committee’s process...... 6 2.1 Referral...... 6 2.2 Public submissions ...... 7 2.3 Departmental assistance...... 7

3. Business Names (Commonwealth Powers) Bill 2011...... 8 3.1 Business names registration ...... 8 3.2 A text‐based referral of power...... 8

4. Background...... 10 4.1 The Intergovernmental Agreement for Business Names...... 10 4.2 Revenue...... 10

5. Should the Bill be passed? ...... 11

6. Examination of the Bill ...... 11 6.1 Definition of ‘Business’...... 11 6.2 Trademarks...... 12 6.3 Non‐government entity access to registration data...... 12 6.4 Registration fees...... 14

7. Consistency with Fundamental Legislative Principles ...... 15 7.1 Sufficient regard to the institution of the State Parliament ...... 15 7.2 Rights and liberties of individuals ...... 19 7.3 Immunity from civil liability...... 20 7.4 Administrative power...... 20

8. Tabling of COAG decisions and Intergovernmental agreements...... 21

9. Consideration of relevant legislation in other jurisdictions...... 22 9.1 Tasmania ...... 22 9.2 New South Wales ...... 23 9.3 The Commonwealth...... 23

Appendix A – Details of meeting and written material provided by the Department of Justice and Attorney‐General ...... 25

STATEMENT OF RESERVATION...... 26

Legal Affairs, Police, Corrective Services and Emergency Services Committee 3 EXAMINATION OF BUSINESS NAMES (COMMONWEALTH POWERS) BILL 2011

Legal Affairs, Police, Corrective Services and Emergency Services Committee 4 EXAMINATION OF BUSINESS NAMES (COMMONWEALTH POWERS) BILL 2011 RECOMMENDATIONS

Recommendation 1 The committee recommends that the Business Names (Commonwealth Powers) Bill 2011 be passed.

Recommendation 2 The committee recommends that the Business Names (Commonwealth Powers) Bill 2011 be amended to omit clause 8 (which provides for the delegation to the Governor in Council of the power to terminate the initial or amendment reference of power to the Commonwealth Parliament).

Recommendation 3 The committee recommends that the Business Names (Commonwealth Powers) Bill 2011 be amended to include a definition of ‘unlawful conduct’ to ensure an appropriate limit to the referral of power under clause 5(1)(f).

ADDITIONAL FINDINGS

The power proposed to be referred to the Commonwealth Parliament under the Business Names (Commonwealth Powers) Bill is effectively defined by the content of the Commonwealth legislation. However, the Commonwealth legislation, which was introduced into the Commonwealth Parliament on 17 August 2011, has not been tabled in the Queensland Parliament. The committee considers that, in the case of national scheme legislation that relies on, or is defined by, proposed Commonwealth legislation or legislation in another jurisdiction (the accompanying legislation), the text of the accompanying legislation should be tabled at the time of introduction of the national scheme legislation into the Queensland Parliament. The availability of the text of the accompanying legislation is essential to the effective scrutiny of the Bill before the State Parliament. The committee strongly encourages the Government to ensure that the text of accompanying legislation is tabled at the time of introduction of future proposed national scheme legislation. Further, with an increasing focus on nationally uniform policy reforms, the committee strongly encourages the Government to table intergovernmental agreements, at the latest, when a Bill to implement the agreed policy reform is introduced into the Legislative Assembly.

Legal Affairs, Police, Corrective Services and Emergency Services Committee 5 EXAMINATION OF BUSINESS NAMES (COMMONWEALTH POWERS) BILL 2011

1. THE COMMITTEE The Legal Affairs, Police, Corrective Services and Emergency Services Committee (the committee) is a statutory committee established by the Parliament of Queensland Act 2001 and the Standing Orders of the Legislative Assembly.1 The committee’s primary areas of responsibility include Attorney‐General and Justice (excluding Industrial Relations), Fair Trading, Police, and Community Safety. Section 93(1) of the Parliament of Queensland Act 2001 provides that a portfolio committee is responsible for examining each Bill and item of subordinate legislation in its portfolio area to consider – a) the policy to be given effect by the legislation; b) the application of fundamental legislative principles to the legislation; and c) for subordinate legislation – its lawfulness. Standing Order 132(1) provides that the committee shall: a) determine whether to recommend that the Bill be passed; b) may recommend amendments to the Bill; and c) consider the application of fundamental legislative principles contained in Part 2 of the Legislative Standards Act 1992 to the Bill and compliance with Part 4 of the Legislative Standards Act 1992 regarding explanatory notes. Standing Order 132(2) provides that a report by a portfolio committee on a Bill is to indicate the committee’s determinations on the matters set out in Standing Order 132(1). Standing Order 133 provides that a portfolio committee to which a Bill is referred may examine the Bill by any of the following methods: a) calling for and receiving submissions about a Bill; b) holding hearings and taking evidence from witnesses; c) engaging expert or technical assistance and advice; and d) seeking the opinion of other committees in accordance with Standing Order 135.

2. THE COMMITTEE’S PROCESS

2.1 Referral On 24 August 2011, the Legislative Assembly referred the Business Names (Commonwealth Powers) Bill 2011 (the Bill) to the committee for examination and report. Initially the committee was required under the Standing Orders to report to the House within six months of referral. However, the committee is now required to report to the House by 4 October 2011, as advised to the House on 7 September 2011.

1 Parliament of Queensland Act 2001, s.88 and Standing Order 194.

Legal Affairs, Police, Corrective Services and Emergency Services Committee 6 EXAMINATION OF BUSINESS NAMES (COMMONWEALTH POWERS) BILL 2011 2.2 Public submissions The committee undertook consultation to obtain the views of stakeholders and to inform itself of the issues. Four submissions were received: ‐ The Queensland Law Society (Sub No. 1) ‐ The Department of Innovation, Industry, Science and Research (DIISR) (Sub No. 2) ‐ Family Business Australia (Sub No. 3) ‐ Veda (Sub No. 4) Owing to the short reporting timeframe the committee did not hold public hearings with stakeholders. The written submissions and transcripts of the hearings with submitters are available on the committee’s website: www.parliament.qld.gov.au/lapcsesc.

2.3 Departmental assistance As the Department of Justice and Attorney‐General (the Department) is responsible for the policy area of the Bill, the committee sought and received assistance from the Department in its examination. The Department provided written briefing material on the bill; a report on the issues raised in submissions and comment on issues of fundamental legislative principle. Officials attended a meeting to brief the committee, provide comment and answer the committee’s questions. A list of the written information provided to the committee by the department and the meeting attended is included at Appendix A. The written material provided by the Department and transcripts of the meeting with officials are available on the committee’s website: www.parliament.qld.gov.au/lapcsesc. The committee thanks the officials from the Department of Justice and Attorney‐General for their assistance during the committee’s examination. The committee also had the benefit of the submission from the DIISR (Sub. No 4) which is the responsible department for the policy area of the relevant Commonwealth legislation.

Legal Affairs, Police, Corrective Services and Emergency Services Committee 7 EXAMINATION OF BUSINESS NAMES (COMMONWEALTH POWERS) BILL 2011 3. BUSINESS NAMES (COMMONWEALTH POWERS) BILL 2011 The objectives of the Business Names (Commonwealth Powers) Bill 2011 (The Bill) are to: • refer legislative power of the Queensland Legislative Assembly to the Commonwealth Parliament to make legislation for the registration and regulation of business names; • repeal existing Queensland business names legislation – the Business Names Act 1962, and the Business Names Regulation 1998; • facilitate the migration of the business names registration data to the Australian Government, through the Australian Securities and Investments Commission (ASIC); and • provide for transitional and consequential amendments.

3.1 Business names registration The Explanatory Notes to the Bill state: The registration and regulation of business names seeks to prevent the registration of names that are misleading, inappropriate and offensive, and to provide a business with a unique identity. It does not allow the granting of new business names which are the same or very similar to existing ones. This process allows customers to know the identity of the person or legal entity behind a business name, thereby providing a level of transparency and confidence in transactions.2

3.2 A text‐based referral of power The Bill proposes a ‘text‐based’ referral of power to the Commonwealth Parliament to legislate for business names pursuant to s. 51 (xxxvii) of the Australian Constitution. Section 51(xxxvii) of the Australian Constitution provides the Commonwealth Parliament with: power to make laws for the peace, order, and good government of the Commonwealth with respect to matters referred to the Parliament of the Commonwealth by the Parliament or Parliaments of any State or States, but so that the law shall extend only to States by whose Parliaments the matter is referred, or which afterwards adopt the law. Clause 6 of the Bill refers business names matters to the Commonwealth in the terms of the ‘tabled text’. ‘Tabled text’ means the text of the Commonwealth Business Names Registration Bill 2011 (the BNR Bill), and the Commonwealth Business Names Registration (Transitional and Consequential Provisions) Bill 2011 (the BNR (TCP) Bill).3 The Commonwealth Business Names Registration (Fees) Bill 2011 (the Fees Bill) was also introduced into the Commonwealth Parliament at the same time but is not included in the definition of ‘tabled text’. The power proposed to be referred to the Commonwealth Parliament is the power to enact and to amend the BNR Bill and the BNR (TCP) Bill. The Explanatory Notes to the Bill provide

2 Business Names (Commonwealth Powers) Bill 2011, Explanatory Notes, at 1‐2. 3 Business Names (Commonwealth Powers) Bill 2011, Schedule 2.

Legal Affairs, Police, Corrective Services and Emergency Services Committee 8 EXAMINATION OF BUSINESS NAMES (COMMONWEALTH POWERS) BILL 2011 that this is the preferred option (as opposed to a broad subject based referral which would refer power to the Commonwealth Parliament to legislate in respect of a broad subject matter), as it provides certainty as to the extent of the Commonwealth Parliament’s powers and presents the least risk to the sovereignty of State Parliaments.4 This approach requires each State and Territory to adopt legislation to refer power to the Commonwealth Parliament. Initially, only one State referral is required, and in this case Tasmania introduced the Business Names (Commonwealth Powers) Bill 2011 (the Tasmanian Bill) into the Tasmanian Parliament on 5 July 2011. The Bill was passed on 22 September 2011. The New South Wales Business Names (Commonwealth Powers) Act 2011 (NSW) was enacted on 20 September 2011. An identical Bill will be introduced in each State and Territory Parliament and all must be passed for the transfer of the legislative power to occur.5 The BNR Bill, BNR (TCP) Bill, and the Fees Bill (The Commonwealth Bills) were introduced into the Commonwealth Parliament on 17 August 2011. The Commonwealth Bills were passed by the House of Representatives and are now before the Senate. The Senate adjourned debate on the Commonwealth Bills until the next period of sittings, commencing in 2012.6 This means that the Commonwealth Bills will not be debated or passed by the Senate until 2012. The committee notes that the power proposed to be referred to the Commonwealth Parliament under the Bill is effectively defined by the content of the BNR Bill and the BNR (TCP) Bill. However, the Commonwealth legislation, which was introduced into the Commonwealth Parliament on 17 August 2011, has not been tabled in the Queensland Parliament. The committee considers that, in the case of national scheme legislation that relies on or is defined by proposed Commonwealth legislation or legislation in another jurisdiction (the accompanying legislation), the text of the accompanying legislation should be tabled at the time of introduction of the national scheme legislation into the Queensland Parliament. The availability of the text of the accompanying legislation is essential to effective scrutiny of the Bill before the State Parliament. The committee therefore strongly encourages the Government to ensure that the text of the accompanying legislation is tabled at the time of introduction of future proposed national scheme legislation. Later in this report, at section 8, the committee discusses the tabling of intergovernmental agreements.

4 Business Names (Commonwealth Powers) Bill 2011, Explanatory Notes, at 4. 5 Business Names (Commonwealth Powers) Bill 2011, Explanatory Notes, at 3. 6 Senate Hansard, Wednesday 14 September 2011, at 72; see also Standing Order 111(5)(c), Standing Orders and Other Orders of the Senate, Commonwealth of Australia, June 2009.

Legal Affairs, Police, Corrective Services and Emergency Services Committee 9 EXAMINATION OF BUSINESS NAMES (COMMONWEALTH POWERS) BILL 2011 4. BACKGROUND

4.1 The Intergovernmental Agreement for Business Names The Australian Constitution does not provide express power for the Commonwealth Parliament to legislate for the registration of business names. There may be power under the corporations power (s. 51(xx)) and the trade and commerce power (s. 51(i)), but, to put the matter beyond any doubt, the Council of Australian Governments (COAG) agreed to transfer responsibility for the registration of business names to the Australian Government. This COAG decision resulted in the Intergovernmental Agreement for Business Names (IGABN).7 The IGABN forms part of the COAG National Partnership Agreement to Deliver a Seamless National Economy (NPA SNE) which aims to reduce the level of unnecessary and inconsistent regulation across jurisdictions, to deliver agreed COAG deregulation and competition priorities, and to improve processes for regulation making and review.8 The IGABN stemmed from substantial differences in the business names registration regimes in each State and Territory, and the requirement for businesses to separately register their business names in each jurisdiction in which they trade. The primary purpose of the national registration scheme is to enable those who engage, or propose to engage, with businesses to identify who they are dealing with when that business does not operate under its own entity name, e.g. where a business trades under a different name. In addition, the creation of a national register is to remove inconvenience and compliance costs of registration of business names across various States and Territories. The IGABN allows for minor or technical amendments to the Commonwealth business names legislation without reference to the States or Territories. Amendments which will alter the effect, scope or operation of the Commonwealth business names legislation will require approval of the Ministerial Council for Corporations.9 COAG decisions and Intergovernmental Agreements are discussed further in section 8 of this report.

4.2 Revenue The approximate revenue generated by the Queensland Business Names Register is currently $21.8 million, and the administration cost is $1.89 million per year.10 This means that the transfer of business names registration to the Australian Government will result in the Queensland Government forgoing net revenue of approximately $19.91 million per year. Pursuant to the NPA SNE the Queensland Government is entitled to $112.7 million in reward payments from the Australian Government over five years. This amount

7 Council of Australian Governments, Intergovernmental Agreement for Business Names, July 2009; Business Names (Commonwealth Powers) Bill 2011, Explanatory Notes, at 2. 8 Council of Australian Governments, National Partnership Agreement to Deliver a Seamless National Economy, 2008. 9 Council of Australian Governments, Intergovernmental Agreement for Business Names Agreement, July 2009, at 4.4. 10 Business Names (Commonwealth Powers) Bill 2011, Explanatory Notes, at 4.

Legal Affairs, Police, Corrective Services and Emergency Services Committee 10 EXAMINATION OF BUSINESS NAMES (COMMONWEALTH POWERS) BILL 2011 relates to completion of all reform areas covered by the NPA SNE. No specific payment is allocated for business names reform.11

Committee comments The committee is cognisant of the cost benefits to small businesses, but remains concerned that the transfer of the business names registration to the Australia government will result in Queensland foregoing the annual revenue generated by the state based business names register for a relatively small payment over five years.

5. SHOULD THE BILL BE PASSED? Notwithstanding a number of concerns about the application to the Bill of the fundamental legislative principles, revenue, fees, and the lack of information on COAG decisions noted in this report, the committee supports the Bill and considers that the national system will benefit Queensland businesses. Pursuant to Standing Order 132, the committee therefore recommends that the Bill be passed.

Recommendation 1 The committee recommends that the Business Names (Commonwealth Powers) Bill 2011 be passed.

However, as a result of its examination, the committee considers that the legislation could be improved by two amendments concerning: the delegation to the Governor in Council of the power to terminate the initial or amendment reference of power to the Commonwealth Parliament (discussed later at section 7) a definition of ‘unlawful conduct’ to ensure an appropriate limit to the referral of power (discussed later at section 7) All recommendations are made unanimously.

6. EXAMINATION OF THE BILL This section discusses issues raised during the committee’s examination of the Bill. The committee notes the concerns raised and, overall, is satisfied with the information contained in the Explanatory Notes to the Bill and the advice from the Department on the issues raised in submissions.

6.1 Definition of ‘Business’ The Queensland Law Society (Sub No. 1) raised concern at the lack of a definition of the term ‘business’ in clause 4 of the Bill and recommended that the term ‘business’ be defined in the Bill to include a franchise.

11 Business Names (Commonwealth Powers) Bill 2011, Explanatory Notes, at 4.

Legal Affairs, Police, Corrective Services and Emergency Services Committee 11 EXAMINATION OF BUSINESS NAMES (COMMONWEALTH POWERS) BILL 2011 Committee comments The committee is satisfied with the advice from the Department that clause 4 of the Bill provides a sufficiently wide definition of the term ‘business’ to capture the business model of a franchise. Under clause 18 the term ‘business’ is to have the same meaning as ‘business’ under the current Business Names Act 1962, which includes a trade or profession.12

6.2 Trademarks The Queensland Law Society recommended that the Bill be amended to require an applicant for registration of a business name to conduct a simple due diligence search to ascertain the uniqueness of the business name and to be aware of businesses trading under similar names. Both the Department and the DIISR (Sub No. 2) state that the onus of ensuring that a business name does not infringe on an existing trademark or intellectual property lies with the business registration applicant. The Department advised, and the DIISR noted in its submission, that the ASIC will administer the register and will provide a link to a free trademark search tool on its business names registration website.13

Committee comments The committee considers this an appropriate measure to address this concern.

6.3 Non‐government entity access to registration data Veda (Sub No. 4) raised concern that the Commonwealth Bills will restrict access to the personal information of business registrants (such as date of birth) by non‐government entities.14 This issue was also raised during the Senate Economic Legislation Committee (the Senate committee) inquiry on the exposure drafts of the Commonwealth Bills by several submitters (discussed further in section 9 of this report). Across Australia, many non‐government entities are currently able to search the state and territory registers, to verify information provided by businesses, to assist them to comply with the Anti‐Money Laundering and Counter‐Terrorism Financing Act 2006 (Cth). That Act places responsibilities on financial institutions to verify the identity of their clients, and imposes penalties for not complying. Under the National Privacy Principles, an organisation must not use or disclose personal information about an individual for a purpose other than the primary purpose of collection unless one of the listed exceptions applies.15 The Department advised that the purpose of collecting information on an entity behind a business name is to register the entity behind it to assist consumers to ascertain who it is

12 Letter from Mr Philip Reed, Director‐General, Department of Justice and Attorney‐General, dated 21 September 2011. 13 Letter from Mr Philip Reed, Director‐General, Department of Justice and Attorney‐General, dated 21 September 2011 (quoting Submission No. 2 at 15). 14 Submission No. 4, Veda, at 2. 15 Privacy Act 1998 (Cth), Schedule 3. An example of an exception under the Schedule is the disclosure of health information to compile statistics relevant to public health or public safety.

Legal Affairs, Police, Corrective Services and Emergency Services Committee 12 EXAMINATION OF BUSINESS NAMES (COMMONWEALTH POWERS) BILL 2011 they are dealing with.16 The use of this information for verification by non‐government entities is not a purpose, under the Commonwealth Bills, for which that information is to be collected by ASIC. The Senate Economics Legislation Committee (the Senate Committee) suggested that the Australian Government give consideration to its decision to deny information brokers the same level of access to the business names register they currently have. The Senate Committee offered suggestions for changes to the then exposure drafts of the Bills, including to allow information brokers to verify certain information against the register, and for ASIC to use the data on the register for verification purposes.17 The DIISR (Sub No. 2) explains that there are a number of reasons why this data will not be made available for these purposes.18 First, under the National Privacy Principles, consent is required for the information to be used for a purpose other than the purpose for which it was collected. It would be impractical for the Commonwealth to sort through each registration to verify if that entity had consented to its information being used in this way, and to seek consent from those entities that had not consented. Secondly, only three States and Territories collect dates of birth for their registers. Clause 26 of the BNR (TCP) Bill prohibits ASIC from making public information that was not publicly available prior to the transfer of the data to the ASIC. Thirdly, DIISR states that advice confirms that the legislation does not breach or inhibit the intent of the identity verification requirements of the Anti‐Money Laundering and Counter‐ Terrorism Financing Act 2006 (Cth). That Act does not require the information to be sourced from the business names registers. Further, that Act requires that the information used to verify identity is reliable, whereas the dates of birth and home addresses are not checked before their inclusion on the business names registers. The DIISR does not state if ASIC will verify this information before it is included on the national business names register.19 DIISR states further: Overall, there appears to be no public interest justification for overriding the right of people who register business names to have certain personal information kept private. Whilst it may be in the business interests of certain organisations and may suit their particular business models, this is not sufficient to override public interest.20

Committee comments The committee is satisfied that, aside from eliminating one potential source of information for identity verification, the restriction on the use of personal information collected by ASIC for the business names register is reasonable. The committee considers that State and Territory business names registers are only one of a number of sources used by non‐

16 Letter from Mr Philip Reed, Director‐General, Department of Justice and Attorney‐General, dated 21 September 2011. 17 Senate Economics Legislation Committee, Exposure draft of the Business Names Registration Bill 2011 and related Bills, The Senate, August 2011, at 60‐61. 18 Submission No. 2, Department of Innovation, Industry, Science and Research, at 20 ‐ 21. 19 Submission No. 2, Department of Innovation, Industry, Science and Research, at 20 ‐ 21. 20 Submission No. 2, Department of Innovation, Industry, Science and Research, at 21.

Legal Affairs, Police, Corrective Services and Emergency Services Committee 13 EXAMINATION OF BUSINESS NAMES (COMMONWEALTH POWERS) BILL 2011 government entities to obtain such information. Whilst restricting access to the personal information on the national business names register may negatively impact these non‐ government entities, the committee considers that it is not within the public interest to make this information available for the purpose of identity verification.

6.4 Registration fees Approximately 40,574 new businesses are registered annually in Queensland. The current registration costs for businesses in Queensland are $133.60 for one year and $255.60 for three years (or $206.85 for a three year renewal). Under the national scheme the cost will be $30 for one year and $70 for three years.21 Part 6 of the IGABN states: 6.1 The Commonwealth will levy fees on private individuals and non‐government entities for registering a business name. These fees will be commensurate with the total costs involved in setting up and administering the national business names registration system. 6.2 Consistent with the objective of full cost recovery, the Commonwealth will seek to ensure that any new fee for national business name registrations will not be higher than the lowest business name registration fee currently paid by any State or Territory, taking account of the consumer price index increases. ASIC will consult with the States and Territories prior to recommending the level of registration fees or any change in the level of registration fees, to the Government. The Fees Bill provides that regulations may prescribe fees for ‘chargeable matters’ (business names registration, renewal or for an extract of the business names register) and that these fees would be imposed as a tax.22 This is to comply with section 55 of the Australian Constitution which provides that laws imposing taxation shall deal only with the imposition of taxation, and any provision therein dealing with any other matter shall be of no effect.23

Committee comments While the IAGBN provides that the fees will be commensurate with the total costs of setting up and administering the registration system, the committee notes that clause 5(2) of the Fees Bill provides that the fee for a chargeable matter need not bear any relationship to the cost of providing any service that forms part of, or is related to, that matter. Accordingly, the committee is mindful that the registration costs for business names registration may increase.

21 Hon Paul Lucas MP, Hansard, Queensland Legislative Assembly, 24 August 2011, at 2612; Mr Chris Irons, Director, Fair Trading Policy Branch, Department of Justice and Attorney‐General, Legal Affairs, Police, Corrective Services and Emergency Services Committee, Public Hearing – Examination of the Business Names (Commonwealth Powers) Bill 2011, Transcript of Proceedings, 22 September 2011, at 5. 22 Business Names Registration (Fees) Bill 2011 (Cth), cl. 4. 23 Business Names Registration (Fees) Bill 2011 (Cth), Explanatory Memorandum, at 5, para. 1.2.

Legal Affairs, Police, Corrective Services and Emergency Services Committee 14 EXAMINATION OF BUSINESS NAMES (COMMONWEALTH POWERS) BILL 2011 7. CONSISTENCY WITH FUNDAMENTAL LEGISLATIVE PRINCIPLES The committee examined the Bill’s consistency with the fundamental legislative principles under the Legislative Standards Act 1992. The committee also examined the Commonwealth Bills as they contain the detail of the State powers to be referred to the Commonwealth. This section discusses potential breaches of the fundamental legislative principles identified during the committee’s examination of the Bill, and includes any reasons or justifications contained in the Explanatory Notes to the Bill and provided by the Department.

7.1 Sufficient regard to the institution of the State Parliament Clauses 6 to 8 of the Bill would refer matters to the Parliament of the Commonwealth, allow for the amendment of the national business names legislation by the Commonwealth, and allow for the termination of the references. These clauses raise three issues regarding the institution of Parliament. Clause 6 of the Bill may not have sufficient regard to the institution of Parliament as it may be seen to erode the sovereign power of the State Parliament by referring that power to the Commonwealth.

7.1.1 The power to terminate the reference to make laws Clause 6 of the Bill provides for two references of power to the Commonwealth: • an ‘initial reference’ to make laws substantially in terms of the ‘tabled text’ (clause 6(1));and • an ‘amendment reference’ to amend the Commonwealth laws (clause 6(2)). The Explanatory Notes state that, as clause 8 of the Bill would empower the Governor in Council to terminate the references at any time by proclamation, the Parliament retains the option to repeal the references by legislation, thereby retaining its sovereign legislative power. 24 However, the Bill proposes to delegate the removal power by empowering the Governor in Council to terminate the text‐based and subject‐based references by proclamation. Any such proclamation made by the Governor in Council is to be declared to be subordinate legislation (so as to make it subject to the tabling and disallowance provisions of the Statutory Instruments Act 1992). This is known as a Henry VIII Clause; a clause which allows the express or implied amendment of an Act by subordinate legislation. These clauses are generally discouraged. In this case, the Bill would allow subordinate legislation to repeal the effect of the legislation itself. The former Scrutiny of Legislation Committee identified the use of Henry VIII clauses in facilitating national scheme legislation as falling into one of a number of acceptable categories. However, this was in the context of the role such clauses play in maintaining consistency of legislative change across jurisdictions.25 That committee was also of the firm

24 Business Names (Commonwealth Powers) Bill 2011, Explanatory Notes, at 6. 25 Scrutiny of Legislation Committee, Report No. 3, The use of Henry VIII clauses in Queensland Legislation, Queensland Parliament, January 1997, at 51 ‐ 53.

Legal Affairs, Police, Corrective Services and Emergency Services Committee 15 EXAMINATION OF BUSINESS NAMES (COMMONWEALTH POWERS) BILL 2011 view that Parliament’s power to disallow a subordinate instrument does not redeem or justify the use of a “Henry VIII clause”.26

Committee comments This committee is satisfied that the sovereign power of the Queensland Parliament to make laws is preserved by the fact that the referral of legislative power can be consequently removed by an Act of (the State) Parliament. However, the committee considers that the delegation of that removal power to the Executive (by empowering the Governor in Council to terminate the text‐based and subject‐ based references by proclamation) is an inappropriate delegation of legislative power and inconsistent with the fundamental legislative principle of having sufficient regard to the institution of the State Parliament.

7.1.2 The open‐ended referral of power Clause 6(2) of the Bill, the amendment reference, would permit the Commonwealth to amend the national business names register in respect of continuing business names matters. Continuing business names matters include: the prohibition or restriction of the use of business names by an entity because— (i) the entity has engaged in unlawful conduct; or (ii) a person involved in the management of the entity has engaged in unlawful conduct.27 The Bill does not define ‘unlawful conduct’. The amendment reference may allow the Commonwealth to refuse or cancel a business name registration for conduct that is minor or unrelated to the conduct of a business. The Tasmanian Committee raised the lack of definition of unlawful conduct in its report on the Tasmanian Bill and recommended that a definition be inserted into that Bill as: …such an open‐ended referral of a State power has the potential to cause future problems in the way the Commonwealth implements this referral power.28 The Department advised that clause 5 was drafted by the Parliamentary Counsels’ Committee on behalf of all State jurisdictions to be used as the template provision for the proposed amendment reference for the Commonwealth Bill and was agreed to by the

26 Ibid, at 55. 27 Business Names (Commonwealth Powers) Bill 2011, cl. 5(1)(f). 28 Government Administration Committee B, Report on Business Names (Commonwealth Powers) Bill 2011 (No. 43), Tasmanian Legislative Council, August 2011, at 11.

Legal Affairs, Police, Corrective Services and Emergency Services Committee 16 EXAMINATION OF BUSINESS NAMES (COMMONWEALTH POWERS) BILL 2011 Australian Government. The Department further advised that this is part of the project to form a single national law.29

Committee comments The committee understands that all parties involved in the IGABN have approved this clause. However, the committee considers that the Department’s response does not address the potentially broad reach of the expression ‘unlawful conduct’ under clause 5(1)(f). Accordingly, to ensure an appropriate limit to the power being referred to the Commonwealth, the committee recommends that the Bill should be amended to include a definition of ‘unlawful conduct’.

7.1.3 Delegation of power to amend the Commonwealth legislation Clause 7 would provide that the Queensland Parliament intends that the national business names legislation may be expressly amended by Commonwealth Acts and legislative instruments. An ‘express’ amendment is required to be a direct amendment of the Commonwealth legislation. Clause 7 goes beyond the usual amendment power found in national scheme referral legislation. The Explanatory Notes to the Queensland Bill state: [T]he State Parliament referrals cover legislative matters to the extent to which the Commonwealth Parliament lacks power. Amendment of the proposed primary Commonwealth legislation by other proposed Commonwealth legislative instruments may be an inappropriate delegation of legislative power. In terms of clause 7 of the Bill, the extent of inappropriateness of this proposed delegation would be determined by the scope of the Commonwealth Parliament’s legislative power under section 51 of the Constitution. In other words, reliance upon the Legislative Assembly’s referral of power to make amendments to Commonwealth primary legislation by Commonwealth legislative instruments would be limited by the scope of the Commonwealth Parliament’s original power under section 51. Exercise of power outside of the referral in the Bill proposing to allow legislative instruments to amend Commonwealth primary legislation, although giving rise to fundamental legislative principles issues, is a matter for the Commonwealth Parliament. As such practice is a breach of fundamental legislative principles it is not usual in Queensland legislation.30

29 Letter from Philip Reed, Director‐General, Department of Justice and Attorney‐General, dated 27 September 2011. 30 Business Names (Commonwealth Powers) Bill 2011, Explanatory Notes, at 7.

Legal Affairs, Police, Corrective Services and Emergency Services Committee 17 EXAMINATION OF BUSINESS NAMES (COMMONWEALTH POWERS) BILL 2011 Section 51 of the Constitution and the text‐based referral of power are explained earlier in this report at section 3.2. The committee sought clarification from the Department on how, and to what extent, the scope of the Commonwealth Parliament’s original power under section 51 of the Australian Constitution would limit amendments of Commonwealth primary legislation by Commonwealth legislative instruments. The Department advised that clause 7(a) recognises that the Commonwealth Parliament arguably has the power, notwithstanding the proposed ‘subject’ reference in clause 6, to make an express amendment to the commonwealth law. Further, the proposed referral of power to the Commonwealth Parliament to allow express amendments of the Commonwealth business names legislation may rely on other heads of power under the Constitution. The Commonwealth Parliament would arguably rely upon section 51(1) (the trade and commerce power) and section 51(xx) (the corporations power) for any express amendment in addition to that provided in cl. 6 of the Bill. This is also recognised in clause 6(4) of the Bill which provides that the ‘subject matter’ amendment reference only has effect to the extent that the matter is not included under the ‘heads of power’ for the Commonwealth Parliament in the Australian Constitution.31 The Queensland Parliament’s referral of power in relation to making express amendments in clause 6(2) is therefore limited to the extent that the Commonwealth Parliament places reliance on its heads of power in the Constitution.32

Committee comments The committee is satisfied with the justification provided in the Explanatory Notes and the departmental comment for the delegation of the power to the Commonwealth Parliament to amend the national business names legislation.

7.1.4 Amendment of an Act by regulation A number of clauses in the draft Commonwealth bills would allow them to be modified by Commonwealth regulations. In particular, clause 15 of the BNR Bill would confer a regulation making power on the Commonwealth to modify the operation of that bill so that: (a) provisions of the business names legislation do not apply to a matter that is dealt with by a law of a referring/adopted State or an affected Territory specified in the regulations; or (b) no inconsistency arises between the operation of a provision of the business name legislation and the operation of a provision of a law of a referring/adopted State or an affected Territory specified in the regulations. The Explanatory Notes to the Bill state that there is no expiry on this clause or regulations made under it, as normally would be expected of a transitional regulation making power in

31 Letter from Mr Philip Reed, Director‐General, Department of Justice and Attorney‐General, dated 29 September 2011. 32 Letter from Mr Philip Reed, Director‐General, Department of Justice and Attorney‐General, dated 29 September 2011.

Legal Affairs, Police, Corrective Services and Emergency Services Committee 18 EXAMINATION OF BUSINESS NAMES (COMMONWEALTH POWERS) BILL 2011 Queensland, and that this approach is common in Commonwealth regulations and the use of regulations in the Commonwealth jurisdiction does differ to Queensland.33 The Department advised that an example of what is contemplated by clause 7(b) of the Bill may be found in clause 15 of the BNR Bill. That clause proposes to allow the Commonwealth to make regulations to modify the operation of business names legislation to provide that the provisions of the Commonwealth business names legislation do not apply to a matter, specified in the regulations, which is dealt with by a law of a referring State or Territory.34 Clauses 18 to 21 of the BNR Bill would allow circumstances in which the strict liability offences provided for in clauses 18 to 21 do not apply, to be prescribed by regulation. In addition, clause 10 of the BNR (TCP) Bill would allow regulations to be made to deal with outstanding matters which would override the draft bills. The proposed clause assists with any inconsistency between the law of a State and the Commonwealth in relation to section 109 of the Australian Constitution.35 The use of regulations in this manner is justified as it provides a means to facilitate the continued operation of State laws where there may be a constitutional inconsistency which preserves the Parliament’s sovereignty.36 The Department stated that it is a matter for the Commonwealth Parliament.37

Committee comments The committee is satisfied with the justification in the Explanatory Notes and the departmental comment for the referral of power to enable the national business names legislation to be modified by Commonwealth legislative instruments.

7.2 Rights and liberties of individuals

Information privacy Clause 12 of the Bill may affect rights of individuals to information privacy. It would provide for the migration of information recorded in the Queensland business names database to the new national business names register to be administered by the ASIC. Clause 62 of the Commonwealth BNR Bill would require ASIC to give details of a kind to be prescribed by regulation, such as an individual’s date of birth, to a government body in limited circumstances.

33 Business Names (Commonwealth Powers) Bill 2011, Explanatory Notes, at 9. 34 Letter from Mr Philip Reed, Director‐General, Department of Justice and Attorney‐General, dated 29 September 2011. 35 Section 109 of the Constitution of Australia provides that the laws of the Commonwealth prevail over the laws of a State and the laws of the State are invalid to the extent of the inconsistency. 36 Letter from Mr Philip Reed, Director‐General, Department of Justice and Attorney‐General, dated 29 September 2011. 37 Letter from Philip Reed, Director‐General, Department of Justice and Attorney‐General, dated 27 September 2011.

Legal Affairs, Police, Corrective Services and Emergency Services Committee 19 EXAMINATION OF BUSINESS NAMES (COMMONWEALTH POWERS) BILL 2011 Committee comments The committee is satisfied that disclosure of information is justified as it is restricted to the migration of all existing business names on the Queensland register to the proposed ASIC Business Names Register.38 The committee is satisfied that the disclosure of information to government bodies for certain purposes, such as the enforcement of criminal law, the protection of public revenue, or consumer protection is justified.39

7.3 Immunity from civil liability Clause 14 of the Bill would protect the chief executive or a public service employee from civil liability for an act or omission made honestly and without negligence in relation to the giving of information to the Commonwealth.

Committee comments The committee is satisfied that the immunity is justified as it will be limited to an act done, or omission made, honestly and without negligence in the performance of those functions. Further, the committee notes that an aggrieved party is not prevented from seeking redress as any liability attaches to the State.40

Immunity under the BNR Bill Clause 78 of the BNR Bill would confer immunity on the Minister, the ASIC, delegates and public servants for an act or omission done in good faith in the exercise of any power or function under the legislation.

Committee comments The committee is satisfied that, whilst this provision does not conform to the standard usually required in Queensland legislation, in that an absence of negligence is not stipulated and no redress to the state is provided, the immunity is sufficiently limited.41

7.4 Administrative power Clauses 19 and 20 of the BNR Bill do not provide a right of review in relation to a refusal by the Minister to make a determination exempting an entity from particular requirements relating to the inclusion of business names in written communications and their display at places open to the public. Clause 32 of the BNR Bill would provide that the Minister may exempt certain entities from disqualification despite conviction without setting out clear criteria for decision making.

Committee comments The committee accepts that protections such as these provide flexibility and, as noted in the Explanatory Notes to the Bill, are normally found in Queensland legislation.42

38 Business Names (Commonwealth Powers) Bill 2011, Explanatory Notes, at 4 – 5. 39 Business Names (Commonwealth Powers) Bill 2011, Explanatory Notes, at 9. 40 Business Names (Commonwealth Powers) Bill 2011, Explanatory Notes, at 6. 41 Business Names (Commonwealth Powers) Bill 2011, Explanatory Notes, at 9.

Legal Affairs, Police, Corrective Services and Emergency Services Committee 20 EXAMINATION OF BUSINESS NAMES (COMMONWEALTH POWERS) BILL 2011 8. TABLING OF COAG DECISIONS AND INTERGOVERNMENTAL AGREEMENTS As discussed earlier in section 4 of this report, the Bill stems from a COAG decision and an Intergovernmental Agreement. The COAG initiates, implements and monitors policy reforms of national significance which require national cooperation and comprises the Prime Minister and State Premiers and Territory Chief Ministers.43 The Queensland Premier, Hon. Anna Bligh MP, signed the IGABN on July 2009 for and on behalf of the State of Queensland, thereby agreeing to establish a national system to be implemented by the Commonwealth and supported by a text‐based referral of power to the Commonwealth Parliament.44 As a party to the agreement, the State of Queensland was bound by the IGABN when it was signed by the Premier. This occurred without the proposed IGABN being tabled in, or being debated or endorsed by, the Queensland Legislative Assembly. Much work has been done in Australia on the scrutiny of national schemes legislation. In 1996 a working party of representatives of scrutiny of legislation committees throughout Australia issued a position paper on the subject.45 Key findings in that position paper included that there is a need for Parliaments to be informed about intergovernmental agreements, and that relevant information including a copy of any intergovernmental agreement need to be tabled in each Parliament prior to any uniform legislation being 46 introduced. The committee is concerned that the IGABN was not tabled in the Queensland Legislative Assembly as this agreement provides that the legislative scheme agreed to by the Parties, i.e. by the Premier for and on behalf of Queensland, involves the enactment by state Parliaments of legislation referring certain matters to the Commonwealth Parliament.47 There is currently no system in place for COAG decisions or for Intergovernmental Agreements of a binding nature to be tabled in the Queensland Legislative Assembly before the State becomes bound by that decision or agreement. Other jurisdictions have processes in place to ensure that the Parliament is aware of intergovernmental agreements relating to Bills. For example, the Australian Capital Territory Government tables a list of intergovernmental agreement negotiations in the Assembly every six months; tables all signed

42 Business Names (Commonwealth Powers) Bill 2011, Explanatory Notes, at 8. 43 http://www.coag.gov.au/about_coag/index.cfm. 44 Council of Australian Governments, Intergovernmental Agreement for Business Names Agreement, July 2009. 45 Senate Standing Committee for the Scrutiny of Bills, Working Party of Representatives of Scrutiny of Legislation Committees throughout Australia—Scrutiny of national schemes of legislation: Position paper, Parliament of Australia, October 1996. 46 Senate Standing Committee for the Scrutiny of Bills, Working Party of Representatives of Scrutiny of Legislation Committees throughout Australia—Scrutiny of national schemes of legislation: Position paper, Parliament of Australia, October 1996, at 6.20 ‐ 6.23. 47 Council of Australian Governments, Intergovernmental Agreement for Business Names Agreement, July 2009, at 4.3.

Legal Affairs, Police, Corrective Services and Emergency Services Committee 21 EXAMINATION OF BUSINESS NAMES (COMMONWEALTH POWERS) BILL 2011 intergovernmental agreements in the Assembly as soon as practicable; and publishes the signed intergovernmental agreements on a register on the Chief Minister’s Department website.48 Ministers in Western Australia must identify, in the second reading speech of a Bill, whether the Bill ratifies a multilateral or bilateral intergovernmental agreement or if it introduces a scheme of uniform legislation throughout the Commonwealth. The Minister must also identify any relevant intergovernmental agreements.49 The Tasmanian Parliament does not table Intergovernmental Agreements. The Legislative Council Government Administration Committee B (the Tasmanian Committee) recommended that the Tasmanian Government table all Intergovernmental Agreements before they become binding on the State.50 Intergovernmental agreements are not tabled in the Northern Territory Parliament, and the committee is not aware of any relevant requirements in either the New South Wales or South Australian Parliaments. With an increasing focus on nationally uniform policy reforms, the committee strongly encourages the Government to table intergovernmental agreements, at the latest, when a Bill to implement the agreed policy reform is introduced into the Legislative Assembly.

9. CONSIDERATION OF RELEVANT LEGISLATION IN OTHER JURISDICTIONS As noted earlier, all States and Territories must refer power to the Commonwealth Parliament. The examination of similar legislation in other States, and the examination of the exposure drafts of the Commonwealth Bills, are outlined below.

9.1 Tasmania On 14 July 2011, the Tasmanian Legislative Council referred the Tasmanian Bill to the Tasmanian Government Administration Committee B (The Tasmanian Committee) for its consideration and report. The Tasmanian Committee reported that there was a substantial referral of power beyond the actual Bill as the term ‘continuing business names matters’ could be construed broadly.51 In respect of the Tasmanian Bill, the Tasmanian Committee recommended that:

48 Chief Minister and Cabinet Directorate website: www.cmd.act.gov.au/policystrategic/igr. The list of intergovernmental agreements (as at 26 September 2011) is available here: www.cmd.act.gov.au/functions/publications/intergovernmental_agreements. 49 Ministerial Office Memorandum 2007/01. Sourced from report No. 63 of the Standing Committee on Uniform Legislation and Statutes Review, Information Report: Review of Uniform Legislation, Western Australian Parliament, June 2011, Appendix 4, at 49. 50 Government Administration Committee B, Report on Business Names (Commonwealth Powers) Bill 2011 (No. 43), Tasmanian Legislative Council, August 2011, at 20. 51 Government Administration Committee B, Report on Business Names (Commonwealth Powers) Bill 2011 (No. 43), Tasmanian Legislative Council, August 2011, at 5 (quoting Michael Stokes) and at 10.

Legal Affairs, Police, Corrective Services and Emergency Services Committee 22 EXAMINATION OF BUSINESS NAMES (COMMONWEALTH POWERS) BILL 2011 • ‘unlawful conduct’ be defined in the Tasmanian Bill as clause 5 allows the Commonwealth to refuse to register a business name, or to cancel a registered business name, for any unlawful conduct; 52 In respect of nationally consistent legislation and the referral of State powers to the Commonwealth, the Tasmanian committee recommended that: • COAG Intergovernmental Agreements be tabled in each State and Territory Parliament before they become binding on those jurisdictions.53 In respect of the Commonwealth Bills, the Tasmanian Committee concluded that: • substantive amendments be tabled in all Australian Parliaments before being passed as law; • a geographic identifier be allowed for businesses in different locations registering similar names that would otherwise be unacceptable; • financial institutions be granted access to business names registration information to comply with Commonwealth counter‐terrorism and money‐laundering legislation; and The Tasmanian Parliament passed the Tasmanian Bill without amendment on 22 September 2011.

9.2 New South Wales The Business Names (Commonwealth Powers) Act 2011 (NSW) was passed by the New South Wales Legislative Council on 14 September 2011 and by the New South Wales Legislative Assembly on 14 September 2011. It received Assent on 20 September 2011.

9.3 The Commonwealth Clause 6 of the Bill refers power to the Commonwealth in terms of the ‘tabled text’. Tabled text is defined as the text of the Business Names Registration Bill 2011 (Cth) and the Business Names Registration (Transitional and consequential Provisions) Bill 2011. As such, this committee considered those Bills as part of its examination of the Queensland Bill. The exposure drafts of the Commonwealth Bills were referred to, and considered by, the Commonwealth Senate Economics Legislation Committee (the Senate Committee), which tabled its report on 16 August 2011.54 The Senate Committee stated that the then draft BNR Bill is a worthwhile initiative and will produce both cost and time savings for businesses across Australia and recommended that the exposure draft of the Bills be introduced into the Commonwealth Parliament.55

52 Government Administration Committee B, Report on Business Names (Commonwealth Powers) Bill 2011 (No. 43), Tasmanian Legislative Council, August 2011Ibid, at 11 and 19. 53 Government Administration Committee B, Report on Business Names (Commonwealth Powers) Bill 2011 (No. 43), Tasmanian Legislative Council, August 2011, at 20. 54 Senate Economics Legislation Committee, Exposure draft of the Business Names Registration Bill 2011 and related Bills, The Senate, August 2011. 55 Senate Economics Legislation Committee, Exposure draft of the Business Names Registration Bill 2011 and related Bills, The Senate, August 2011, at 64.

Legal Affairs, Police, Corrective Services and Emergency Services Committee 23 EXAMINATION OF BUSINESS NAMES (COMMONWEALTH POWERS) BILL 2011 However, the Senate Committee also suggested changes to the then draft Bills. This committee notes that, despite the changes to the exposure drafts of the Commonwealth Bills suggested by the Senate Committee, there were no substantive differences between the Commonwealth Bills, as introduced, and the exposure drafts published on the website of the Senate Committee.56

Domain names The Senate Committee noted that there is an opportunity through this reform to address the issue of domain names, particularly given the imperative of brand recognition under a desired name and the likelihood that competition for original business names under one national register will intensify.57 The report noted that ASIC proposed to provide information on domain name registration prior to, and after, business name registration and will provide prominent online links to the Australian Domain Name Administrator site. The Senate Committee found that this link was not as direct as in other jurisdictions.58 In relation to intellectual property rights the Senate Committee noted that a business may be registered under one name but trade under another – i.e. by using a domain name. This can cause problems when that name, or a near identical name, is registered to another business. The Senate Committee considered that if domain issues were left unaddressed, business owners may become subject to litigation, potential fines, and in the worst case scenario, lose business and/or internet presence due to an order to remove a web‐page.59 The Senate Committee suggested that either a clause be inserted into the Business Names Registration Bill 2011 which stipulates that domain names will not be taken into account should a dispute arise (unrelated to trademarks), or by legislating that domain names be part of the registration process and searchable so that owners can take precautionary measures against registering near identical domains and avoid potential litigation.60

56 Spooner. D, and Scully. S, Business Names Registration Bill 2011, Bills Digest No. 43, Parliament of Australia, 2011‐12, September 2011, at 7. 57 Senate Economics Legislation Committee, Exposure draft of the Business Names Registration Bill 2011 and related Bills, The Senate, August 2011, at 46. 58 Senate Economics Legislation Committee, Exposure draft of the Business Names Registration Bill 2011 and related Bills, The Senate, August 2011, (quoting the DIISR) at 47. 59 Senate Economics Legislation Committee, Exposure draft of the Business Names Registration Bill 2011 and related Bills, The Senate, August 2011, at 49. 60 Senate Economics Legislation Committee, Exposure draft of the Business Names Registration Bill 2011 and related Bills, The Senate, August 2011, at 63.

Legal Affairs, Police, Corrective Services and Emergency Services Committee 24 EXAMINATION OF BUSINESS NAMES (COMMONWEALTH POWERS) BILL 2011 APPENDIX A – DETAILS OF MEETING AND WRITTEN MATERIAL PROVIDED BY THE DEPARTMENT OF JUSTICE AND ATTORNEY‐ GENERAL

The transcripts of the meeting, and all written material provided to the committee by the department are available on the committee’s website at: www.parliament.qld.gov.au/lapcsesc.

Undumbi Meeting Room, Parliament House, Brisbane Thursday 22 September 2011 Mr Philip Reed – Director‐General, Department of Justice and Attorney‐General Mr David Ford – Deputy Director‐General, Department of Justice and Attorney‐General Mr Chris Irons – Director, Fair Trading Policy, Office of Regulatory Policy, Department of Justice and Attorney‐General Mr Danny Low – Principal Policy and Legislation Officer, Fair Trading Policy, Office of Regulatory Policy, Department of Justice and Attorney‐General

Written material: Letter from the Director‐General, Department of Justice and Attorney‐General providing the department’s initial overview and information prior to consultation, 19 September 2011 Letter from the Director‐General, Department of Justice and Attorney‐General providing the department's comments on matters raised in submissions, 21 September 2011 Letter from the Director‐General, Department of Justice and Attorney‐General providing information in relation to fundamental legislative principles, 27 September 2011 Letter from the Director‐General, Department of Justice and Attorney‐General providing further information in relation to fundamental legislative principles, 29 September 2011

Legal Affairs, Police, Corrective Services and Emergency Services Committee 25 EXAMINATION OF BUSINESS NAMES (COMMONWEALTH POWERS) BILL 2011 STATEMENT OF RESERVATION

We, the undersigned, support with reservation, the recommendations in the Inquiry into Business Names (Commonwealth Powers) Bill 2011 ‐ Report (the "Report"). The reasons for our reservation are based on the concerns outlined below.

THE COMMITTEE PROCESS

The Business Names (Commonwealth Powers) Bill 2011 (the "Bill") was referred by the Legislative Assembly of Queensland ("Legislative Assembly") to the Legal Affairs, Police, Corrective Services and Emergency Services Committee (the "Committee") for examination and report on 24 August 2011.

Pursuant to the new Standing Orders of the Legislative Assembly the Committee was required to report to the Legislative Assembly by the date which is 6 months from when the referral to the Committee was made.

However on the 7 September 2011, the Legislative Assembly moved that the report be brought forward to 4 October 2011, some five months ahead of the original reporting timeframe.

We object to the rushing through of this important Bill and subsequent inquiry through the Committee process.

It is clear by viewing the Legislative Assembly Notice Paper for Tuesday, 11 October 2011 that the Government Business Orders of the Day is light on. As at Monday, 3 October 2011 there are 4 government bills set down to be debated in the Legislative Assembly.

The Government successfully sought the Legislative Assembly to bring forward the reporting dates of numerous bills currently before committees, of which this was one.

The circumvention of a full and proper inquiry into the Bill should be avoided.

We note that there were four public submissions received: 1. Queensland Law Society; 2. Federal Department of Innovation, Industry, Science and Research; 3. Family Business Australia; and 4. VEDA.

Due to the shortened timing of the report finalisation, we do not believe that the relevant Queensland stakeholders have had the opportunity to submit their concerns or otherwise to the Committee.

We note that the Committee does report that due to the short timeframe the Committee did not hold any public hearing into the Bill.

It is disappointing that in the spirit of this new committee system, with all its trumpeted openness and accountability, that we would be faced with the situation so soon into this new system whereby committees are being forced to rush through their enquiries because

Legal Affairs, Police, Corrective Services and Emergency Services Committee 26 EXAMINATION OF BUSINESS NAMES (COMMONWEALTH POWERS) BILL 2011 the Government seems unable to bring forward enough legalisation to put on the parliamentary agenda.

REFERRAL OF POWER

As noted in the Report, the Bill proposes a referral power to the Commonwealth Parliament to legislate for business name registration.

This will fundamentally change the way business names are registered in Queensland.

Currently those wishing to carry on an enterprise in Queensland in a name other than their own name are required to register a business name for 1 or 3 years.

Registration does not give the owner any proprietary right as such but merely the right to trade under the registered business name. It does offer some protection from other similar names being registered in Queensland but does not prevent other individuals or companies from registering the same or similar name in other jurisdictions throughout Australia.

It is proposed to refer the power to enact and amend the Commonwealth Business Names Registration Bill and the Commonwealth Business Names Registration (Transitional and Consequential Provisions) Bill.

Although the referral of power to the Commonwealth is not a broad based referral, one ought to take a cautionary approach when meddling with the sovereignty of the State.

As set out earlier in this Statement, given the reduced timeframe we do not believe that appropriate stakeholder consultation has occurred. We are yet to see any fundamental consultation undertaken by the State Government prior to the debate of the Bill.

We are uncomfortable with the ever increasing trend of this Labor State Government to cede Queensland legislative powers to the Commonwealth.

REVENUE

As noted in the Report the approximate revenue generated by the Queensland Business Names Register is currently $21.8 million. The total over five years is approximately $99.55 million.

We note that as a reward payment the Queensland Government is entitled to $112.7 million from the Commonwealth Government over 5 years.

For the initial five years the Queensland State Government appears set to recoup its estimated lost revenue through receipt of the reward payment. However, this will of course change following the end of the five year period where the State will no longer be entitled to reward payments or revenue generated through the registration of business names.

The State will forego an income source to the tune of $21.8 million. This will of course have an impact on future State budgets. One ought to ask whether the State Government has taken this into consideration and whether the State Government has identified the impact that the loss of revenue will have, including what services will be cut as a result of the lost revenue.

Legal Affairs, Police, Corrective Services and Emergency Services Committee 27 EXAMINATION OF BUSINESS NAMES (COMMONWEALTH POWERS) BILL 2011 COSTS TO REGISTER A BUSINESS NAME

Unsurprisingly, Queensland is currently the most expensive State or Territory to register a business name.

The Commonwealth Business Name Registration Fees Bill 2011 (the Fees Bill) will replace the existing fee arrangement. We note that the proposed fees of $30 for one year and $70 for three years are considerably less than the current Queensland registration fees.

However, the Fees Bill does provide that regulations may prescribe fees for chargeable matters including business name registration, renewal or an extract of the business name register.

There does not appear to be a moratorium on new fees being introduced or increased by regulation.

The Report notes that registration costs for business name registration may increase to an unlimited amount.

We have concerns that the Commonwealth Government may do this. This referral was pitched as business friendly and cutting red tape.

If, for instance, a business name currently registered in Queensland requires registration of that same name in other jurisdictions then we can see the potential saving for business. Under the current system they would be required to register that name separately in each State or Territory and pay separate registration costs.

If there is a future national push to increase registration costs, then the Queensland small business that does not intend to register in any other state or territory may be adversely impacted by an increase in costs.

IDENTICAL OR NEARLY IDENTICAL NAMES

We have concerns that the transitional provisions whereby each identical or nearly identical business name that is merged onto the National register will be identified by potential geographic location, i.e. Blueys Seafood (Qld) or Blueys Seafood (WA). This has the potential to create confusion in the market place and to consumers.

CONCLUDING REMARKS

Overall, the reduced timeframe for the Committee's proper review of this Bill and adequate stakeholder consultation is severely inadequate and is at odds with the spirit of the Legislative Assembly's committee system of openness and accountability.

John Paul Langbroek MP Jarrod Bleijie MP Member for Surfers Paradise Member for Kawana

Legal Affairs, Police, Corrective Services and Emergency Services Committee 28