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Legal framework and regulation

Section Sponsor: Emil Ford

Overview

As a former UK colony, Australia’s legal system is largely derived from the common law system that it received from Britain in the Nineteenth Century. For this reason, many of the current legal traditions and institutions reflect their English origins. However, over time, Australia has attempted to move away from this model through its judicial system (which was initially modelled on the English system) and by recognising that there has been a variety of sources from which Australian law has arisen – the Constitution, statute, common law, equity, customary law and international law.

Emil Ford Lawyers

Level 5, 580 George Street,

Sydney NSW 2000, Australia

Contact Fred Chilton

Email lawyers@emilford.com.au

Tel +61 2 9267 9800

www.emilford.com.au

Key legislation

Local regional differences.

The Commonwealth of Australia is a federation of six states (New South Wales, Victoria, Queensland, South Australia, Western Australia and Tasmania) with two major territories (Northern Territory and Australian Capital Territory).

There are three levels of government – Federal, State/Territory and Local – each with different and overlapping law-making responsibilities. In the event of a conflict of laws, the Commonwealth Parliament prevails. The Commonwealth Parliament also has power to legislate in regards to the Territories and can override Territory laws.

The Commonwealth Parliament derives its authority from the Australian Constitution, which enumerates areas of responsibility of the Federal Government such as Banking, Defence, Immigration, Tax, Intellectual Property and Corporations.

The State and Territory parliaments have broad legislative powers, except in those areas reserved for the Commonwealth Parliament. It is important to note that though there is a broad similarity between State and Territory laws, there can be important differences in legislation.

Local governments have limited power in the following areas:

Building Approvals

Local Roads

Local Services

Planning

Legal and regulatory transparency

There are very few concerns in Australia regarding issues of legal and regulatory transparency. Traditionally in terms of investment, Australia has always been a nation which not only welcomes foreign investment but actively encourages it, with its liberal and transparent screening process for incoming investment proposals. It is very rare that the Government will even consider blocking proposals, and this is only the case where the future investment has been determined by the Foreign Investment Review Board (FIRB) to be contrary to the national interest. However, some restrictions may apply in sectors considered to be ‘sensitive’, such as in residential real estate, banking, media, telecommunications, shipping, civil aviation and airports.

Hierarchy of courts

The High Court of Australia is the highest court in Australia, and its main function is to deal with appeals from the State/Territory Supreme Courts or to deal with matters concerning constitutional review. While it does possess original jurisdiction, it mainly serves as the final court of appeal with the ability to interpret the common law for the entirety of Australia. It was established by section 71 of the Australian Constitution, and is composed of seven Justices: the Chief Justice of Australia (a position currently held by Robert French) and six other Justices.

The Federal Court of Australia hears matters related to areas of federal legislation, and this may include issues of bankruptcy, corporations, trade practices, industrial relations, customs and immigration. It was established by the Federal Court of Australia Act in 1976, which grants this court original jurisdiction in the aforementioned areas, whilst also allowing it to hear appeals from tribunals and other similar bodies. There is also an appellate level usually comprising a panel of three judges.

The Family Court of Australia has jurisdiction over family law matters, and therefore deals with issues such as marriage, divorce, parental disputes, child support and custody and matrimonial property.

It was established by the Family Law Act in 1975 and attempts to be ‘less adversarial’ in nature, recognising the need to make family law matters more informal and friendlier for participants.

The Federal Circuit Court of Australia (previously known as the Federal Magistrates Court of Australia) was created in order to lighten the workload of both the Federal Court and the Family Court by hearing less complex and demanding cases. It is a fairly recent court which can exercise its jurisdiction in matters of privacy, intellectual property (copyright), industrial law, human rights, consumer law and administrative law, but its main areas of work are in the fields of bankruptcy, migration and family law.

Each State and Territory of Australia also has its own court hierarchy, which varies from State to State (or Territory to Territory) but often contains a fairly similar structure. The highest court in each State or Territory is the Supreme Court (for example, the Supreme Court of NSW) which has both original and appellate jurisdiction, and generally hears large civil disputes or serious criminal matters.

However, even though the Supreme Court is the highest court for a particular state or territory, an appeal by special leave can be made to the High Court of Australia, or appeals can also be made to the Full Court/Court of Appeal of the Supreme Court (for civil matters) or the Court of Criminal Appeal (in criminal matters).

Beneath the Supreme Court in each State/Territory is the District Court (or County Court in Victoria), which generally hears most criminal trials for less serious indictable offences, and most civil matters below a certain threshold (usually $1 million). Finally, in most States/Territories, the Magistrates Court (or Local Court in NSW) falls below the District Court, and hears summary matters and smaller civil matters. These are usually heard before a single magistrate and without a jury.

(a) In some jurisdictions, appeals from lower courts or district/country courts may go directly to the full court or court of appeal at the supreme/federal level; appeals from the Federal Magistrates’ Court can also be heard by a single judge exercising the Federal/Family Courts’ appeliate jurisdiction.

(b) Appeals from federal, state and territory tribunals may go to any higher court in their jurisdiction.

Source: Steering Commitee for the Review of Government Service Provision, Report on Government Services 2011.

Key legal considerations for digital merchants

For information about digital and electronic signatures in Australia, refer to the table.

Prospective e-merchants may also wish to consider The Australian Guidelines for Electronic Commerce, which apply specifically to business-to-consumer (B2C) commerce. However, businesses are also encouraged to follow these guidelines when involved in transactions with other businesses (B2B). It is also important to note that these are merely guidelines, and as such, where there is a conflict or inconsistency between the guidelines and the law, the law has precedence and will prevail.

Nevertheless, the main aim of the guidelines is to foster consumer confidence in B2C commerce by providing advice and recommendations on a broad spectrum of issues including:

fair business practices;

accessibility and disability access;

advertising and marketing;

engaging with minors;

disclosure of a business’s identity and location;

disclosure of a contract’s terms and conditions;

the implementation of mechanisms for concluding contracts;

adopting privacy principles;

using and disclosing information about payment, security and authentication mechanisms;

the establishment of fair and effective procedures for handling complaints and resolving disputes; and

the law and forum for the resolution of contractual disputes.

Data Protection

The relevant privacy and data protection legislation is the Privacy Act 1988 (Cth). This Act is still current and relevant, although was amended when the Privacy Amendment (Enhancing Privacy Protection) Act 2012 (Cth) came into force in 2014. See the table above for more information.

Legal certifications for trading online

If a company is operating merely as an online retailer outside of Australia, it is unlikely that they would be considered to be carrying on business in Australia. If they establish a business in Australia, they would need to apply for an ABN and register for GST, as well as registering with ASIC. Recent changes will require GST to be collected and remitted to the Australian Taxation Office on goods sold directly from overseas entities for delivery in Australia.

A foreign company can either register a branch, or establish a local subsidiary, but in either case, it will need an Australian registered address. A branch will require a local agent whereas an Australian subsidiary must have at least one resident director.

It is also recommended that a retailer consider registering a business name or trade mark to protect its business name.

Cross border trading into Australia

Trading between Australia and foreign nations in the area of agricultural produce is highly regulated by a number of acts, including the Quarantine Act 1908 (Cth), the Export Control Act 1982 (Cth) and the Imported Food Control Act 1992 (Cth) among many others. Together, these acts are the backbone of a system which seeks to protect Australia’s produce and wildlife from contamination or disease by authorising restraints on individuals and businesses engaged in exporting or importing.

The Export Control Act 1982 (Cth) is fairly broad and provides for the application of export controls to goods specified in regulations. It also makes clear the inspection responsibilities and the authority of inspection staff to carry out these responsibilities, whilst setting penalties to apply in the case of fraud or deliberate malpractice. The Imported Food Control Act 1992 (Cth) has a similar effect, albeit in the field of importing particular goods and foods which may carry disease that could threaten Australia’s agricultural sector. In terms of the Quarantine Act 1908 (Cth), this deals more broadly with powers concerning “the examination, exclusion, detention, observation, segregation, isolation, protection, treatment and regulation of vessels, installations, human beings, animals, plants or other goods or things.”

Possible changes to legislation

Australia’s participation in the 2015 United Nations Climate Change Conference in Paris might result in the implementation of domestic legislation. UN negotiators recently released a proposed skeleton agreement, with the hope of reaching a binding and universal agreement on climate from all the members who will be in attendance – close to 200. Because of Australia’s high level of emissions per capita, it is possible (but certainly not guaranteed) that Australia will return from the December 2015 conference with an obligation to introduce or amend legislation to meet these environmental goals. The government could choose to adopt something similar to the previously proposed emissions trading scheme (ETS), or it could choose to explore different avenues if it has been compelled by the international community to reduce its environmental footprint. However, it is worth noting that if any subsequent legislative changes were to be made, it could take a significant amount of time to implement them.

Key official sources of information

Austrade: for information on setting up a business in Australia.

http://www.austrade.gov.au/International/Invest/Guide-to-investing/Setting-up-a-business

Australian Business Register: to register a business name, or apply for an ABN.

http://abr.business.gov.au/ContactUs.aspx

Australian Competition and Consumer Commission: for competition and consumer concerns.

https://www.accc.gov.au/contact-us/contact-the-accc

Australian Government- Business: for business related enquiries.

http://www.business.gov.au/contact-us/Pages/default.aspx

Australian Securities and Investments Commission: for corporate, markets and financial services enquiries.

http://asic.gov.au/

Australian Taxation Office: for taxation enquiries ranging from individuals to large corporations.

https://www.ato.gov.au/

Fair Work Commission: for most employment enquiries.

https://www.fwc.gov.au/about-us/contact-us

Foreign Investment Review Board for acquisitions by foreign entities.

http://www.firb.gov.au/content/policy.asp

IP Australia: for intellectual property related enquiries.

http://www.ipaustralia.gov.au/about-us/contact-us/

Office of the Australian Information Commissioner: for privacy related enquiries.

http://www.oaic.gov.au/about-us/contact-us-page

Before commencing e-retailing and distribution in either a B2C or B2B model into Australia, E-retailers should make themselves familiar with the laws and regulations governing customs within Australia:-

Customs Act 1901

Commerce (Trade Descriptions) Act 1905

Copyright Act 1968

Trade Marks Act 1995

Customs Regulations 1926

Customs (Prohibited Exports) Regulations 1958

Customs (Prohibited Imports) Regulations 1956

Commerce (Imports) Regulations 1940

Prohibited and restricted goods

E- retailers should also take note of the prohibited and restricted goods noting in particular the permits, declarations, and applicable fees.

 

 

 

Political and socio-economic environment

Online and mobile usage

Marketing

Payment

Custom clearance policy

Logistics and fulfilment

References

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