Commonwealth Numbered Regulations - Explanatory Statements

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INTERNATIONAL AIR SERVICES COMMISSION AMENDMENT REGULATIONS 2003 (NO. 1) 2003 NO. 270

Subsection 55(1) of the International Air Services Commission Act 1992 (the Act) provides that the Governor-General may make regulations prescribing matters that are required or permitted by the Act to be prescribed or that are necessary or convenient to be prescribed for carrying out or giving effect to the Act. In particular, subsection 55(2) of the Act provides that the Governor- General may make regulations providing for procedures to be followed by the Commission in performing its functions, including time limits within which such procedures must be completed.

The rights of Australian carriers to operate scheduled international air services to other countries are governed by Australia's bilateral arrangements with those countries. The arrangements typically provide for the designation of international carriers. They also set out a regime under which the capacity (the frequency of flights and the number of passenger seats available on each flight) and points (the airports to which the airlines can fly) are allocated to the airlines designated under the arrangements.

Since 1992, a policy of "multiple designation" has applied, providing the opportunity for competition between Australian carriers on international air services to and from Australia. Multiple designation means that more than one airline can be designated an international airline, entitled to fly between countries that are parties to a bilateral arrangement. When there is more than one designated airline, an issue arises as to the fair allocation of the capacity allocated by the bilateral arrangement. In Australia this was dealt with by the establishment of the International Air Services Commission (the Commission) under subsection 6(1) of the Act. The primary function of the Commission is to make determinations allocating available capacity to Australian international carriers. Determinations identify which airlines are selected to operate particular available capacity and set necessary conditions. Determinations are reviewed after a specified period (usually 5 years).

The Aviation Legislation Amendment Act 2002 (AVLA) inserted Part 3A into the Act, which gives effect to recommendations of the Productivity Commission (PC) to streamline the operation of the International Air Services Commission and its processes for allocation of capacity. The amendment changed the circumstances in which submissions could be made on allocation of capacity and provided for delegation of some of the Commission's functions and powers in certain circumstances. These circumstances were to be set out in the International Air Services Commission Regulations.

The purpose of the Regulations is, therefore, to give effect to Part 3A of the Act by specifying:

•       the situations in which the International Air Services Commission must invite submissions relating to the allocation of capacity; and

•       the circumstances in which the Commission may delegate a power or function as provided for in Part 3A of the Act.

The Regulations also

•       update the citation of the Regulations to include the year and italicise the title; and

•       update the Commission's contact details, which are required to be included in the Regulations by sections 14 and 21 of the Act.

Details of the Regulations are set out in the Attachment. The Office of Regulation Review has advised that the amendments do not require a Regulation Impact Statement, as the Regulation Impact Statement attached to the Explanatory Statement to the Aviation Legislation Amendment Act 2002, deals adequately with the issue.

The Regulations commenced on gazettal.

Authority: Section 55 of the International Air Services Commission Act 1992

ATTACHMENT

Clause 1       Name of Regulations

This clause provides that the Regulations are the International Air Services Commission Amendment Regulations 2003 (No. 1).

Clause 2       Commencement

This clause provides that these Regulations commence on gazettal.

Clause 3       Amendment of International Air Services Commission Regulations

This clause provides that Schedule 1 amends the International Air Services Commission Regulations.

Schedule 1       Amendments

Item 1       Name of Regulations

This item updates the title of the Regulations in line with current drafting practice by inserting the year 1992 and italicising the title.

Item 2       Submissions about allocation of capacity (Act, paragraph 12 (1) (b))

This item inserts an new regulation 2B, which places an obligation on the International Air Services Commission to invite submissions to it about the allocation of capacity where more than 1 Australian carrier applies for the capacity, or where the Commission considers that the allocation may breach competition law or where, despite having made an application for capacity, the Commission is not convinced that the carrier will actually be able to obtain all the necessary licences and permits required to operate services into and out of Australia. Formerly, the Act required that the Commission had to call for submissions on all applications.

This regulation makes the processing of most applications more efficient, in that non-contentious applications can be dealt with more efficiently. This is in line with the Government's decision to accept the Productivity Commission's recommendations for the more efficient administration of the Commission's functions. It also does it in a manner consistent with the objects of the Act.

Item 3       Paragraphs 3 (b) and (c)

This item updates the Commission's contact details, which are required to be included in the Regulations by sections 14 and 21 of the Act.

Item 4       Delegation of powers and functions (Act, subsection 27AB(3))

This item inserts a new Regulation 3A, which provides for the delegation of the Commission's powers and functions in relation to allocations of capacity where only one application is made for the allocation of capacity and the proposed allocation is uncontentious. Uncontentious is defined to mean that no submission is received concerning the allocation and that the Commission considers it unlikely that such a submission will be received.

This item also provides that delegations can also be made for reviews and variations of existing determinations in the same circumstances.