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Trade (Australia And New Zealand) Act 2023

Contents

Commentary on provisions of the Act

Section 1: Power to implement government procurement Chapters

  1. Before an FTA can enter into force, the parties to the FTA should ensure that it is implemented domestically, to avoid breaching the FTA on entry into force. This means that each party to the FTA should ensure its domestic legislative framework is consistent with the obligations in the FTA. Not all obligations within an FTA require a change to the law.
  2. The UK-Australia FTA and UK-New Zealand FTA require changes to UK domestic procurement law. The scope of the power contained in the Act is to implement the government procurement Chapters of these Agreements, including the market access schedules (as they may be modified from time to time), and to make related provision.
  3. The UK previously implemented its procurement obligations under section 2(2) of the European Communities Act 1972 when the UK was still a Member State of the EU. Now that the UK has left the EU, the power in section 1 of the Act is needed to ensure that the obligations in the government procurement Chapters of the Agreements, and matters arising out of or related to those Chapters, can be implemented in domestic law.
  4. Section 1 provides a power for appropriate authorities to make regulations for two purposes:
    1. Subsection 1(a) allows an appropriate authority to make regulations for the purpose of implementing the government procurement Chapters in the FTAs.
    2. Subsection 1(b) allows an appropriate authority to make regulations for the purpose of making other changes for matters arising out of, or related to, the government procurement Chapters in the FTAs.
  5. The power in subsection 1(a) will be used to make the following changes:
    1. to amend existing secondary legislation for procurement to extend the duties owed by contracting authorities, and remedies available in that legislation, to the suppliers of the relevant countries for procurement covered by the respective Agreements, implementing the market access conditions of the Agreements;
    2. to amend existing secondary legislation for procurement to bring it in line with certain rules in the text of the government procurement Chapter of the UK-Australia FTA. The specific areas of the procurement regulations that may be amended relate to rules regarding (i) unknown contract values, (ii) notices advertising procurements, and (iii) termination of awarded contracts;
    3. to amend existing secondary legislation to implement any changes to the government procurement Chapters of the Agreements over their lifetime, for example updates to the market access schedules to reflect certain machinery of government changes. The Procurement Bill is expected to include a power to implement the procurement market access obligations in future FTAs, including any updates to these Agreements. Accordingly, this power is intended to provide for future implementation only until it is replaced by the power in the Procurement Bill.
  6. The power in subsection 1(b) is to be read with sections 1(2) and 1(3).
  7. Section 1(2) allows the regulations under subsection 1(b) to be made also for cases falling outside the scope of the government procurement Chapters to provide for general application.
  8. Section 1(3) clarifies that a case is outside the scope of a government procurement Chapter if that Chapter does not impose an obligation on the UK in respect of that case, i.e. it is not an obligation owed specifically in the Chapter.
  9. The effect of subsection 1(b) read with 1(2) is that certain changes made to domestic law to implement the UK-Australia FTA, i.e. in respect of the rules in the text of the government procurement Chapter (see paragraph 17.b above), can apply generally and not only to suppliers from Australia. This will ensure procurement regulations remain uniform and coherent by not imposing different or conflicting procurement procedures on contracting authorities for procurements covered by the FTA, and ensure the UK can implement its obligations in the FTA in a way that is consistent with the UK’s other international procurement obligations.
  10. Section 1(4) defines "government procurement Chapters of the UK-Australia and UK-New Zealand FTAs" set out in section 1(4)(a) and (b) respectively, by reference to the relevant chapters and annexes in the FTAs.
  11. Section 1(5) defines the "UK-Australia FTA" and "UK-New Zealand FTA". These definitions include reference to the Agreement as it is modified from time to time in accordance with any provision of it. This clarifies that the scope of the power includes implementation of updates to the Agreements.

Section 2: Further provision about power

  1. Section 2 provides for different types of provision that could be made by regulations under section 1 where needed, for example consequential provision. Section 2 also gives effect to Schedules 1 and 2, which, respectively, set out restrictions on the use of the power by devolved authorities and provide for how regulations under section 1 can be made.

Section 3: Interpretation

  1. Section 3 sets out how certain terms within the Trade (Australia and New Zealand) Act 2023 should be interpreted.
  2. An "appropriate authority" means a Minister of the Crown or a devolved authority, for the purpose of making regulations under section 1. "Minister of the Crown" and "devolved authority" are also defined in section 3. "Devolved authority" is defined as the Scottish Ministers, the Welsh Ministers or a Northern Ireland department.
  3. Section 3 also defines the terms "modify" and "subordinate legislation".

Section 4: Extent, commencement and short title

  1. Section 4(1) provides that the Act extends to England and Wales, Scotland and Northern Ireland.
  2. Section 4(2) provided that the Act came into force on the day of Royal Assent.
  3. Section 4(3) establishes that the short title for this Act will be the Trade (Australia and New Zealand) Act 2023.

Schedule 1 – Provision relating to devolved authorities and Senedd Cymru

Part 1 - Restrictions on devolved authorities

  1. Part 1 of the Schedule describes the circumstances in which a devolved authority (defined in section 3 as the Scottish Ministers, Welsh Ministers and a Northern Ireland department) may use the power in section 1 to make regulations.

No power to make provision outside devolved competence

  1. Paragraph 1 provides that a devolved authority may not make provision under section 1 unless the provision is within the devolved authority’s devolved competence. Devolved competence is defined in paragraphs 5 to 7 of the Schedule.

Requirement for consent where it would otherwise be required

  1. Paragraph 2 sets out that consent of a Minister of the Crown is required if a devolved authority is making a provision using the power in section 1 acting alone and the provision would otherwise require consent if it were being made under other powers. That could be where the relevant devolved legislature’s legislative powers were subject to a consent requirement, or where the devolved authority would normally require consent to make such a provision by secondary legislation. This requirement for consent will not apply if the devolved authority already has power to make such provision using secondary legislation without needing the consent of the Minister of the Crown.

Requirement for joint exercise where it would otherwise be required

  1. Paragraph 3 sets out that, where a devolved authority would normally only be able to make legislation jointly with the UK Government, the devolved authority will still have to make such legislation jointly when exercising the power in section 1.

Requirement for consultation where it would otherwise be required

  1. Paragraph 4 requires consultation with the Government on legislation made by a devolved authority acting alone in the exercise of the powers in section 1, where the devolved authority would normally be required to consult with the Government when making those kinds of changes in legislation.

Meaning of devolved competence

  1. Paragraphs 5 to 7 define devolved competence for the purposes of exercise by a devolved authority of the power in section 1.

Meaning of "Northern Ireland devolved authority"

  1. Paragraph 8 defines "Northern Ireland devolved authority" for the purposes of Part 1 of the Schedule.

Part 2 - Legislative competence of Senedd Cymru: exclusions from restrictions

  1. Paragraph 9 in Part 2 of the Schedule disapplies some of the restrictions in paragraphs 8 and 11 of Schedule 7B to the Government of Wales Act 2006 in relation to concurrent functions in this Act.

Schedule 2 – Regulations under Section 1

Part 1 - Statutory instruments and statutory rules

  1. Part 1 provides that the power to make regulations under section 1 of the Act is exercisable by statutory instrument when exercised by a Minister of the Crown acting alone and makes corresponding provision for each of the devolved authorities acting alone and for a Minister of the Crown acting jointly with a devolved authority.

Part 2 - Scrutiny of regulations under section 1

  1. Part 2 of the Schedule provides for scrutiny by the UK Parliament and the devolved legislatures of regulations made under section 1.

Scrutiny of regulations made by Minister of the Crown or devolved authority acting alone

  1. Paragraph 2 provides that the negative procedure applies to regulations made by a Minister of the Crown or a devolved authority acting alone under section 1.

Scrutiny of regulations made by Minister of the Crown and devolved authority acting jointly

  1. Paragraph 3 provides for the negative procedure to apply to regulations made jointly by a Minister of the Crown and a devolved authority under section 1.

Part 3 – Anticipatory exercise of section 1 power

  1. Part 3 provides that the power to make regulations may be exercised before the agreement or a modification to a government procurement Chapter of the UK-Australia FTA or UK-New Zealand FTA is ratified.

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