29 Apr 2021

How do the proposed options for reform to Australia's measurement laws measure up?

By Julie Wong, Charis Chan and Samy Mansour

The Australian Government is seeking feedback on proposed measurement law reforms contained in a Regulation Impact Statement following consultation conducted between 2017 and 2020.

Between 2017 and 2020, the Australian Government's Measurement Law Review (MLR) consulted with key stakeholders who interact with Australia's measurement system, seeking input on six discussion papers that examined key aspects of Australia's measurement framework. The results of those consultations have now been released in a Regulation Impact Statement (RIS) which proposes three options for reform that target aspects of Australia's measurement laws which can be modernised or streamlined to better meet the needs of the modern economy.

This step is significant given national measurement legislation underpins significant social and economic outcomes for Australia and provides confidence in measurement across industry.

The discussion papers considered:

  • the scope of Australia's measurement laws;
  • measurement in everyday life, including traceability, measuring instruments and measurement-based transactions; and
  • measurement assurance, including third party arrangements and compliance arrangements.

MLR limitations and the reason for government involvement

The consultation identified six key issues with the current measurement legislation:

  1. emerging measuring instrument technologies require a new approach;
  2. the international measurement system is evolving and creating new ways to recognise legal measurements;
  3. industry has identified some prescriptive requirements as burdensome and unnecessary;
  4. Australia’s trading environment and economy have matured significantly since the Measurement Act 1960 (Cth) came into force;
  5. exemptions need to be reviewed and more flexible; and
  6. compliance and enforcement mechanisms are limited.

A practical example of a key MLR finding was that there are many inconsistencies in measurement-based transactions such as pre-packaged and non-packaged goods, where a disparity exists between the requirements for products that are sold as either packaged or loose items. Similarly, there is a difference in Australia's marketing requirements and those of some key trading partners, such as the European Union and the United Kingdom. These discrepancies place a sizeable burden on Australian importers who must relabel products, particularly in the cosmetics industry where exemptions are considered on a case by case basis. 

The RIS also notes that the reforms required to address these issues can only be legislated by the Government. While there is some potential for the private sector to provide partial solutions to these problems, the Government is arguably best placed to facilitate a cohesive measurement system that binds all State and Territories within Australia.


The three latest reform proposals from the MLR open for consultation

Option 1: Streamline with minimal change

This approach fixes known issues with the current framework and largely maintains the existing approach and scope of regulation. While existing measurement law is updated to address current needs, there is limited future support for industry and innovation needs.

Option 1 is aimed at streamlining and phrasing legislation to be more technology neutral. This will be supported by guidance material issued to assist in its interpretation, and prescription will be maintained where it is required, for example for National Instrument Test Procedures and certain pattern approval requirements. While legislation will be updated according to current technology and measurement practices, subsequent amendments would be required in the future to reflect further changes.

This option takes a principles-based approach to legislation and reduces prescription, which means that the law states what outcome (or principle) must be achieved and leaves the method of compliance for the relevant party to decide. Legislation therefore has the flexibility to respond to changing circumstances and avoids imposing unduly detailed requirements on how to achieve outcomes.

Examples of actions under Option 1 include:

  • additional mechanisms for the Chief Metrologist to determine other references to support accurate and reliable measurement beyond traditional "weights and measures", particularly for chemical, biological or other complex measurements;
  • maintaining existing exemptions in the Measurement Act; and
  • simplification of presentation requirements for the "measurement mark" on packaged goods.

Option 2: Flexible and future focused

As with Option 1, legislation will be streamlined in Option 2 but a flexible approach to regulation will be adopted that aims to support current and future needs as they arise.

Option 2 is also largely principles-based with the issuance of guidance material, but prescription may be maintained where required due to risk.

Key enhancements include modernising the primary measurement law to become largely principles-based, and providing appropriate mechanisms that enable adjustment of key regulatory settings over time – for example, adjusting the degree of regulation for differing measuring instruments based on design, use and risk. Exemptions would also be transferred from the primary Measurement Act to the regulations to simplify future review.

Option 3: Flexible with additional regulatory powers

This option extends Option 2, and provides the Government with additional power to more broadly support measurement confidence using a risk based approach. Under this approach, the National Measurement Institute (NMI) will have a general power to regulate measurement, beyond a primary focus on trade as in Options 1 and 2. The NMI would use this power selectively, and with consultation, to support confidence in measurements which other regulators rely upon, and provide a rapid response in a crisis or provide coverage where other regulators lack a sufficient existing framework.

Option 3 involves implementing flexible and principles-based legislation that establishes mechanisms to directly provide solutions to measurement-based issues faced by other regulators, who rely on measurement to achieve their policy objectives but do not have a sufficient legal framework in place.


MLR's analysis of reform proposals

The MLR's analysis recommends Option 2 as being the option for reform that best aligns with the Government's policy principles and objectives. These include principles that go towards instilling measurement confidence, ensuring adaptability and generating outcomes such as international recognition, enabling innovation and encouraging industry investment. Likewise, the MLR also found that Option 2 provided the greatest overall benefit across all stakeholder groups noting that, in terms of changes in regulatory burden, the MLR found that the quantifiable change stemming from each reform proposal was similar.

For more details on the benefits and opportunities of each option, as well as the challenges and risks, please see the comparison table on page 8 and section 5.3.5 of the RIS.

Giving feedback to shape measurement laws

Consultation on the RIS closes on 14 May 2021.

Interested parties can give feedback via an online survey, which requires uploading a written document or answering set questions regarding the RIS through a survey. There is no requirement to answer all questions and no limit to the length of written submissions. Sample questions for various stakeholder groups in the RIS can be found in Appendix 15 (see page 111) of the RIS.

Virtual town hall meetings will also be held throughout late April for the following stakeholders: Measuring Instruments, Authorised Third Parties, Consumers, Wholesalers/Packers/Retailers/Importers and Regulators, with further information available on the Department of Industry's website here.

To align with both domestic and international stakeholders, the Government will also consult with various bodies as well as countries, such as New Zealand in relation to measurement marks on packaged goods.

Feedback to the proposed reform options will be used to inform the development of the measurement law and will be summarised and published online before the Government makes a final decision on how the measurement law will change.

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Clayton Utz communications are intended to provide commentary and general information. They should not be relied upon as legal advice. Formal legal advice should be sought in particular transactions or on matters of interest arising from this communication. Persons listed may not be admitted in all States and Territories.