Delivering Victorian Infrastructure (Port of Melbourne Lease Transaction) Bill 2015

Delivering Victorian Infrastructure (Port of Melbourne Lease Transaction) Bill 2015

Introduction Print

EXPLANATORY MEMORANDUM

581014

BILL LA INTRODUCTION 26/5/2015

Clause Notes

Part 1—Preliminary

Clause 1 sets out the main purposes of the Bill, which are—

·  to authorise and facilitate transactions under which land in the port of Melbourne is leased, and assets of the Port of Melbourne Corporation are disposed of, to a private sector entity; and

·  to establish the Victorian Transport Fund into which the transaction proceeds are to be paid; and

·  to guarantee the employment entitlements of employees of the Port of Melbourne Corporation who become employees of a private sector entity; and

·  to amend the Transport Integration Act 2010 and the Port Management Act 1995 to revise the Port of Melbourne Corporation's functions and powers to reflect the port of Melbourne's operation by the private sector entity and the continuing role of the Port of Melbourne Corporation in relation to the port; and

·  to amend the Port Management Act 1995 and the Essential Services Commission Act 2001 to establish a new licensing and economic regulatory framework to apply to the private sector entity that will be providing services at the port of Melbourne; and

·  to amend the Marine Safety Act 2010 to ensure that, when carrying out activities at the port, the private sector entity is subject to marine safety duties; and

·  to make consequential amendments to other Acts.

Clause 2 provides that the provisions of the Bill come into operation on a day or days to be proclaimed or, if not proclaimed sooner, on 30June 2017. The extended forced commencement date reflects the desirability to provide flexibility in relation to altering the objects, functions and name of the Port of Melbourne Corporation as well as making other amendments to the Transport Integration Act 2010 once authorised transactions under the Bill are finalised.

Clause 3 defines various words and expressions used in the Bill.

The definitions of port of Melbourne and port of Melbourne waters adopt the meaning used in the Port Management Act 1995.

Other key definitions include—

assets is defined to mean any legal or equitable estate or interest (whether present or future, whether vested or contingent) in real or personal property of any description.

associated assets means any assets, rights and liabilities designated under clause 7 as associated assets.

authorised transaction is defined to mean a transfer of port assets authorised by Part 2 of the Bill, which allows for such a transfer subject to certain restrictions and specifies the nature and use of the transaction proceeds.

Crown land is defined to include a stratum of Crown land.

liabilities is defined to mean all liabilities, duties and obligations, whether actual, contingent or prospective.

Port Corporation is defined to mean the Port of Melbourne Corporation within the meaning of the Transport Integration Act 2010.

port of Melbourne seabed is defined to mean the Crown land comprising the area of waters that are port of Melbourne waters and, to avoid doubt, includes any stratum of that land.

private sector entity is defined to mean any person other than a public sector entity.

public sector entity is defined to mean any of the following—

(a) the State;

(b) Minister;

(c) the Port Corporation;

(d) the Port of Hastings Development Authority within the meaning of the Transport Integration Act 2010;

(e) the Victorian Regional Channels Authority within the meaning of the Transport Integration Act 2010;

(f) a public entity within the meaning of the Public Administration Act 2004;

(g) any other person acting on behalf of the State;

(h) a corporation established under clause 22;

(i) a company established in accordance with clause 23, butonly while all the shares in the company are held byor on behalf of an entity referred to in paragraphs (a) to (h);

(j) a wholly-owned subsidiary of an entity referred to in paragraphs (c) to (i).

relevant land Ministers is defined to mean—

·  in clauses 51 and 52, the Minister administering the Crown Land (Reserves) Act 1978, the Minister administering the Coastal Management Act 1995 and the Minister administering Part IX of the Land Act 1958; and

·  in clause 55, the Minister administering the Coastal Management Act 1995 and the Minister administering Part IX of the Land Act 1958.

rights is defined to mean all rights, powers, privileges and immunities, whether actual, contingent or prospective.

transaction arrangement is defined to mean a transaction, agreement or other arrangement entered into by or on behalf of a public sector entity for the purposes of an authorised transaction.

transaction entity is defined to mean—

·  a corporation established under clause 22; or

·  a company established in accordance with clause 23; or

·  a company designated under clause 24.

Clause 4 defines port assets to mean the assets, rights and liabilities of the Port Corporation and associated assets. Subclause (2) provides that port assets include assets, rights and liabilities vested in a public sector entity that were port assets before their transfer to a public sector entity for the purposes of an authorised transaction. However, subclause (3) provides that assets, rights and liabilities cease to be port assets when they are transferred (other than under a lease or licence) to a private sector entity for the purposes of an authorised transaction.

Clause 5 defines a transfer, in relation to port assets, to include the sale, lease or licensing of port assets, and the creation and transfer of any interest in port assets.

Subclause (2) provides that, to avoid doubt, each of the following is a creation and transfer of an interest in port assets for the purposes of subclause (1)—

·  a declaration of trust relating to port assets the specification of which forms part of the declaration of trust or part of the transaction constituted by the declaration of trust;

·  a surrender of an interest in port assets;

·  a change in the beneficial ownership of port assets.

Subclause (3) defines the following words and expressions used in the clause—

beneficial ownership is defined to include ownership of assets by a person as trustee of a trust.

change in beneficial ownership is defined to include—

·  the creation of an asset;

·  the extinguishment of an asset;

·  a change in equitable interests in an asset;

·  an asset becoming the subject of a trust;

·  an asset ceasing to be the subject of a trust.

declaration of trust is defined to mean any declaration (otherthan by a will or testamentary instrument) that any identified asset vested or to be vested in the person making the declaration is or is to be held in trust for the person or purpose mentioned in the declaration although the beneficial owner of, or the person entitled to appoint, the asset may not have joined in or assented to the declaration.

Clause 6 provides that certain words and expressions have the same meanings as they have in section 9 of the Corporations Act 2001 of the Commonwealth.

Clause 7 empowers the Premier to designate any assets, rights or liabilities of a public sector entity concerning the port of Melbourne as associated assets, forming part of port assets.

Clause 8 specifies the circumstances in which any act, matter or thing is done or has effect for the purposes of an authorised transaction.

Clause 9 provides that the Bill will bind the Crown in right of Victoria, and so far as the legislative power of the Parliament permits, in all its other capacities.

Clause 10 provides that the Bill is intended to operate in or outside Victoria as far as the legislative power of Parliament is able to extend.

Part 2—Authorised transactions

Division 1—Transfer of port assets

Clause 11 authorises the transfer to a private sector entity or public sector entity of port assets subject to limitations that—

·  the land comprising port assets may be leased or licensed to a private sector entity, but the ownership of the freehold title to that land must remain with a public sector entity; and

·  the maximum term of a lease or licence of land comprising port assets to be granted to a private sector entity, including any period of a further lease or licence of those port assets is 50years or, if the Premier makes an order under subclause (3), for a period not exceeding 50years and 30 days or, if the regulations prescribe an additional period, for an aggregate period not exceeding 70 years or, if the Premier makes an order under subclause (3), for an aggregate period not exceeding 70years and 30 days.

The clause also provides that port assets may be transferred for the purposes of an authorised transaction in any manner.

Clause 12 specifies that the proceeds (including any payment to a public sector entity that is a premium or periodic payment under or related to a lease or licence of port assets to a private sector entity or grant of other rights that is authorised by the Bill that, but for subclause (1), would be payable to another public sector entity) of the transfer of port assets to a private sector entity under an authorised transaction belong to and are payable directly to the State and are to be paid into the Victorian Transport Fund, except for specified authorised deductions approved by the Premier, including—

·  amounts to repay debt and satisfy other liabilities of a public sector entity in relation to the transfer of port assets; and

·  amounts to reimburse or pay on behalf of a public sector entity certain taxes, duties fees or charges; and

·  amounts to satisfy any liability of a public sector entity arising under or in connection with a transaction arrangement; and

·  amounts to meet expenses reasonably incurred by a public sector entity for the purpose of an authorised transaction; and

·  amounts to satisfy the liabilities of a public sector entity arising under or in connection with a project approved by the Premier as a port-related project or to reimburse a public sector entity for payments made to satisfy liabilities incurred in connection with such a project.

Such deductions may be made before payment of the transaction proceeds into the Victorian Transport Fund or by payment from the Victorian Transport Fund.

The clause also provides that the transaction proceeds do not include any amount certified by the Premier to have been paid to a public sector entity as a tax, duty, fee or charge imposed by any Act or law of the State in connection with a transaction arrangement. The clause further provides that requirements of the clause do not affect the validity of the transaction arrangement.

Division 2—The Victorian Transport Fund

Clause 13 provides for the establishment in the Public Account as part of the Trust Fund of an account to be known as the Victorian Transport Fund.

Clause 14 provides for payment into the Victorian Transport Fund of all money that is appropriated by the Parliament for the purposes of the Fund, money received from the investment of money in the Fund and money directed or authorised to be paid into the Fund by or under the Bill or any other Act.

Clause 15 provides for payments out of the Victorian Transport Fund of—

·  amounts authorised by the Treasurer to fund the cost of all or any part of the development of the Level Crossing Removal Program and infrastructure projects for or relating to public transport, roads, rail, the movement of freight, ports or other infrastructure; and

·  all money directed or authorised to be paid out of the Fund by or under the Bill or any other Act.

The clause also authorises payments out of the Victorian Transport Fund of amounts authorised by the Treasurer for the payment of costs and expenses incurred in administering Division 2 of Part 2 of the Bill and monitoring and reporting on the financial operations and financial position of the Fund.

Clause 16 authorises the Treasurer, by instrument, to delegate the Treasurer's power to authorise payments under clause 15 to the Secretary to the Department of Treasury and Finance.

Part 3—Facilitating authorised transactions

Division 1—Premier's functions

Clause 17 provides that the Premier has and may exercise all the functions that are necessary or convenient for the purposes of an authorised transaction.

The clause also authorises the Premier to act for or on behalf of the Port Corporation or a transaction entity in the exercise of any of its functions for the purposes of an authorised transaction while it is a public sector entity. The clause further provides that functions conferred on the Premier by any other provision of the Bill do not limit the Premier's functions under clause 17.

Clause 18 provides that an authorised transaction is to be effected as directed by the Premier in any manner that the Premier considers appropriate and there are no limitations on the kinds of transactions or arrangements that may be entered into or used for the purposes of an authorised transaction.

Division 2—Functions of the Port Corporation

Clause 19 provides that the Port Corporation has and may exercise all the functions that are necessary or convenient for the purposes of an authorised transaction. The clause further provides that the functions conferred by clause 19 are in addition to any other functions that Port Corporation has apart from clause 19 and those other functions do not prevent or limit the exercise of additional functions conferred by clause 19.