ADMINISTRATIVE REVIEW COUNCIL
THECOERCIVEINFORMATION-GATHERING
POWERS OFGOVERNMENT AGENCIES
Report no. 48
May 2008
AdministrativeReviewCouncil
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©CommonwealthofAustralia2008
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nopartmaybereproducedbyanyprocesswithoutwrittenpermission.ISBN1921241 36 5
ADMINISTRATIVEREVIEWCOUNCIL
1May2008
TheHon.RobertMcClellandMP Attorney-General
ParliamentHouse
CanberraACT2601
DearAttorney-General
IhavepleasureinsubmittingtoyoutheAdministrativeReviewCouncil’sreportentitled TheCoerciveInformation-gatheringPowersof GovernmentAgencies.
Coerciveinformation-gatheringpowersareimportantpowerspossessedandwidelyused by manygovernmentagencies.InthisreporttheCouncildescribesarangeofbest-practice principlesitconsiderswillensurethatagenciesusethepowerseffectively, efficientlyandwith dueregardtoindividualrights.
Yourssincerely
JillianSegalAM President
TheAdministrative Review Council
ThefollowingpeopleweremembersoftheAdministrativeReviewCouncilatthetime of publication:
•JillianSegalAM(President)
•JusticeGarryDownesAM
•ProfessorJohnMcMillan
•ProfessorDavidWeisbrotAM
•PeterAnderson
•BarbaraBelcher
•IanCarnell
•RobertCornallAO
•ProfessorRobinCreyke
•AndrewMetcalfe
•DrMelissaPerryQC
•BrigadierBillRolfeAO(rtd).
ThefollowingpeopleweremembersoftheAdministrativeReviewCouncil
Secretariatatthetimeofpublication:
•MargaretHarrison-Smith(ExecutiveDirector)
•KerrinStewart(SeniorLegalOfficer)
•DanniNicholas-Sexton(Attorney-General’sDepartmentGraduate)
•FarhanaMasih(AdministrativeOfficer).
TheCouncilthanksallpastandpresentmembersoftheSecretariatwhoassistedwith the developmentofthisreport.
Thecoercive information-gathering powers ofgovernment agenciesv
Contents
Preface...... ix
Theprinciples...... xi
1Introduction...... 1
Thepurposeofthisreport...... 2
Theagencieschosen...... 2
Otherworkdoneinrelationtocoerciveinformation-gatheringpowers...... 3
Consultation...... 3
Thestructureofthereport...... 4
2Statutorytriggers...... 5
Providingabalance...... 5
TheAustralianCompetitionandConsumerCommission...... 5
TheAustralianPrudentialRegulationAuthorityandtheAustralian
SecuritiesandInvestmentsCommission...... 6
Centrelink...... 7
MedicareAustralia...... 8
TheAustralianTaxationOffice...... 8
Triggersinlegislation...... 9
Consistencyintriggers...... 9
Settingthethreshold...... 10
3Decidingwhethertousethepowers...... 13
Alternativewaysofobtaininginformation...... 13
Compliancecosts...... 14
Keepingarecordofthedecisiontousethepower...... 17
Consultationonrecordkeeping...... 18
vi / Thecoercive information-gathering powers ofgovernment agenciesConsultationonannualreporting...... 19
Contemptofcourt...... 20
4 / Exercisingthepowers...... 23
Delegationandauthorisation...... 23
Agencylegislation...... 24
Whoshouldexercisethepowers?...... 24
Skills,attributesandqualifications...... 25
Accountability...... 26
Scrutiny...... 27
Training...... 27
Conflictofinterest...... 30
Identitycards...... 31
5 / Notices,examinationsandhearings...... 33
Thecontentofagencynotices...... 33
Agencypracticeinrelationtonotices...... 34
Thenatureofmaterialsthatmaybecollected...... 38
Noticerecipients...... 39
Variationofnotices...... 39
Serviceofnotices...... 40
Examinationsandhearings...... 40
Conductinganexamination...... 41
Legalrepresentation...... 41
Transcripts...... 42
Subsequentuseofinformation...... 42
6 / Claimsofprivilege...... 45
Privilegeagainstself-incriminationorself-exposuretopenalty...... 45
Clientlegalprivilege...... 51
Privilegeandotherprofessionals...... 58
Thecoercive information-gathering powers ofgovernment agenciesvii
7Limitsonthedisclosureanduseofinformation:secrecyandprivacyprovisions...... 61
Thegeneralpositionatlaw...... 61
Disclosureofinformation...... 62
Useofinformation...... 64
Agencypractice...... 65
Consultationandreforms...... 65
Thethresholdforinformationexchange...... 68
Physicalsecurityandrecordmanagement...... 69
AppendixAThelegislation:asummary...... 71
AppendixBSection51oftheAdministrativeAppealsTribunalAct...... 95
AppendixCSubmissionsreceived...... 97
Thecoercive information-gathering powers ofgovernment agenciesix
Preface
Coerciveinformation-gatheringpowersareimportantadministrativeandregulatorydevices forgovernment.AtthenationallevelinAustraliamanyagenciesusethemtocompel the provisionofinformation,theproductionofdocumentsandthe
answeringof questions.
InthisreporttheAdministrativeReviewCouncilconsidersindetailthesepowers,using as its referencepointthepowersofsixagencies—theAustralianCompetitionand Consumer Commission,theAustralianPrudentialRegulationAuthority,theAustralian Securitiesand InvestmentsCommission,theAustralianTaxationOffice,Centrelink, andMedicare Australia.
TheseagenciesprovidedtotheCouncilvaluableinsightsintotheoperationoftheircoercive information-gatheringpowers.Detailsofthemainstatutorypowersofeachagency aresetout inthesummarypresentedas AppendixA. Thisinformation,aswell asinformationprovided byotheragenciesandbodiesinresponsetoadraftreport releasedforcommentinDecember 2006,providesthebasisforthisreport.TheCouncil alsohadregardtotheworkofother reform,reviewandadvisorybodiestothe extentthatitisrelevanttoagencies’coercive information-gatheringpowers.
SubmissionstheCouncilreceivedmakeitclearthatacross-the-boardlegislativeuniformity is neitherfeasiblenordesirableinthisarea.TheCouncildoes,however,consider thatapplicationoftheadministrativelawvaluesoffairness,lawfulness,rationality, transparency andefficiencydoespointto20best-practiceprinciplesthatare generallyapplicable.These principlesseektostrikeabalancebetweenagencies’objectives in usingcoercive information-gatheringpowersandtherightsofthoseinrelation towhomthepowersare exercisable.
Amongthetopicscoveredbytheprinciplesaretheappropriate‘trigger’thresholdfor the useofcoerciveinformation-gatheringpowers,whoshoulddelegatethepowers andtowhomthepowersshouldbedelegated,training,notices,examinationsandhearings, privilege,andexchangeofinformationbothwithinandbetween agencies.Althoughthe principlesthemselvesdonothavelegislativebacking, theyrepresentminimumstandards andgoodadministrativepractice;insomecasestheyaresuggestiveofdesirablelegislative practice.
TheCouncilputsforwardtheprinciplesasanimportantguidetofair,efficientandeffective useofcoerciveinformation-gatheringpowers.Governmentshouldtakethem intoaccount whenofferingsuchpowerstonewagencies,whenreviewingthepowers ofexistingagencies, andwhendeterminingtheannualexpectationsofagencies.
InthereporttheCouncilalsoidentifiesseveralaspectsofagencylegislationandpractice relatingtocoerciveinformation-gatheringpowerswherethereisuncertaintyand lackofdefinitioninthelegislation.Twosuchareasaretheprivilegeagainstself-incrimination or self-exposuretopenaltyandclientlegalprivilege.Inthelegislation
xThecoercive information-gathering powers ofgovernment agencies
theCouncilexamineditwassometimesunclearwhethertheprivilegesappliedand,if so,the extenttowhichtheyhavebeenabrogated.
Therewaslittleguidance—particularly legislativeguidance—onhowtoclaimandto adjudicate aclaimofprivilege.(TheCouncilnotesheretheAustralianLawReform Commission’srecentreportentitledPrivilegeinPerspective:clientlegalprivilegeinfederal investigations.)Foritspart,theCouncilisoftheopinionthattheuncertaintiesarising fromthe lackofclarityinrelationtoprivilegecauseinefficienciesandarecostly foragenciesusing coerciveinformation-gatheringpowers;noraretheyinthebest interestsofthoseinrelationto whomthepowersareused.
Anotherareathatcouldbeworthyofinvestigationisinformationsharingbetweenand withinagencies.Simplificationandrationalisationoftherelevantlegislativeprovisions might bepossiblewithoutcompromisingthefunctionsofagenciesortherights andinterestsof those towhomtheinformationrelates.
Thecoercive information-gathering powers ofgovernment agenciesxi
Theprinciples
TheCouncilputsforwardthefollowingprinciplesasaguidetogovernmentagencies, toensurefair,efficientandeffectiveuseofcoerciveinformation-gatheringpowers.
Settingthethresholdandscope
Principle1
Theminimumstatutorytriggerfortheuseofagencies’coerciveinformation-gathering powersformonitoringshouldbethatthepowerscanbeusedonlytogather information forthepurposesoftherelevantlegislation.
Ifacoerciveinformation-gatheringpowerisusedinconnectionwithaspecificinvestigation, theminimumstatutorytriggerforusingthepowershouldbethattheperson exercisingithas‘reasonablegrounds’forthebelieforsuspicionthatisrequired beforethepowercanbe exercised.
Ifaninformation-gatheringprocessescalatesfrom monitoringtospecificinvestigation, agencyofficersshould,totheextentoperationallypossible,informthesubject ofthe investigationofthatchangeinstatus.
Principle2
Beforeusingthepowers
Beforeusingcoerciveinformation-gatheringpowersagencyofficersshoulddotwothings:
•consideralternativemeansthatcouldbeusedtoobtaintheinformationsoughtand
•weighupwhetherthe probableimportanceofinformationobtainedthrough
usingcoerciveinformation-gatheringpowersisjustified,havingregardtothecost of complianceforthenoticerecipient.
Draftingnotices
Whendraftinginformation-gatheringnoticesagencyofficersshouldseekonlythe information thatisnecessaryfortheircurrentinformation-gatheringrequirements.
Totheextentoperationallypossible,itisdesirablethatagencyofficersconsultproposed noticerecipientsinordertodeterminetheprobablescopeandnatureofinformation held.
xiiThecoercive information-gathering powers ofgovernment agencies
Exercisingthepowers
Whenexercisingcoerciveinformation-gathering powersagencyofficersmustchoosethe mostefficientandeffectivemeansofobtainingtheinformation.Forexample,ifinformation isheld oncomputer,theissuingofanoticerequestingidentificationofrecordsheldonthesystemcouldinthefirstinstancebethemosteffectiveandefficient courseofaction.Thiscouldthen befollowedbyanoticerequestingtheproduction ofrelevantdocuments.
Recordkeeping
Principle3
Whenanagencyusesitsinformation-gatheringpowersforthepurposeofaspecific investigation itisgoodadministrativepracticefortheagencyofficerconcernedtoprepare a writtenrecorddescribingthebasisonwhichthethresholdtriggerfortheuse ofthepowers wasdeemed tohavebeenmet.
Ifthepowersareusedformonitoringorifanagencyregularlyissueslargenumbersof notices,awrittenrecordofthefactoftheuseofthepowersisalsodesirable;itshould name theofficerwhoauthorisedtheuseofthepowers.
Transparency
Principle4
Tofacilitateinternalandexternalscrutinyoftheuseofcoerciveinformation-gathering powers andtoengendercommunityconfidenceintheexerciseofthosepowers, each agencyshouldregularlypublishinformationaboutitsuseofthepowers. Theinformation providedshouldbesufficienttoallowanyoneseekingtoassesstheuseofthepowerstodo so,yetshouldnotbesuchastojeopardisecontinuing investigationsorrevealdetailsof importantinvestigatorymethods.
Contemptofcourt
Principle5
Agenciesshouldregularlymonitordevelopmentsincaselawrelatingtocontemptofcourt. In thisregard,trainingandsupportforofficersexercisingcoercive
information-gatheringpowersareessential.
Authorisationanddelegation
Principle6
Legislationshouldspecifywhomayauthorisetheexerciseofanagency’scoercive information-gathering powers.
Thecoercive information-gathering powers ofgovernment agenciesxiii
Iffailuretocomplywithanoticewouldattractacriminalpenalty,thelegislationor administrative guidelinesshouldspecifythecategoryofofficertowhomthepowerto issuea noticecanbedelegated.
Principle7
Itisimportantthat an agencyhasinoperationproceduresforensuringthatcoercive information-gathering powersaredelegatedonlytosuitablyseniorandexperiencedagency officers.
Theofficerstowhomthepowersaredelegatedshouldbesufficientlyseniorand experienced tobeabletodealeffectivelywithquestionsassociatedwithproceduralfairnessandprivilegethatcanarisein theconductofexaminations and hearings.
Training
Principle8
Iftherighttoexercisecoerciveinformation-gatheringpowerswerelinkedtotrainingor accreditationprogramsthiswouldhelpagencyofficersexercisingthepowerstogain the requisitecompetency.
Foranagencywithalargenumberofofficersexercisingcoerciveinformation-gathering powers,developmentofanaccreditedtrainingprogramspecifictotheagency would representgoodadministrativepractice.
Accountability
Principle9
Whenanagencyconfersauthoritytoexercisecoerciveinformation-gatheringpowerson peoplewhoarenotofficersoftheagency—forexample,stateofficialsoremployees ofagency contractors—theagencyshouldremainaccountablefortheuseof thosepowers.
Principle10
Seniorofficersofanagencyshouldregularlyauditandmonitortheexerciseofcoercive information-gatheringpowerswithintheagency.Inadditiontoensuringthe continuing suitabilityandaccuracyofdelegations,theseniorofficersshouldensure thatofficers exercisingthepowershavereceivedthenecessarytraining,possess therequisiteskills,and havecontinuingaccesstoassistance,adviceandsupport.
xivThecoercive information-gathering powers ofgovernment agencies
Sharingresourcesandexperience
Principle11
Subjecttoconsiderationsofprivacyandconfidentiality,agenciesareencouragedtoshare theirideasandexperiencesinrelationtotheexerciseofcoerciveinformation-gathering powersinthefollowingways:
•establishinganagencynetworkfortheexchangeofeducationalmaterials,including trainingmanualsandideas.Discussionandcirculationofinformationabout relevant casesandthecontentandupgradingofinstructionalmaterialswould be useful—especiallyforsmalleragencies
•establishinganinformalpeernetworkwithinandbetweenagenciesfor discussion,trainingandinformationsharing
•conductingperiodicmeetingsbetween‘likeagencies’
•identifyingimportantacross-agencyorsectoraltopicsforinclusioninagency training programsandmanuals.
Conflictofinterest
Principle12
Agenciesshouldadoptproceduresandoffertrainingaimedatavoidingconflictofinterest inrelationtotheexerciseofcoerciveinformation-gatheringpowers.
DecisionMaking:naturaljustice,guide2intheCouncil’sseriesofbest-practiceguidesfor administrativedecisionmakers,providesanoverviewofthelawinthisareaandof its practicalapplication.
Identitycards
Principle13
Ifface-to-facecontactisinvolved,ataminimumofficersorexternal expertsexercising coerciveinformation-gatheringpowersshouldcarryofficialphotographicidentification and produceitonrequest.
Inaformalinvestigativeprocedureitisgoodadministrativepracticeifofficersandexternal expertsarealsoabletoproducewrittenevidenceoftheextentoftheirauthority.
Thecoercive information-gathering powers ofgovernment agenciesxv
Notices
Principle14
Allcoerciveinformation-gatheringnoticesshoulddothefollowing:
•identifythelegislativeauthorityunderwhichtheyareissued,thetime,dateandplace forcompliance,andanypenaltiesfornon-compliance
•inrelationtospecificinvestigations,setoutthegeneralnatureofthematterinrelation towhichinformationissought
•consistentwiththerequirementsofthePrivacyAct1988(Cth)inrelationtopersonal information,clearlystatewhetheritistheusuallawfulpracticeoftheagency tohand informationcollectedinresponsetonoticestoanotherareaofthesameagencyorto anotheragency
•providedetailsofacontactintheagencytowhominquiriesaboutthenoticecanbe addressed
•informnoticerecipientsoftheirrightsinrelationtoprivilege.
Noticestoprovideinformationorproducedocuments
Itisgoodadministrativepracticetospecifyhowthenoticerecipientshouldprovidethe informationorhowthedocumentshouldbeproducedandtowhom.
Noticestoattendanexaminationorahearing
Noticerecipientsshouldbetoldwhethertheymaybeaccompaniedbyalawyerorthird partyand,totheextentpossible,thenameofthepersonwhowillbeconducting the examination.
Thetimeframeforcompliance
Agencylegislationshouldspecifyaminimumperiodfortheproductionofinformation or materialsorforattendanceforexaminationorhearing.Thelegislationshould alsoallowfor exceptionstotheruleinspecifiedcircumstances.
Materialscoveredbya notice
Tofacilitatecompliance,anoticeoritssupportingcorrespondenceshouldclearlyidentify thesortsofmaterialscoveredbythenotice,includingmaterialsheldoncomputer.
Principle15
Compliancewouldbefurtherencouragedif termssuchas‘informationinthepossessionof’,‘inthecustodyof’or‘underthecontrolof’thenoticerecipientweredefined. Proforma noticescanbeusefulifdifferencesinexpressionoccurinthelegislation ofasingleagency.
xviThecoercive information-gathering powers ofgovernment agencies
Examinationsandhearings
Principle16
Unlesstherearespecialreasonstothecontrary,examineesshouldbeentitledto:
•aprivatehearing—subjecttothepresenceofauthorisedindividuals
•intheabsenceofexceptionalcircumstances,theoptionofhavinglegal(or,if appropriate, other)representation.
Thereasonforholdingapublicexaminationorfordenyinglegalorother representation shouldbeexplainedandarecordofthiskept.
Amongthemattersthatshouldbetakenaccountofinlegislationarethetakingof evidence onoathoraffirmationandtheadmissibilityoftheevidencetakenatthe examination insubsequentproceedings.
Amongothermattersthatmaybedealtwithwithoutlegislationareprovisionforviewing andcorrectionbytheexamineeofatranscriptofproceedingsand,whererelevant, thecircumstancesinwhichathirdpartymaybegivenacopyofthetranscript withinthe scope ofagencyprivacyandsecrecyprovisions.
Examineesshouldbetoldiflegislationprecludessubsequentdisclosureofinformation obtainedduringanexaminationorhearing.Agenciesshouldclearlydifferentiate this situationfromoneinwhichwherethereisnosuchlegislativerestriction.
Privilege
Principle17
Clientlegalprivilegeandtheprivilegeagainstself-incrimination—includingtheprivilege againstself-exposuretopenalty—arefundamentalprinciplesthatshould
beupheldthroughlegislation.Abrogationoftheprivilegesshouldoccuronlyrarely,in circumstancesthatareclearlydefined,compellingandlimitedinscope.Legislation should clearlystatewhetherornottheprivilegesareabrogatedandwhen,howandfromwhomthe privileges(includingauseimmunity)maybeclaimed.
Agenciesshouldkeepwrittenrecordsofthesituationsinwhichtheprivilegesapply,and especiallywhentheyarewaived.Agencyguidelinestosupplementlegislativedirections shouldalsobe developedinrelationtoprivilege;amongthetopics
coveredshouldbetheprocedurestobeadoptedbyagenciesinrespondingtoaclaim
ofprivilegeandthenatureandeffectofawaiverofprivilege.
Thecoercive information-gathering powers ofgovernment agenciesxvii
Disclosureofinformation
Principle18
Thecomplexityandinconsistencyofagencies’secrecyprovisionsmeanthatspecialcare is neededwhendealingwithinter-agencydisclosureofinformation.
Innoticesandrequestsitisnecessarytocarefullydescribetheinformationagencyofficers requireintheexerciseoftheircoerciveinformation-gatheringpowersandthe probable usesofthatinformation.
Agenciesshouldprovidetotheirofficersguidanceaboutsituationsinwhichtheuseof informationforpurposesnotreasonablyforeseenatthetimeofcollectingtheinformation mightbecontemplated.
Guidelinesandtrainingforagencyofficersinboththeseareasandinrelationtotheeffect of andinteractionbetweenthePrivacyAct1988(Cth)andagencies’secrecyprovisions are essential.
Itisgoodadministrativepracticetodevelopmemorandumsofunderstandingbetween agencies,clarifyingtheresponsibilitiesofagencyofficersindisclosinginformation obtained through,amongotherthings,theuseofcoerciveinformation-gathering powers.
Principle19
Subjecttolimitedexceptions,itisdesirablethatinter-agencydisclosureofinformation obtainedintheexerciseofcoerciveinformation-gatheringpowersbesubject toa threshold triggerofthesamecalibreasthatgoverningtheinitialissuingof anotice(seeprinciple1). Additionally,privilegeanduseimmunityshouldbetaken intoaccountwhenthereleaseofinformationtoanotheragencyisbeingconsidered.
Examplesofsituationsinwhichexceptionstothethresholdtriggerwouldbeapposite arewhenthereis animmediateandseriousrisktohealthorsafetyandwhen limited informationisrequiredforaroyalcommission.
Asnoted,thediscretiontodiscloseinformationobtainedthroughtheuseofcoercive information-gathering powersshouldrestwithsenior,experiencedagencyofficers.
Recordmanagement
Principle20
Agencystrategiesandguidelinesshouldoperatetoensuretheintegrity,propermanagement andaccuraterecordingofinformationreceivedintheexerciseofanagency’s coercive information-gatheringpowers.Whereverpossible,receiptsshouldbe givenfordocumentsandmaterialsfurnishedtotheagency.
xviiiThecoercive information-gathering powers ofgovernment agencies
Anagencythat hasuseditsinformation-gatheringpowerstoobtaininformationor documents fromsomeoneshouldkeepundercontinuingreviewtheneedtokeeptheperson informed,asappropriate,aboutwhetheraninvestigationisstillcurrent,
whendocumentscanbereturnedtotheperson,orwhetherotherarrangementscan
bemadeforthepersontobegiveninterimaccesstothedocumentsoracopyofthe documents.
Thecoercive information-gathering powers ofgovernment agencies1
1Introduction
Coerciveinvestigativepowersarestatutorypowersconferredonmanygovernment agencies toenablethemtoobtaininformationassociated withtheperformanceoftheir statutoryfunctions.Suchpowerstypicallypermitagencyofficerstoenterandsearch premises,torequiretheproductionofinformationordocuments,andtorequire provisionof informationrelevanttotheirstatutoryfunctionsbywayoforalexamination orhearing withouttheissuingofawarrantorotherexternalauthorisation.
Suchpowershavealreadybeenthesubjectofdetailedexaminationbylawreformbodies andparliamentarycommittees.TheCouncil’sreportfocuses,however,oncoercive powers relatingtotheproductionofinformationordocumentsandtheprovision ofinformationby wayoforalexaminationorhearing.Thesepowershavenot previouslybeenthesubjectof suchdetailedscrutiny;theyarereferredtointhisreport as‘coerciveinformation-gathering powers’.
Agenciescanusecoerciveinformation-gatheringpowersformonitoringlegislative complianceandinthecontextofformalinvestigationswheretherehasbeenorcouldbe a breachofthelaw.Legislativepowersallowingagenciestocollectinformationinorder to determineaperson’sinitialentitlementtogainaccesstoagovernmentprogram orbenefitdo notfallwithintheambitofthisreport.Sometimesallthreesorts ofusesof information-gatheringpowersareprovidedforinasinglelegislativeprovision.1
Section194oftheSocialSecurity(Administration)Act1999(Cth)isanexampleofacoercive information-gatheringpower.Thesectionprovidesthat,if the Secretaryofthe Departmentof Families,Housing,CommunityServicesandIndigenousAffairsbelieves apersonmighthave informationora documentthatwouldhelplocatesomeone (a‘debtor’)whoowesadebtto theCommonwealth‘underorasaresultofthe socialsecuritylaw’or‘thatisrelevanttothedebtor’sfinancialsituation’,theymay requirethatperson‘togivetheinformation,orproduce thedocument’.
Similarly,s 264oftheIncomeTaxAssessmentAct1936(Cth)provides thattheAustralian TaxationOfficemayissuetoanypersonanoticerequiringthemtofurnish suchinformationastheATOmayrequire,toattendandgiveevidenceconcerning theiror anyoneelse’sincomeorassessment,andtoproduceallrelatedbooks, documentsandother papersintheircustodyorundertheircontrol.
1Sections63and64ofthe Social Security (Administration)Act1999 (Cth),discussed indetailin
Chapter2,areillustrative.
2Thecoercive information-gathering powers ofgovernment agencies
Thepurposeofthisreport
InthisreporttheCouncilprovidesadvicetotheAttorney-General—inaccordancewith its functionsunders 51oftheAdministrative AppealsTribunalAct1975(Cth)(seeAppendix B)—in connectionwithagencycoerciveinformation-gathering powers.
Animportantpurposeofthereportistoidentifyasetofbest-practiceprinciplesthatare consistentwiththe administrativelawvaluesoffairness,lawfulness,rationality,openness (or transparency)andefficiency2 andthatarerelevanttoallagenciesusingcoercive information-gatheringpowers.TheCouncilidentifies20principles.Itrecommendsthemasaguidetofair,efficientandeffectiveuseofsuchpowers.Italsoconsidersthatgovernment shouldtakethemintoaccountwhenprovidingthe
powerstonewagencies,whenreviewingthepowersofexistingagencies,andwhen
determiningexpectationsofagencies.
Afurtherpurposeofthereportistoestablishwhethermoreconsistencyinlegislation relatingtocoerciveinformation-gatheringpowersmightleadtogreaterefficiencies intheuse ofsuchpowers.TheCouncilconcludedthat,althoughacross-the-board uniformityis generallyneitherfeasiblenordesirable,efficiencieswouldprobably beachievedif differencesinlegislationaffectinga singleagencywereremoved.
Theoverridingobjectiveofthereportis,however,tosecurethecorrectbalancebetween theinterestsofagenciesandtherightsofindividualsinrelationtothescopeand useofcoercive information-gatheringpowers.
Theagencieschosen
TheCouncil’sanalysisfocusedonthecoerciveinformation-gatheringpowersofsix agencies—the AustralianCompetitionandConsumerCommission,theAustralianPrudential RegulationAuthority,theAustralianSecuritiesandInvestmentsCommission,theAustralian TaxationOffice,Centrelink,andMedicareAustralia.These agenciesarerepresentativeof Commonwealthagenciesinvolvedinrevenuecollecting (theATO),revenuespending (CentrelinkandMedicare)andcorporateregulation (theACCC,APRAandASIC).Despitetheirdifferentfunctions,theagencies sharetheobjectiveofadministeringtheirstatutory information-gatheringpowers asefficientlyandeffectivelyaspossiblewithregardtotheir ownobjectivesand therightsandinterestsofthosein relationtowhomthepowersare exercisable.3
Thereportdoesnotconsiderthecoerciveinformation-gatheringpowersofagenciesinvolved incriminalinvestigationandprosecutionornationalsecurity;examplesare
2TheCouncil considers these valuesfundamentaltotheCommonwealthadministrativesystemand hasusedthemasbenchmarksforanalysisinanumberofits reportsand otherpublications.
3See,forexample,s1(2)oftheAustralian Securities andInvestments CommissionAct 2001, s 8(2) of the
AustralianPrudentialRegulatoryAuthorityAct1998,ands8ofthe SocialSecurity (Administration)Act
1999.See alsothe ACCC’s2007–08 Corporate PlanandPriorities,where,‘workingonthe
fundamentalprinciplethatthisbenefits consumers,businessand thewidercommunity’,theaim is tobring greatercompetitiveness andfairtrading tothe Australianeconomy;seefurther the ATO’s TaxpayerCharterandtheaddressaboutitsEasier,Cheaper,MorePersonalisedprogramby Michael D’Ascenzo,CommissionerofTaxation,totheAustralasianTaxTeachers’Association18th AnnualConference,Melbourne,30January2006.
Thecoercive information-gathering powers ofgovernment agencies3
theAustralianFederalPolice,theCommonwealthDirectorofPublicProsecutionsand the AustralianCommissionforLawEnforcementIntegrity.Nordoesitconsiderthe coerciveinformation-gatheringpowersofmonitoringbodiessuchastheCommonwealth Ombudsman.
Finally,theCouncildoesnotseektorecommendamendmentofthecoercive information-gathering powersofanyparticularagency.
Otherworkdonein relationtocoerciveinformation-gatheringpowers
IndevelopingitsreporttheCounciltookintoaccountotherbodies’worktotheextent thatitpertainstocoerciveinformation-gatheringpowers.Suchworkincludesthe 2000and2006 reportsoftheSenateStandingCommitteefortheScrutinyofBills4,the government’sresponsetothe earlierofthosereports,the2003reportReviewof theCompetitionProvisionsoftheTrade PracticesAct5,andworkdonebylawreformbodiessuch astheAustralianLawReform Commissionintheareasoftheprivilegeagainstself-incrimination orself-exposuretopenalty andclientlegalprivilege.6 TheCouncilalso tookintoaccounttheALRC’sworkonclientlegal privilegeandprivacy.7
Consultation
Inadditiontotheinformationprovidedbythesixagencies,theCouncilwasmindfulof the36submissionsreceivedinresponsetothedraftreportitreleasedfordiscussioninDecember 2006.(AppendixCliststheorganisationsthatpresented
submissions.)TheCouncilextendsparticularthankstothe sixagencies;italsothanksall who presentedsubmissions.
4SenateStandingCommitteefortheScrutinyofBills2000, EntryandSearchProvisions in CommonwealthLegislation, ParliamentofAustralia,Canberra;Senate Standing Committeeforthe ScrutinyofBills2006,EntrySearchandSeizure Provisions in CommonwealthLegislation, Parliament of Australia,Canberra.
5TradePracticesAct ReviewCommittee2003, Review of the Competition Provisions oftheTrade Practices
Act,ParliamentofAustralia,Canberra.
6AustralianLawReform Commission, PrincipledRegulation:civilandadministrativepenaltiesin
Australia,Reportno.95,ALRC,Sydney; Australian & NSWLawReform Commissions,Evidence Act1995,Issuespaperno.28,ALRC,Sydney; Australian,NSW,VictorianLawReform Commissions2005, Review of the Uniform Evidence Acts,ALRC discussion paperno.47,ALRC, Sydney;Australian,NSW& VictorianLawReformCommissions2005,UniformEvidenceLaw, ALRC Reportno.102,ALRC,Sydney;QueenslandLawReformCommission2004, TheAbrogationofthe Privilegeagainst Self-incrimination,Reportno. 59,QLRC, Brisbane.
7In2007the ALRCreleasedtwodiscussionpapers,Review ofAustralian Privacy Law(Discussion
paperno.72)and ClientLegalPrivilegeand Federal Investigatory Bodies (Discussion paperno.73), in
relationto thesereferences.InJanuary2008itreleaseditsreportofthisreview,Privilegein
Perspective:clientlegalprivilege in federalinvestigations,Reportno.107, ALRC,Sydney.
4Thecoercive information-gathering powers ofgovernment agencies
Thestructureofthereport
Chapter2ofthisreportconsidersthestatutoryandagencytriggersfortheuseof coercive information-gatheringpowers.
Chapter3discusses otherfactorsinfluencingthedecisiontousetheinformation- gathering powers—forexample,whethertherearealternativewaysofobtaining information, thecostsofcompliance,andcontemptofcourt.
Chapter4considerswhomayexercisecoerciveinformation-gatheringpowersand concludeswithadiscussionofagencyguidelinesandtraining.
Chapter5looksatthe noticeprovisionsintheagencies’legislation.Italsodiscusses agencies’ legislationandpracticein relationtoexaminationsandhearings.
Chapter6 dealswiththedisclosureofinformation,includingtheprivilegeagainst self-incrimination orself-exposuretopenaltyandclientlegalprivilege.
Chapter7considersinter-andintra-agencytransferofinformation,agencysecrecy provisions, confidentialityprovisionsandtheprivacylegislation.
AppendixAsetsouta summaryofthemaincoerciveinformation-gatheringpowersof the sixagenciesreviewed.
AppendixBreproducess 51oftheAdministrative AppealsTribunalAct1975.Appendix C liststheorganisationsthatpresented submissionsinresponsetothe
Council’sdraftreportreleasedinDecember2006.
Thecoercive information-gathering powers ofgovernment agencies5
2Statutorytriggers
Providingabalance
Coerciveinformation-gatheringpowersareimportantadministrativeandregulatorydevices. Itisessentialthat,whenusingthem,agenciesimpingeontherightsofindividuals onlyina proportionateandjustifiableway.Amongtheindividual’srights arethoseassociatedwiththeprotectionofpropertyandprivacy8,therighttosilence9,andstatutoryrightstotheprotection ofpersonalinformation.Relatedrightsare therighttoprivilegeagainstself-incriminationorself-exposuretopenaltyandclient legalprivilege.
Thereisoftenastatutorytriggerorlegislativethresholdfortheuseofcoercive information-gathering powers.Thetriggerisimportantformaintainingasuitablebalance betweenthestatutoryobjectivesofagenciesandtheinterestsofthose inrespect ofwhomtheinformation-gatheringpowersareexercisable.Triggersalsoconstitute an importantaccountabilitymechanism.
Thestatutorytriggersfortheuseofcoerciveinformation-gatheringpowersintheagency legislationtheCouncilconsideredforthisreportareasfollows.
TheAustralianCompetitionandConsumerCommission
Unders155oftheTradePracticesAct1974theACCCmayissueanoticerequiringaperson to provideinformation,toproducedocumentsortogiveevidenceorallyorinwriting. The statutorytriggerforuseofthispoweris:
… if the Commission …has reasonto believe that a person is capable of furnishinginformation,producing documentsor giving evidencerelating to amatter that… is relevantto the making of adecisionby the Commission … [emphasis added]
8Historically,thefocuswasonthe right toprivateproperty,butmorerecently this has shiftedto privacy—George vRockett(1990)170CLR104,110.
9SeeR v Director of Serious Fraud Office; Ex parte Smith[1993]AC1,31(MustillLJ).MustillLJ’s commentshavebeennotedwithapprovalinseveral Australiancases—Azzopardi v TheQueen(2001)
205CLR50;AvBoulton (2004)204ALR598;CommonwealthDirector of Prosecutions v Xu 154CrimR
173.SeealsoLegislativeReviewCommittee2006, TheRighttoSilence:response tothe discussion paper, Reportno.4,NSWParliament,Sydney, p. 2.
6Thecoercive information-gathering powers ofgovernment agencies
TheAustralianPrudentialRegulationAuthorityandtheAustralian
SecuritiesandInvestmentsCommission
APRA’spowersareconferred(orenabled)underanumberofstatutes,amongthemtheAustralianPrudentialRegulationAuthorityAct1998(Cth),theSuperannuationIndustry (Supervision)Act1993(Cth),theBankingAct1959(Cth),theRetirementSavings AccountsAct 1997(Cth)andtheInsuranceAct1973(Cth).
Formonitoringpurposes,ss254(2)and 255oftheSuperannuationIndustry(Supervision)Actprovidethattheregulatormayrequiretheprovisionofinformation andtheproduction ofbooks‘forthepurposesofthisAct’.10Therearesimilar provisionsunderss 131 and 132oftheLifeInsuranceAct1995(Cth).APRAuses thesepowersinasupervisory, ratherthaninvestigative,context.
Investigationsareauthorisedbys 263oftheSuperannuationIndustry(Supervision)Act. Subsequentprovisionsrelatetothepowersandprocessesapplicabletothoseinvestigations. Theyincludes 269(Productionofbooks)ands 270(Provisionofreasonable assistanceand/or toappearforexamination).Suchpowersare
exercisable‘ifitappears’toAPRAthat,forexample,acontraventionoftheActmight
haveoccurredorbeoccurringorthefinancialpositionofa superannuationentitymight be unsatisfactory.
ASICisestablishedunderandadministerstheAustralianSecuritiesandInvestments
CommissionAct2001(Cth)andcarriesoutmostofitsworkundertheCorporationsAct
2001(Cth).It hascoerciveinformation-gatheringpowersunderbothActs.11Forthe purposes oftheASICActtheinformation-gatheringpowercanbeusedforthreereasons.
First,ASICmayissueanoticefortheproductionofbooksunderss 30,31,32Aand
33ofDivision3oftheAct.Useofthispowerisgovernedbys 28,whichprovidesthat powersmaybeused:
•forthepurposesoftheperformanceorexerciseofanyofASIC’sfunctionsandpowers underthecorporationslegislation12
•forthepurposesofensuringcompliancewiththecorporationslegislation
•inrelationtocertainallegedorsuspectedcontraventionsofcorporations legislationandotherlegislation
or
•forthepurposesofas 13 investigation—thatis,whereASIChas‘reasontosuspect’thata contraventionmighthaveoccurred.Thepowerisnotconfinedbyproperty rightsin documentsorlegalentitlementtopossession.13
10Thisis located inDivision2ofPart25oftheAct(Monitoringsuperannuationentities).
11Sections672Aand912CoftheCorporationsActrelate toASIC’spowertoissuedisclosurenotices andtodirect entitiestoprovideastatement.
12TheCorporationsActand theASICAct.
13IntegratedFinancialGroupPtyLtdvAustralianSecurities &Investments Commission (2004)183FLR8.
Thecoercive information-gathering powers ofgovernment agencies7
Theproductionpowerscanthereforebeusedaspartofageneralauditormonitoring ofa company’saffairs,as wellasinthecourseofaninvestigationwithaview totaking enforcementaction.Section28(a)providesthatnoformalinvestigation orsuspicionof wrongdoingisrequiredinordertoissueanoticetoproduce books.
Second,investigationsmaybeconductedunderDivision1,Part3,oftheASICAct.Section 13ofthatpartprovidesthat,forASICtomakeinvestigations,itmusthave
‘reasontosuspect’thattheremayhavebeena contraventionofthecorporationslegislation or certainotherlegislation.Theambitoftheinvestigationisnotconfinedto determiningwhetherthesuspectedcontraventionoccurred.Oncetriggered,theprovision givesASICthescopeto conductaninvestigationatleastasbroadasanyofits functionsunders 1(2)oftheASICAct.14
Third,appearanceforexaminationunders 19applieswhereASIC‘onreasonablegrounds, suspectsorbelievesthatapersoncangiveinformationrelevanttoamatterthat itis investigating,oristoinvestigate’[emphasisadded].Thisisastricterthresholdthanthat applyingtotheproductionofdocuments.
BothASICandAPRAmayusemonitoringpowersunderss254(2)and255ofthe Superannuation Industry(Supervision)Act,whichprovidesthattheregulatormayrequire the provisionofinformationandtheproductionofbooks‘forthepurposesofthis Act’.15 Sections 131and132oftheLifeInsuranceActmakesimilarprovision.
Centrelink
ForCentrelink,animportantinformation-gatheringpowerresidesins 192oftheSocial Security(Administration)Act1999(Cth),whichprovidesthattheSecretaryofthe Department ofFamilies,Housing,CommunityServicesandIndigenousAffairsmay requirethatapersongiveinformationorproduceadocumentthatisintheperson’s custodyorundertheircontrol tothedepartmentif theSecretary‘considers’that theinformationcouldberelevanttoa person’seligibilityforbenefit.16
ThereisnostatutorytriggerfornoticesissuedbytheSecretaryunders 193toobtain information directlyfromapersonwhoowesadebttotheCommonwealth.Incontrast, asnoted,s194requiresthattheSecretary‘believethata personmayhaveinformation ora document’thatwouldhelpthedepartmentlocateanotherpersonwho owesadebttotheCommonwealthorisrelevanttothedebtor’sfinancialsituation [emphasisadded].
Sections63(Requirementtoattendthedepartmentetc)and64(Requirementtoundergo a medicalexamination)requiretheSecretarytobe‘oftheopinion’thatsomeoneshouldattendorcontactthedepartmentorprovideinformation.Noticesunder theseprovisionscan beissuedonlytoindividualswhoarereceivingorhave
14See,forexample,LittleRiverGoldfieldsNLvMoulds(1991) 32FCR456.
15Thisis in Division 2ofPart25of the Act(Monitoring superannuationentities).
16Notethat,sincetheDepartmentsofEducation,EmploymentandWorkplaceRelations and
Families, Housing,Community ServicesandIndigenousAffairsshare portfolioresponsibility for
administrationofsocial security law,thecorresponding Secretariesare entitledtoexercisethe powerwithin their department’sportfolioresponsibility.
8Thecoercive information-gathering powers ofgovernment agencies
madeaclaimforasocialsecuritypaymentorotherbenefit(ss63(1)and64(1)).Failure tocomplywithanoticewithoutareasonableexcusewillresultin thenon-payment ofa benefitapersoncurrentlyreceivesorhasappliedfor.
Totheextentthattheseprovisionsareusedforthecollectionofinformationforthepurpose of determininganindividual’sinitialentitlementtoabenefit,theyfalloutside thescopeof theinformation-gatheringpowersunderconsiderationinthisreport.
MedicareAustralia
UndertheMedicareAustralia Act1973(Cth)anauthorisedMedicareofficercanrequire a persontogiveinformationorproducedocuments,canenterpremises,canconduct searches,andcanseizeevidentialmaterial.Section8PoftheActprovidesthat there mustbe ‘reasonablegroundsforbelieving’anoffencehasbeencommittedand theinformationor documentisrelevanttotheoffence.
TheAustralianTaxationOffice
ThereareaccessprovisionsinmanyoftheActsadministeredbytheCommissionerof Taxation.Thecommissioner’srightsundertheaccesspowerscanbeusedonlybyan officer actingingoodfaithandforthepurposesoftheAct.
Section264oftheIncomeTaxAssessmentAct1936(Cth)isoneofthemainaccessprovisions.Asnoted,s264providesthatapersoncanberequiredto‘furnish[theCommissioner]with suchinformationashemayrequire’(s264(1)(a))and‘toattendand giveevidence… concerninghisoranyotherperson’sincomeorassessmentandmay requirehimtoproduce allbooks,documentsandotherpaperswhateverinhiscustody orunderhiscontrolrelating thereto’(s264(1)(b)).
Section264(1)(a)isbroaderthans 264(1)(b).ItallowstheATOtoaskformoregeneral information—forexample, anaccountant’sclientlist.17Incomparison,
s264(1)(b)islimitedtoevidenceordocuments‘concerning[a]person’sincomeor assessment’.ThismeanstheATOmustdeterminethattheevidenceordocumentationitisseekingrelatestoataxpayer’sincomeorassessment.18
Althoughtheproperpositionofs 264(1)(a)canbeseenasa preliminaryinformation- gathering procedureonwhichamoredirectedrequestunders.264(1)(b)canbebased, s264(1)(a)isnotrestrictedtothatfunction.Thetwoprovisionscanoperateindependently.
Asamatterofconstruction,thecourtshaveimpliedtheprerequisitethatthepowerin s 264(1)(a)isusedonlyforthepurposesofthatAct.19Thesepurposeshave,however, been widelyconstrued.Ithasbeensuggestedthatanybonafideinquiry
17McCormack v Commissioner ofTaxation(2001)114FCR574.
18Federal Commissioner ofTaxation v AustralianandNewZealandBankingGroupLtd(1979)143CLR499.
19ibid,535(Mason J).
Thecoercive information-gathering powers ofgovernment agencies9
abouttheoperationoftheIncomeTaxAssessmentActwouldbeforthepurposesofthe Act.20
Triggersin legislation
ThesubmissionspresentedinresponsetotheCouncil’sdraftreportoverwhelmingly supported theinclusionoftriggersinlegislation,ratherthaninsubordinatelegislation. The OfficeofthePrivacyCommissioner submittedthatclearlegislativeauthority assistswith regulationofthedisclosureandsecondaryuseofpersonalinformation.
Consistencyin triggers
Whentheagencieswereaskedwhetherthereshouldbegreaterconsistencyinthetriggers foractivatingcoerciveinformation-gatheringpowers,thepredominantresponse wasthatit isimportantthatsuchtriggersreflecttheregulatoryobjectivesand theriskprofilesofeach agency.Asacorollarytothis,itwasnotedthatconsistencyshouldnotbesoughtatthe expenseofoperationalneed.Moreover,respondents wereunconvincedthatacross-agency consistencyinthisareawouldlead togreaterefficiencies.
TheATOsaid,forexample,itsconsiderabledegreeofdiscretioninrelationtotheuseof its coercivepowerscomplementsthe‘self-assessment’approachonwhichtheAustralian tax systemislargelybased.Itnoted, too, thatthiswidediscretionandtheability tocompelpeople toprovideinformationworkasastrongdeterrenttonon-compliancewithtaxlaws.
Itwassaidthatoneareainwhichconsistencyisdesirableisin relationtothresholdsfor the useofcomparablepowersindifferentstatutesadministeredbya singleagency. BothASIC andAPRApointedtodifferencesbetweentheASICActandtheSuperannuation Industry (Supervision)Actandthetriggersinotherlegislationtheyadminister.21Thesedifferencesseem tobehistoricalratherthanoperationallynecessary andinpracticecanbeinconvenient tocomplywith.
Itwasalsosuggestedthatconsistencyinthepracticalapplicationoflegislativetriggers inan agencyisimportant,especiallywhereanagency’sinformation-gathering powersare exercisedindifferentstatesorterritoriesorinoverseasoffices.
20SeeVincentAMorfuni2004,‘Legalprofessionalprivilegeandthegovernment’srighttoaccess informationanddocuments’,Australian TaxReview,vol. 33, pp.89,99.
21Inresponse to thistypeof concernandrelatedeconomic inefficiencies, the FinancialSystem Inquiry commissioned bytheAustralianGovernment in1996recommended,amongotherthings, amendmentstostandardiseASIC’s coerciveinformation-gathering powersacross thefinancial servicesregime—FinancialSystemInquiryCommittee1997, Financial System Inquiry Final Report, AustralianParliament,Canberra.
10Thecoercive information-gathering powers ofgovernment agencies
Settingthethreshold
Monitoringpowers
Theagenciesstudiedstressed theroleofmonitoringpowersintheexecutionoftheir regulatory responsibilities.Usedtoassessgenerallevelsoflegislativecompliance,these powersareoftennotreferabletoparticularinvestigations.Further,itmightnotalways be apparentwhenmonitoringactivitiesescalateintoamoreformalinvestigation. Whethertouse thepowersformonitoringorin relationtoamorespecific investigationisoftenapractical decisionmadecasebycase.
Anumberofagenciespointedtoinefficienciesthatcouldariseifthethresholdfortheuse of monitoringpowersweresettoohigh.Therewas,however,broadagreementthat,asa minimum,monitoringpowersshouldbeexercisedinamannerconsistentwith theobjectsof therelevantlegislation.
Morespecific investigations
Thesubmissionsexpressedbroadsupportfortheideaoftyingtriggersfortheuseof agencies’monitoringpowerstothelegislativeobjectivesofeachagency.Inthecaseof specific investigations,though,theprevailingviewwasthatthereshouldbeahigher trigger, determinedonthebasisofobjectivelyassessablecriteria.Whatthecriteria shouldbewasless clear.Severalsubmitterssuggestedthatathresholdof
‘reasonablebelief’forpowersusedinacriminalcontextand‘reasonablesuspicion’
forpowersexercisableinacivil contextmightbeappropriate.
Theterms‘suspect’and‘believe’havebeenconsideredbythecourts.InGeorgevRockett the FullCourtof theHighCourtdefined‘suspicion’as‘astateof conjectureor surmisewhere proofislacking’.22AsKittoJnotedinQueenslandBaconPtyLtd23,a
‘suspicionthatsomethingexistsismorethanamereidlewonderingwhetheritexistsor not;it isapositivefeelingofactualapprehensionormistrust,amountingtoa“slight opinion,but withoutsufficientevidence”’.
Ontheotherhand,theHighCourtconsideredinRockettthat‘belief’needsto‘pointmore clearlytothesubjectmatter’.24Althoughbeliefisnotrequiredtoestablishtheexistence of therelevantfactonthebalanceofprobabilities,theCourtheld:
Beliefisaninclinationofthemindtowardsassentingto,ratherthanrejecting, apropositionand thegroundswhichcanreasonablyinduce thatinclination
of the mindmay, depending on the circumstances,leave something to surmise orconjecture.25
Whereeitherthesuspicionorthebeliefmustbebasedon‘reasonablegrounds’,ithasbeen heldthat,althoughthenotionimportsanobjectivetest,‘“reasonable”involves
avalueornormativejudgment’.26Thisdoesnotmeantheissuingofficerhasanon-
22(1990)170CLR104,115.
23Queensland Bacon Ltd v Rees(1966)115CLR266,303.
24GeorgevRockett (1990)170CLR104,112.
25ibid.
26Greiner v Independent Commission Against Corruption(1992)28NSWLR125,167.
Thecoercive information-gathering powers ofgovernment agencies11
examinablediscretion,butithasbeenheldthat theissuingofficer’sdecisionisopento challengeonlyifthedecisionwasonethattheofficercouldnotlawfullyhavemade onthebasisofthematerialsbeforehimorher.27
In Rockett,theHighCourtheldthatwhenthelegislationprovidesthattheremustbe
‘reasonablegrounds’foraparticularstateofmind,includingasuspicionorbelief,this ‘requirestheexistenceoffactswhicharesufficienttoinducethatstateofmindina reasonableperson’.28Thecourtalsoheldthat‘the factswhichcanreasonablyground asuspicionmaybe quiteinsufficientreasonablytogroundabelief’,although
‘somefactualbasisforthesuspicionmustbeshown’.29
ThereasonablegroundstestenunciatedinRockettrelatestothedecisionmaker’sstate ofmind,which,whetherasuspicionorabelief,mustbebasedonsupportingfacts or circumstances.
TheCouncil’sview
TheCouncil’sviewisthatinmostinstancesitisdesirablethattherebeadistinctionbetween thethresholdfortheuseofanagency’scoerciveinformation-gatheringpowers for monitoringandformorespecificinvestigations.Formonitoring,theCouncilconsidersthe minimumthresholdtriggershouldbethatthepowersareexercised in accordancewiththeagency’sstatutoryobjectives.Formorespecificinvestigations, thetestshouldbe correspondinglymorespecific,requiringestablishment ofarequisitestateofmindon reasonablegrounds.Bothtests shouldbe appliedobjectively.
Ifamonitoringprocessescalatestoamorespecificinvestigationofsomeone,itisgood administrativepractice,totheextentoperationallypossible,toinformthatperson ofthe changeinstatus.
Principle1
Theminimumstatutorytriggerfortheuseofagencies’coerciveinformation-gathering powersformonitoringshouldbethatthepowerscanbeusedonlytogather information forthepurposesoftherelevantlegislation.
Ifacoerciveinformation-gatheringpowerisusedinconnectionwithaspecificinvestigation, theminimumstatutorytriggerforusingthepowershouldbethattheperson exercisingithas‘reasonablegrounds’forthebelieforsuspicionthatisrequired beforethepowercanbe exercised.
Ifaninformation-gatheringprocessescalatesfrom monitoringtospecificinvestigation, agencyofficersshould,totheextentoperationallypossible,informthesubject ofthe investigationofthatchangeinstatus.
27MinisterforImmigrationEthnicAffairsvWuShanLiang(1996)185CLR259,275–6.
28GeorgevRockett (1990)170CLR104,112.
29ibid,115.
Thecoercive information-gathering powers ofgovernment agencies13
3Deciding whether to use the powers
Inadditiontothelegislativethresholdsfortheuseofcoerciveinformation-gatheringpowers, otherimportantfactorsarerelevanttothequestionofwhethertheuseofthepowers is appropriate.
Alternativewaysofobtaininginformation
Anagency’sdecisiontoissueanoticeinexercisingitscoerciveinformation-gatheringpowers isnottobemadelightlyconsideringthatfailuretocomplywithaninformation-gathering noticecanbepunishablebyafineorimprisonment,orboth.
Thesixagenciesunderconsiderationforthisreportemphasisedthattheyexercisetheir coerciveinformation-gathering powersonlyaftercarefulassessmentoftheneed todoso, andthisincludesconsiderationofalternativewaysofobtainingthedesired information.
Anumberofagenciesidentifiedotherimportantstatutorysourcesofinformation—for example,annualandotherreportingrequirements.ASICalsonotedtheobligations the CorporationsActimposesontrusteesfordebentureholders,auditors,receivers, administrators andliquidatorstoinformitofpossibleirregularities.
Theagenciessaidthatwhereitisappropriatetheytrytoobtaininformationinformally andvoluntarily.Thisapproachisreflectedinsomeagencies’practicemanuals.
TheACCCsaidthatbeforeissuinganoticeitconsidersthefollowing:
•whethertheinformationisotherwiseavailable—includingvoluntarily
•thedegreeofriskthattheinformationmaybedestroyed,notprovidedor provided ontermsunacceptabletotheACCC
•whetheritisappropriatefortheACCCtoobtaininformationformally
•whethertheinformationisnecessaryandrelevanttotheACCC’sinvestigation
•thetimeandcostimplicationsofas 155processfortheACCCandforthenotice recipient.30
Therearealsoimportantreasonswhyinsomecases theissueofanoticemightbethe preferred option,bothforagenciesandfornoticerecipients.
IfinformationissoughtfromathirdpartythePrivacyAct1988(Cth)mightprecludethat person’sdisclosureofpersonalinformation31unless,amongotherthings,the
30ACCCpolicies andguidelines.
14Thecoercive information-gathering powers ofgovernment agencies
disclosureisauthorisedbylaw.32Disclosureinaccordancewithanagency’scoercive information-gathering powerswouldfallwithinthisexception.
Formalnoticescanalsoofferstatutoryprotectiontoindividualssubjecttocontractual confidentiality clauses.Similarly,protectioninrelationtoself-incriminationunder
s68(3)oftheASICActisnotavailableforinformationprovidedvoluntarily—although it mightexistatcommonlaw—anddoesnotgiverisetoimmunityfromsuit unders 92.
Additionally,concernwasexpressedthatinformationprovidedvoluntarilycouldsometimes be incompleteorofferedtofurthertheperson’sowninterests.Forthisreason anagency’suse ofitscoercivepowersgivesitclearandeffectiveremediesifthere isdoubtaboutwhetherall thenecessaryinformationhasbeenproduced.Several submissionsalsonotedtheevidentiary benefitsarisingfromtheformalissueof anotice.Forexample,ifanexaminationisunderoath theproceedingsareusuallyrecorded, atranscriptisproduced,andthequestionof admissibilityisusuallydealtwith.
TheCouncil’sview
Alternativewaysofobtaininginformationarenotpracticalineverycase—for example, iftimeisacrucialfactororthepersonis unlikelytoprovidethe
informationvoluntarily.Therearealsolegitimatelegalgroundsonwhichtheissuing
ofaformalnoticecanrepresentthepreferableapproach.
Asamatterofgoodadministrativepractice,however,theCouncilconsidersthatbefore they issueanoticeagenciesshouldcarefullyconsideralternativewaysofobtaining information. TheACCC’sapproachillustratesthesortsoffactorsthatarerelevant inthisregard.Other sourcesofpubliclyavailableinformationshouldbeconsidered.
Compliancecosts
Commonlaw,legislationandpractice
Atcommonlaw,thecourtsmayconsiderwhetheranoticeisundulyburdensomeonly as evidencethatitwasissuedunreasonablyorwithouttakingrelevantfactorsinto account.33 Otherwise,noticesmustbecompliedwithregardlessoftheinconvenience, disruptionand expenseinvolved.Ithas,however,beensuggestedthat thedegreeofharshnessandrelated factorsinanoticemightbesuchastosuggest thatthenoticewasnotimposedingoodfaithor wasimposedforacollateral
31‘Personalinformation’is definedin s6ofthePrivacyActas‘informationoranopinion(including informationoranopinionforming partofadatabase),whether true or not, andwhether recorded inamaterialformornot,aboutanindividualwhose identityisapparent,orcanreasonablybe ascertained,from theinformationoropinion’.
32SeeInformationPrivacyPrinciple11.1(e), s 14ofthePrivacy Act; National Privacy Principle2.1(g);
Schedule3to thePrivacy Act.
33Kotan HoldingsPty Ltd v TradePractices Commission(1991)30FCR511,515.
Thecoercive information-gathering powers ofgovernment agencies15
purposeorwithoutregardtoburden.34Thereappearstohavebeennodecisionsupporting thepropositionthatitisappropriatetorelievetheburdenbyrequiringapayment tocover theindividual’scosts.
ThelegislationtheCouncilreviewedrevealsthatthereisnoacross-the-boardapproach to costs.Thebroadestapproachis thatunders 89(3)oftheASICAct,whichprovides thatASIC hasdiscretiontopay‘suchamountasit thinksreasonableonaccountofthecostsandexpenses(ifany)thatapersonincursincomplying’.
Severalstatutespermitpaymentstoindividualsattendingforexamination;examplesare the IncomeTaxAssessmentActandtheASICAct.35TheATO’sAccessandInformation-gathering Manualprovides,however,thatexpenses arenottobepaidifaperson isprovidingevidencein respectoftheirownincomeorassessmentortheincomeorassessmentofapersonthey represent.
Somelegislationprovidesforthesupplyfreeofchargeoftherecordofanexaminationtoexaminees.36Unders 131oftheLifeInsuranceActacompanyisentitled tobepaid reasonablecompensationformakingcopiesofdocuments.
Theobligationtocomplywithanoticeis qualifiedinsomeinstances,noticerecipients beingrequiredtogiveall‘reasonable’assistance.Thisqualificationis,however, found onlyinprovisionsrelatingtoattendanceforexamination.
Consultationoncosts
Costscanbeanimportantandsensitivematter,especiallywhencoercive
information-gatheringnoticesareissuedtothirdpartiesagainstwhoman agencyhasno intentionoftakingregulatoryaction.
Severalsubmissionsexpressedtheviewthatthereislittleawarenessonthepartofagencies ofthepressuresplacedonnoticerecipientsbyrequestsforlargeamountsofinformation. Moreover,thepurposesforwhichinformationwasbeingsoughtwereoften saidtobeunclear.
Itwasalsosuggestedthat,evenifadecisionismadetoissueanotice,anagencymight do bettertoadoptaconsultativeapproachinordertohelpdeterminewhattype ofnotice wouldbestsecuretheinformationsought.Further,itwassaidthatifagencies wererequiredtocompensatenoticerecipientsforthecostofcompliancethey wouldmore carefullyconsiderotheroptionsandrefinethescopeoftheinformation sought.
Despitetheseviews,agenciessaidtheyarenotindifferenttothepotentialcostofcompliancewithanotice.Forexample,theATOsaidifinformationisavailablefrommultiple sources officersarerequiredtoconsiderthepersonwhoismostsuitedtobearing thecostofproviding thatinformation.Similarly,theACCC’s‘Reasonto