Over the past 2 years, the Australian Government has been consulting with industry stakeholders (including ACAPMA) on the options for the future operation of the Oil Code Regulations (2006).

In accordance with normal legislative processes, the current Regulations were due to expire later this year and the Government sought comment on three future options, namely:

  1. Remaking the Regulations in their current form
  2. Remaking the Regulations with amendments
  3. Allowing the Regulations to expire

ACAPMA, together with a group of other industry and government stakeholders, has been participating in the consultative process.

“Our firm view was that there was a need for these Regulations to continue with some minor amendments, to ensure that a formal mechanism continued to exist for the resolution of disputes arising from the operation of fuel reseller agreements”, said ACAPMA CEO Mark McKenzie.

“The removal of the Oil Code Regulations could potentially have resulted in our industry being required to operate in accordance with the requirements of the more general Australian Franchise laws, raising a question about the future of the Commission Agent model that is being increasingly used within our industry”, Mark continued.

The Australian Department of Energy finalised its’ review in October 2016.

One of the key recommendations of this review was that the Regulation be remade with minor technical amendments prior to the scheduled sunsetting date of the original Regulation on 1 April 2017.

Since that time, the Australian Government has been working on the new Regulation.

Earlier this week, ACAPMA was advised that the work on the new Regulation had been completed and that the Competition and Consumer (Industry Codes – Oil) Regulations 2017 were formally approved by the Federal Government on 9 March 2017.

The Regulations are largely a continuation of the 2006 Regulations in that they will continue to:

  1. Specify standard contractual terms and conditions for fuel re-selling agreements for both franchise and commission agency arrangements.  The Regulations provide that tenure of fuel re-selling agreements entered into prior to the commencement of the 2006 Regulation will be honoured, but all other contractual conditions will be expected to comply with the minimum standards established under the Regulations;
  2. Provide a nationally consistent approach to terminal gate pricing (TGP) arrangements to ensure transparency in wholesale pricing and allow access for all customers, including small businesses, to petroleum products at TGP, whilst not negating the ability of entities to negotiate individual supply agreements nor preventing the offering of discounts; and
  3. Provide an independent, downstream petroleum dispute resolution scheme, including the appointment of a Dispute Resolution Adviser to provide the industry with a cost‑effective alternative to taking action in the courts.

The new Oil Code Regulations come into effect on 1 April 2017.

A copy of the new Regulation can be downloaded via the following link (https://www.legislation.gov.au/Details/F2017L00223).

“The new Regulations are a good result for our industry and our thanks goes to the Australian Department of Energy and Environment for the conduct of a thorough and balanced review”, said Mark.