Frequently Asked Questions
General Questions
- Do the best practice regulation requirements apply to me?
- Who is responsible for applying the best practice regulation requirements?
- Which regulatory assessment guidelines apply to my proposal, Australian Government or COAG?
- Is there a difference between the Australian Government and COAG guidelines?
- What is ‘regulation’?
- What is ‘quasi-regulation’?
- Are guidance or advisory notes quasi-regulation?
- Are voluntary instruments quasi-regulation?
- Is the removal or revoking of a regulation caught by the regulatory impact analysis arrangements?
- What is 'business'?
- What is meant by ‘community-wide perspective’?
- What does ‘restrict competition’ mean?
- What is a Regulation Impact Statement (RIS)?
For Australian Government Regulation
- What is a Best Practice Regulation Coordinator?
- Do I need to prepare a RIS?
- Are RISs only required for primary legislation or legislative instruments?
- Is a RIS required if someone other than Cabinet is making the decision?
- Is it true that RISs are not required for election commitments?
- Are RISs required for Budget proposals?
- Is a RIS required for new regulations only and not for amendments to regulations?
- Is it true that RISs only have to consider the impacts on business or the not-for-profit sector?
- Is it true that a RIS is only required if the regulation imposes compliance costs?
- Is a RIS required even when the regulation will provide a benefit to business or the not-for-profit sector?
- Is a RIS only required at the policy implementation stage?
- Is a RIS only required for tabling?
- What role does the Small Business Advisory Committee (SBAC) have in the RIS process?
- Does a RIS need to examine non-regulatory options?
- If the benefits are difficult to value does the RIS still need to have a cost-benefit analysis?
- Does the RIS need to demonstrate that the preferred option has the greatest net benefit?
- Do the RIS requirements apply to changes in taxation?
- Do ‘competition impacts’ include impacts due to an increase in competition?
- What would be examples of proposals that would have minor or machinery impacts?
- Do I need to quantify compliance costs?
- In quantifying compliance costs, should I consider impacts on overseas businesses affected by a proposal?
- I’ve never prepared a RIS before and I know little about cost-benefit analysis. Who can help?
- When an agency/department has no discretion in the development of some elements of a regulatory proposal (because they are specified in the primary legislation,) does the agency/department have to provide a full analysis of these elements in a RIS?
- What happens if I don’t prepare a RIS?
- What happens when a proposal proceeds to the decision maker without clearance of the Regulation Impact Statement by the OBPR?
- When do I need to consult with stakeholders?
- What are Annual Regulatory Plans and is it a requirement for departments and agencies to publish one?
- What were the changes to the Best Practice Regulation requirement made in 2010?
For COAG Regulation
- What should I do if the impacts of my proposal are minor or machinery?
- If I assess a proposal as being minor or machinery in nature (and do not perform any further analysis), what are the consequences if the OBPR disagrees with my assessment?
- At what point is a RIS required?
- Do I need to quantify compliance costs?
- What if there is not time to prepare a RIS?
- What happens if I don’t prepare a RIS?
- What is the role of the OBPR?
General Questions
Do the best practice regulation requirements apply to me?
Australian Government best practice regulation requirements apply to all government departments, agencies, boards and statutory authorities. Council of Australian Governments (COAG) best practice regulation requirements apply to all Ministerial Councils and other intergovernmental standard setting bodies.
Who is responsible for applying the best practice regulation requirements?
You, your department or agency, and individual ministers or Ministerial Councils.
Which regulatory assessment guidelines apply to my proposal, Australian Government or COAG?
The regulatory assessment guidelines that apply to your department/agency depend on who is the decision maker for your proposal.
- If the decision maker is the Australian Government (that is, Cabinet, the Prime Minister, Australian Government ministers or other delegated decision makers), you must follow guidelines outlined in the Best Practice Regulation Handbook.
- If the decision maker is an intergovernmental body (including the Council of Australian Governments, ministerial councils and standing committees), you must follow the COAG Best Practice Regulation guide.
If you are unsure about which guidelines apply to your department or agency, contact the OBPR.
Is there a difference between the Australian Government and COAG guidelines?
Yes – while both the Australian Government and COAG guidelines require the preparation of a Regulation Impact Statement (RIS), there are some key differences in their respective processes. In particular, under the COAG guidelines, a consultation RIS must be circulated to stakeholders.
Any ‘rule’ endorsed by government where there is an expectation of compliance, for example, primary legislation (Acts), subordinate legislation (legislative or non-legislative instruments), treaties and quasi-regulation.
Quasi-regulation includes a wide range of rules or arrangements where governments influence businesses and individuals to comply, but which do not form part of explicit government regulation. Broadly, whenever the government takes action that puts pressure on businesses to act in a particular way, the government action may be quasi-regulatory.
Are guidance or advisory notes quasi-regulation?
Government agencies publish large numbers of rulings, guidelines, circulars and other documents which advise on, clarify or interpret existing legislation. These types of documents could be regarded as being quasi-regulatory if they add additional requirements and there is pressure on business to comply. If this is likely to be the case, the responsible agency should contact the OBPR for advice.
Are voluntary instruments quasi-regulation?
Instruments that are entirely voluntary (for example, complying with an industry code of conduct that is purely voluntary with no consequences for non-compliance) are not quasi-regulatory. However, whenever government is involved with the development, promotion or enforcement of a voluntary instrument (such as an industry code or a standard), there needs to be an examination of whether government involvement pressures businesses to comply. If you are still in any doubt as to whether your proposal is regulatory, please contact the OBPR.
Is the removal or revoking of a regulation caught by the regulatory impact analysis arrangements?
Yes – you should contact the OBPR on any proposal to remove or revoke regulation.
'Business' includes any private organisation that aims to make a profit (including sole traders), the commercial activities or transactions of not-for-profit organisations, and any government business enterprise.
What is meant by ‘community-wide perspective’?
This means canvassing the impacts on all affected parties (not just vocal special interest groups).
What does ‘restrict competition’ mean?
A restriction on competition is where a regulatory proposal directly (for example, regulatory constraint) or indirectly (for example, influences behaviour) limits the number or range of suppliers, limits the ability of suppliers to compete, reduces their incentive to do so, or limits the choices of consumers. See also the Competition Assessment Checklist.
What is a Regulation Impact Statement (RIS)?
A RIS is a document prepared by the department, agency, statutory authority or board responsible for a regulatory proposal, following consultation with affected parties. It formalises and provides evidence of the key steps taken during the development of the proposal, and includes an assessment of the costs and benefits of each option.
Preparation of a RIS ensures that all relevant information is documented, and that the decision-making processes are made explicit and transparent.
For Australian Government Regulation
What is a Best Practice Regulation Coordinator?
Each Australian Government department and agency has appointed a senior executive officer to champion sound policy development processes. These Best Practice Regulation Coordinators are responsible for administering the Government’s framework at a departmental or agency level, and help ensure compliance with the Government’s requirements. The OBPR works closely with Best Practice Regulation Coordinators to facilitate compliance with the Government’s regulatory assessment and consultation requirements.
If there are likely to be regulatory impacts on business or the not-for-profit sector, unless the impacts are of a minor or machinery nature and do not substantially alter existing arrangements, you will be required to prepare a RIS.
Are RISs only required for primary legislation or legislative instruments?
No - RISs are also required for international treaties and for other requirements that governments impose on business or the not-for-profit sector but that do not form part of explicit government regulation (such as industry codes of practice, guidance notes, industry-government agreements and accreditation schemes).
Is a RIS required if someone other than the Cabinet is making the decision?
Yes – RISs are required for all decision makers, including committees of the Cabinet, ministers, delegated officials or heads/boards of statutory agencies.
Is it true that RISs are not required for election commitments?
No – RIS requirements apply to election commitments that involve regulation. Where a proposal implements a specific election commitment, the RIS should focus on the commitment and its implementation, and not on the initial regulatory decision.
Are RISs required for Budget proposals?
Yes – RIS requirements apply to all regulatory decisions whether or not they are made as part of the Budget process.
Is a RIS required for new regulations only and not for amendments to regulations?
No – RIS requirements apply to both new and amended regulations, including the rolling over of sunsetted regulations.
Is it true that RISs only have to consider the impacts on business or the not-for-profit sector?
No – once a proposal triggers the RIS requirements, the RIS must consider the impacts on all relevant groups, including consumers, governments and the broader community.
Is it true that a RIS is only required if the regulation imposes compliance costs?
No – a RIS is required if a regulatory decision is likely to impact on business or the not-for-profit sector. This impact includes items that can be readily quantified in monetary terms (like compliance costs, service charges or subsidies) as well as items that cannot be readily quantified in monetary terms (for example the costs of pollution).
Is a RIS required even when the regulation will provide a benefit to business or the not-for-profit sector?
Yes – a RIS is required for regulatory decisions likely to have any impact (whether positive or negative) on business or the not-for-profit sector unless the impact is of a minor or machinery nature.
Is a RIS only required at the policy implementation stage?
No – RIS requirements apply to all decisions in a policy process, whether they are broader decisions, or decisions on the detailed implementation of the policy.
Is a RIS only required for tabling?
No – a RIS is required to be presented to decision makers as they make their decision.
What role does the Small Business Advisory Committee (SBAC) have in the RIS process?
The SBAC’s role is limited to those RISs that are likely to have a significant impact on small business. The SBAC will assist the agency in assessing the impacts of the proposal on small business. If a regulatory proposal being developed by your agency is likely to be particularly burdensome for small business, you should contact the SBAC Secretariat at an early stage.
Does a RIS need to examine non-regulatory options?
Yes – if non-regulatory options can feasibly address the government’s objectives they should be included in the RIS.
If the benefits are difficult to value does the RIS still need to have a cost-benefit analysis?
Yes – even though it can be very difficult to place a monetary value on some factors, including environmental and social impacts. The cost-benefit analysis should recognise this and include a qualitative discussion of these impacts so that they can be compared with other impacts that can be more easily quantified.
Does the RIS need to demonstrate that the preferred option has the greatest net benefit?
No – the RIS must describe the impacts of all the feasible options and identify the preferred option but, unless the option restricts competition, it is not necessary to demonstrate that the preferred option has the greatest net benefit to the community.
Do the RIS requirements apply to changes in taxation?
Yes – a RIS is required for all regulatory decisions, including changes in taxation, likely to have any impact (whether positive or negative) on business or the not-for-profit sector unless the impact is of a minor or machinery nature or, in the case of taxation, purely revenue in nature.
Do ‘competition impacts’ include impacts due to an increase in competition?
Yes – competition impacts include both promotion and restriction of competition.
What would be examples of proposals that would have minor or machinery impacts?
The indexation of thresholds for tax measures, minor amendments to legislation to close loopholes arising from recent amendments, and amendments to add new species to endangered species lists would be examples of proposals that would usually be considered to have minor or machinery impacts.
Do I need to quantify compliance costs?
If you have to undertake regulatory analysis in a RIS, and there are likely to be compliance costs, you are required to prepare a full compliance cost assessment using the Business Cost Calculator (BCC) or an approved equivalent. The OBPR will advise you if this is the case (when you contact them for advice on the need to prepare a RIS). Where there are likely to be significant compliance costs, the quantification of these costs will form part of the RIS.
In quantifying compliance costs, should I consider impacts on overseas businesses affected by a proposal?
It is not a requirement to cost impacts on foreign businesses. However, proposals that affect overseas businesses may impact on competition and you should consult with the OBPR on whether a RIS is required.
I’ve never prepared a RIS before and I know little about cost-benefit analysis. Who can help?
You should contact the OBPR for technical assistance and training on RISs, undertaking cost-benefit and risk analysis and using the Business Cost Calculator (BCC).
When an agency/department has no discretion in the development of some elements of a regulatory proposal (because they are specified in the primary legislation), does the agency/department have to provide a full analysis of these elements in a RIS?
No – an agency/department needs to provide a full analysis of those elements of a proposal only where discretion is available. Where no discretion is available for elements of a regulatory proposal because they are specified in the primary legislation, it is sufficient for the agency/department to refer to the non-discretionary elements in the RIS. These elements should have been subject to the Government’s regulatory impact analysis requirements when the legislation was developed.
What happens if I don’t prepare a RIS?
Under Australian Government regulatory guidelines, no regulatory proposal can go to the Cabinet or other decision maker that has not complied with the Government’s best practice regulation requirements, unless ‘exceptional circumstances’ have been granted by the Prime Minister. Where a RIS was required but not prepared, a post-implementation review is required to commence within one to two years after implementation of the proposal. The OBPR will also report on those proposals granted ‘exceptional circumstances’ on the Best Practice Regulation Updates website and in the OBPR’s annual Best Practice Regulation Report.
What happens when a proposal proceeds to the decision maker without clearance of the Regulation Impact Statement by the OBPR?
Australian Government proposals should not proceed to the decision maker unless they have satisfied the Government’s best practice regulation requirements.
However, in the event that a proposal proceeds (either to Cabinet or another decision maker) without an adequate RIS, the resulting regulation must be the subject of a post-implementation review within one to two years. The agency/department responsible for the proposal will also be reported as non-compliant by the OBPR on the Best Practice Regulation Updates website as soon as possible following the announcement of a regulatory decision, as well as in the Best Practice Regulation Report.
When do I need to consult with stakeholders?
Effective consultation should occur at all stages of the regulatory cycle. Consultation early in the regulatory process will assist in identifying the nature and extent of the problem, the range of possible options for addressing it, and potential costs to consider. The whole-of-government policy on consultation establishes the principles for best practice consultation with stakeholders as part of good regulatory process.
What are Annual Regulatory Plans and is it a requirement for departments and agencies to publish one?
Annual Regulatory Plans (ARPs) are public listings of upcoming regulatory activity of a department or agency. They should include planned regulatory measures and any upcoming reviews of regulation (including five-yearly reviews and post-implementation reviews). It is a requirement for departments and agencies to publish an ARP in July of each year and update them as appropriate so that stakeholders are informed about regulatory activity and consultation opportunities.
For COAG Regulation
What should I do if the impacts of my proposal are minor or machinery?
The COAG principles and assessment requirements do not apply to agreements or decisions that result in regulation that is minor or machinery in nature and do not substantially alter existing arrangements. If you consider that your proposal fits into this category, then you do not have to conduct any further regulatory impact analysis. If you are unsure, you can contact the OBPR for confirmation of the regulatory impact of the proposal.
If I assess a proposal as being minor or machinery in nature (and do not perform any further analysis), what are the consequences if the OBPR disagrees with my assessment?
If you assess that a proposal is minor or machinery and the impacts are in the OBPR's estimation more significant, your Ministerial Council or standard setting body may be assessed as non-compliant in the annual Best Practice Regulation Report under the relevant Ministerial Council or standard setting body.
If you are unsure as to whether there are no/low impacts, or whether any further analysis is required, you should consult the OBPR.
At what point is a RIS required?
A draft RIS is required for consultation and a final RIS is required at the point a decision is taken. For multi-staged decision-making processes, where a RIS is prepared in accordance with the Guidelines in the COAG Best Practice Regulation guide, a RIS will not generally be required for follow-up or subsequent regulation which implements the original decision, unless significant additional regulation is contemplated.
Do I need to quantify compliance costs?
In preparing a RIS, consideration should be given to the compliance burden imposed on business. These are the additional (incremental) costs incurred by business when complying with regulations.
What if there is not time to prepare a RIS?
A Ministerial Council may decide that a situation requiring a regulatory response is an emergency. In these cases, a RIS need not be prepared before the regulation comes into effect. However, the Chair of the Ministerial Council must write to the Prime Minister before making the regulation:
- seeking agreement to waive the need for a RIS; and
- explaining why the situation was an emergency and why no transitional measures were available.
If the situation was an emergency, the Ministerial Council would be expected to prepare a RIS within 12 months of making the regulation. Alternatively, in emergency cases the briefing material prepared for a Ministerial Council can be provided to the OBPR, which will advise whether the key elements of a RIS are addressed in such material. If so, the OBPR can “post assess” the material as complying with the COAG Guidelines.
What happens if I don’t prepare a RIS?
Under COAG regulatory guidelines, the OBPR must advise the Ministerial Council or standard setting body of its assessment of your compliance with the COAG guidelines, incorporating any comments from New Zealand relating to a trans-Tasman Issue. The Ministerial Council or standard setting body will determine whether or not to adopt the OBPR’s advice.
The OBPR’s assessments are publicly available, and non-compliance with COAG guidelines are reported against the relevant Ministerial Council or standard setting body.
The OBPR does not have any power over decisions made by Ministerial Councils and its role is advisory. COAG has directed the OBPR to provide independent advice on the adequacy of RIS prepared for both public consultation and decision by Ministerial Councils. In fulfilling this role the OBPR does not support any particular regulatory approach or jurisdiction. The OBPR can assist and advise as to whether a RIS is consistent with the principles and Guidelines in the COAG Best Practice Regulation guide.
However, the attention of COAG can be drawn to any regulatory proposals for which the RIS is seriously inadequate through the Best Practice Regulation Report.
Contact for information on this page: OBPR contacts page