Farm Business Debt Mediation Bill 2016

Introduced: 30/8/2016By: Hon L Donaldson MPStatus: PASSED with amendment

Regional Queensland Business & Economy Justice & Rights

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Plain English Summary

This is an omnibus bill covering multiple policy areas.

Overview

This bill forces banks and other lenders to offer farmers mediation before they can enforce a farm mortgage, giving struggling farmers a structured chance to negotiate outside of court. It also renames QRAA as the Queensland Rural and Industry Development Authority, lets industry bodies run their own biosecurity accreditation schemes, clears the way for viruses to be used as pest control, and allows Queensland cannabis growers to supply seed to medicinal cannabis producers.

Who it affects

Queensland farmers with mortgaged farm property get stronger protections before enforcement action; banks and rural credit providers must offer and take part in mediation in good faith. Plant and animal industry groups, biological control programs, and the Queensland medicinal cannabis industry are also affected.

Mandatory farm debt mediation

Creates a legal framework requiring banks and other rural lenders to offer mediation before repossessing farm property. Farmers can request mediation, have it run by an accredited mediator, and block enforcement through a certificate if the lender refuses to mediate.

Banks must offer mediation and participate in good faith before enforcing a farm mortgage (maximum penalty 100 penalty units, plus any enforcement action has no effect)
Farmers can apply for an enforcement action suspension certificate that stops the bank from acting while a dispute is resolved
Mediation is confidential, both parties share the mediator's cost equally, and farmers can bring an advisor or lawyer
Heads of agreement reached in mediation have a 10-business-day cooling-off period during which the farmer can revoke them
QCAT can review the authority's decisions on certificates and accreditation

QRAA becomes QRIDA

Continues QRAA as the Queensland Rural and Industry Development Authority with expanded functions including research and advice on the rural sector, partnering with commercial lenders, and broader community assistance.

QRAA is renamed Queensland Rural and Industry Development Authority with clarified power to make loans
New functions include advising the Minister on the financial performance of the rural sector and partnering with commercial lenders
The authority can now administer schemes of assistance to community, sporting and cultural organisations

Industry-led biosecurity accreditation

Amends the Biosecurity Act 2014 to let the chief executive approve private-sector biosecurity accreditation schemes. Approved operators can issue biosecurity certificates used to move plants, animals and other produce.

Industry groups can run accreditation schemes like BioSecure HACCP that issue biosecurity certificates
Schemes and their operators must be approved by the chief executive, with terms of up to three years and regular audits
Giving false information in an application carries a maximum 200 penalty units; breaching approval conditions also carries 200 penalty units
Schemes can be suspended immediately if there is a serious risk to biosecurity or trade in a commodity

Viruses as biological control agents

Amends the Biological Control Act 1987 to clarify that viruses and sub-viral agents are organisms for the Act, so programs such as the K5 rabbit calicivirus and carp herpesvirus release are covered by the Act's liability protections.

Definitions of 'organism' and 'prescribed organism' now clearly include viruses and sub-viral agents
Supports the scheduled 2017 release of K5 calicivirus for rabbit control and carp herpesvirus for common carp
Existing relevant law declarations made under the Act are preserved

Medicinal cannabis seed supply

Amends the Drugs Misuse Act 1986 to let licensed Queensland industrial cannabis growers and researchers supply seed to holders of cannabis research or medicinal cannabis licences under the Commonwealth Narcotic Drugs Act 1967.

Category 1 and 2 researchers and industrial cannabis growers can supply seed to Commonwealth-licensed medicinal cannabis producers
The chief executive must consider suspensions or cancellations under the Commonwealth Act when assessing suitability for a Queensland licence

How this affects you

Regional Queensland

•Farmers in financial trouble can force their bank into mediation before losing the farmPart 2, Clause 12A mortgagee must not take enforcement action under a farm mortgage unless the Act does not apply or an exemption certificate is in force, with a maximum penalty of 100 penalty units.
•The rural authority known as QRAA is renamed Queensland Rural and Industry Development Authority and takes on a broader advisory and research role for farming and regional communitiesClauses 122-134QRAA is continued as the Queensland Rural and Industry Development Authority with expanded functions including advising the Minister on the financial performance and sustainability of the rural and regional sector.
•Pest control programs using viruses like calicivirus for rabbits and carp herpesvirus are now clearly covered by Queensland lawClauses 95-98The Biological Control Act 1987 definitions of 'organism' and 'prescribed organism' are amended to include viruses and sub-viral agents.
•Industry groups representing growers can now run their own biosecurity accreditation schemes to certify plants and produceClause 105 (new ch 15, pt 5)The Biosecurity Act 2014 is amended to allow the chief executive to approve industry-led biosecurity accreditation schemes such as BioSecure HACCP.

Business & Economy

•Banks and other rural lenders must offer mediation and take part in good faith before enforcing a farm mortgagePart 3Mortgagees who fail to respond to a mediation request within 15 business days, refuse mediation, or delay unreasonably can have enforcement blocked by the authority.
•If a corporation (including a bank) enforces a mortgage in breach of this Act, an executive officer can also be held personally liableClause 89Executive officers who authorised or permitted the corporation's conduct, or were knowingly concerned in it, are taken to have committed the offence.
•Queensland cannabis growers with existing licences can supply seed to Commonwealth-licensed medicinal cannabis producersClauses 117-120Category 1 and 2 researcher licences and grower licences under the Drugs Misuse Act 1986 are amended to authorise supply of seed to holders of cannabis research or medicinal cannabis licences under the Narcotic Drugs Act 1967 (Cth).
•Operating a biosecurity accreditation scheme without complying with its approval conditions carries a penalty of up to 200 penalty unitsClause 106 (new s 436A)An approved operator of an approved biosecurity accreditation scheme must not contravene an approval condition without a reasonable excuse, with a maximum penalty of 200 penalty units.

Justice & Rights

•Farmers can apply for a certificate that legally stops their bank from taking enforcement action when the bank refuses to mediatePart 4, Division 1 (Clauses 40-47)A farmer in default who has given a request for mediation notice may apply to the authority for an enforcement action suspension certificate if the mortgagee has failed to mediate.
•Anything said or documents shared during farm debt mediation stay confidential and can't be used in courtClause 38Matters said or done during a mediation meeting and documents prepared for it are not admissible in any civil, criminal or administrative proceeding.
•Farmers and banks can appeal the authority's decisions to the Queensland Civil and Administrative Tribunal after internal reviewPart 6A person must first apply for internal review of an original decision, and may then apply to QCAT for external review of the internal review decision.
•Any contract clause trying to waive a farmer's right to ask for mediation has no legal effectClauses 85-86Contracts contrary to this Act have no effect, and a waiver or purported waiver of a farmer's rights under this Act has no effect.

Bill Journey

Introduced30 Aug 2016

First Reading

Committee

Committee Report

Second Reading

In Detail

Third Reading

Royal Assent30 Mar 2017

Referenced Entities

Sectors Affected

Agriculture Financial Services Public Administration Pharmacy Civil Law

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