Regulatory intersection with other functions

How we deal with the intersection of our regulatory responsibilities with our other functions

Section 15 of the Australian Radiation Protection and Nuclear Safety Act 1998 (ARPANS Act) confers on the CEO of ARPANSA (CEO) a number of different functions (see What we do for a description of some of these).

Included in these functions is performing certain activities required to be licensed under the ARPANS Act and providing some commercial services that potentially could compete with private providers for the business of other entities licensed under the ARPANS Act.

It has been recognised that in these circumstances the potential exists for certain conflicts of interest to arise or be perceived to arise and consequently subsection 15(2) of the ARPANS Act  provides that the CEO must “take all reasonable steps to avoid any conflict of interest between the CEO’s regulatory functions and the CEO’s other functions”.

Conflicts of interest are likely to arise only infrequently between the CEO’s regulatory functions and the CEO’s other functions.  Below, two examples of theoretical conflicts between regulatory and other functions are examined:

  1. where the exercise of the regulatory power could be perceived to financially advantage ARPANSA, because it would produce revenue – for instance the imposition of  a licence condition which incidentally requires the licensee to utilise a commercial service offered by ARPANSA;
  2. where ARPANSA is effectively required to regulate itself – for example, where ARPANSA owns equipment which is required to be licensed under the ARPANS Act.

Conflicts of interest require management if they are ‘material’ – that is where a reasonable disinterested person would think the two functions could conceivably conflict or appear to conflict.  There is a real question in the first example as to whether any material conflict arises.  As explained in the Explanatory Memorandum to the ARPANS Act, the fact that any such licensing decision is subject to review by the Minister and by the Administrative Appeals Tribunal, is considered sufficient to address any such perceived conflict of interests.  In addition to the review mechanisms available to persons affected by such a decision, ARPANSA deals with this potential conflict through staff training and policies and procedures requiring decision-makers to expressly and explicitly exclude from the decision-making process any consideration of the potential benefit ARPANSA might receive because fees would become payable by the person granted the licence.

The second conceivable conflict arises from the fact that ARPANSA is effectively required to regulate itself because it owns equipment that must be licensed or regulated under the ARPANS Act.

To manage this conflict, ARPANSA has adopted a practice of, as necessary, securing external oversight of its self-regulation, e.g. by inviting an inspector from another jurisdiction to provide oversight of ARPANSA’s self-inspections and self-licensing decisions.

Both the measures outlined above are considered to constitute ‘reasonable steps’ to avoid conflicts of interest between the CEO’s regulatory and other functions for the purposes of subsection 15(2) of the ARPANS Act. Other particular measures may be reasonable in other specific circumstances should they arise. E.g., the CEO may implement measures to ensure that ARPANSA is organised and governed in a way that ensures that the CEO’s regulatory functions can be discharged effectively and with the necessary rigour and legal oversight.

ARPANSA officers exercising regulatory powers must be alert to the possibility of perceived or potential conflicts arising between their duties in exercising regulatory powers and functions and their duties arising from other powers and functions in the ARPANS Act and other legislation affecting their Commonwealth employment.

Where there is a potential conflict with other ARPANSA functions it will not usually be possible to simply transfer the task of exercising the regulatory power to another ARPANSA officer (as might be appropriate where a personal conflict of interests arises) because any other officer of ARPANSA will likely be subject to the same conflict as the first officer (whether that is the CEO or a delegate).  But in most cases it will be possible to find ways of managing the consequences of the potential or perceived conflict, for instance by disclosing the potentially conflicting function or the interest to which it might give rise, and ensuring that the decision maker has consciously acknowledged that issue and expressly and explicitly excluded it from his or her decision-making process.

If officers consider a material conflict arises or might arise in any particular case, they are required to seek advice from ARPANSA’s General Counsel about the conflict and what might be required to manage it.

All staff that undertake regulatory activities are ultimately accountable to the CEO, who retains all functions and responsibilities under the Act.