An overview of industry codes

The Small Business Commissioner Act 2011 (the Act) provides a legislative framework for the relevant minister to prescribe industry codes and for those codes to be enforced by the Small Business Commissioner. Where prescribed by the minister an industry code will be mandatory for industry participants. The minister will decide whether to prescribe a particular code following consultation with industry participants.

Industry codes are a proven mechanism to improve standards of conduct within an industry. Codes typically set out specific standards of conduct for how an industry will deal with a range of issues. These may include disclosure arrangements and resolution of disputes.

How are industry codes developed?

A code may be developed in the following ways:

  • a proposal is put forward to the relevant minister from industry participants or groups
  • the Small Business Commissioner may recommend to the relevant minister that a process be initiated for the development of a code
  • an existing code eg a Commonwealth code may be adopted by the relevant minister as a South Australian code.

The development process for each code is likely to have a number of common elements and a consultation process will be a critical part of that development process, as well as being required by the legislation.

The Small Business Commissioner will consult with industry groups regarding the process envisaged for the development of industry codes so that there is transparency with respect to consultation and engagement with relevant stakeholders.

Once a code is developed the minister will be in a position to prescribe the code if considered appropriate.

In developing industry codes the Commissioner will be performing their functions in a way that promotes better relationships and conduct between businesses and between businesses and state and local government bodies.

All industry codes that are developed will be monitored by the Small Business Commissioner. If the code is a mandatory or prescribed code then the Commissioner will be able to enforce that code under the provisions of the Fair Trading Act 1987.

The codes