AIP authority tightens reporting for Australian Industry Participation Plans
AIP authority tightens reporting for Australian Industry Participation Plans
In 2013, Australia introduced legislation mandating that most projects with a capital expenditure of $500 million or more, should prepare and implement an Australian Industry Participation Plan (AIP Plan). Despite the Australian Jobs Act 2013 (Cth) (the Jobs Act), being in effect for over a decade, this requirement comes as a surprise for many project owners.
In response to this, the Australian Industry Participation Authority (Authority) recently announced a stricter application of administrative requirements relevant to AIP Plans prepared in accordance with the Jobs Act. Here’s what you need to know.
Key updates to AIP reporting requirements
- Timelines of draft submission: Explanations (rationale) will be required where draft AIP Plans are not lodged within legislated timeframes in order for the Authority to determine whether to apply penalties
- No extensions for compliance reports: Extensions will no longer be granted for the submission of compliance reports. The deadline is fixed at three months following the end of the reporting period
- Action required on feedback: Once draft AIP Plans are lodged, any feedback provided by the Authority needs to be actioned within 14 days
- Limited information requests: Case Managers will no longer be seeking more information after the first round of feedback on draft AIP Plans or Compliance Reports, prior to consideration by the Authority of whether proponents have complied with their obligations under the Act
- Penalties for non-compliance: Where the above requirements are not met, project proponents will be asked for a rationale. The rationale will be taken into account by the Authority in determining whether to apply any penalties, such as publicly naming the project as non-compliant with its obligations under the Act or seeking an injunction against the project.
What is a major project?
A major project includes mines and quarries, land transport, wharves, ports, passenger terminal and airport facilities, petroleum, electricity, water, sewerage and wastewater facilities, telecommunications networks, factories and other productive facilities and any combinations of these. It applies to both new facilities and upgrades of existing facilities with a capital expenditure of $500 million or more.
What is an Australian Industry Participation Plan?
The Jobs Act aims to provide Australian industry with ‘full, fair and reasonable’ opportunity to participate in large-scale projects in Australia. This is achieved through the AIP Plan, which requires both the project owner and procurement entities (those acquiring goods and services valued at $1 million or more) to undertake activities that ensure fair communication, avoid discrimination, and support the development of Australian industry capacity.
AIP Plans must be lodged at the earliest stage of project inception. Importantly, whether or not a project has had Final Investment Decision is not a determining factor in whether an AIP Plan is required to be prepared and lodged. This is because the intent of the legislation is to capture the procurement process to ensure Australian industry is provided with opportunity to tender for key goods and services for the project.
BDO AIP Plan and Jobs Act expertise
BDO offers comprehensive support to ensure compliance with AIP Plan requirements, including:
- Advisory services: Guidance on the timing and requirements for lodging notifications and draft AIP Plans
- Preparation support: Crafting tailored, project specific and compliant draft AIP Plans for major projects
- Obligations advice: Advice on your obligations under the Act, and specific requirements of your AIP plan
- Documentation templates: Provision of templates and systems for accurate and efficient compliance reporting
- Review services: Reviews of draft AIP plans and compliance reports to minimise Authority queries
- Training: Training for project procurement teams and procurement entities on AIP Plan obligations under the Act.
Contact our team for further assistance or to discuss your project’s needs.