Primary Industry Funding Schemes (Adelaide Hills Wine Industry Fund) Regulations 2017

“Adelaide Hills” is the area outlined in bold on the map in Schedule 1 of the regulations (r 3(1)). That map is the sole legal definition of the geographic zone to which the levy applies; no other description is given. “Adelaide Hills grapes” means any variety of grapes grown in that area and used or intended to be used for wine (r 3(1)). Therefore grapes grown outside the mapped area, or grown inside but destined for table grapes, juice, or dried fruit, are not subject to the levy. An “Adelaide Hills grapes winemaker” is a person who carries on a business of making wine and who processes Adelaide Hills grapes for that purpose (r 3(1)). This captures not only commercial wineries but any person making wine from those grapes as a business. The term “delivered” is defined operationally: for a transaction between a grower and an unrelated winemaker, delivery occurs when the winemaker takes possession of the grapes (r 3(3)(a)). For a winemaker who processes their own grapes, delivery is deemed to occur when the winemaker places the grapes in a container for the purpose of commencing processing - including placing them in a container for fermentation or in preparation for crushing or pressing (r 3(3)(b)). This prevents evasion by an integrated operator who might argue that “delivery” never happens. The “prescribed period” is the 12-month period commencing on 1 June 2018 and on 1 June in each subsequent year, as well as any equivalent period under the revoked 2003 regulations (r 3(1)). “Default” is defined in a way that captures two quite different behaviours: failing to pay contributions, or having been refunded contributions within the preceding two prescribed periods (r 3(2)). This means that claiming a refund places the claimant in the same legal category as a non-payer for the purposes of receiving benefits from the Fund. The “Fund” is the Adelaide Hills Wine Industry Fund, which continues under regulation 4 and consists of contributions (both current and from the revoked regulations), investment income, and any other sums received by the Minister for payment into the Fund (r 4(3)). The “revoked regulations” are the Primary Industry Funding Schemes (Adelaide Hills Wine Industry Fund) Regulations 2003, which the 2017 regulations replaced but whose contribution history and fund balance carries forward (r 3(1)). The “refund period” is the window for claiming a refund: 12 months after the prescribed period for periods up to and including the one ending in 2021, and 6 months after the prescribed period for later periods (r 5(9)). The “official cash rate” is the prevailing cash rate fixed by the Reserve Bank of Australia as at the date of lodgment of the refund claim (r 5(9)). This rate determines the interest payable on approved refunds. A “representative body” is not named in the regulations; rather the Minister decides, in the Minister’s opinion, which body (if any) represents both winemakers and growers for the purposes of receiving Fund money for industry purposes (r 6(a)). The decision is not subject to defined criteria, appeal rights, or competitive selection requirements within the regulations themselves.

The regulations directly affect three classes of private actors within the Adelaide Hills region and one government actor. First, growers of Adelaide Hills grapes are required to contribute $6.50 per tonne (or such other amount as the Minister fixes from 2022) for grapes they sell to a winemaker. They do not remit the contribution directly; instead the purchasing winemaker deducts it from the sale proceeds (r 5(3)). The grower’s effective sale price is therefore reduced by the levy amount. Growers who also wish to claim a refund must take positive steps within the refund period and provide evidence. Second, Adelaide Hills grapes winemakers are the primary compliance point. They must calculate and pay contributions both on their own account and on behalf of the growers whose grapes they process (r 5(1)(a)(ii),(1a)(a)(ii)). They must keep proper records of tonnage, grower identities, and contributions (r 5(4)(a)), and must make those records available for inspection at any reasonable time by a person authorised by the Minister (r 5(4)(b)). They must lodge an annual financial statement in a form and with information required by the Minister (preferably in electronic form) and forward the contributions within one month after the prescribed period ends (r 5(5)). Winemakers who grow their own grapes must also pay the combined rate on those self-delivered grapes. Third, the representative body - which is not a named organisation in the regulations - is the intended recipient of Fund money. It must satisfy the Minister that it represents both winemakers and growers. The body cannot compel payment directly; it relies on the Minister’s decision to allocate Fund money to it (r 6(a)). Fourth, the Minister administers the Fund and exercises significant discretion: setting contribution amounts from 2022, varying those amounts mid-period, approving or rejecting refund claims based on evidence, deciding which body is representative, and determining what constitutes “other purposes for the benefit of the Adelaide Hills wine industry” (r 6(b)). The regulations also affect persons who have been refunded contributions: they are automatically deemed in default for the next two prescribed periods and lose eligibility for direct benefits or services funded by the Fund (rr 3(2)(b), 8). This includes winemakers or growers who may have sought a refund for legitimate commercial reasons. Lastly, the regulations indirectly affect consumers of Adelaide Hills wine to the extent that the levy is passed through in grape or wine prices, and the Fund’s spending on promotion and research may influence product quality or marketing.

The regulations impose distinct duties on winemakers and growers and grant limited rights, chiefly the right to claim a refund. Duties of winemakers are the most extensive. A winemaker who processes Adelaide Hills grapes must: (a) within one month after the end of each prescribed period, furnish the Minister with a financial statement relating to contributions (both their own and on behalf of growers) for Adelaide Hills grapes delivered during that period, in the form and with the information the Minister requires, and electronically if the person has the necessary equipment (r 5(5)(a)); (b) forward to the Minister with that statement the required contributions (r 5(5)(b)); (c) keep proper records concerning the tonnage of Adelaide Hills grapes delivered, the growers of those grapes, and the contributions required (r 5(4)(a)); and (d) make those records available for inspection at any reasonable time by a person authorised by the Minister (r 5(4)(b)). The winemaker must also pay the grower’s share of contributions out of the amount payable to the grower - in effect acting as a compulsory collection agent (r 5(3)). Duties of growers are simpler: they must accept the deduction from their sale proceeds. They have no obligation to report directly to the Minister unless they choose to claim a refund. Rights of growers and winemakers include the right to claim a refund of contributions paid. A grower may claim a refund in respect of contributions paid by the winemaker on the grower’s behalf; a winemaker may claim a refund in respect of contributions paid on their own behalf (r 5(6)). To do so, the claimant must supply the Minister with evidence acceptable to the Minister of the contributions made (r 5(7)). If the Minister is satisfied, the refund must be paid together with interest at the official cash rate (Reserve Bank of Australia cash rate) from the date of payment of the contributions to the Minister until the date of lodgment of the claim (r 5(8)). The claim must be made within the refund period: 12 months following the prescribed period for periods up to 2020, and 6 months following the prescribed period for later periods (r 5(9)). There is no right of internal review or appeal against a Minister’s decision to refuse a refund; the regulations do not provide for merits review. Right to receive direct benefits from the Fund is conditional on not being in default. A person who is in default (either by non-payment or by having obtained a refund within the preceding two prescribed periods) is not entitled to receive any direct benefits or services funded by payments from the Fund (r 8). This is not merely a disqualification from a particular benefit but a blanket exclusion. Right to be informed is limited: the Minister may (not must) provide information identifying contributors to the representative body (r 7). There is no obligation on the Minister to disclose contribution rates or fund balances to contributors. Right to vary contribution amounts is held only by the Minister, who may fix or vary amounts by Gazette notice, even after the start of a prescribed period (r 5(3a)(3b)). No obligation exists to consult with or seek consent from growers or winemakers.

The only offence explicitly created by the regulations is the making of a false or misleading statement. Regulation 9 provides that a person must not make a statement that is false or misleading in a material particular (whether by inclusion or omission) in any information provided or record kept for the purposes of the regulations. The maximum penalty is $5,000. This is a modest sum; it is not indexed to inflation and has not been updated since the regulations were made. The offence covers both positive falsehoods and misleading omissions, so a failure to disclose relevant information in a record or statement could attract liability. Importantly, the offence applies to any “person” - it would cover not only winemakers and growers but also the representative body or any other party providing information to the Minister. No penalty is prescribed for the more obvious compliance failures: late payment of contributions, failure to keep records, failure to make records available for inspection, or failure to lodge a financial statement. However, the regulations operate under the Primary Industry Funding Schemes Act 1998, which likely contains general enforcement powers, including the power to recover unpaid contributions as a debt due to the Crown, and to impose penalties for non-compliance with regulations. Because the text of the Act is not reproduced, the specific civil or criminal consequences outside regulation 9 are unknown from this source alone. The regulations create a different set of consequences through the concept of “default”. A person who fails to pay contributions is in default (r 3(2)(a)). The consequence is not a monetary fine but exclusion from receiving any direct benefits or services funded by payments from the Fund (r 8). This is potentially a significant commercial disadvantage for a winemaker or grower who relies on industry promotion, research, or services provided with Fund money. It also applies to a person who has been refunded contributions (r 3(2)(b)), which may be counterintuitive: exercising the statutory right to a refund triggers the same default status as non-payment. The default lasts for the two prescribed periods immediately following the event - effectively up to two years. There is no mechanism in the regulations to remedy a default other than waiting for time to pass. A winemaker who fails to deduct the grower’s contribution from payments to the grower remains liable to pay it to the Minister and could become in default. The Minister has power to inspect records (r 5(4)(b)), but no search or seizure powers are expressed in these regulations. The Minister may also refuse a refund application if evidence is not satisfactory, which is a de facto penalty for incomplete record-keeping. Overall, the enforcement regime is light on stated penalties but heavy on incentive effects via the default and exclusion mechanism.

The regulations are made under the Primary Industry Funding Schemes Act 1998 of South Australia. That Act is the enabling statute and would contain provisions regarding the Minister’s powers to establish funds, collect contributions, and enforce compliance that are not detailed in these regulations. For example, the Act likely provides for the recovery of unpaid contributions as debts, the conduct of audits, and the disallowance or variation of regulations by Parliament. Because the regulations are subordinate legislation, they must operate within the bounds of the Act. The Act is not reproduced, so its specific interaction with contributions, refunds, and penalties is not directly sourced here; however, where the regulation is silent on a procedural matter (such as late payment interest or appeals) the Act may fill the gap. The regulations interact with South Australia’s general legislation on record-keeping and false statements - the $5,000 penalty for false or misleading statements under regulation 9 sits alongside more general criminal offences for fraud or false statements to a government official under state criminal law, but the regulation creates a specific strict liability or summary offence. There is no reference to the Commonwealth wine industry levies, such as those imposed under the Primary Industries (Excise) Levies Act 1999 or the Wine Australia Act 2013. This means that growers and winemakers in the Adelaide Hills may be subject to both state-level contributions under this Fund and separate federal levies for research, marketing, and regulatory purposes. The regulations do not provide for any offset or exemption. The definition of “Adelaide Hills” relies entirely on a map in Schedule 1 - this may interact with laws defining geographical indications for wine under the Australian Grape and Wine Authority Act 2013 or the geographical indications register, but no explicit connection is made. The regulations do not address land title, property rights, or contractual arrangements between growers and winemakers; rather, they impose a statutory obligation that overrides or supplements private agreements. The requirement for the winemaker to deduct the grower’s contribution from the purchase price (r 5(3)) may affect the terms of grape supply contracts; a grower cannot contract out of the deduction. The fund’s application to “other purposes for the benefit of the Adelaide Hills wine industry” (r 6(b)) is broad and could overlap with functions performed by other statutory bodies, industry associations, or local councils. The exchange of information provision (r 7) allows the Minister to share data with the representative body, which may intersect with privacy laws such as the Privacy Act 1988 (Cth) or the state’s Information Privacy Principles if the body is not a government agency; the regulation provides a specific authority for that disclosure. No interaction with the Corporations Act or associations incorporation law is mentioned; the representative body is not defined by the regulations, so it could be an incorporated association, a company limited by guarantee, or an unincorporated group.

The regulations as originally made in 2017 (Gazette 12.12.2017 p5019) commenced on 1 June 2018 (r 2). They revoked and replaced the Primary Industry Funding Schemes (Adelaide Hills Wine Industry Fund) Regulations 2003. The original 2017 regulations set the contribution rates at fixed amounts: $6.50 per tonne each for growers and winemakers, and $13.00 per tonne for integrated winemaker-growers (r 5(1)). The refund period was uniformly 12 months after the prescribed period. The definition of “prescribed period” covered the period from 1 June 2018 and each subsequent 12-month period. The first major variation occurred by Statutory Instrument 129/2021, published in the Gazette on 2 September 2021, commencing on the same day. That variation inserted a new subregulation (1a) to create a flexible contribution system for prescribed periods commencing on or after 1 June 2022. Under the new system, the Minister fixes the per-tonne contribution amount by Gazette notice, rather than using a statutory fixed rate. The variation also inserted subregulations (3a) and (3b) to allow the Minister to vary those amounts by Gazette notice even after a prescribed period has started, with the variation applying only prospectively within that period. The 2021 variation shortened the refund period from 12 months to 6 months for prescribed periods after 2020 (by amending the definition of “refund period” in r 5(9)). It also modified the provision for claim evidence and the definition of “prescribed period” to include periods under the revoked regulations for backward-looking matters. The second variation occurred by Statutory Instrument 11/2023, published in the Gazette on 30 March 2023, commencing that day. That variation amended the definition of “prescribed period” in regulation 3(1) to include “a prescribed period as defined under the revoked regulations” - effectively ensuring continuity for default calculations and refund eligibility across the regulatory transition. Several technical amendments were also made: regulation 2 (commencement) was omitted under the Legislation Revision and Publication Act 2002, and Schedule 2 (which previously existed) was similarly omitted. Thus the current instrument is essentially a 2017 base with two significant structural amendments making contribution rates variable and shortening the refund window, plus a minor clarifying amendment to the prescribed period definition. The power to vary rates by Gazette notice means that from the 2022-23 prescribed period onward, the contribution amounts are no longer set in the regulations themselves and can be changed without further regulation amendment, subject only to publication in the Gazette. This reduces legislative certainty for levy payers.

The source material does not record any litigation directly concerning these regulations or the Fund. There are no noted court decisions, tribunal appeals, or judicial review applications cited in the legislative history or the regulations themselves. The absence of recorded litigation may reflect the small geographic scope, the relatively low monetary stakes per tonne, or the fact that disputes are resolved through administrative mechanisms within the Minister’s office rather than through courts. Nonetheless, several provisions could give rise to legal challenge. The Minister’s power to fix and vary contribution amounts (r 5(1a),(3a)) could be subject to judicial review on grounds of unreasonableness or failure to consider relevant matters, if a decision were arbitrary or discriminatory. The definition of “in default” - which includes having been refunded contributions - could be challenged as punitive or irrational, given that it penalises the exercise of a statutory right. The exclusion from benefits (r 8) for a defaulting person may be tested on natural justice grounds, particularly if the person is not notified of their default status before being denied a service. The Minister’s opinion that a body “represents both Adelaide Hills grapes winemakers and growers of Adelaide Hills grapes” (r 6(a)) is not defined with criteria, and a dispute over which body should receive funds could lead to litigation over procedural fairness or whether the Minister’s decision was within power. The refund mechanism requires evidence “acceptable to the Minister” (r 5(7)) - a subjective test that could give rise to challenges if a claimant asserts that their evidence was unreasonably rejected. The interest rate on refunds is fixed at the official cash rate as at the date of lodgment - a relatively low rate that may not compensate for the time value of money if contributions were paid long before the claim; a constitutional challenge could argue that the provision amounts to an acquisition of property without just terms (though the Commonwealth Constitution would not directly apply to state legislation). The map in Schedule 1 is the sole definition of “Adelaide Hills” - boundary disputes could arise if a grower or winemaker claims their land falls outside the outlined area. The definition of “delivered” for own-grapes (r 3(3)(b)) depends on when the winemaker places grapes “in a container for the purposes of commencing processing” - this could be ambiguous as to whether harvest bins count as containers, or only fermenters. Any such dispute would likely be adjudicated in the South Australian Magistrates Court or the District Court, depending on quantum. The penalty provision (r 9) may attract prosecutions; if so, the interpretation of “false or misleading in a material particular” would follow established criminal law principles. The regulations have been in force since 2018, so the absence of litigation may simply indicate that the affected community has accepted the scheme or resolved issues informally.

Several provisions in these regulations are likely to catch out both growers and winemakers who do not read carefully. Claiming a refund makes you a defaulter. Regulation 3(2)(b) provides that a person is in default if, within the immediately preceding two prescribed periods, the person “has been refunded contributions from the Fund”. This means that exercising the statutory right to a refund under regulation 5(6) automatically places the claimant in the same category as a non-payer for the purposes of receiving any direct benefits or services funded by the Fund (r 8). The effect lasts for up to two years. So a winemaker who decides to opt out by claiming a refund may find themselves ineligible for industry promotion, research, or other services paid for by the Fund - which may be the very services they were trying to avoid funding. Short refund window. For prescribed periods after 2020, the refund period is only six months (r 5(9)(b)). For the 2020 period, it was 12 months. Anyone who misses the six-month window loses the right to a refund entirely; there is no discretion to extend it. The period starts at the end of the prescribed period. For example, for grapes delivered in the 2022-23 year (1 June 2022 to 31 May 2023), the refund must be claimed by 30 November 2023 at the latest. Interest runs only until the lodgment date, so delays further reduce the limited compensation. Minister can change contribution rates mid-year. From the 2022-23 prescribed period onwards, the Minister may vary an amount fixed under regulation 5 by a Gazette notice published before the payment due date, and that variation can apply during an already running prescribed period, though only from the date of the variation forward (r 5(3a),(3b)). This means a winemaker cannot know the final contribution rate for a season until after the season is partly or fully complete, making forward budgeting difficult. The representative body is chosen at the Minister’s sole discretion. The body that receives Fund money for industry purposes is one that, “in the opinion of the Minister”, represents both winemakers and growers (r 6(a)). There is no requirement for a vote, a poll, or even a demonstration of support from contributors. A body that does not truly represent the industry may receive funding, and there is no formal mechanism for contributors to object or propose an alternative. Default by refund also excludes from all direct benefits, not just one. Regulation 8 says a person in default is “not entitled to receive direct benefits or services funded by payments from the Fund”. This is a blanket exclusion - it does not tie the exclusion to the specific contribution that was refunded. If a winemaker claims a refund on one year’s contributions, they lose access to benefits for two full prescribed periods, even if they pay full contributions in the years immediately following the refund. False or misleading statement penalty applies to any record or information. The $5,000 maximum penalty under regulation 9 covers statements in “any information provided, or record kept, for the purposes of these regulations”. This includes not only the financial statement but also the tonnage and grower records that winemakers must keep under regulation 5(4). An inadvertent error in a record could technically attract prosecution, though the penalty is low. Delivery definition for own grapes may be earlier than expected. For a winemaker who grows their own grapes, delivery is deemed to occur when they place the grapes “in a container for the purposes of commencing processing (including placing the grapes in a container for fermentation or in preparation for crushing or pressing)” (r 3(3)(b)). This likely happens at harvest, not at the point of sale or later use. The contribution liability therefore arises regardless of whether the wine is ever sold. The map is the only boundary definition. There is no text description of the Adelaide Hills wine region in the regulations. The boundaries are determined solely by the map in Schedule 1, which may be subject to interpretation at the margins. A grower on the boundary may need to obtain the map and assess whether their vineyard falls within the bold outline. No appeal or review mechanism. The regulations do not provide for internal review, merits review, or appeal to a tribunal or court against Ministerial decisions on contribution amounts, approval of refunds, or which body receives funding. The only recourse would be judicial review on legal grounds or a complaint under the Ombudsman Act. Winemakers are statutory debt collectors. They must deduct the grower’s contribution from the amount payable to the grower (r 5(3)). If the winemaker fails to do so - for instance, if the grower refuses to accept the deduction - the winemaker remains liable to pay the full contribution to the Minister. The grower’s non-cooperation is not a defence.

For Adelaide Hills grapes winemakers the compliance obligations are the most intensive. First, determine whether you are an “Adelaide Hills grapes winemaker” - that is, whether you carry on a business of making wine and process Adelaide Hills grapes for that purpose (r 3(1)). Obtain the map in Schedule 1 to confirm that the source vineyards fall within the Adelaide Hills area. If you purchase grapes from growers, verify that the grower’s vineyard is within the mapped area and that the grapes are intended for wine. For each prescribed period (1 June to 31 May), you must calculate contributions on all tonnes of Adelaide Hills grapes delivered to you. For prescribed periods up to and including the one commencing 1 June 2021, the rates are fixed: $6.50 per tonne from the grower (deducted from the purchase price) and $6.50 per tonne from you as winemaker, totalling $13 per tonne (or $13 per tonne entirely from you if you grew the grapes yourself) (r 5(1)). For prescribed periods from 1 June 2022 onward, check the Gazette for the amounts fixed by the Minister for that period - the rates may change each year and may be varied during the period (r 5(1a),(3a)). Keep a record of the relevant Gazette notices. Your core obligations are: (1) keep proper records of the tonnage of Adelaide Hills grapes delivered, the growers of those grapes, and the contributions required both on your own behalf and on behalf of growers (r 5(4)(a)); (2) make those records available for inspection at any reasonable time by a person authorised by the Minister (r 5(4)(b)); (3) within one month after the end of the prescribed period (i.e., by 30 June), furnish the Minister with a financial statement in the form and containing the information required by the Minister, in electronic form if you have the necessary equipment (r 5(5)(a)); (4) forward the required contributions to the Minister with that statement (r 5(5)(b)). For contributions payable by growers, you must deduct those amounts from the payments you make to the growers for the grapes (r 5(3)). Ensure your purchase contracts reflect this deduction. You are not required to hold a separate trust account for the contributions, but you should account for them separately in your records. If you grow your own Adelaide Hills grapes, you must treat the moment you place the grapes in a container to begin processing (e.g., into a fermenter, crusher, or press) as the delivery time and calculate contributions on that tonnage at the applicable rate (r 3(3)(b)). If you wish to claim a refund of contributions you paid on your own account, you must lodge a written claim with the Minister within the refund period: 12 months after the end of the prescribed period for periods up to 2020, and 6 months after the end of the prescribed period for subsequent periods (r 5(6)(b),(9)). Provide evidence satisfactory to the Minister of the contributions made (r 5(7)). If the Minister approves, you will receive the refund with interest at the RBA cash rate from the date you paid the contributions to the date you lodged the claim (r 5(8)). Be aware that obtaining a refund places you in default for the next two prescribed periods (r 3(2)(b)), meaning you and your business will be ineligible for any direct benefits or services funded by the Fund during that time (r 8). Evaluate whether the loss of benefits outweighs the value of the refund. For growers of Adelaide Hills grapes your main obligation is to accept the deduction of your contribution from the sale proceeds by the winemaker (r 5(3)). There is no need to file reports. If you want to reclaim your contribution, you must submit a written notice to the Minister within the refund period, providing evidence of the contributions made on your behalf (r 5(6)(a),(7)). The same default consequence applies: if you claim a refund, you become in default and lose access to direct benefits for two prescribed periods. For both winemakers and growers: ensure any information you provide or records you keep are accurate and not false or misleading in a material particular - the penalty is $5,000 (r 9). For the intended representative body: to receive Fund money, you must satisfy the Minister (in the Minister’s opinion) that you represent both winemakers and growers (r 6(a)). There is no formal application process specified; you should engage with the Minister’s office to present evidence of membership, board composition, or support. Fund money can be used for operating and management expenses, promotion, research and development, information dissemination, communication programs, and other purposes (r 6(a)(i)-(v)). Keep records of expenditure to demonstrate compliance with the application purposes. The Minister may also provide you with information identifying contributors who have paid or been refunded (r 7); you should handle that information in accordance with privacy laws. General: monitor the South Australian Government Gazette for notices fixing or varying contribution amounts. Retain Gazette notices and correspondence with the Minister for at least two prescribed periods beyond your involvement to address any default or refund issues.