Issue
Is an entity that sells fuel to its contractors a 'fuel retailer' as defined in regulation 4 of the Product Grants and Benefits Administration Regulations 2000 (PGBA Regs), for the purposes of the Fuel Sales Grant Scheme (FSGS)?
Decision
No. An entity that sells fuel to its contractors is not a 'fuel retailer' as defined in regulation 4 of the PGBA Regs, for the purposes of the FSGS.
Facts
An entity operates a business enterprise.
The entity purchases bulk fuel and sells it to contractors.
The entity sells the fuel to the contractors at cost plus a margin.
The fuel is sold to the contractors to enable them to perform services for the entity.
The entity does not make the fuel available to anyone other than the contractors.
Fuel is pumped directly from the bowser in the entity's fuel depot into the contractors' vehicles.
The entity does not sell the fuel in bulk or in drums.
Reasons for Decision
Subsection 6(1) of the Fuel Sales Grants Act 2000 (FSGA) provides that an entity is not entitled to a fuel sales grant unless it is registered for entitlement to fuel sales grants.
Registration requirements for the FSGS are set out in the Product Grants and Benefits Administration Act 2000 (PGBAA).
The specific requirements for registration for the FSGS are set out in subsection 9(3) of the PGBAA. The only specific requirement listed in subsection 9(3) of the PGBAA is that the entity must satisfy any prescribed conditions. The prescribed conditions are set out in regulation 5 of the PGBA Regs. Subregulation 5(a) of the PGBA specifies that an entity applying for registration must be a 'fuel retailer'.
The term 'fuel retailer' is defined in subregulation 4(1) of the PGBA Regs as follows: A fuel retailer is an entity that: (a) operates, as a franchisee, a retail fuel outlet selling fuel in an eligible location to the public; or (b) owns and operates a retail fuel outlet selling to the public, in an eligible location, fuel that the entity owns; or (c) owns the fuel that the entity consigns by the entity to a retail fuel outlet that sells the fuel to the public in an eligible location; or (d) makes retail sales, in an eligible location, of bulk or drummed fuel that the entity owns.
The entity does not make retail sales of bulk or drummed fuel. Therefore, paragraph (d) of the definition of fuel retailer is not applicable.
Paragraphs (a), (b) and (c) of the definition of fuel retailer all require the entity to sell fuel to the public (either directly or via a consignment arrangement).
In this instance, the entity is selling fuel exclusively to contractors to enable the contractors to perform services for the entity. The fuel is not made available for sale to anyone other than the entity's contractors.
The term 'public' is not defined in the FSGA, the PGBAA or any related regulations and therefore the ordinary meaning is to be used. The Macquarie Dictionary, [Multimedia], version 5.0.0, 1/10/01 defines 'public' as 'open to all people'.
The entity is clearly not making fuel available to 'all people'.
This view of what constitutes sales to the public is reinforced by subregulation 4(2) of the PGBA Regs, which states: (2) However, an end user of fuel is not a fuel retailer only because the end user: (a) buys the fuel from a fuel retailer; and (b) sells some of the fuel in an eligible location to: (i) an employee of the end user; or (ii) an agent of the end user; or (iii) an entity that is otherwise related to the end user.
The entity is not selling fuel to the public. They are merely providing fuel to other entities (contractors) that have a contractual relationship with the entity, in order to enable the contractors to perform services for the entity.
Therefore, the entity does not meet the definition of a 'fuel retailer' in regulation 4 of the PGBAA regs.