Non-compliance and the top of the enforcement pyramid


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Knowing when to respond to breaches by prosecuting or seeking civil penalties requires careful assessment of risk. But what are the practical realities for Commonwealth regulators?

When a regulator faces a case of non-compliance, they have the choice to act via prosecution, or civil seeking penalties, however each course of action has its own complexities. The path taken could also send a strong or weak message about the seriousness of the breach.

These responses to non-compliance are the most serious and sit at the top of the regulatory enforcement pyramid. They should be reserved for non-compliances that have had the greatest consequences or potential consequences.

But which course of action is the right way to respond to non-compliance? We have previously looked at the importance of a risk-based assessment of non-compliance, and this approach will clearly indicate to a regulator when prosecution or civil penalty proceedings are warranted. We’ve also looked at when a light touch response to non-compliance can be justified.

One of the key benefits and reasons why a regulator will prosecute or seek civil penalties is for general deterrence.

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