The Fit and Proper Person (FPP) test is a key control to protect the integrity of the schemes administered by the Clean Energy Regulator.
While particular eligibility requirements for each scheme may differ, the FPP requirements generally consider a person’s past compliance with the law, whether they are insolvent, and whether they have the necessary capabilities and competence to effectively fulfil their intended scheme role.
By defining its FPP posture the Clean Energy Regulator is seeking to strengthen this control by making it clear that eligibility assessments undertaken by the agency do focus on client capability, competency, integrity and good character aspects.
This includes that:
- The agency will consider the specific legislative FPP categories, as well as non-prescribed ‘other matters’, such as a client’s fitness to participate in schemes it administers. Consideration of ‘other matters’ can include an assessment of whether the relevant person (or its officers) have the necessary skills, capability and competency, business practices and good character that would reasonably be expected of a participant in our schemes,
- If the agency identifies matters flagged under any of the FPP categories, the agency will require the client to demonstrate or show cause why they should be permitted to or continue to participate in our schemes
- In some circumstances, a failure to meet FPP requirements will be sufficiently concerning that an immediate suspension or revocation may be considered.
The Clean Energy Regulator is progressively implementing this posture across its schemes and will ensure that clients have the necessary information to successfully participate in the schemes and a reasonable time to comply with scheme requirements where needed.