Senate

Explanatory Memorandum

(Circulated by authority of the Minister for Justice and Customs, Senator the Honourable Christopher Martin Ellison)

Schedule 6 - cargo reporting

Customs Act 1901

192. There are a number of reports that have to be provided to Customs before a ship that is on an international voyage arrives at a port in Australia. Currently these are the impending arrival, cargo, passenger and crew reports. These reports must be given not later than:

192.1.

if the journey from the last port outside Australia is likely to take not less than 48 hours-48 hours; or

192.2.

if the journey from the last port outside Australia is likely to take less than 48 hours-24 hours;

before the arrival of the ship (for impending arrival, cargo and crew reports) or the time stated in the report made under section 64 to be the estimated time of arrival of the ship (for the passenger reports).

193. When the International Trade Modernisation Act commences a report of the persons engaged to unload the cargo will also have to be provided to Customs before a ship arrives. Under the Trade Modernisation Act, the timing of the reports will also change as follows:

194. Impending arrival, crew and persons engaged to unload cargo reports must be given no later than:

194.1.

if the journey from the last port is likely to take not less than 48 hours-48 hours or such other period as is prescribed by the regulations; or

194.2.

if the journey from the last port is likely to take less than 48 hours:

a.

24 hours or such other period as is prescribed by the regulations; or

b.

if the journey is of a kind described in regulations made for the purposes of this subparagraph-such shorter period as is specified in those regulations.

195. Cargo reports will have to be made not later than:

195.1.

24 hours or such other period as is prescribed by the regulations; or

195.2.

if the journey from the last port is of a kind described in regulations made for the purposes of this subparagraph-such shorter period as is specified in those regulations;

before the estimated time of arrival specified in the impending arrival report.

196. Passenger reports will remain subject to the current requirements as set out above.

197. As part of the Government's maritime security initiatives it is proposed to require some or all of these reports earlier than 48 hours before the ship arrives. Items 1 to 13 amend the current reporting requirements and those that will be inserted into the Customs Act by the International Trade Modernisation Act so that the timing of those reports will be prescribed. It is also proposed to allow voyages of a kind to be prescribed in the regulations and for those voyages the regulations will specify a shorter period in which a report has to be made. For example, this may cover voyages from Papua New Guinea to Australia.

198. It is also proposed to allow regulations to be made prescribing matters of a transitional nature (including prescribing any saving or application provisions) arising out the making of the regulations prescribing the times at which reports have to be made. For example, if the timing was increased to say 96 hours, a ship that was less than 96 hours from arrival would not be covered by the new timing but would continue to be covered by the 48 hours.

199. It is proposed to prescribe these matters, as they can be made with more certainty when the timing requirements are prescribed. It is also expected that this power to make transitional provisions in the regulations would be relied upon when these amendments commence, but also may be relied upon if the prescribed times are ever changed. It is expected that two types of transitional provisions will be prescribed. Depending on the times prescribed there may be a transitional provision for each amendment. The first will apply an amendment to ships arriving at or after a certain time (the transition time). The transition time will depend on the prescribed time. The second will save the existing provision, so that ships arriving before the transition time are subject to the current reporting requirements.

Part 1 - Pre-ITM provisions

Item 1 - Paragraphs 64(1)(a) and (b)

200. Under section 64 of the Customs Act, the master or owner of a ship that is due to arrive at a port in Australia (whether the first port or any subsequent port on the same voyage) must report its impending arrival to Customs.

201. Item 1 replaces paragraphs 64(1)(a) and (b) so that impending arrival reports in respect of a ship will have to be provided:

201.1.

not later than the start of the prescribed period before its arrival; or

201.2.

if the journey is of a kind described in regulations made for the purposes of paragraph 64(1)(b) - not later than such shorter period before its arrival as is specified in those regulations.

202. As a result of this amendment, because the timing of a crew report under section 64ACB is directly linked to the timing of an impending arrival report, a crew report will also be required to be made not later than the start of these prescribed periods.

Item 2 - At the end of section 64

203. Item 2 inserts the transitional regulation making power into existing section 64 of the Customs Act as explained in paragraphs 192 and 193.

Item 3 - Subsections 64AB(2) and (3)

204. Section 74 of the Customs Act provides that the master or owner of a ship or the pilot or owner of an aircraft must not unship goods at a port or airport otherwise than in accordance with a Collector's permit to unship the goods.

205. Subsection 64AB(2) of the Customs Act currently provides that before a Collector's permit is granted in respect of cargo on board a ship that is due to arrive at a port in Australia (whether the first port or any subsequent port on the same voyage), the master or owner of the ship must communicate to Customs a report of the cargo that is intended to be unshipped at the port:

205.1.1.

if the journey from the last port is likely to take not less than 48 hours - not later than 48 hours before ship's arrival at the port; and

205.1.2.

if the journey from the last port is likely to take less than 48 hours - not later than 24 hours before its arrival.

206. Subsection 64AB(3) contains the same requirement for aircraft arriving at an airport in Australia, but the report must be made:

206.1.1.

if the report is made by document - 3 hours after the arrival of the aircraft at the airport;

206.1.2.

if the report is made by computer - 2 hours before the arrival of the aircraft at the airport.

207. For example this means that when cargo is unshipped at a number of ports in Australia, a cargo report for each port is provided to Customs 48 or 24 hours before the ship's arrival at the relevant port. Each report will set out the cargo intended to be unshipped at the port which the report relates to. This means that Customs may not get a complete list of all cargo on the ship until 48 hours before its arrival at the last port. This may be some days after the ship has arrived at its first port in Australia.

208. However, there may be circumstances where a ship will stay in Australian waters for a considerable time between two ports of call, for example whilst waiting for a berth. This means that if it is intended to unship security related cargo (eg weapons) at the second port Customs would not be able to risk assess such cargo until 48 hours before its arrival in that port even though the ship may have been waiting outside the port limits for some longer time, or may have already visited another port with those unreported on board.

209. Item 3 replaces subsection 64AB(2) so that all the cargo on board the ship intended to be unshipped in Australia has to be reported to Customs before the ship arrives at its first port in Australia since it called at any port outside Australia. The timing requirements have also been changed so that the cargo report must be made:

209.1.

not later than the start of the prescribed period before its arrival at the first port; or

209.2.

if the voyage is of a kind described in regulations made for the purposes of paragraph 64B(2)(b) - not later than such shorter period before its arrival as is specified in those regulations.

210. Item 3 also inserts new subsection 64AB(2A) which contains the transitional regulation making power as explained in paragraphs 192 and 193.

211. That item also replaces subsection 64AB(3) so that all cargo on board an aircraft intended to be unshipped in Australia must be reported before the aircraft arrives at its first airport in Australia since it last departed from any airport outside Australia. The timing requirements have not otherwise changed for aircraft.

Item 4 - Subsection 64ACA(5)

212. Section 64ACA of the Customs Act requires the operator of a ship or aircraft to report to Customs the passengers on board the ship or aircraft when it arrives at a port or airport in Australia.

213. Item 4 replaces subsection 64ACA(5) so that the report in respect of a ship must be given not later than:

213.1.

the start of the prescribed period before its arrival; or

213.2.

if the journey is of a kind described in regulations made for the purposes of paragraph 64ACA(5)(b) - such shorter period before its arrival as is specified in those regulations.

214. New section 64ACA(5A) contains transitional regulation making provisions for section 64ACA as explained in paragraphs 192 and 193.

Part 2 - Post-ITM provisions

Item 5 - Paragraph 64(5)(b)

215. Item 5 amends section 64 of the Customs Act as replaced by the International Trade Modernisation Act. New section 64 will require the operator of a ship to report the ship's impending arrival in Australia to Customs.

216. Item 5 replaces new paragraph 64(5)(b) so the impending arrival report of a ship must be provided not later than:

216.1.

the start of the prescribed period before its arrival; or

216.2.

if the journey is of a kind described in regulations made for the purposes of subparagraph 64(5)(b)(ii) - such shorter period before its arrival as is specified in those regulations.

Item 6 - Subsection 64(6)

217. Item 6 inserts the transitional regulation making power, as explained in paragraphs 192 and 193, into section 64 of the Customs Act as inserted by the International Trade Modernisation Act.

Item 7 - Subsection 64AB(2)

218. Section 64AB of the Customs Act will be replaced by new section 64AB as contained in the International Trade Modernisation Act. New subsection 64AB(2) requires cargo reporters who have arranged goods to be carried on a ship or aircraft that are intended to be unloaded at a port or airport to report them to Customs. Again a report is required for each port or airport.

219. Item 7 replaces new subsection 64AB(2) so that the report must be made in respect of all of the cargo that is intended to be unloaded at any port or airport before the ship or aircraft arrives at its first port or airport in Australia since it last departed from a port or airport outside Australia.

Item 8 - Subparagraph 64AB(8)(a)(i)

220. Item 8 amends subparagraph 64AB(8)(a)(i) of the Customs Act as inserted by the International Trade Modernisation Act so that a cargo report will have to be provided no later than the start of the prescribed period. Subparagraph 64AB(8)(a)(ii) already allows shorter periods to be prescribed for voyages of a prescribed kind.

Item 9 - Subparagraph 64AB(8)(a)(ii)

221. Item 9 amends subparagraph 64AB(8)(a)(ii) of the Customs Act as inserted by the International Trade Modernisation Act so that it is clear that for prescribed kinds of voyages the report must be made before the start of the shorter prescribed period.

Item 10 - Paragraph 64AB(8)(a)

222. Item 10 amends new paragraph 64AB(8)(a) so that the report in respect of ships must be made no later than the start of prescribed periods before the estimated time of arrival of the ship at the first port in Australia since it last departed from a port outside Australia. As well as changing this provision so that it refers to the first port in Australia, this item removes the reference to the estimated time of arrival specified in the impending arrival report. This is because, under these new timing requirements, the cargo report may have to be made at the same time as the impending arrival report.

Item 11 - Paragraph 64AB(8)(b)

223. Item 11 amends new paragraph 64AB(8)(b) so that the report in respect of aircraft must be made no later than the start of the prescribed periods before the estimated time of arrival of the aircraft specified in the impending arrival report for the aircraft at the first airport in Australia since it last departed from an airport outside Australia. This makes the wording in respect of aircraft the same as for ships without changing the requirements for aircraft.

Item 12 - After subsection 64AB(8)

224. Item 12 inserts the transitional regulation making power, as explained in paragraphs 192 and 193, into section 64AB of the Customs Act as inserted by the International Trade Modernisation Act.