House of Representatives

Explanatory Memorandum

(Circulated by authority of the Minister for Justice and Customs Senator the honourable Amanda Vanstone)

Outline

The purpose of this Bill is to:

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amend the Customs Act 1901 (the Customs Act) to provide for increased penalties for a range of import and export offences, including custodial sentences;

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amend the Customs Act and the Australian Postal Corporation Act 1989 (the Australian Postal Corporation Act) to enhance Customs powers to detect illicit drugs;

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amend the Customs Act to make a number of technical amendments related to the drugs and other prohibited goods provisions; and

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amend the Customs Administration Act 1985 (the Customs Administration Act) in relation to the appointment of the Chief Executive Officer.

Schedule 1 of the Bill proposes amendments to the Australian Postal Corporation Act 1989 to provide Customs officers with the power to open international postal articles reasonably believed to consist of, or contain, drugs or certain other chemical compounds. This power is currently limited to Australia Post employees.

Schedule 2 of the Bill proposes amendments to the Customs Act 1901 to provide for increased penalties for certain import and export offences; to enhance Customs powers to conduct external personal searches by the use of new technology; to extend the power of arrest to cover the new offences; to extend the period for which Customs may retain goods seized for evidentiary purposes and to improve arrangements for disposal of abandoned goods.

Schedule 3 of the Bill proposes amendments to the Customs Administration Act 1985 to allow for appointment or reappointment of the Chief Executive Officer of Customs for periods of up to 5 years.

Financial impact statement

The measures proposed in Schedules 1, 2 and 3 - amendments to the Customs Act 1901 and the Australian Postal Corporation Act 1989 and the Customs Administration Act 1985 - have no direct financial impact, and regulatory impact is minor or machinery in nature. Schedule 1 extends to Customs officers powers currently exercised by employees of Australia Post. Schedule 2 provides for increased penalties for goods that are already controlled under Customs (Prohibited Imports) and Customs (Prohibited Exports) Regulations. Any increased workload arising from the new criminal penalties will be dealt with in the normal budgetary context. Schedule 2 also removes current restrictions on jurisdictional limits, extends existing arrest powers to the new offences and provides for procedural improvements in dealing with abandoned goods and with evidence seized during an investigation. Schedule 3 has no financial impact.

Notes on individual clauses

Clause 1 - Short Title

1. This clause provides for the Act to be cited as the Customs Legislation Amendment (Criminal Sanctions and other measures) Act 1999.

Clause 2 Commencement

2. Subclause (1) provides that subject to subclauses (2) and (3), the Act commences on the day on which it receives the Royal assent.

3. Subclause (2) provides that Schedule 1 (amendments of the Australian Postal Corporation Act 1989 ), Schedule 2 (amendments of the Customs Act 1901) and Schedule 3 (amendments of the Customs Administration Act 1985) commence on a day or days to be fixed by Proclamation. Subclause (3) provides that if an item of Schedules 1, 2 or 3 has not commenced within 6 months of the day on which the Act receives the Royal Assent, that item commences at the end of that 6 month period. This is the standard provision that applies to commencement by Proclamation.

Clause 3 - Schedule(s)

4. This clause is the formal enabling provision for the 3 Schedules to the Act, providing that each Act that is specified in a Schedule to this Act is amended as indicated.

5. The clause also provides that any other item in a Schedule has effect according to its terms. this is a standard enabling clause for transitional, savings and application items in amending legislation. They appear in this Act as items 5 and 11 of Schedule 2.

SCHEDULE 1 - Australian Postal Corporation Act 1989 (APC ACT)

Item 1 - Paragraph 90N(1)(a)

1. This item amends paragraph 90N(1)(a) to provide that the opening of a mail article as allowed by new section 90T is not prohibited conduct under the APC Act.

Item 2 - Paragraph 90S(1)(a)

2. This items adds a new paragraph (aa) to subsection 90S of the APC Act to indicate that section 90S of the APC Act will not apply in the circumstances set out in new section 90T. Section 90S currently requires that a customs officer who has reasonable grounds to believe that an article of mail contains items on which customs duty or sales tax is payable, or things that are being carried in contravention of a law of the Commonwealth relating to the importation into, or exportation from, Australia of that thing, must request an authorised examiner to open the article of mail for the Customs officer to inspect. This amendment will remove the requirement that a customs officer must request an authorised officer to open the article in the circumstances set out in new section 90T.

Item 3 - After section 90S

3. This item inserts new section 90T . This section provides that where a Customs officer has reason to believe that the postal article consists of, or contains, drugs or other chemical compounds that are being carried in contravention of a law of the Commonwealth relating to the importation into, or exportation from, Australia the article may be opened by a Customs officer. A Customs officer who opens the article may examine the article to check whether it consists of such drugs or other chemical compounds.

4. If the article opened by the Customs officer does not consist of, or contain, prohibited drugs or other chemical compounds or any other thing on which duty or sales tax is payable or which is being carried in contravention of a law of the Commonwealth relating to the importation into, or exportation from, Australia of that thing, the Customs officer must close up the article and return it to the normal course of carriage. If the article does consist of, or contain, prohibited drugs or other chemical compounds or any other such thing, the article and its contents must be dealt with in accordance with applicable Commonwealth laws.

5. Regulations may be made prescribing the procedure to be followed by a Customs officer when closing an article and returning it to the normal course of post.

Item 4 - Subsection 90V(2)

6. This item amends subsection 90V(2) to clarify that that provision only relates to articles opened by Australia Post.

Item 5 - After subsection 90V(2)

7. This item inserts a new subsection 90V(2A) that provides that where an article is opened under section 90T by a Customs officer, then, before the article is returned to the normal course of carriage, the Customs officer must cause to be endorsed on the article a notification that the article has been opened by the Australian Customs Service and that explains the purpose for which it was opened.

Item 6 - Subsection 90V(3)

8. This item amends subsection 90V(3) consequent upon the insertion of new subsection 90V(2A) .

Item 7 - At the end of subsection 90ZC

9. This item adds a new subsection 90ZC(2) to clarify that the indemnity given to Australia Post and employees of Australia Post in relation to acts done or omitted in good faith extends to actions carried out by Customs officers under new section 90T or new subsection 90V(2A) .

Schedule 2- Customs Act 1901

Item 1 - Paragraph 203R(1)(b)

1. This item increases the period before which things seized as evidential material by an officer or authorised person must be returned, from 60 days to 180 days.

2. Under s.203R anything seized under a search warrant or under section 203B(3) or 203C(3) of the Act must be returned if the reason for its seizure no longer exists or it is decided that it is not to be used in evidence. Applications may be made to a magistrate (section 203S) to extend time for retention, but difficulties have been experienced because of the relatively short period for which retention is currently permitted.

Item 2 - Paragraph 203S(1)(a)

3. This item increases the period before which a magistrates order must be sought for continued retention of things seized as evidential material by an officer or authorised person under a search warrant, from 60 days to 180 days. This item is consequential to the amendment proposed in item 1.

Item 3 - Paragraphs 205D(2)(b), (c), (d), and (e)

4. This item increases the period before which seized goods which have been claimed must be returned, if proceedings have not been commenced or a magistrates order for continued retention has not been made, from 60 days to 180 days.

Item 4 - Paragraph 205E(1)(a)

5. This item increases the period before which a magistrates order must be sought for continued retention of things seized as evidential material by an officer or authorised person under a seizure warrant, from 60 days to 180 days.

Item 5 - Application

6. This item provides that the amendments made by items 1, 2, 3 and 4 do not apply in relation to things seized before the commencement of those items.

Item 6 - Paragraph 210(1)(b)

7. This item extends the power of an officer of Customs or police to arrest without warrant to take account of the new offence regime introduced by item 17.

Item 7 - After section 218

New section 218A - Disposal of certain abandoned goods

8. This item inserts a new section 218A which provides for the disposal of goods that a Collector has reason to believe are not required to be entered and that have been abandoned at a Customs place. Where the goods satisfy those criteria, the Collector may dispose of the goods in any manner he or she thinks fit.

9. New subsection 218A(2) provides that a Collector is taken to have reason to believe that goods have been abandoned if no one has claimed ownership of the goods within a specified period of time. This period of time will be prescribed in the regulations and will not exceed 120 days.

10. New subsection 218A(4) provides that a person may at any time seek compensation in relation to goods found at a Customs place that have been so disposed. New section 4AB of the Customs Act to be inserted by the Border Protection Legislation Amendment Act 1999 provides for compensation for acquisition of property and will apply in the circumstances of disposal of goods under this section.

11. New subsection 218A(5) provides that the Collector must create and maintain records specifying in respect of goods found at a Customs place, the date they were found, the date and manner of disposal and, if the goods are sold, the amount realised on the sale and the amount offset against that amount in respect of expenses incurred by Customs in relation to those goods.

Item 8 - After subparagraph 219R(1)(c)(ii)

12. This item amends the power of an officer of Customs or police officer to carry out a consensual external search, to include a new requirement, that the officer comply with the provisions of new section 219RAA which is to be inserted by item 10.

Item 9 - After subsection 219R(11)

13. This item inserts new provisions concerning the use of prescribed equipment in the conduct of an external search.

14. Division 1B of Part XII provides for three discrete types of personal searches. They are:

frisk search (Subdivision A);

external search (Subdivision B), and

internal search (Subdivision C).

15. The amendments proposed in this item introduce the use of equipment to assist Customs in conducting and recording the conduct of an external search only.

16. New subsection 219(11A) permits the use of prescribed equipment (which may include equipment such as ion scanning, x-ray or thermal imaging equipment) in the carrying out of an external search, but only if the person to be searched has consented and the requirements of new section 219RAB are met, or alternatively, if an order to search made by a Justice or officer under subsection 219R(2) directs that the equipment may be used.

17. New subsection 219(11B) ensures that if equipment is used to obtain samples from a detainees body, the samples must only be taken from the outer surface of the detainees hand.

18. New subsection 219(11C) makes it clear that the search may be continued without the use of the equipment, if the use of the equipment produces an indication that the detainee is or may be carrying prohibited goods.

Item 10 - After 219R

19. This item inserts new sections 219RAA, 219RAB, 219RAC, 219RAD, 219RAE, and 219RAF to provide the regime for the use of prescribed equipment in external searches.

New section 219RAA - Videotape record may be made of external search

20. New section 219RAA sets out the conditions with which an officer of Customs must comply in obtaining consent for the use of videotape or other electronic means to record the conduct of an external search.

21. The purpose of the conditions is to ensure that the person who is the subject of the external search may make an informed decision about whether to have the conduct of the search recorded by video or other electronic means.

22. New subsection 219RAA(1) provides that in inviting a detainee to consent to an external search, an officer of Customs must have told the detainee that a videotape or other electronic record may be made of the search; that such a record could be used in evidence against the detainee in a court; that the detainee would be provided with a copy of the recording, and that the invitation, and any giving of consent, would itself be recorded by audiotape, videotape or other electronic means, or in writing.

23. New subsection 219RAA(2) obliges Customs to record the invitation, and any giving of consent, by audiotape, videotape or other electronic means, or in writing.

24. New subsection 219RAA(3) requires that the officer making the record of the conduct of a search must be the same sex as the detainee.

25. New subsection 219RAA(4) enables an order to conduct an external search made under subsection 219R(2) to authorise the making of a record of the conduct of the search using videotape or other electronic means.

26. New subsection 219RAA(5) provides that if, in the course of conducting an external search, an officer of Customs or a police officer find prohibited goods, then that officer may, without further consent of the detainee, take a photograph of the prohibited goods on the person.

New section 219RAB - Use of prescribed equipment for external search

27. New section 219RAB sets out the conditions with which an officer of Customs must comply in using equipment for the conduct of an external search.

28. The purpose of the conditions is to ensure that the person who is the subject of the external search and who has been invited to have the search conducted by using the equipment, may make an informed decision about whether to have the search conducted by using the equipment or by removing articles of clothing.

New section 219RAC - Prescribing equipment for use in external searches

29. Because of ongoing advances in the development of new technology, it is necessary for there to be an ability for Customs to introduce new equipment resulting from such developments. This item proposes that new equipment be introduced by regulation, provided the equipment complies with strict requirements, which are set in place by this section for the benefit of both the person on whom the equipment will be used as well as the Customs officer using the equipment.

30. Besides establishing whether the equipment is effective in detecting prohibited goods on a person, the Chief Executive Officer of Customs must provide the Minister with a statement that:

the equipment is safe to use;

it poses minimal risk to the person who agrees to be subject to its use; and

the equipment does not require professional qualifications to operate it.

31. Prior to making that statement, the Chief Executive Officer must consult with Commonwealth authorities (if any) that have expertise or responsibilities relevant to the equipment or its use.

New section 219RAD - Authorising officers to use prescribed equipment for external search

32. New section 219RAD provides for the Chief Executive Officer to authorise an officer of Customs for the purposes of subsection 219RAB(3) to use equipment only if the officer has successfully completed the training specified in an approved statement describing training in the operation of the instrument. By virtue of subsection 4(1) of the Customs Act 1901, this statement is a disallowable instrument under section 46A of the Acts Interpretation Act 1901. This means if either House of Parliament is not satisfied with the level of training an authorised officer is to be given, a motion of disallowance may be moved, thereby stopping the proposal.

33. Although the type of equipment to be introduced will not require professional qualifications to operate it, the manufacturers of such equipment in many cases provide training in the operation of their product. In other cases written material is provided relating to the operation of the equipment. Customs, in consultation with the manufacturer, will develop a training program for each type of new equipment introduced. This will ensure effective and efficient use of the equipment. Such training programs will be the subject of an approved statement.

34. Only officers of Customs who have successfully completed such training will be able to be authorised by the Chief Executive Officer to operate the equipment.

New section 219RAE - Giving a record of invitation and consent or of order

35. In the situation where a person invited to consent to the use of prescribed equipment for an external search under section 219R requests it, new section 219RAE requires an officer of Customs to give to that person, as soon as is reasonably practicable:

a copy of the record of the invitation; and

if the person gave consent - a copy of the record of the persons consent.

New section 219RAF - Records of results of external search

36. New section 219RAF concerns the retention and destruction of videotape or other electronic records, photographs or human samples made or obtained during or as a result of an external search.

37. New subsection 219RAF(2) requires the photograph, image, videotape, electronic record or sample to be destroyed as soon as practicable if:

a period of 12 months has elapsed since the record was made or the sample taken; and

relevant proceedings have not been instituted or have been discontinued.

38. New subsection 219RAF(3) provides that relevant proceedings, for the purposes of new subsection 219RAF(2), are proceedings:

against the person the subject of the search;

relating to the prohibited goods; and

in which the photograph, videotape, image, electronic record or sample is relevant.

39. New subsection 219RAF(4) permits a magistrate, on application by an officer of Customs or the DPP, to extend the period for which the photograph, videotape, image, electronic record or sample may be retained. The magistrate must be satisfied that there are special reasons for extended retention.

40. New subsection 219RAF(5) requires the photograph, videotape, image, electronic record or sample to be destroyed as soon as practicable if the person the subject of the search:

is found to have committed a relevant offence but no conviction is recorded; or

is acquitted of a relevant offence and no appeal is lodged against the acquittal, or an appeal is lodged and the acquittal is confirmed or the appeal withdrawn;

unless there is pending an investigation or other proceedings concerning another offence relating to the prohibited goods.

41. New subsection 219RAF(6) provides that for the purposes of subsection 219RAF(5), an offence is relevant if:

it relates to prohibited goods; and

the photograph, videotape, image, electronic record or sample relates to the offence.

42. The purpose of this provision is to protect the privacy of the person who has been subjected to the use of prescribed equipment. Customs is mindful that some equipment, for example an x-ray machine, may produce a permanent record of an image of a person. Similarly, if a sample is taken from a persons hand for the purposes of a swab test, such a sample might in theory be indefinitely retained.

43. This provision ensures that such things obtained from the use of prescribed equipment may only be retained for a period of 12 months unless a magistrate orders otherwise. The retention period of 12 months is considered necessary for circumstances where a person who has undergone an external search makes a complaint some time later in relation to the procedure.

Item 11 - Application

44. This item provides that the amendments made by items 8, 9 and 10 only apply to persons detained under section 219Q or externally searched pursuant to section 219R by force of section 219P, after the commencement of those items.

Item 12 - Paragraph 233AB(1)(a)

45. This item and items 13, 14 and 15 concern the penalties applicable to offences against sections 233 and 233A.

46. Section 233 concerns smuggling, the unlawful importation or exportation of prohibited goods, possession of smuggled goods or prohibited imports, and possession of a prohibited export with intent to unlawfully export, but does not deal with narcotic goods.

47. Section 233A concerns the master of a ships or pilot of an aircrafts responsibility to ensure that his or her vessel or aircraft is not used to smuggle goods, or to convey prohibited imports or prohibited exports.

48. This item omits the requirement in paragraph 233AB(1)(a) that a penalty applicable to the offences described in section 233 and 233A be not less than two times the amount of duty that would have been payable on smuggled goods. The removal of this minimum penalty will enable courts to make fuller use of the range of sentencing options, such as community service orders or good behaviour bonds, in punishing smugglers.

Item 13 - Paragraph 233AB(1)(b); Item 14 - Subparagraph 233AB(2)(a)(ii); Item 15 - Paragraph 233AB(2)(b)

49. Items 13, 14 and 15 are all in similar terms and increase the maximum penalty applicable to the offences described in sections 233 and 233A, from $50,000 to $100,000.

Item 16 - Subsection 233BA(2)

50. Section 233BA concerns the certification of analysis of goods for the purposes of proceedings for an offence against section 233B, which concerns the importation and exportation of narcotic goods.

51. Item 16 expands the scope of section 233BA to encompass the certification of analysis of goods for the purposes of proceedings for an offence against new section 233BAA, and also for the purposes of proceedings for an offence against new section 233BAB in so far as that section relates to specified anti-personnel sprays or gases, radioactive substances, human body tissue or human body fluid.

Item 17 - After section 233B

52. Section 233AB currently imposes pecuniary penalties for the offences of smuggling, unlawful importation or exportation of prohibited goods, possession of smuggled goods or prohibited imports, and possession of a prohibited export with intent to unlawfully export.

53. This item introduces a new two-tiered penalty regime for the unlawful importation or exportation of certain prescribed prohibited goods, which extends to criminal sanctions.

New section 233BAA - Special offence relating to tier 1 goods

54. New section 233BAA establishes a special offence relating to the unlawful importation or exportation of specified drugs and other goods.

55. New subsection 233BAA(1) provides that specified performance enhancing drugs, specified non-narcotic drugs and other specified goods may constitute tier 1 goods. The specification of actual items that will constitute tier 1 goods will be by regulation.

56. New subsection 233BAA(2) provides that the regulations must not specify an item as constituting a tier 1 good unless the importation or exportation of the item is already prohibited (conditionally or absolutely) by the Customs (Prohibited Imports) Regulations or the Customs (Prohibited Exports) Regulations. Thus, this new section does not establish a new class of prohibited goods, rather it creates new penalties relating to the unlawful importation or exportation of existing classes of prohibited goods.

57. New subsection 233BAA(3) provides that where a critical quantity is specified for a particular drug, the drug will not constitute a tier 1 drug unless it is of a quantity that exceeds that critical quantity.

58. New subsection 233BAA(4) establishes the offence for knowingly or recklessly importing goods that were tier 1 goods where the importation of those goods was prohibited. The subsection imposes a maximum penalty of a fine not exceeding $100,000, or imprisonment for 5 years, or both.

59. New subsection 233BAA(5) establishes the offence for knowingly or recklessly exporting goods that were tier 1 goods where the exportation of those goods was prohibited. The subsection imposes a maximum penalty of a fine not exceeding $100,000, or imprisonment for 5 years, or both.

60. New subsection 233BAA(6) provides that a person convicted or acquitted of an offence against new subsection 233BAA(4) or new subsection 233BAA(5) in respect of particular conduct is not liable to be proceeded against civilly under section 233.

New section 233BAB - Special offence relating to tier 2 goods

61. New subsection 233BAB(1) provides that specified items including firearms, munitions, warfare items, knives, chemical compounds (which are used in the manufacture of chemical weapons), anti-personnel sprays and gases, fissionable or radioactive substances, human body tissue and fluids, items of child pornography, counterfeit credit, debit and charge cards and other specified goods may constitute tier 2 goods. The specification of actual items that will constitute tier 2 goods will be by regulation.

62. New subsection 233BAB(2) confirms that the regulations must not specify an item as constituting a tier 2 good unless the importation or exportation of the item is already prohibited (conditionally or absolutely) by regulation. Thus, this new section does not establish a new class of prohibited goods, rather it creates new penalties relating to the unlawful importation or exportation of existing classes of prohibited goods.

63. New subsection 233BAB(3) defines child pornography for the purposes of the offence. It provides that for the purposes of new subsection 233BAB(1) an item is taken to be an item of child pornography if is a document or other goods that depicts a person who is, or appears to be, under the age of 16 years, who is involved in a sexual pose or sexual activity, and that depiction is likely to cause offence to a reasonable adult. Section 4 defines document as including books.

64. New subsection 233BAB(4) establishes the offence for knowingly or recklessly importing goods that were tier 2 goods where the importation of those goods was prohibited. The subsection imposes a maximum penalty of a fine not exceeding $250,000, or imprisonment for 10 years, or both.

65. New subsection 233BAB(5) establishes the offence for knowingly or recklessly exporting goods that were tier 2 goods where the exportation of those goods was prohibited. The subsection imposes a maximum penalty of a fine not exceeding $250,000, or imprisonment for 10 years, or both.

66. New subsection 233BAB(6) provides that a person convicted or acquitted of an offence against new subsection 233BAB(4) or new subsection 233BAB(5) in respect of particular conduct is not liable to be proceeded against civilly under section 233.

New section 233BAC - Evidence relating to approval for import or export

67. This items concerns goods which would be prohibited imports or prohibited exports if the necessary permission for import or export is not obtained prior to importation or exportation.

68. The Customs (Prohibited Imports) Regulations and the Customs (Prohibited Exports) Regulations permit the importation and exportation of certain specified goods where the permission of a specified Minister or an authorised person has been granted in writing. Additionally, in the case of firearms, accessories and ammunition, a specific purpose test must be satisfied before permission may be granted.

69. New section 233BAC provides that a certificate of an authorised officer to the effect that a person charged with an offence against new subsection 233BAA(4) or (5) or new subsection 233BAB(4) or (5) had not obtained the requisite approval at the time the offence was allegedly committed, is prima facie evidence that the approval had not been so obtained. It further provides that before such a certificate can be admitted as evidence in proceedings it must be given to the person charged with the offence (or his or her solicitor), at least 14 days before the certificate is sought to be admitted.

Item 18 - Paragraph 235(2)(c)

70. Section 235 concerns penalties for offences in relation to narcotic goods.

71. This item and items 19 and 20 amend the penalties relating to offences concerning narcotic goods, to reflect a comparable increase in penalties for non-narcotic-related offences proposed by item 17.

72. This item amends the penalties relating to offences concerning commercial quantities of narcotic goods, from imprisonment for life to a fine not exceeding $750,000 or imprisonment for life, or both.

Item 19 - Subparagraph 235(2)(d)(i)

73. This item amends the penalties relating to offences concerning trafficable quantities of narcotic goods other than cannabis, increasing the penalty from a fine not exceeding $100,000 to a fine not exceeding $500,000.

Item 20 - Subparagraph 235(2)(d)(ii)

74. This item amends the penalties relating to offences concerning trafficable quantities of cannabis, increasing the penalty from a fine not exceeding $4,000 to a fine not exceeding $250,000.

Item 21 - Subsections 245(2) and (4)

75. This item repeals subsection 245(2) and subsection 245(4). In practice these subsections operate to constrain certain courts in setting pecuniary penalties for Customs prosecutions by limiting the amount of penalty that may be imposed. By repealing these subsections and expressing the penalty in terms of a maximum penalty, the penalty imposed in a given instance will only be constrained by the sentencing limits that adhere to the jurisdiction of the relevant court.

Schedule 3 - Customs Administration Act 1985

Item 1 - Subsection 6(1)

1. The Chief Executive Officer of Customs is currently appointed for a period of 5 years under section 6(1), but may be reappointed. Item 1 amends the provision to provide that the Chief Executive Officer is to be appointed for a period of up to five years. No change is made to the reappointment option.