Replacement Explanatory Memorandum
(Circulated by authority of the Attorney-General, the Honourable Nicola Roxon MP)Outline
The purpose of this Bill is to amend the Customs Act 1901 (the Act) to create criminal offences for the smuggling of tobacco products and for the conveyance or possession of smuggled tobacco products where the person conveying or possessing the goods knows they were smuggled.
A smuggling offence currently exists in section 233 of the Act and is punishable by a pecuniary penalty of up to five times the duty evaded; however this offence is no longer considered an effective deterrent as many penalties currently imposed for tobacco smuggling are not paid.
On some occasions the investigation of the smuggling offence results in the identification of sufficient evidence to warrant the pursuit of fraud offences under the Criminal Code Act 1995 (Cth). In these cases offences carry penalties of up to 10 years imprisonment.
These new offences combine the penalties of the existing smuggling and fraud offences by providing a pecuniary penalty of up to five times the duty evaded in addition to up to 10 years imprisonment. The inclusion of the imprisonment penalty will provide a strong deterrent to criminals and will demonstrate the seriousness of smuggling acts.
Financial impact statement
Nil.
Statement of Compatibility with Human Rights
Prepared in accordance with Part 3 of the Human Rights (Parliamentary Scrutiny) Act 2011
Customs Amendment (Smuggled Tobacco) Bill 2012
This Bill is compatible with the human rights and freedoms recognised or declared in the international instruments listed in section 3 of the Human Rights (Parliamentary Scrutiny) Act 2011.
Overview of the Bill
The Bill will create new offences for the smuggling of tobacco products and for the conveyance and possession of smuggled tobacco where the person conveying or possessing the tobacco knows the tobacco products were imported with the intent to defraud the revenue.
The existing ability for officers of Customs or the police to arrest a person without warrant where they believe on reasonable grounds that the person has committed or is committing certain offences will be extended to the new offences.
Human rights implication
Minimum guarantees in criminal proceedings
The Bill will create new criminal offences for the smuggling of tobacco. The elements of the new offences are the same as those for the existing smuggling offence in the Act. The new offences include a penalty of up to 10 years imprisonment in addition to a pecuniary penalty that is identical to the pecuniary penalty available for the existing offence.
As the Bill creates new criminal offences it engages the minimum guarantees in criminal proceedings contained in article 14 of the International Covenant on Civil and Political Rights. Although a new criminal offence will be created, the Bill does not affect or limit any of the existing human rights protections, including the minimum guarantees in criminal proceedings contained in Australian law.
Conclusion
The Bill is compatible with human rights. Although it engages the minimum guarantees in criminal proceedings, the Bill maintains all existing protections contained in Australia law and does not seek to limit the minimum guarantees in any way.
NOTES ON CLAUSES
Clause 1 - Short title
1. This clause provides for the Bill, when enacted, to be cited as the Customs Amendment (Smuggled Tobacco) Act 2012.
Clause 2 - Commencement
2. This clause provides for the Bill to commence on the day after the Act receives the Royal Assent.
Clause 3 - Schedules
3. This clause is the formal enabling provision for the Schedule to the Bill, providing that each Act specified in a Schedule is amended in accordance with the applicable items of the Schedule. In this Bill the Act being amended is the Customs Act 1901.
4. The clause also provides that the other items of the Schedules have effect according to their terms. This is a standard enabling clause for transitional, savings and application items in amending legislation. In this Bill there is an application provision in item 2 of Schedule 1.
Schedule 1 - Amendments
Customs Act 1901
Item 1 - Subparagraph 210(1)(a)(iii)
5. This item will amend section 210 of the Act to include a reference to the new offence provision inserted by item 2.
6. Section 210 of the Act allows an officer of Customs or police to arrest a person without a warrant in certain circumstances. The effect of this item will be to allow an officer of Customs or police to arrest a person without warrant where the officer believes on reasonable grounds that the person has committed or is committing an offence against new section 233BABAC relating to the smuggling of tobacco products.
7. Section 210 contains limits on the exercise of the power to arrest without warrant. This power can only be exercised if an officer believes on reasonable grounds that proceedings by summons against the person would not achieve one or more of several purposes including ensuring the appearance of the person before a court in respect of the offence.
8. Section 210B requires the officer of Customs or police who arrests the person without warrant to inform the person, at the time of the arrest, of the offence for which the person is being arrested. In addition, section 212 requires the officer of Customs or police to ensure the person is delivered into the custody of a police officer or taken before a magistrate as soon as practicable.
Item 2 - After section 233BABAC
9. This item inserts new section 233BABAD which creates new offences in relation to smuggling tobacco products and the conveyance or possession of smuggled tobacco products.
10. Section 233 of the Act already creates an offence for the smuggling of any goods, and their conveyance and possession, including tobacco products; however, these offences can only be prosecuted by way of a Customs prosecution and is punishable by a penalty only. The new offences created by this Act will be criminal offences punishable by up to 10 years imprisonment or a fine, or both.
11. The elements of the new offences in section 233BABAD are the same as those in current offences in section 233 as they relates to smuggled tobacco products; however, the new offences are structured differently in section 233BABAD in accordance with the standard approach to formulating offences set out in the Criminal Code Act 1995 (Cth).
12. New subsection (1) will create an offence where a person imports tobacco products with the intention of defrauding the revenue.
13. New subsection (2) will create an offence where a person conveys or possesses tobacco products which the person knows were imported with the intent to defraud the revenue. New subsection (3) provides that when prosecuting a person under subsection (2) it is not necessary to prove the identity of the person who imported the goods.
14. New subsection (4) provides that an offence against subsection (1) or (2) is punishable by up to 10 years imprisonment, a fine calculated under subsection (5), or both.
15. The amount of the fine payable in new subsection (5) is calculated as either, if the court can determine the amount of the duty that would have been payable on the tobacco products had the goods been entered for home consumption, five times the amount of the duty that would have been payable, or otherwise 1000 penalty units.
16. The amount of the fine payable, including the method for calculating the amount, is the same as the amount of the penalty payable for a smuggling offence under section 233 the Act.
17. New subsection (6) provides that a person convicted or acquitted of an offence against new section 233BABAD is not liable for smuggling proceedings under section 233 of the Act in respect of the same conduct. This will ensure that a person cannot be prosecuted twice for the same conduct, consistent with section 4C of the Crimes Act 1914.
18. New subsection (7) contains a definition of tobacco products. The definition of tobacco products links to goods classified in Schedule 3 of the Customs Tariff Act 1995 (the Tariff Act). In particular, tobacco products means goods classified to headings 2401, 2402 and 2403 of the Tariff Act excluding subheadings 2402.90.00 and 2403.99.10. Subheadings 2402.90.00 and 2403.99.10 are excluded as goods classified by those subheadings do not contain any tobacco.
19. The Tariff Act classifications include a broad range of tobacco products including unmanufactured tobacco, tobacco refuse, cigars, cheroots, cigarillos, cigarettes, other manufactured tobacco, homogenised and reconstituted tobacco, and tobacco extracts and essences.
Item 3 - Application provisions
20. Item 3 contains and application provision.
21. Subitem 3(1) provides that the new offence created by subsection 233BABAD(1) concerning the smuggling of tobacco will apply to goods which have been imported on or after the commencement of this item, being the day after the Royal Assent.
22. Subitem 3(2) provides that the new offence for the conveyance or possession of smuggled tobacco in subsection 233BABAD(2) will apply in relation to goods that are conveyed, or goods that are in a person's possession, on or after commencement of the item whether or not the goods were imported before, on or after commencement of the item.