House of Representatives

Explanatory Memorandum

(Circulated by authority of the Minister for Justice and Customs Senator the Honourable Chris Ellison)

SCHEDULE 2 - FOREIGN PROCEEDS OF CRIME ORDERS AND REQUESTS BY AUSTRALIA FOR ORDERS IN FOREIGN COUNTRIES

This Schedule amalgamates and co-locates provisions currently in the Proceeds of Crime Act 1987 and the Mutual Assistance Act in Criminal Matters 1987 which provide for the registration and enforcement of foreign restraining and confiscation orders in Australia in relation to the confiscation of assets located in Australia which are the proceeds of a foreign offence. The Mutual Assistance in Criminal Matters Act 1987 also enables authorised agencies, as the request of a foreign country and as authorised by the Attorney-General, to apply for and use production orders, monitoring orders and search warrants in relation to foreign serious offences where the it is reasonably suspected that the proceeds or instrument or property-tracking documents are located in Australia.

The provisions will be located in the Mutual Assistance in Criminal Matters Act 1987 . This Schedule also widens the existing conviction-based scheme to enable foreign civil-based restraining and confiscation orders to be registered and enforced, and makes some procedural amendments to the existing regime.

Further, provisions in the PoC Act 1987 relating to the enforcement of forfeiture orders made under the International War Crimes Tribunals Act 1995 have been re-located into that Act.

International War Crimes Tribunals Act 1995

Item 1 Part 6 of the International War Crimes Tribunals Act 1995 ('IWCT Act') enables forfeiture orders of the International War Crimes Tribunal to be enforced in Australia. Once registered, the order currently takes effect as if made under the PoC Act 1987. This amendment will replace the reference to the 1987 Act, and enable the order to take effect as if made under the PoC Bill 2002.

Item 2 This item inserts a new subsection into section 46 of the IWCT Act, to take into account changes made to the proceeds of crime regime by clause 68 of the PoC Bill 2002. This item also amends the effect of clause 64 in relation to the IWCT Act.

Section 68 of the PoC Bill 2002, as amended by this item, provides an exception to the rule that property specified in a forfeiture order vests absolutely in the Commonwealth at the time the order is made. Under clause 68 as amended, property specified in a forfeiture order where a joint owner of the property died before the forfeiture order was made, but after the DPP applied for registration of the forfeiture order under section 45 of the IWCT Act, is taken to have vested in the Commonwealth immediately before the person's death. Any restraining order is also taken to have continued to apply to the property as if the person had not died.

The effect of this provision is that the property does not form part of the deceased's estate.

Item 3 This item repeals subsection 46(3) of the IWCT Act, and replaces it with provisions mirroring section 23 the PoC Act 1987 (in so far as it applies to the IWCT Act ). It also updates references to provisions in the PoC Act 1987 in existing subsection 46(3) with the corresponding provisions in PoC Bill 2002.

Item 4 This item inserts a new provision in the IWCT Act which mirrors section 23A of the PoC Act 1987. The provision enables third parties who were not involved in the commission of the offence to which the forfeiture order relates, to in specified circumstances either have their interest in the property transferred to them by the Commonwealth or to be recompensed for their interest in the forfeited property. To be successful, the property must not be the proceeds or instrument of the offence within the meaning of the PoC Bill 2002. Under that Act, property ceases to be proceeds if acquired by a person for value and without knowledge that it was proceeds of the offence (eg an innocent third party).

If the person was given notice or appeared at the forfeiture order hearing, he or she may only apply under proposed section 46A if given leave by the court. Applications should be made within six weeks of the forfeiture order being registered in the court; however, court may give leave to apply in certain circumstances.

Item 5 This item enables regulations which are already in force under the PoC Act 1987 to continue in force as if they were made under the IWCT Act until regulations are made under that Act.

Mutual Assistance in Criminal Matters Act 1987

Item 6 This item inserts a definition of 'account'.

Item 7 This item inserts a definition of 'agent'.

Item 8 'Ancillary offence' is currently defined in the MA Act by reference to the PoC Act 1987. This item repeals that definition, and inserts the PoC Act 1987 definition in full. As the PoC Act 1987 is to be repealed in the future, it is more appropriate that relevant definitions appear in the MA Act.

Item 9 This item amends paragraph (a) of the definition of 'Australian forfeiture order'. It repeals the reference to 'Proceeds of Crime Act' and replaces it with a reference to a 'proceeds of crime law'. A 'proceeds of crime law' is defined to include both the PoC Act 1987 and the PoC Bill 2002.

Item 10 This item inserts a new paragraph into the definition of 'Australian forfeiture orders', to take into account clause 95 of the PoC Bill 2002, which enables a court to make a declaration that property has been forfeited under Part 2-3 of that Act.

Item 11 This item amends paragraph (ab) of the definition of 'Australian forfeiture order'. It repeals the reference to 'Proceeds of Crime Act' and replaces it with a reference to the PoC Act 1987. This limits the application of that paragraph to the old Act.

Item 12 This item inserts the definition of 'literary proceeds order'.

Item 13 This item amends paragraph (a) of the definition of 'Australian pecuniary penalty order'. It repeals the reference to 'Proceeds of Crime Act' and replaces it with a reference to a 'proceeds of crime law'. A 'proceeds of crime law' is defined to include both the PoC Act 1987 and the PoC Bill 2002.

Item 14 This item repeals paragraph (a) of the definition of 'Australian restraining order', which referred to a restraining order within the meaning of the PoC Act 1987 (other than a restraining order made by virtue of section 59 of that Act), and replaces it with a reference to a 'proceeds of crime order' (other than a restraining order made by virtue of section 59 of that Act or 34K of the MA Act.

Item 15 This item inserts a definition of 'authorised officer'.

Item 16 This item inserts a definition of 'Confiscated Assets Account'.

Item 17 This item inserts a definition of 'enforcement agency'.

Item 18 this item inserts a definition of 'foreign confiscation proceedings'

Item 19 This item inserts a definition of 'foreign order'.

Item 20 This item repeals the definition of 'foreign organised fraud offence', which is no longer required as proposed section 34R is now closer to the definition of 'serious offence' in the PoC Bill 2002.

Item 21 This item inserts a definition of 'instrument'.

Item 22 This item inserts a definition of 'interest'.

Item 23 This item inserts a definition of 'narcotic substance'.

Item 24 This item inserts a definition of 'officer'.

Item 25 This item inserts a definition of 'Official Trustee'.

Item 26 This item repeals the definition of 'proceeds' and replaces it with a reference to the definition in the PoC Bill 2002.

Item 27 This item inserts a definition of 'proceeds jurisdiction'

Item 28 This item amends the definition of 'Proceeds of Crime Act' from the 1987 Act to the 2002 Bill.

Item 29 This item inserts the definition of 'proceeds of crime law', which is defined to include both the PoC Act 1987 and the PoC Bill 2002.

Item 30 This item inserts the definition of 'related foreign serious offence'.

Item 31 This item repeals the definition of 'serious narcotic offence', which is no longer required as proposed section 34R is now closer to the definition of 'serious offence' in the PoC Bill 2002.

Item 32 This item repeals the definition of 'tainted property'. This reflects the different way this term is used in the PoC Bill 2002 and the PoC Act 1987.

Item 33 This item amends paragraph 32(b) to enable Australia to request an appropriate authority of a foreign country to make arrangements for the enforcement of literary proceeds orders (which are new orders under the PoC Bill 2002).

Item 34 This item repeals paragraph 33(a), which enables Australia to obtain a warrant similar to a search warrant for tainted property under PoC Act 1987 in a foreign country. In conjunction with item 35, this reflects the amended search warrant regime in the PoC Bill 2002, which now has one set of search warrant provisions, enabling 'tainted property', property-tracking documents and evidential material to be searched for under the one warrant.

Item 35 This item repeals the phrase 'in respect of property-tracking documents' in paragraphs 33(c) and (d). As noted in the discussion of item 34, this item reflects the amended search warrant regime in the PoC Bill 2002.

Item 36 This item repeals Division 2 of Part VI of the MA Act, and inserts a new Division 2 - Requests by foreign countries

Subdivision A - Enforcement of foreign orders

This subdivision replaces the existing section 34 of the MA Act, which governs the registration of foreign proceeds of crime orders in Australia. It provides that once registration is effected, the relevant order may be enforced as if it were made by a court under the PoC Act 1987. The PoC Act 1987 in turn provides that when enforcing foreign restraining orders, forfeiture orders and PPOs registered in Australia, certain parts of the PoC Act 1987 do not applied or are applied in modified form.

This subdivision combines the provisions of the section 34 of the MA Act with relevant provisions of the PoC Act 1987 to simplify use of the legislation.

Proposed section 34 Requests for enforcement of foreign orders

Proposed subsection 34(1) replicates current subsection 34(1) of the MA Act, and enables the Attorney-General to authorise the DPP to apply for the registration of a foreign forfeiture order or a foreign PPO made in respect of a foreign serious offence. The Attorney-General can only authorise the application for registration where it is reasonably suspect that relevant property is located in Australia, and the Attorney-General is satisfied that a person has been convicted of the offence and there are no appeal proceedings on foot or able to be taken in relation to either the conviction or the forfeiture order.

Subsection 34(2) is a new provision, which enables the Attorney-General to authorise the DPP to apply for registration of a foreign civil based forfeiture or pecuniary penalty order. This reflects both the Commonwealth's move to a civil-forfeiture regime, and the growing trend worldwide.

The application of the provision is limited to where the foreign country is specified in the regulations. This will ensure that the Commonwealth is enforcing civil orders made on a similar basis to PoC Bill 2002.

Subsection 34(3) replicates subsection 34(2), and enables the Attorney-General to authorise the DPP to apply for the registration of a foreign restraining order in Australia. The Attorney-General may make such an authorisation in relation to both civil- and conviction-based restraining orders.

Subsection 34(4) performs the same function as subsection 34(3), and sets out which courts have jurisdictions to hear such application. The new provision reflects the jurisdictional provisions in the PoC Bill 2002.

Proposed section 34A Registration of foreign orders

Under existing provisions, subsection 34(4) of the MA Act applies subsection 23A(2) of the PoC Act 1987. Proposed subsections 34A(1) and (2) combine subsection 34(4) of the MA Act and subsection 23A(2) of PoC Act 1987, and slightly amends those provisions.

The effect of proposed subsections 34A(1) and (2) is that the DPP must give notice to people who may have an interest in the property with a power for the court to make directions if needed. This includes the persons the subject of the order (currently excluded by subsection 34A(2)). The application must be considered ex-parte if the DPP requests the court to do so (proposed subsection 34A(3)

Subsection 34A(4) replicates subsection 34(8) of the MA Act, and enables amendments to a registered foreign PPO or restraining order to also be registered. Amendments must be registered to have any effect under either the MA Act of PoC Bill 2002.

Proposed subsection 34A(5) replicates subsection 34(9) of the MA Act, and provides how an order or amendment to an order must be registered.

Proposed section 34B Enforcement of foreign forfeiture orders

Proposed subsection 34B(1) replicates subsection 34(5) of the MA Act, and provides that a registered foreign forfeiture order has effect as it was made by the court under the PoC Bill 2002 at the time of registration.

Proposed subsection 34B(2) is a new provision which takes into account changes made to the proceeds of crime regime by clause 64 of the PoC Bill 2002. This proposed subsection also amends the effect of clause 64 in relation to the MA Act.

Clause 64 of the PoC Bill 2002, as amended by this proposed subsection, provides an exception to the rule that property specified in a forfeiture order vests absolutely in the Commonwealth at the time the order is made. Under clause 64 as amended, property specified in a forfeiture order where a joint owner of the property died before the forfeiture order was made, but after the DPP applied for registration of the forfeiture order under the MA Act, is taken to have vested in the Commonwealth immediately before the person's death. Any restraining order is also taken to have continued to apply to the property as if the person had not died. The effect of this provision is that the property does not form part of the deceased's estate.

Proposed subsection 34B(3) reproduces subsection 23(2) of the PoC Act 1987, and enables the Attorney-General to give directions for the disposal of property the subject of a registered foreign forfeiture order. This proposed subsection is subject to the operation of the provisions in proposed subsection 34C regarding the property interests of innocent third parties.

Proposed subsection 34B(4) replicates subsection 23(1) of the PoC Act 1987 disapplies certain parts of the PoC Bill 2002 which do not have practical application to the enforcement of forfeiture orders under the MA Act.

Proposed section 34C Effect on third parties of registration of foreign forfeiture orders

This is largely based on section 23A of the PoC Act 1987, and enables third parties who were not involved in the commission of the offence to which the forfeiture order relates, to either have their interest in the property transferred to them by the Commonwealth or to be recompensed for their interest in the forfeited property. To be successful, the property must not be the proceeds or instrument of the offence within the meaning of the PoC Bill 2002. Under that Bill, property ceases to be proceeds if acquired by a person for value and without knowledge that it was proceeds of the offence (eg an innocent third party).

If the person was given notice or appeared at the forfeiture order hearing, he or she may only apply under section 46A if given leave by the court. Applications should be made within six weeks of the forfeiture order being registered in the court; however, court may give leave to apply in certain circumstances.

Proposed section 34C applies in relation to civil- and conviction-based orders alike.

Proposed section 34D Enforcement of foreign pecuniary penalty orders

Proposed subsection 34D(1) replicates section 34(6) of the MA Act, and provides a registered foreign PPO may be enforced as if it were made by the court under the PoC Bill 2002 at the time the order was registered. The proposed subsection also enables the foreign PPO to be enforced as if it was a debt due to the Commonwealth.

Proposed subsection 34D(2) is based on subsection 63(6) of the PoC Act 1987, and provides that where a PPO is registered in Australia, any subsequent payment made in relation to the PPO is taken to be made in relation to that PPO. This ensures that the PPO is only liable to be paid once, and that there are not two separate debts (eg one in Australia and one in the originating foreign country).

Proposed subsection 34D(3) disapplies Division 5 of Part 2-4 of the PoC Bill 2002 from applying to foreign PPOs. Division 5 deals with the effect on PPOs of relevant convictions being quashed - as a foreign PPO cannot be registered unless the conviction and order are not subject to any further appeal, Division 5 has no application.

Proposed section 34E Enforcement of foreign restraining orders

Proposed subsection 34E(1) replicates subsection 34(7) of the MA Act, and enables a restraining order to have effect and be enforced as if it were made by the court under the PoC Bill 2002 at the time the order was registered, and as if it were an order directing that property not be disposed of or otherwise dealt with.

Proposed subsection 34E(2) is the equivalent of paragraphs 60(b) - (e) of the PoC Act 1987. The proposed subsection amends the operation of specified parts of the PoC Bill 2002, to account for the fact that it is operating in relation to foreign, not domestic, orders.

Proposed subsection 34E(3) is the equivalent of paragraph 60(a) of the PoC Act 1987, and operates the exclude a number of provisions from applying when enforcing a foreign restraining order under PoC Bill 2002.

Proposed section 34F Faxed copies of foreign orders

This item is similar to subsection 34(10) of the MA Act, but has been altered to reflect the PoC Bill 2002, which provides that the original order must be filed in court within twenty-one days of the faxed copy being registered, without requiring that the original be registered.

Proposed section 34G Cancelling registration

Proposed section 34G reproduces subsections 34(11), (12) and (13) of the MA Act, and enables the Attorney-General to direct the DPP to cancel the registration of a foreign PPO or restraining order. This may occur where the order ceases to have effect in the foreign country, or the cancellation of the order is appropriate in light of arrangements between Australia and the foreign country, or any other circumstance. The Attorney-General's discretion to cancel the order is not fettered. Upon application by the DPP, the court must cancel the registration.

Proposed section 34H Certain provisions of the Proceeds of Crime Act not to apply

This item disapplies certain parts of the PoC Bill 2002, and replicates subsection 34(4) of the MA Act. Sections 317 and 318 and Part 4-2 of the PoC Bill 2002 relate to appeals against forfeiture orders, recovery of costs for an action and legal assistance.

Subdivision B - Restraining orders relating to foreign criminal proceedings.

This subdivision replaces the existing section 36 of the MA Act, which enables the Attorney-General to authorise the DPP to apply for a restraining order under the PoC Act 1987 in certain circumstances. The PoC Act 1987 in turn provides that when the DPP makes such an application, an interim restraining order may be issued. Subsection 59(1) of that Act specifies provisions relating to the making of restraining orders which do not apply or apply in modified form.

This subdivision combines the provisions of section 36 of the MA Act with relevant provisions of the PoC Act 1987 to simplify use of the legislation.

Proposed section 34J Requests for restraining orders

This item is based on section 36 of the MA Act, and enables the Attorney-General to authorise the DPP to apply for a restraining order covering property which is reasonably believed to be in Australia, and is or is about to be the subject of a foreign restraining order.

Proposed section 34 K Applying for and making restraining orders

This item is based on subsection 59(1) of the PoC Act 1987. Proposed subsections 34K(1) and (2) enable the DPP to apply for a restraining order under the PoC Bill 2002, and provide that Part 2-1 of that Act applies to both the application and any order.

Proposed subsection 34K(3) is the equivalent of paragraphs 59(1)(a) - (f) of the PoC Act 1987, and modifies the operation of Part 2-1 of the PoC Bill 2002.

Proposed section 34L Excluding property from restraining orders

This item is based on subsection 59(2) of PoC Act 1987, and enables restrained property to be recovered in certain circumstances.

The proposed section enables a third party who was not involved in the commission of the offence to which the forfeiture order relates, to have his or her interest in the property excluded from the restraining order. To be successful, the property must not be the proceeds or instrument of the offence within the meaning of the PoC Bill 2002. Under that Act, property ceases to be proceeds if acquired by a person for value and without knowledge that it was proceeds of the offence (eg an innocent third party).

The proposed section also enables a property to be excluded if the restraint of the property would cause financial hardship or it is otherwise in the public interest to do so, regardless of whether the applicant for the exclusion order is the subject of the order or a third party.

Proposed section 34M Cessation of restraining orders

This item is based on subsections 59(3), (4) and (5) of the PoC Act 1987. It provides that a restraining order made under Subdivision B ceases to have effect 30 days after it is made, or at a later time if so ordered by the court.

If a restraining order under Subdivision A is granted within either the 30 days or the extended timeframe, the restraining order ceases at that point.

Subdivision C - Production orders relating to foreign serious offences

This subdivision replaces existing provisions in section 37 of the MA Act and subsection 69(1) of the PoC Act 1987 which enables the Attorney-General to authorise a police officer to apply for a production order under the PoC Act 1987 in certain circumstances. Subsection 69(1) of the PoC Act 1987 in turn provides that when a police officer is authorised under the MA Act to apply for a production order, such an order may be made under that Act. The proposed subsection also specifies provisions relating to the making of production orders which do not apply, or apply in a modified form.

This subdivision combines the relevant provisions of subsection 37(1) of the MA Act with relevant provisions of the PoC Act 1987 to simplify use of the legislation.

Proposed section 34N Requests for production orders

Upon the request of a foreign country, proposed subsection 34N enables the Attorney-General to authorise an authorised officer to apply for a production order under the PoC Bill 2002 to obtain property-tracking documents relating to criminal proceedings in the requesting foreign country. An authorised officer may be a member of the AFP, NCA or ASIC, or an officer of Customs, authorised by the appropriate agency head.

The production order must be sought in the State or Territory in which the property-tracking documents are reasonably believed to be located.

Proposed subsection 34N is based on subsections 37(1) and (2) of the MA Act, in so far as they relate to production orders.

Proposed section 34P Applying for and making production orders

Proposed subsections 34P(1) and (2) are based on subsection 69(1) of the PoC Act 1987, and enable an authorised officer to seek a production order under the PoC Bill 2002, and that Part 3-2 of that Act is to apply to both the application and any subsequent order.

Proposed subsection 34P(3) is based on paragraphs 69(1)(a) and (b) of the PoC Act 1987. The proposed subsection disapplies certain provisions in Part 3-2 for the purposes of a production order made on request of a foreign country, and amends the application of certain other provisions in Part 3-2.

Proposed section 34Q Retaining produced documents

This proposed subsection provides that an authorised officer may retain a property-tracking document obtained as a result of a production order until the Attorney-General provides written directions on how to deal with the document. It is clear from this provision that such a direction may include forwarding that document to the foreign country which requested the production order.

This provision is based on subsection 69(2) of the PoC Act 1987.

Subdivision D - Notices to financial institutions

This is a new form of investigative power included in the PoC Bill 2002. Its exercise allows an investigator to make a decision on whether to seek a warrant or production order, or for the purpose of proceedings under the Act. One of the reasons for the Notice is for AFP or NCA investigators to discover if a person holds an account with the particular institution: that is, there is a known suspect, but the location of their funds is not known. The provisions are based on Recommendation 76 of the 1999 ALRC Report Confiscation that counts : A review of the Proceeds of Crime Act 1987 .

This subdivision enables notices to financial institutions to be used in relation to proceedings or possible proceedings under Division 2 of Part VI of the MA Act.

Proposed section 34R Giving notices to financial institutions

Proposed section 34R sets out the procedure that must be followed where the Attorney-General or a senior Departmental officer gives a notice to a financial institution requiring the production of information or documents relevant to certain matters.

Under proposed subsection 206(1), a specified officer may give a written notice to a financial institution requiring the production of any information or documents relevant to certain account and transaction information. The notice must not be issued unless the officer reasonably believes that giving the notice is required to determine whether to take action under Division 2 of Part VI of the MA Act or the PoC Bill 2002 in connection with proceedings under that Division, or in relation to proceedings under that Division or the PoC Bill 2002.

Proposed section 34S Contents of notices to financial institutions

Proposed section 34S sets out what a notice must contain. First, it must state that the officer giving the notice believes that giving the notice is required to determine whether to take action under Division 2 of Part VI of the MA Act or the PoC Bill 2002 in connection with proceedings under that Division, or in relation to proceedings under that Division or the PoC Bill 2002. It must also specify the name of the financial institution, the kind of information or documents required to be provided, and the form and manner in which that information or those documents are to be provided. Further, it must also state that the information or documents must be provided within 14 days of the notice.

If the notice specifies that information about the notice must not be disclosed, it must also set out the effect of the offences in proposed sections 34V (disclosing existence or nature of a notice) and 34W (failing to comply with a notice).

Proposed section 34T Protection from suits etc. for those complying with notices

Proposed section 34T provides that a financial institution or one of its officers, employees or agents are protected from any action, suit or proceeding in relation to any action taken by the institution or person in relation to its or their response to a notice under proposed section 34R, or in the mistaken belief that action was required under the notice. The same parties are also protected from prosecution for money laundering offences in respect of the information provided in response to a notice under proposed section 34R.

Proposed section 34U Making false statements in applications

This proposed section creates the offence of providing a false or misleading statement in relation to an application for a notice to a financial institution. The offence applies whether the statement is given orally or in a document or other form. The maximum penalty which can be imposed in relation to this offence is 12 months imprisonment, a fine of 60 penalty units, or both.

Proposed section 34V Disclosing existence or nature of notice

Proposed section 34V makes it an offence for a person given a notice under proposed section 34R to disclose the existence or nature of the notice where the notice specifies that information about the notice must not be disclosed. The maximum penalty which can be imposed in relation to this offence is 2 years' imprisonment, a fine of 120 penalty units, or both.

Proposed section 34W Failing to comply with a notice

Proposed subsection 34W(1) provides that it is an offence for a person to fail to comply with a notice given under proposed section 206. The maximum penalty which can be imposed in relation to this offence is 6 months' imprisonment, a fine of 30 penalty units, or both.

Subdivision E - Monitoring orders relating to foreign serious offences

This subdivision replaces existing provisions in subsection 37(2) of the MA Act and section 75 of the PoC Act 1987 which enable the Attorney-General to authorise a police officer to apply for a monitoring order under the PoC Act 1987 in certain circumstances. Subsection 75(1) of the PoC Act 1987 in turn provides that when a police officer is authorised under the MA Act to apply for a monitoring order, such an order may be made under that Act. The subsection also specifies provisions relating to the making of monitoring orders which do not apply, or apply in a modified form.

This subdivision combines the relevant provisions of subsection 37(2) of the MA Act with relevant provisions of the PoC Act 1987 to simplify use of the legislation.

Proposed section 34X Requests for monitoring orders

Proposed subsection 34X(1) enables a monitoring order to be applied for by an authorised officer for the purpose of obtaining information about account transactions in Australia which is reasonably believed to be relevant to a proceeding or investigation relating to a serious offence in a foreign country. An order may only be sought if the foreign country requests it, and the Attorney-General authorises the authorised officer to so apply. This provision is based on subsection 37(3) of the MA Act.

Proposed subsection 34X(2) defines the foreign serious offences in relation to which a monitoring order may be authorised under proposed subsection 34X(1). The offences are closely aligned with those defines as 'serious offences' in the PoC Bill 2002, and include offences punishable by 3 or more years imprisonment where the unlawful conduct involves drugs (ie drug trafficking), the benefit (or intended benefit) to a person of at least $10,000 or loss or intended loss to the foreign country of the same amount. Offences relating to money laundering, people smuggling and failure to report financial transactions are also included.

Proposed subsection 34X(3) specifies that an order must be sought in a court able to hear matters on indictment - ie an intermediate or Supreme Court. This provision is similar to subsection 37(4) of the MA Act.

Proposed section 34Y Applying for and making monitoring orders

Proposed subsections 34Y(1) and (2) are based on subsection 75(1) of the PoC Act 1987, and enable an authorised officer to seek a monitoring order under the PoC Bill 2002, and that Part 3-4 of that Act is to apply to both the application and any subsequent order.

Proposed subsection 34Y(3) amends the application of certain provisions in Part 3-4 for the purposes of a monitoring order made on request of a foreign country.

Proposed section 34Z Passing on information given under monitoring orders

This proposed section provides that information gained under a monitoring order must be passed to the Attorney-General or a specified officer of the Attorney-General's Department as soon as practicable after the enforcement agency receives the information.

Subdivision F - Search warrants relating to foreign serious offences

This subdivision combines the two search warrant regimes which existed under section 35 and subsection 37(1) of the MA Act - namely, the regimes relating to 'tainted property' (proceeds and instruments of an offence) and property-tracking documents respectively. Those provisions reflected the two different sets of search warrant provisions in Parts III and IV the PoC Act 1987, which are now combined in Part 3-5 of the PoC Bill 2002.

It also incorporates relevant parts of the PoC Act 1987 which govern how the provisions of the PoC Act 1987 apply to such applications.

Proposed section 34ZA Requests for search warrants

Proposed subsection 34ZA(1) enables a search warrant to be applied for by an authorised officer for the purpose of obtaining proceeds or an instrument of an offence, or a property-tracking document in Australia which is relevant to a proceeding or investigation relating to a serious offence in a foreign country and os reasonably believed to be located in Australia. An order may only be sought if the foreign country requests it, and the Attorney-General authorises the authorised officer to so apply. This provision is based on section 35 and subsection 37(1) of the MA Act.

Proposed subsection 34ZA(2) specifies in which State or Territory a warrant may be sought.

Proposed section 34ZB Applying for and issuing search warrants

Proposed subsections 34ZB(1) and (2) are based on subsections 42(1) and 72(1) of the PoC Act 1987, and enable an authorised officer to seek a search warrant under the PoC Bill 2002, and that Part 3-5 of that Act is to apply to both the application and any subsequent order.

Proposed subsection 34ZB(3) is based on paragraphs 42(1)(b) and (c) and paragraph 72(c) of the PoC Act 1987. The proposed subsection disapplies provisions in Part 3-5 which provide for an incidental power of seizure and provides for the retention and return of seized property. Those provisions are set out in sections 34W and 34X of the MA Act. Proposed subsection 34ZB(3) also amends the application of certain other provisions in Part 3-5.

Proposed section 34ZC Seizure of other property and documents

This proposed section authorises the incidental seizure of other things when executing a search warrant, where it is believed that seizure is necessary to prevent the thing's destruction, loss or concealment, or its use in an offence.

Specifically, the provision enables the seizure of a thing reasonably believed to be a property-tracking document, the proceeds or an instrument of the offence to which the warrant relates but which is not of the kind specified in the warrant. If there is another search warrant in force under Part 3-5 of the PoC Bill 2002 in relation to a serous offence, a thing reasonably believed to be a property-tracking document related to that offence and an instrument or proceeds of the offence may also be seized. In addition, if the authorised officer finds something he or she reasonably believes to be relevant to the criminal proceedings in respect of the foreign serious offence, or will afford evidence in relation to an Australian offence, that thing may be seized.

Proposed section 34ZD Return of seized property to third parties

This proposed section provides for property (other than property-tracking documents) that is seized under a search warrant to be returned to a person who claims an interest in that property.

The person must apply to the court which issued the search warrant. To order the return of the property the court must be satisfied that the applicant is entitled to the return of the property, that the property is be neither the proceeds nor instrument of the relevant foreign serious offence, and that the person suspected of committing the relevant offence has not interest in the property.

However, if the property was seized because it may afford evidence of an Australian offence, the person cannot apply under this proposed section to get the property back.

This proposed section is based on subsections 42(3), (4) and (9) of the PoC Act 1987.

Proposed section 34ZE Dealing with seized property (other than property-tracking documents)

This proposed section provides how property seized under a warrant issued in relation to a foreign serious offence and which is not evidence of an Australian offence or a property-tracking document must be dealt with.

Proposed subsection 34ZE(2) establishes the general rule that seized property must be returned if a foreign restraining order or a foreign forfeiture order has not been registered in an Australian court within 30 days of the seizure, and a restraining order has not been made under PoC Bill 2002 in relation to the foreign serious offence.

If a foreign restraining order is registered or a restraining order made within the 30 day period, the head of the agency whose officer seized the property must ensure that the property is given to the OT in accordance with a direction of the court that the OT take custody and control of the property. If the court has made no such direction, but has ordered under proposed subsection 34ZE(6) that the head of the relevant agency may retain the property, that person must retain the property in accordance with the restraining order (see proposed subsection 34ZE(3)).

Where property is given to the OT under 34ZE(3), the PoC Bill 2002 applies to that property as if it were 'controlled property'. 'Controlled property' is defined in the PoC Bill 2002 as property in relation to which the OT must exercise the powers, and perform the duties, conferred or imposed on it, in relation to property of which a court has ordered the OT to take custody and control.

Proposed subsections 34ZE(5) and (6) provide that where a foreign restraining order has been registered in an Australian court or a restraining order has been made under PoC Bill 2002 in relation to the foreign serious offence, the head of the relevant enforcement agency may apply to the court to retain the property. The court may grant such an order is satisfied that retention of the property is necessary for it to be dealt with in accordance with the relevant restraining order. The order may be for so long as the property is required to be retained.

Proposed subsection 34ZE(7) requires the head of the relevant agency to deal with seized property still in his or her possession when a foreign forfeiture order is registered in Australia in accordance with the terms of that order.

The provisions of proposed section 34ZE are based on subsections 45(5) to (8) of the PoC Act 1987.

Proposed section 34ZF Dealing with seized property-tracking documents

This proposed section provides that an authorised officer may retain a property-tracking document obtained as a result of a search warrant for a period up to one month, pending the Attorney-General providing written directions on how to deal with the document. It is clear from this provision that such a direction may include forwarding that document to the foreign country which requested the search warrant.

This proposed section is based on subsection 72(3) of the PoC Act 1987.

Division 3 - Provisions relating to registered foreign restraining orders

This Division enables property the subject of a registered foreign restraining order to be put in the custody and control of the OT, in the same way that property the subject of a domestic restraining order may be.

Proposed section 35 Court may order Official Trustee to take custody and control of property

This amendment enables a court to order the Official Trustee (OT) to take custody and control of restrained property where the DPP applies for the order, and the court considers it necessary to do so. For example, the court may order this if there is a risk that the property would otherwise be dealt with contrary to the restraining order; alternatively, the property may require the OT to manage it to ensure it does not lose value.

This is similar to clause 38 of the PoC Bill 2002, and is based on subsection 61(1) of the PoC Act 1987.

Proposed section 35A Procedural matters

Proposed section 35A sets out that the DPP must give notice of an application for an order for the OT to take custody and control of restrained property to the owner of, or any other person the DPP believes has an interest in, the property. The court may also direct the DPP to publish notice of the application.

A person with an interest in the property has a right to appear and adduce evidence at the hearing.

This provision is based on subsections 61(2)-(4) of the PoC Act 1987.

Proposed section 35B Ancillary orders

This provision enables a court to make ancillary orders with respect to the OT having custody and control of restrained property. Such an order may regulate the way in which the OT performs its functions or powers, determines questions relating to the property (such as the liabilities of the owner of the property in the custody and control of the OT) or direct a person to do give a statement specifying the particulars of the property to the OT.

Proposed section 35C Dealing with restrained property

Proposed subsection 35C(1) applies Division 3 of 4-1 of the PoC Bill 2002 to property as if it were controlled property. That division regulates dealings with or which relate to controlled property.

Proposed subsection 35C(2) provides that before the OT exercises a power under clause 278 of the PoC Bill 2002, the OT must consult with the relevant foreign country. Clause 278 is a new provision, which grants the OT power to destroy or dispose of controlled property. The OT may destroy controlled property if it is in the public interest to do so or if it is required for the health or safety of the public.

The proposed subsection also grants the OT power to dispose of controlled property, by any means, if the circumstances described in any of paragraphs 266(2)(a) to (c) of the Bill exist. Paragraphs 266(2)(a) to (c) concern agreement between all entitled parties to the disposal, the likelihood of the property losing value in the OT's opinion, and the OT's opinion that the cost of controlling the property until final resolution will exceed, or represent a significant proportion of, the value of the property when it is finally dealt with.

Proposed section 35D Money not to be paid into the Common Investment Fund

Proposed subsection 35D provides that money that is in the control of the OT due to a foreign restraining order must not be paid into the Common Investment Fund under the Bankruptcy Act 1966 , despite anything in that Act. This is similar to clause 287 of the PoC Bill 2002, and is based on subsection 61(7) of the PoC Act 1987.

Proposed section 35E Undertakings

This provision enables an affected person to apply to the court for the DPP to give or carry out an undertaking for damages or costs relating to the registration, making or operation of the relevant restraining order.

The provision reflects section 62 of the PoC Act 1987, and is similar in effect to clause 21 of the PoC Bill 2002.

Proposed section 35F Order to discharge certain registered foreign pecuniary penalty orders

Where a registered foreign PPO is made and there is a related registered foreign restraining order, the court in which the PPO is registered may order the OT to pay the Commonwealth an amount equal to the PPO.

Proposed subsection 35F(3) enables the court to order the OT to sell or dispose of the restrained assets to meet the order under proposed subsection 35F(1). The court may also appoint a person to execute a deed or instrument in the name of the person who has an interest in the property. Proposed subsection 35F(4) confirms that the execution by a person appointed by the court is valid as it the owner of the interest has themself executed the deed.

Proposed section 35F is based on subsections 63(1)-(3) of the PoC Act 1987, and has been amended to enable the OT to carry out the functions in respect of civil-based PPOs and restraining orders.

Proposed section 35G Official Trustee to carry out orders

Proposed subsection 35G provides how the OT is to carry out an order under proposed section 35F. If the OT is given a direction under proposed subsection 35F(1) in relation to property that is money, the OT must as soon as practicable apply the money in payment of the costs, charges, expenses and remuneration of the OT (as set out in clause 288 of the PoC Bill 2002) which were incurred or payable in connection with the restraining order

If the order under proposed subsection 35F(1) relates to property that is not money, the OT must sell or otherwise dispose of that property, and as soon as practicable apply the proceeds of sale in payment of the costs, charges, expenses and remuneration of the OT (as set out in clause 288 of the PoC Bill 2002) which were incurred or payable in connection with the restraining order. Those costs may include those incurred in disposing of the property.

The OT must pay the remainder of the money or proceeds received from the sale or disposition of property to the Confiscated Assets Account.

Proposed subsection 35G(3) provides that if the remainder of the money and proceeds received from the sale or disposition of property exceeds the penalty amount, the OT must pay an amount equal to the penalty amount to the Confiscated Assets Account, and pay the balance to the person whose property was subject to the restraining order.

This provision is based on paragraphs 63(4)(a) and (b), and subsection 63(5) of the PoC Act 1987. There is a similar provision in clause 284 of the PoC Bill 2002.

Proposed section 35H Discharge of person's liability under foreign pecuniary penalty order

Proposed subsection 35H provides that if the OT pays money to the Confiscated Assets Account in satisfaction of a person's liability under a foreign pecuniary penalty order, the person's liability under the foreign pecuniary penalty order is discharged to the extent of the payment.

The proposed section is similar to clause 286 of the PoC Bill 2002, and is based on subsection 63(6) of the PoC Act 1987.

Proposed section 35J Creation of charge on property

Upon occurrence of the events specified in paragraphs 35J(1)(a) to (c), proposed subsection 35J(1) creates a charge over the property which is the subject of a registered foreign restraining order to secure the payment of a registered foreign PPO.

Paragraphs 35J(1)(a) to (c) require a foreign restraining order and a foreign PPO to have been made against a person, and each of those orders to have been registered. The foreign PPO must be made in relation to the person's conviction for a foreign serious offence, or a related foreign serious offence.

The charge is created over the property upon the registration of the foreign restraining order or the foreign PPO, whichever occurs last. The amount is the amount that would be the penalty amount under the PoC Bill 2002 as if the foreign PPO had actually been made under that Act.

A charge made under this proposed section is subject to all earlier encumbrances that would otherwise have priority.

Proposed section 35J is based on subsections 64(1) and (3) of the PoC Act 1987.

Proposed section 35K When the charge ceases to have effect

This proposed section provides for the cessation of the charge. The charge ceases to have effect if the person pays out the PPO in full, or where the registration of the foreign restraining order or PPO is cancelled under proposed section 34G.

Sale or disposal of property by order of the court under proposed subsection 35F(3), by the owner of the property with the consent of the foreign court which made the original order, or by the owner of the property with the consent of the OT, also causes the charge to cease.

Sale of the property to a purchaser for sufficient consideration, where the person has no notice of the charge and purchases in good faith will also cause the charge to cease.

This provision is based on subsection 64(2) of the PoC Act 1987.

Proposed section 35L Registering charges

Proposed section 35L provides that where the Commonwealth, a State or Territory have a system of registration for certain types of property the OT or the DPP may apply for a charge created by proposed section 35J to be registered with the relevant authority. Once registration is effected, any person who purchases or otherwise acquires an interest in the property is taken to have notice of the charge.

This provision is based on subsection 64(4) of the PoC Act 1987.

Proposed section 35M When order ceases to be in force

Proposes subsection 35M provides that when registration of a foreign restraining order is cancelled under Subdivision A of Division 2 of the MA Act, the order ceases to be in force. This provision is based on section 65 of the PoC Act 1987.

Item 37 This item repeals the reference to 'Proceeds of Crime Act' and replaces it with a reference to a 'proceeds of crime law'. A 'proceeds of crime law' is defined in subsection 3(1) of the MA Act to include both the PoC Act 1987 and the PoC Bill 2002.