Explanatory Memorandum
(Circulated by authority of the Treasurer, the Hon Peter Costello, MP)Chapter 3 - Immediate disposal of seized goods
Outline of chapter
3.1 This chapter explains amendments to the Excise Act 1901 that alter the criteria enabling the immediate disposal of seized forfeited goods, and provides for retention of samples, and for the use of evidentiary certificates relating to those goods in prosecutions and certain other proceedings. [Schedule 3, items 1, 3 and 4]
3.2 The amendments provide owners of destroyed goods with the right to recover the market value of the disposed goods (valued as at the time of disposal) upon proof that the grounds for disposal did not exist. [Schedule 3, item 2]
Context of amendments
3.3 The Excise Act 1901 enables the Commissioner of Taxation (CEO) to deal in a manner considered appropriate, including destruction of the goods, with goods seized under warrant or under section 9 of the Crimes Act 1914 if the goods are perishable and constitute a danger to public health. However, in most cases seized excisable goods or tobacco seed, plant or leaf do not satisfy both the perishable and danger to public health criteria.
3.4 Seized forfeited goods may constitute a public health risk only if returned to the owner or the market, or they may only be perishable without special storage arrangements. For example, tobacco is highly perishable but can be preserved with special storage arrangements. Goods may be neither a risk to public health nor perishable but cannot be returned to the market as they do not meet applicable quality standards. For example, alcohol extended with other products or illegally blended petroleum that would not meet the relevant food or fuel standards respectively do not meet the current criteria for immediate destruction. Such goods are generally not perishable and whether or not they are a danger to public health depends on the constituents. However, they cannot be appropriately returned to the market.
Summary of new law
3.5 The provisions for immediate destruction are altered to provide for immediate destruction where the goods are perishable, or do not meet any applicable quality standard or the goods, if made available to the public, would constitute a risk to public health or public safety. [Schedule 3, item 1]
3.6 Where the goods are destroyed, provision is made for sampling and recording of goods, appointment of an analyst and use of evidentiary and analyst's certificates in proceedings. [Schedule 3, item 4]
3.7 An owner has a right to recovery of the market value of the destroyed goods where a court is satisfied that the grounds on which the goods were destroyed did not exist. [Schedule 3, item 2]
Comparison of key features of new law and current law
| New law | Current law |
|---|---|
| Immediate disposal of seized goods is permitted where the goods are perishable; the CEO is satisfied the goods do not meet a standard that applies to goods of that kind; or the CEO is satisfied there is a reasonable likelihood, if the goods are made available to the public, they would constitute a risk to public health or public safety. | Immediate disposal of seized goods is authorised by the Excise Act 1901 where the goods are perishable goods and the CEO is satisfied that the retention of the goods would constitute a danger to public health. |
| The owner of destroyed goods has a right to recover the market value of the goods if he or she is able to satisfy the Court that the ground(s) for disposal did not exist at the relevant time. | An owner has a right to recover the market value of the destroyed goods if the owner establishes that the circumstances for destruction did not exist. |
| Procedures for retaining samples and a written record of the destroyed goods are specified.
Evidentiary or analyst's certificates may be issued as evidence of licensing details or nature of the goods for the purposes of relevant proceedings. |
No equivalent. |
Detailed explanation of new law
3.8 Subsection 107FJ(1) of the Excise Act 1901 currently allows immediate disposal of seized excisable goods (goods seized under a seizure warrant or section 9 of the Crimes Act 1914) only where the goods are perishable goods and the CEO is satisfied the retention of the goods would constitute a danger to public health.
3.9 New subsection 107FJ(1) enables the CEO to immediately dispose of goods seized under a seizure warrant or under section 9 of the Crimes Act 1914 where the goods are perishable; or the CEO is satisfied the goods do not meet a standard that applies to goods of that kind; or the CEO is satisfied there is a reasonable likelihood that the goods, if made available to the public, would constitute a risk to public health or public safety. [Schedule 3, item 1]
3.10 'Perishable goods' is defined in new subsection 107FJ(8) to include goods that will perish unless treated with chemicals to preserve them or stored in special conditions (e.g. refrigeration). [Schedule 3, item 3]
3.11 The amendments provide for the retention of a sample and written record of goods destroyed, appointment of an analyst and the use of analyst's and evidentiary certificates in proceedings involving the destroyed goods.
3.12 New section 107GB requires the CEO to ensure a sample of the goods destroyed is taken and dealt with in the manner set out under subsection 107GB(2), that is: divided into three equal parts, each marked and securely sealed, retention of two parts, one for examination by an analyst, the second for further examination if necessary, and retention of one part for delivery for further examination by a suitably qualified appointed person should an owner request such further examination. Subsection 107GB(3) requires a sample or written record to be kept for the longer of three years or the completion of the relevant proceedings.
3.13 The CEO, under new section 107GC, may appoint an officer or other suitably qualified person to be an analyst for the purposes of the Excise Act 1901. New subsection 107GD(4) provides that evidentiary certificates and analyst's certificates constitute prima facie evidence, in proceedings relating to the disposed goods, of the matters stated in the certificates. New subsection 107GD(2) provides that evidentiary certificates may be signed by an officer and state details as to the licence, permission or authority of a person or premises. Analyst's certificates, under new subsection 107GD(3), signed by an appointed analyst, may set out the nature of the sample examined (including identification, packaging and description of it) and the nature of analysis undertaken (when the sample was analysed, the method and results). New subsection 107GD(5) provides that a copy of a certificate must be provided to the defendant at least 14 days prior to its intended admission as evidence in proceedings and the defendant may request the person who signed the certificate to give evidence.
3.14 New subsections 107GD(6) and (7) provide for the person giving the certificate to be called to give evidence with four days notice of intention from the prosecution or by a court order. [Schedule 3, item 4]
3.15 Substitute paragraph 107FJ(6)(c) provides owners of the destroyed goods with a right to recover the market value of the goods calculated as at the time of their destruction where the owner has satisfied the court the grounds upon which disposal occurred did not exist at the time the goods were dealt with. [Schedule 3, item 2]
Application and transitional provisions
3.16 Schedule 3 commences on the day after this bill receives Royal Assent.
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