Introductory Info
Date introduced: 24 May 2018
House: House of Representatives
Portfolio: Agriculture and Water Resources
Commencement: The day after Royal Assent.
Purpose and structure of the Bill
The purpose of the Export Legislation Amendment
(Live-stock) Bill 2018 (the Bill) is to amend the Australian Meat and
Live-stock Industry Act 1997 (AMLI Act) and the Export Control Act
1982 (EC Act) to:
- increase
the applicable criminal penalties for offences relating to the export of live-stock
under each Act
- introduce
aggravated offences where the relevant conduct causes economic detriment to
Australia, or where the exporter commits the offence with the intention of
obtaining commercial advantage
- introduce
new civil penalty provisions which trigger enforcement provisions of the Regulatory Powers
(Standard Provisions) Act 2014 (Regulatory Powers Act) and
- enable
courts to make adverse publicity orders requiring exporters to publish or
disclose details of their contravention.
The Bill has one Schedule with three Parts—Part 1
amends the AMLI Act, and Part 2 amends the EC Act. Part
3 contains an application provision.
Background
Overview of regulatory scheme
The export of live-stock is underpinned by a complex
regulatory scheme. There are two key Acts which create the broad legal
framework:
- the
AMLI Act regulates the licencing of exporters. It prohibits the export
of meat or live-stock without a licence, which may be subject to prescribed
conditions, orders and directions[1]
and
- the EC Act regulates the export of prescribed goods (including live
animals).[2]
It provides authority for ‘authorised officers’ to carry out monitoring and
enforcement activities, and sets out penalties for a range of export offences.
Specific requirements for exporters are largely contained
in instruments made under these Acts. In particular, the Export Control
(Animals) Order 2004 (Animals Order) provides that the export of live-stock
is prohibited unless certain conditions are met.[3]
These include that the exporter has in place an approved Exporter Supply Chain
Assurance System (ESCAS), which is intended to allow them to trace all
live-stock through the supply chain and ensure that animal handling and
slaughter in the importing country conforms to international animal welfare
standards.[4]
Exporters must comply with all requirements under the
Animals Order as a condition of their export licence.[5]
They must also comply with the Australian Standards for the Export of
Live-stock in relation to the treatment of livestock prior to their arrival in
the importing country.[6]
Additional requirements for the handling of live-stock on
export vessels are contained in Marine Order 43, made under the Navigation
Act 2012.[7]
Enforcement
As the independent regulator, the Department of Agriculture
and Water Resources (DAWR) is responsible for enforcement of the regulatory
scheme.[8]
Monitoring of the live export process is primarily conducted through ESCAS
auditing requirements. Exporters submit an independent initial audit report as
part of their ESCAS application, and must subsequently provide independent
performance audit reports covering the performance of the ESCAS after
live-stock have entered the supply chain.[9]
The frequency of these audits depends on the type of facility and its inherent
risks, as well as the compliance history of the exporter.[10]
In addition to audits, DAWR has the power to monitor,
review or audit the activities of exporters, including in response to
self-reported breaches and third party complaints.[11]
There is a range of sanctions available, including criminal penalties, the
refusal or revoking of an export permit or licence, or imposition of conditions
on the export licence.[12]
From February 2012 to the time of writing, there have been
157 regulatory compliance investigations (either finalised or ongoing).[13]
Additionally, there have been 70 investigations of voyages with reportable
mortality events.[14]
However, DAWR has been criticised for a perceived reluctance to penalise
exporters.[15]
The Department has suspended or cancelled an export licence in only a small
number of cases, and there are no publicly reported cases of criminal sanctions
being imposed.[16]
In regards to mortality investigations, in April 2018 The Guardian Australia
reported:
An analysis by Guardian Australia of 70 mortality
investigation reports produced by the department shows a number of cases where
conditions contrary to ASEL are noted in the report. Despite this, Guardian
Australia found no instances of punitive measures such as fines or loss of
export licence being imposed. The department was asked to provide details of
any companies that had been punished for breaches of the standards, but it did
not respond.
Many fatality reports result in additional conditions being
added to the exporter’s next consignment, such as loading fewer animals or the
addition of a vet. In several cases, temporary halts on exporting were imposed
but later lifted.[17]
As part of its report on the Regulation of Australian
Agriculture, released in March 2017, the Productivity Commission considered
the regulatory scheme for live animal exports.[18]
Its report highlights the tension between concerns from exporters as to the
cost and complexity of the ESCAS, and criticisms from animal welfare groups
regarding weaknesses in responding to
non-compliance. The Commission concluded:
It is critical that the community has confidence in the
system used to regulate live exports. Incidents of mistreatment of animals in
facilities that are within the purview of the ESCAS and that are overseen by
the Australian livestock industry reduce community confidence in the trade and
the regulator’s effectiveness.[19]
More broadly, the Productivity Commission recommended the
establishment of an Australian Commission for Animal Welfare, with
responsibility for developing national standards and guidelines relating to
farmed animal welfare.[20]
It recommended that this independent statutory body play a role in live export
regulation:
At a minimum, this role should involve reviewing the
performance of the ESCAS, including the performance, independence and
effectiveness of the auditing arrangements, and making recommendations for
reform. Mandatory rotation of auditors (as discussed above), and specific
requirements for auditors to have experience and training in animal health, husbandry
and welfare, could improve the effectiveness of the auditing arrangements.
...It should also review other aspects of the regulatory system
for live exports, including the Australian Standards for the Export of
Livestock. Although not a focus of analysis of this inquiry, the Commission
notes concerns raised about these standards, including with respect to the
accreditation and independence of veterinarians on board live export vessels.[21]
The Australian Government has not yet issued its response
to the report.
Awassi Express footage and
response
In April 2018, Sixty Minutes broadcast footage
obtained by Animals Australia from the Awassi Express en route to the
Middle East in August 2017, run by Perth exporter Emanuel Exports.[22]
The footage showed the extreme suffering of sheep on board the vessel, on which
approximately 2,400 sheep died from heat stress (3.76 per cent of the total
number on board).[23]
A mortality investigation by the Department, completed prior to the release of
the footage, had declined to take enforcement action against the exporter.[24]
On 9 April 2018, Minister for Agriculture David
Littleproud expressed concern that the Department’s mortality report ‘did not
accurately reflect the conditions seen in the vision on the ship’.[25]
He announced three measures in response:
- a
review into the ‘investigative capability, powers and culture of the
independent regulator’ (that is, DAWR)
- a
whistleblower hotline, allowing anonymous reporting of wrongdoing and
- an
intention to increase the applicable penalties for exporters.[26]
On the issue of penalties, the Minister stated:
Personally, I'd like to see company directors be held more
personally accountable if they do the wrong thing, facing big fines and
possible jail time. They shouldn't be able to hide behind companies and shelf
companies...[27]
Minister Littleproud also announced a ‘short, sharp
review’ of the standards for the live sheep trade during the Middle Eastern
summer, to be conducted by veterinarian Dr Michael McCarthy.[28]
The report from the review was publicly released on 17 May 2018, and made a
number of recommendations for reform, including reductions of stocking
densities and movement from a heat stress risk assessment based on mortality to
assessment based on animal welfare.[29]
In response, the Department accepted most of the recommendations, but announced
that it would not implement a revised heat stress risk assessment model until
further public and expert consultation is undertaken.[30]
In July 2018, it was reported that Emanuel Exports, whose
licence was suspended in June pending investigations into overstocking, was
seeking a permit to export sheep from Fremantle to the Middle East, through its
wholly-owned subsidiary EMS Rural Exports.[31]
The Department subsequently announced that it had also suspended the export
licence of EMS Rural Exports.[32]
Calls for export ban
The release of the Awassi Express footage led to a
renewal of calls for either a total or partial ban of the live export trade,
with particular focus on live sheep exports.
In May 2018, Liberal MP Sussan Ley introduced a private
member’s Bill to phase out long-haul exports of live sheep and lambs to the
Middle East.[33]
The ALP has indicated support for the Bill, with Shadow Minister for
Agriculture, Joel Fitzgibbon, announcing that if elected, a Labor Government
would develop a transition plan to end live sheep exports.[34]
The Australian Greens have also said they will support Ms Ley’s Bill, and have
released a plan to transition the live sheep export trade to a locally-processed
chilled meat trade.[35]
In June, cross-bench Senators Lee Rhiannon, Derryn Hinch and Tim Storer
introduced an almost-identical version of Ms Ley’s Bill into the Senate.[36]
A list of all live-export Bills currently before Parliament is provided at Appendix
A.
The Government has criticised calls for a ban. In his second
reading speech for the present Bill, Minister Littleproud reaffirmed support
for the live trade, stating:
The calls to ban live-stock exports disregard the value of
this trade to our farmers and others in rural and regional Australia. Banning,
or even suspending, live-stock exports at this time is simply a 'knee-jerk'
reaction, and would be a poorly considered decision.[37]
Committee consideration
Selection of Bills Committee
On 21 June 2018, the Senate Standing Committee for the
Selection of Bills recommended that the Bill not be referred to committee.[38]
Senate Standing Committee for
the Scrutiny of Bills
On 20 June 2018, the Senate Standing Committee for the
Scrutiny of Bills reported that it has no comment to make on the Bill.[39]
Policy position of
non-government parties/independents
While stating that it will support the measures in the
Bill, the ALP has introduced amendments which replicate Sussan Ley’s Bill to
phase out the live sheep trade.[40]
Shadow Agriculture Minister, Joel Fitzgibbon has stated:
Labor supports the Bill, it can do no harm. But increasing
penalties which are never applied will not change the settled science on heat
stress and associated issues in the live sheep trade.
Labor's amendments replicate those contained in Sussan Ley's
Private Member's Bill. They offer something better; an immediate end to the
tortuous northern summer trade and the phase out of the balance of the sheep
trade within five years.
... If Labor's amendments fail, we'll accept the will of the
Parliament, as currently constituted, and vote for the unamended Bill.[41]
Other non-government parties and independents have not
commented on the Bill to date. Minister Littleproud has stated that the
Government will reintroduce the Bill for debate if the ALP provides written
assurance that it will support the Bill unamended in both Houses.[42]
Position of major interest
groups
The RSPCA and National Farmers’ Federation have both
expressed a desire for the Bill to be passed promptly.[43]
At the same time, the RSPCA has noted that the effectiveness of increased
penalties will depend largely on the regulator’s willingness to take action
against exporters.[44]
There has been little comment about the Bill from other
stakeholders, with much of the current public debate about live export focused
on the outcomes of the McCarthy review, and questions about whether the
live-stock trade should continue.
Financial implications
The Explanatory Memorandum states that the Bill will have
no financial impact on the Australian Government Budget.[45]
Statement
of Compatibility with Human Rights
As required under Part 3 of the Human Rights
(Parliamentary Scrutiny) Act 2011 (Cth), the Government has assessed the
Bill’s compatibility with the human rights and freedoms recognised or declared
in the international instruments listed in section 3 of that Act. The
Government considers that the Bill is compatible.[46]
Parliamentary Joint Committee
on Human Rights
On 19 June 2018, the Parliamentary Joint Committee on
Human Rights reported that the Bill does not raise human rights concerns.[47]
Key issues and provisions
Relationship to the Export Control Bill 2017
The Export
Control Bill 2017, introduced in the Senate in December 2017, proposes
the consolidation of existing Acts and legislative instruments to streamline
Australia’s legislative framework for the export of goods, including live-stock.[48]
If passed, the Bill will replace existing export laws including the AMLI
Act and EC Act.
The Government has not expressly stated whether the
penalties in the current Bill, which relate specifically to live-stock
export, will be incorporated into the new legislative scheme. However, a
number of the changes proposed by the current Bill broadly mirror the
compliance and enforcement provisions in the Export Control Bill 2017,
including through:
- the
introduction of a civil penalty regime, which triggers the Regulatory
Powers Act
- the
inclusion of aggravated offences where a contravention causes damaging
economic consequences for Australia or where the person intends to obtain a
commercial advantage and
- the
imposition of liability on executive officers of bodies corporate.
The Export Control Bill 2017 was still before the Senate
at the time of writing.[49]
|
Proposed changes to penalties
The Bill increases the penalties applicable for
contraventions of certain live-stock export offences under the AMLI Act
and EC Act. The Explanatory Memorandum states that the measures are
intended to act as a deterrent to non-compliant behaviour and ‘reflect the
seriousness of failing to comply with requirements of live-stock export
legislation’, noting:
This will assist in driving a positive cultural change in the
live-stock export sector. These penalties are also intended to meet community
expectations by allowing the courts to impose significant penalties where there
has been a serious breach of law.[50]
AMLI Act offences
Under existing section 54 of the AMLI Act, it is an
offence to export meat or live-stock from Australia without the appropriate export
licence, or to intentionally or recklessly contravene a condition of an export
licence.[51]
A maximum penalty of five years imprisonment currently applies.[52]
Items 20 to 22 amend section 54 to remove
references to live-stock export and specify that that provision deals only with
offences relating to meat export. These amendments reflect the fact that
offences relating to live-stock export will now be dealt with in separate
provisions.
Item 23 inserts into the AMLI Act a series
of new provisions dealing with contraventions in relation to the export of
live-stock. The basic versions of each offence are the same as those which
currently exist under section 54, but with heavier penalties attached, as well
as newly available civil penalties. There are also new aggravated versions of
each offence.
Export of live-stock without licence
Under proposed subsection 54A(1), a person commits
an offence if they export live-stock from Australia without holding a
live-stock export licence. The maximum applicable penalty is eight years
imprisonment and/or 480 penalty units.[53]
This is a heavier penalty than the five years imprisonment currently applicable
under section 54.
A person contravening this section is also liable to a
civil penalty of 960 penalty units.[54]
The Regulatory Powers Act provides that a court may not make a civil
penalty order against a person for a contravention of a civil penalty provision
if the person has been convicted of an offence for the same (or substantially
the same) conduct.[55]
However, criminal proceedings may still be commenced against a person when a
civil penalty order has already been made for the same (or substantially the
same) conduct.[56]
Contravention of conditions of export licence
Under proposed section 54D, the holder of a
live-stock export licence commits an offence if they contravene a condition of
the licence. This would capture, for example, breaches of the exporter’s ESCAS.
There are two versions of the basic offence:
- a
fault-based offence where the licence holder contravenes the condition either
intentionally or being reckless as to the licence condition—the applicable
maximum penalty is eight years imprisonment and/or 480 penalty units[57]
and
- a
strict liability offence where it is sufficient that the licence condition is
contravened, regardless of whether the licence holder does so knowingly—the
applicable penalty is 60 penalty units.[58]
A licence holder who contravenes this section is also
liable to a civil penalty of 960 penalty units.[59]
Aggravated offences
There are two aggravated versions of each of the
contraventions discussed above. These apply where a person commits the
contravention and either:
- intends
to obtain a commercial advantage over their competitors, or potential
competitors, as a result of exporting the live-stock without a licence[60]
or in breach of a licence condition[61]
or
- the
contravention (being either the breach of a licence condition or export without
a licence) causes, or has the potential to cause, economic consequences for
Australia.[62]
The phrase economic consequences for Australia
is defined as including substantial damage to Australia’s trading reputation,
and restrictions on or closures of access to one or more overseas markets for
goods from Australia.[63]
An individual committing either of these aggravated
offences is liable to a maximum penalty of imprisonment for ten years and/or
2,000 penalty units.[64]
Heavier penalties apply to body corporates—these are explained below. The Bill
further provides that a defendant on trial for one of these aggravated offences
may be found not guilty of that offence but guilty of the basic version of the
offence, provided that they have been accorded procedural fairness in relation
to the finding of guilt.[65]
A person may also be liable to a civil penalty for any of
these aggravated breaches. The applicable penalty is 4,000 penalty units for an
individual.[66]
Bodies corporate are subject to the penalties set out below.
Penalties for bodies corporate
Where a body corporate is liable to a penalty for
contravening one of the aggravated offence or aggravated civil penalty
provisions of the AMLI Act, proposed section 54G provides that
the amount of the penalty will be an amount no more than the greatest of the
following:
- 20,000
penalty units[67]
- three
times the value of any benefit obtained directly or indirectly by the body
corporate (and any related body corporate) that is ‘reasonably attributable’ to
the conduct which constitutes the contravention or
- if
the court cannot determine the value of the benefit obtained, ten per cent of
the body corporate’s annual turnover in the 12 months prior to the
contravention.[68]
There is no minimum penalty prescribed under this section.
EC Act offences
Part IIA of the EC Act concerns the accreditation
of veterinarians to undertake ‘approved export programs’, which are programs
aimed at ensuring the health and welfare of live animals (and animal
reproductive material) in the course of export.[69]
Division 2 of this Part contains a number of offences in relation to this,
including where a veterinarian undertakes an approved export program without
accreditation or fails to keep records or provide reports as required.[70]
Existing section 9K provides that a person commits an
offence if they obstruct or hinder an accredited veterinarian or authorised
officer in the undertaking of any activities in an approved export program. The
offence is one of strict liability, which means that the prosecution does not
need to prove the defendant’s fault (that they intended to obstruct or hinder
the veterinarian/authorised officer)—the conduct itself is sufficient.[71]
The maximum penalty is 50 penalty units.[72]
Item 31 repeals existing section 9K and inserts proposed
sections 9K and 9KA. Similar to the existing provision, proposed
section 9K provides that it is an offence to obstruct or hinder accredited
veterinarians or authorised officers in the undertaking of any of the
activities in an approved export program. The new provision retains the offence
of strict liability (with the same applicable penalty of 50 penalty units), but
also adds:
- a
fault-based offence (that is, where it can be proven that the person had an
intention to obstruct or hinder)[73]
with a heavier maximum penalty of eight years imprisonment and/or 480 penalty
units[74]
and
- a
civil penalty of 960 penalty units.[75]
Enforcement of civil penalties
Proposed subsection 56A(1) of the AMLI Act
and proposed subsection 13A(1) of the EC Act trigger the
operation of Part 4 of the Regulatory Powers Act in relation to the
enforcement of the civil penalty provisions of each Act.[76]
Civil penalty orders
The Regulatory Powers Act enables an ‘authorised
applicant’ to apply to a relevant court for a civil penalty order, which is
enforceable as a debt to the Commonwealth.[77]
The Bill provides that the Secretary of DAWR is an
authorised applicant for the purposes of the proposed civil penalty provisions
under the AMLI Act and EC Act.[78]
The Secretary may delegate their powers as an authorised applicant:
- under
the AMLI Act, to an APS employee at the SES level within DAWR[79]
and
- under
the EC Act, to any person appointed by the Secretary as an ‘authorised
officer’.[80]
As the Explanatory Memorandum notes, section 85 of the Regulatory
Powers Act will apply in relation to the AMLI Act and EC Act,
allowing a relevant court to make a single civil penalty order against a person
for multiple contraventions (where the proceedings are founded on the same
facts, or if the contraventions are part of a series of contraventions of the
same or a similar character).[81]
Infringement notices
As an alternative to an enforcement order made by the
courts, the Regulatory Powers Act also provides that an ‘infringement
officer’ may issue an infringement notice for an alleged contravention, if they
believe on reasonable grounds that the contravention has occurred.[82]
A person who receives an infringement notice can choose to pay a specified
amount as an alternative to having court proceedings brought against them.[83]
The Bill provides that infringement notices may be given
only in relation to offences against proposed subsection 54D(2) of the AMLI
Act—that is, for strict liability contraventions of
live-stock export licence conditions. The Secretary of DAWR is an
infringement officer for the purposes of these provisions, and can also delegate
this power to an APS employee at the level of an SES Band 1 or higher.[84]
The amount which can be payable under an infringement
notice is the lesser of:
- one-fifth
of the maximum penalty that a court could impose on the person for the
contravention and
- 12
penalty units for an individual, or 60 penalty units for a body corporate.[85]
Liability of executive
officers
The Bill inserts provisions into both the AMLI Act
and EC Act imposing criminal and civil liability on executive officers
for offences committed by their body corporate. Currently, there is no
provision in either Act which expressly extends liability in this way. However,
as noted above, similar provisions are also contained in the Export Control
Bill 2017, which is still before Parliament, in relation to civil (but not
criminal) liability.[86]
Criminal liability
Proposed section 56D of the AMLI Act
provides that an executive officer of a body corporate commits an offence if
the organisation contravenes one of the fault-based offence provisions proposed
by the Bill, and the officer:
- knew,
or was reckless or negligent as to whether, the contravention would occur
- was
in a position to influence the body corporate’s conduct in relation to the
contravention and
- failed
to take all reasonable steps to prevent the contravention.[87]
Proposed subsection 56D(3) specifies a number of
(non-exhaustive) factors to which a court may have regard in determining
whether an executive officer of a body corporate failed to take all reasonable
steps to prevent a contravention. These include any action taken by the officer
upon becoming aware of the contravention, and any actions taken to ensure:
- the
body corporate arranges regular professional assessments of its compliance with
the proposed offence provisions, and implements any appropriate recommendations
arising from this
- the
body corporate’s employees, agents and contractors have a reasonable knowledge
and understanding of the requirements to comply with the proposed offence
provisions and
- the
body corporate has in place adequate procedures to prevent the contravention.
An executive officer found guilty of an offence under proposed
section 56D is liable to a maximum penalty of eight years imprisonment or
480 penalty units (in the case of a contravention of the basic offences) or ten
years imprisonment or 5,000 penalty units (for contravention of an aggravated
offence).[88]
Proposed section 13B of the EC Act imposes
criminal liability on an executive officer of a body corporate which
contravenes proposed subsections 9K(1) or 9KA(1) of that Act.
This provision is in almost identical terms to its equivalent under the AMLI
Act.[89]
Civil liability
Proposed section 56E of the AMLI Act and proposed
section 13C of the EC Act impose civil liability on an executive
officer of a body corporate for the organisation’s contraventions of the
proposed civil penalty provisions under each Act. The same requirements apply
as for criminal liability—that is, the officer: knew that, or was reckless or
negligent as to whether, the contravention would occur; was in a position to
influence the conduct of the body corporate; and failed to take all reasonable
steps to prevent the contravention.[90]
An executive officer found liable is subject to a maximum civil
penalty of 960 penalty units; a higher penalty of 10,000 penalty units applies
to contraventions of the proposed aggravated civil penalty provisions under the
AMLI Act.[91]
Adverse publicity orders
The Bill inserts into the AMLI Act and EC Act
provisions which enable a court, on its own initiative or on application by the
Secretary or Director of Public Prosecutions, to make an ‘adverse publicity
order’ in relation to a person who is found guilty of an offence or ordered to
pay a penalty for contravention of a livestock-export civil penalty provision
(under the AMLI Act) or approved export program civil penalty provision
(under the EC Act).[92]
An adverse publicity order may require a person to publish
and/or disclose to specified persons the details of the contravention or
offence, including its consequences, the penalty imposed and any other related
matter. The person must give the Secretary, within 14 days after the end of the
period specified in the order, evidence of having taken the required actions.[93]
The Explanatory Memorandum states that these amendments
are intended to incentivise compliance through raising the prospect of adverse
publicity, noting ‘such orders can draw public attention to a particular
wrongdoing and can be an effective deterrent for an organisation that is
concerned about its reputation’.[94]
Similar orders are provided for under consumer laws.[95]
Concluding
comments
The Bill substantially increases the maximum penalties available
for live-stock export related offences, introduces a new civil penalties regime
and imposes liability on executive officers of export corporations. While these
are significant changes to the existing compliance and enforcement regime, the
Bill’s impact will necessarily depend on whether DAWR, as the independent
regulator, chooses to pursue criminal and civil penalties against exporters.
Appendix A—live export Bills currently before Parliament