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Tuesday, 19 October 2010
Page: 802

Mr CHESTER (5:10 PM) —I rise to speak in relation to the Protection of the Sea Legislation Amendment Bill 2010. I indicate from the outset that the opposition supports the bill. This bill amends the Protection of the Sea (Prevention of Pollution from Ships) Act 1983 to give domestic effect to recent amendments to annex VI of the International Convention for the Prevention of Pollution from Ships, or MARPOL, that were adopted by the International Maritime Organisation on 10 October 2008.

The bill also amends the Protection of the Sea (Civil Liability for Bunker Oil Pollution Damage) Act 2008 to provide protection for persons taking reasonable measures to prevent or minimise the effects of bunker oil pollution in Australia or the exclusive economic zone of Australia, in line with the resolution of the diplomatic conference of the International Maritime Organisations that adopted the International Convention on Civil Liability for Bunker Oil Pollution Damage, the bunkers convention, in March 2001. This legislation was introduced into the House of Representatives on 3 February 2010, it was agreed to by the House on 18 March 2010 and it was introduced into the Senate on 11 May 2010 but not debated.

The coalition accepts that, as an island trading nation, Australia has an enormous shipping task. It is therefore proper that Australia accepts its responsibility to reduce maritime pollution wherever possible. Australia has been a member of the IMO since its establishment in 1948 and has played an active role in the development of conventions and treaties over many years. The six annexes of the MARPOL deal with different aspects of marine pollution and all six have been implemented by both Labor and coalition governments over a period of time. These six annexes cover various aspects of marine pollution—namely, oil, noxious liquid substances, harmful substances in packaged form, sewage, garbage from ships and air pollution.

Under the previous coalition government Australia adopted all six, with the initial version of annex VI entering into force in Australia in November 2007 via the Maritime Legislation Amendment (Prevention of Air Pollution from Ships) Bill 2006. At that time the then Parliamentary Secretary to the Minister for Transport and Regional Services pointed out:

This bill continues the government’s efforts to prevent pollution by ships and maintains the close alignment Australia has with the International Maritime Organisation’s international conventions.

Annex 6 is intended to reduce air pollution from ships to prevent the adverse public health costs associated with it, and I commend the government for continuing the good work of the previous coalition government.

In October 2008 the IMO agreed to revise even further the limits on maritime air pollution described in annex 6. These revisions will reduce sulphur emissions from 4.5 per cent to 3.5 per cent from 1 January 2012. Subject to a review to be conducted by the IMO and to be completed no later than 2018, the cap may be reduced further. The limits on sulphur emissions applying to parts of seas close to heavily populated areas will be reduced from 1.5 per cent to one per cent from 1 July 2010 and then further reduced to 0.1 per cent from 1 January 2015. These areas, known as emission control areas, apply to the Baltic Sea, the North Sea and parts of the US and Canadian coast. There will be a progressive reduction in nitrogen oxide emissions from ship engines constructed after 1 January 2016 operating in emission control areas. There is also the possibility of imposing further reductions in such areas as well, subject to IMO approval, on the grounds of health.

I note that, because of the progressive nature of the reduction in pollution, the bill provides for the establishment of regulations to set the maximum allowable sulphur content. These revisions to annex 6 entered into force internationally on 1 July 2010. These amendments must be implemented in Australian law; otherwise Australia will be in breach of its obligations and be unable to require registered Australian ships to meet the revised targets. The coalition therefore supports this element of the bill.

The second element of this bill relates to the Protection of the Sea (Civil Liability for Bunker Oil Pollution Damage) Act 2008, known as the bunkers act. The bunkers act gives domestic effect to Australia’s obligations as a party to the International Convention on Civil Liability for Bunker Oil Pollution Damage 2001. This convention was adopted by the IMO on 23 March 2001 and entered into force internationally on 21 November 2008. The convention entered into force in Australia on 16 June 2009. The bunkers act establishes a liability and compensation regime where shipowners are liable for pollution damage resulting from a spill of fuel oil from their ships. Liability is based on the size of the ship, with ships of more than 1,000 gross tonnes required to take out insurance to cover liability up to the limits set out in the Convention on Limitation of Liability for Maritime Claims.

This bill amends the bunkers act and addresses a particular industry concern that relates to the possible liability of persons or organisations assisting in the clean-up of an oil spill who inadvertently make the pollution damage worse in doing so. For example, the compensation for clean-up costs following the spill of fuel oil from Pacific Adventurer off the south-east coast of Queensland in March 2009 exceeded $30 million. This bill addresses concerns that some may be deterred from helping to clean up such a spill out of fear that they could become liable if their actions carried out in good faith make the pollution worse. Schedule 2 of the bill deals with this by creating a responder immunity. Organisations or persons assisting in the clean-up of a spill will not be held liable for damage caused if they acted reasonably and in good faith. A shipowner will continue to be generally liable for pollution damage resulting from a spill of fuel oil. Under proposed new section 24A responder immunity will not affect that liability. Immunity from an action suit or proceeding will not apply in relation to actions or omissions that were intended to cause damage or that were undertaken recklessly when it was known that damage would probably result.

Australia likes to think of itself as a good international citizen and it is important that, given almost all of our international trade is carried by sea, we meet our particular responsibility in dealing with marine pollution. The previous coalition government did its fair share in this area, particularly in its adoption of all six elements of the MARPOL Convention. The coalition supports the government in building upon the coalition’s efforts. We also accept from a practical point of view that sulphur levels in fuel in Australia currently fall below the 3.5 per cent cap. So vessels operating in Australia will have no trouble complying with these new standards. The coalition is happy to support the passage of this legislation.

In conclusion, I wish to make a few comments regarding the government’s handling of the Pacific Adventurer oil spill. On 11 March 2009, the Hong Kong-China registered general cargo ship, Pacific Adventurer, lost 31 containers of ammonium nitrate overboard, some seven nautical miles east of Cape Moreton while en route to Brisbane. The ship then reported that its fuel service tank was breached. Subsequently, it was established that 270 tonnes of oil was lost. The clean-up operations continued for two months and, as I indicated previously, cost in the vicinity of $30 million. Under its obligations under the 1996 IMO Convention on Limitation of Liability for Maritime Claims, to which Australia is a party, the owners of the Pacific Adventurer were liable to pay $17.5 million. However, on 7 August 2009 the owner of the Pacific Adventurer, Swire Shipping, agreed to pay a total of $25 million for compensation of valid claims arising from the oil spill. But in a decision to bail out the cash-strapped state Labor government of Queensland, the federal Labor government decided that the decision by the owners of the Pacific Adventurer to go beyond its obligations in meeting its liabilities and responsibilities was not enough. Instead, the federal Labor government decided that, from 1 April 2010, it would increase the tax on Australia’s international shipping industry by increasing the protection of the sea levy by 3c per net registered tonne in order to recover the clean-up costs of the oil spill.

The increase of 3c brings the total levy to 14.25c per net registered tonne. In other words, the entire sector has to pay an increase in costs, even though the party responsible in this situation more than met its liability obligations through a convention to which Australia is a signatory. If the government was not happy with the limits provided under the convention then it should have approached the IMO to increase them. The imposition of an extra levy on the whole industry because of a serious accident goes well beyond the principle of the potential polluter pays. I would be interested to know how much money the government expects this increased levy will raise and over what period of time. I would also be interested to know when the government will honour its commitment in its press release of 9 February 2010 that this increase will be temporary. When will the government rescind this increase? Aside from these matters, the coalition supports the passage of the Protection of the Sea Legislation Amendment Bill 2010.