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Maritime Legislation Amendment Bill 2003

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2002









THE PARLIAMENT OF THE COMMONWEALTH OF AUSTRALIA







 

 





HOUSE OF REPRESENTATIVES















MARITIME LEGISLATION AMENDMENT BILL 2002















EXPLANATORY MEMORANDUM









 

 

 

 

 

 

 

 

 

 

 

(Circulated by authority of the Minister for Transport and Regional Services,

the Honourable John Anderson, MP)



 



MARITIME LEGISLATION AMENDMENT BILL 2002

 

 

GENERAL OUTLINE

 

The Maritime Legislation Amendment Bill 2002 will:

(a) amend four Acts:

·           the Protection of the Sea (Civil Liability) Act 1981 ;

·           the Protection of the Sea (Oil Pollution Compensation Fund) Act 1993 ;

·           the Protection of the Sea (Prevention of Pollution from Ships) Act 1983 ;

·           the Trade Practices Act 1974 ; and

(b) repeal the Bass Strait Sea Passenger Service Agreement Act 1984 .

 

Amendments to the Protection of the Sea (Civil Liability) Act 1981 (the Civil Liability Act) and to the Protection of the Sea (Oil Pollution Compensation Fund) Act 1993 (the Fund Act)

 

There is a two-tier international scheme to provide compensation for pollution damage resulting from the escape or discharge of "persistent oil" from oil tankers.  Persistent oils are oils which do not evaporate readily and include crude oil, fuel oil, heavy diesel oil and lubricating oil.

 

The first tier of this scheme applies to tanker owners.  It is set out in the International Convention on Civil Liability for Oil Pollution Damage (Civil Liability Convention) which is implemented in Australia by the Civil Liability Act.  Owners of oil tankers are strictly liable for damage resulting from the escape or discharge of persistent oil but that liability is generally limited, depending on the size of the tanker.

 

The second tier of the scheme is set out in the International Convention on the Establishment of an International Fund for Compensation for Oil Pollution Damage (the Fund Convention).  The Fund Convention established the International Oil Pollution Compensation Fund (the IOPC Fund) which pays compensation where full compensation for oil pollution damage is unable to be obtained under the Civil Liability Convention.  The amount of compensation payable from the IOPC Fund is also limited so that the maximum amount payable in respect of a particular incident is currently approximately $A320 million.

 

The Legal Committee of the International Maritime Organization (IMO) has adopted resolutions to increase the limits set out in both the Civil Lability Convention and the Fund Convention by slightly more than 50%.  Schedule 1 of the Bill amends the Civil Liability Act and the Fund Act to implement the increased limits.

 

Amendments to the Protection of the Sea (Prevention of Pollution from Ships) Act 1983 (the Pollution Prevention Act)

 

The Pollution Prevention Act gives effect to the operational aspects of the International Convention for the Prevention of Pollution from Ships, 1973 as amended by the Protocol of 1978 (MARPOL 73/78).  Schedules 1 and 3 of the Bill will amend the Pollution Prevention Act to:

·           expand the definition of plastics so that there is an absolute prohibition on the disposal from a ship into the sea of incinerator ashes from plastic products which may contain toxic or heavy metal residues;

·           allow garbage disposal placards which are required to be displayed on a ship to be written in Spanish as an alternative to the existing requirement of either English or French; and

·           convert penalties that are currently expressed in monetary amounts to the equivalent amounts in penalty units.

 

Amendments to the Trade Practices Act 1974 (the Trade Practices Act)

 

Schedule 2 of the Bill will amend Part X of the Trade Practices Act to make it clear that stevedoring operators are not permitted to collude in setting charges for stevedoring services.

 

Repeal of the Bass Strait Sea Passenger Service Agreement Act 1984

 

Schedule 3 of the Bill will repeal the Bass Strait Sea Passenger Service Agreement Act which no longer has any application.

 

 

FINANCIAL IMPACT STATEMENT

 

There are no financial impacts arising from this Bill.

 



List of Abbreviations

 

 

Civil Liability Convention

International Convention on Civil Liability for Oil Pollution Damage

Civil Liability Act

Protection of the Sea (Civil Liability) Act 1981

Fund Act

Protection of the Sea (Oil Pollution Compensation Fund) Act 1993

Fund Convention

International Convention on the Establishment of an International Fund for Compensation for Oil Pollution Damage

IMO

International Maritime Organization

IOPC Fund

International Oil Pollution Compensation Fund

MARPOL 73/78

International Convention for the Prevention of Pollution from Ships, 1973 as amended by the Protocol of 1978

MEPC

Marine Environment Protection Committee

Pollution Prevention Act

Protection of the Sea (Prevention of Pollution from Ships) Act 1983

Trade Practices Act

Trade Practices Act 1974

 



 

MARITIME LEGISLATION AMENDMENT BILL 2002

 

NOTES ON CLAUSES

 

Clause 1: Short title

 

Clause 1 is a formal provision specifying the title of the proposed Act.

 

Clause 2: Commencement

 

Clause 2 sets out when the provisions contained in the Bill will commence:

-     the amendments in Schedule 1 to the Civil Liability Act (items 1 and 3) and to the Fund Act (items 4 and 6), and their respective application provisions (items 2  and 5) will commence on 1 November 2003 which is the date on which the relevant resolutions adopted by the Legal Committee of IMO will enter into force;

-     the amendments in Schedule 1 to the Pollution Prevention Act (items 7 to 9) will commence on the day after the proposed Act receives Royal Assent;

-     the remaining provisions will commence on Royal Assent.

 

Clause 3: Schedules

 

Clause 3 is a formal clause indicating that each Act specified in a Schedule to the Bill is amended or repealed as set out in the relevant Schedule.

 

 

Schedule 1 - Amendments about liability for pollution

 

Item 1

 

Item 1 amends the definition of the 1992 Protocol in subsection 3(1) of the Civil Liability Act to provide that it means the Protocol of 1992 to amend the Civil Liability Convention as amended by Resolution LEG.1(82) adopted by the Legal Committee of IMO on 18 October 2000.  The text of Resolution LEG.1(82) is added as a Schedule to the Civil Liability Act by item 3.

 

The Civil Liability Convention governs the liability of shipowners for oil pollution damage resulting from the escape or discharge of persistent oil from tankers.  The Convention lays down the principle of strict liability for shipowners and creates a system of compulsory liability insurance.  Shipowners are normally entitled to limit their liability to an amount which is linked to the tonnage of their ships.

 

The effect of the amendments made to the definition of the 1992 Protocol is to increase the liability limits.  Liability limits are expressed in terms of "units of account " [1] .  The following table compares the current liability limits with the limits proposed by Resolution LEG.1(82).  The liability limits in the table are expressed in terms of both units of account and the approximate equivalent amount in Australian dollars.

 

 

Current liability limits

Proposed liability limits

 

Units of Account

$A

Units of Account

$A

For a ship up to 5,000 tons

3,000,000

7,130,000

4,510,000

10,720,000

For each additional ton

420

1,000

631

1,500

Maximum limitation amount

59,700,000

141,900,000

89,770,000

213,400,000

 

This will mean, for example, that the liability limit for which the owner of an oil tanker of 40,000 gross tons is required to be insured will increase from approximately $A42 million to approximately $A63 million.

 

Item 2

 

The effect of item 2 is that the increased liability limits resulting from the amendment made by item 1 will apply only to pollution incidents that occur on or after 1 November 2003.

 

Item 3

 

Item 3 adds the text of Resolution LEG.1(82) as a Schedule to the Civil Liability Act.

 

Item 4

 

Item 4 amends the definition of the 1992 Protocol in section 3 of the Fund Act to provide that it means the Protocol of 1992 to amend the Fund Convention as amended by Resolution LEG.2(82) adopted by the Legal Committee of IMO on 18 October 2000.  A copy of Resolution LEG.2(82) is added as a Schedule to the Fund Act by item 6.

 

The Fund Convention, which is supplementary to the Civil Liability Convention, establishes a regime for compensating victims when the compensation provided for under the Civil Liability Convention is inadequate.  The Fund Convention established the IOPC Fund which pays compensation where full compensation for oil pollution damage is unable to be obtained under the Civil Liability Convention in the following circumstances:

(a)   the tanker owner is exempt from liability under the Civil Liability Convention because the shipowner can invoke one of the exemptions under that Convention; or

(b)   the tanker owner is financially incapable of meeting his or her obligations under the Civil Liability Convention and the owner's insurance is insufficient to satisfy the claims for compensation for pollution damage; or

(c)   the damage exceeds the tanker owner's liability under the Civil Liability Convention.

 

The IOPC Fund is financed by contributions levied on any person who has received by sea in a calendar year more than 150,000 tons of persistent oil in a country which is a party to the Fund Convention.  Annual contributions are levied by the IOPC Fund to meet the anticipated payments of compensation and administrative expenses during the coming year.  Each contributor pays a specified amount per ton of contributing oil received.

 

The Fund Convention sets a limit on the total aggregate amount payable by the tanker owner (under the Civil Liability Convention) and the IOPC Fund.

 

The effect of the amendments made to the definition of the 1992 Protocol is to increase the total aggregate amount so that there is a higher compensation limit.  Compensation limits are expressed in terms of "units of account".  In accordance with Resolution LEG.2(82), the maximum amount of compensation to be paid for a single pollution incident will increase from 135 million units of account (approximately $A320 million) to 203 million units of account (approximately $A480 million).  However, if three States contributing to the 1992 Fund receive more than 600 million tons of contributing oil per annum , the limit of compensation will increase from 200 million units of account (approximately $A475 million) to 300,740,000 units of account (approximately $A715 million).  This latter condition has not been met and so the former maximum compensation limit currently applies.

 

Item 5

 

The effect of item 5 is that the increased compensation limits resulting from the amendment made by item 4 will apply only to pollution incidents that occur on or after 1 November 2003.

 

Item 6

 

Item 6 adds the text of Resolution LEG.2(82) as a Schedule to the Fund Act.

 

Item 7

 

Item 7 amends the definition of plastics in subsection 26F(13) of the Pollution Prevention Act in accordance with a resolution to amend MARPOL 73/78 agreed to by the Marine Environment Protection Committee (MEPC) of IMO on 5 October 2000.

 

Section 26F of the Pollution Prevention Act restricts the disposal of garbage from ships into the sea.  That section places an absolute prohibition on the disposal from a ship of plastics which, in accordance with the current definition, includes synthetic ropes, synthetic fishing nets and plastic garbage bags.  The amendment to the definition of plastics means that there will also be a prohibition on the disposal from a ship into the sea of incinerator ashes from plastic products which may contain toxic or heavy metal residues.

 

Items 8 and 9

 

Items 8 and 9 amend subsection 26FD(3) of the Pollution Prevention Act in accordance with a resolution to amend MARPOL 73/78 agreed to by the MEPC of IMO on 5 October 2000.

 

Section 26FD of the Pollution Prevention Act requires the display on ships of 12 metres or more in length of placards setting out the kinds of garbage that may or may not be disposed of from the ships and the conditions to which such disposal is subject.  In accordance with subsection 26FD(3), such placards may be written in the language of the flag State of the ship and, if that language is not English or French, the placards must be also written in either English or French.  The amendments made by items 8 and 9 will allow the placards to be written in Spanish as an alternative third language.

 

 

Schedule 2 - Amendments about trade practices

 

Item 1

 

Part X of the Trade Practices Act regulates the market conduct of international liner cargo shipping companies that collaborate as conferences to co-ordinate scheduled joint services, share capacity and agree on freight rates.  Item 1 amends Part X to make it clear that the limited, conditional exemptions from the competition rules provided under Part X for liner shipping do not allow stevedoring operators to collude among themselves for any purpose whatsoever.

 

 

Schedule 3 - Technical amendments

 

Item 1

 

Item 1 repeals the Bass Strait Sea Passenger Service Agreement Act 1984 .  The purpose of that Act was to approve an agreement made in 1984 between the Commonwealth and Tasmania for the payment of a non-refundable grant by the Commonwealth to Tasmania towards the purchase of a ship (which was renamed the Spirit of Tasmania ) to provide passenger shipping services between Melbourne and Devonport, and for the upgrading of terminal facilities.  The grant has been paid and all conditions of the agreement have been met.  The Act is therefore redundant.

 

Items 2 to 28

 

Items 2 to 28 convert penalties in the Pollution Prevention Act from monetary amounts to penalty units.  There is no change in the value of the penalties.




[1]      One unit of account is the same as a Special Drawing Right (SDR) as defined by the International Monetary Fund.  The value of the SDR varies from day to day in accordance with changes in currency values.  On 28 November 2002, one SDR was worth $A2.37756.