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Crimes Legislation Amendment (Organised Crime and Other Measures) Bill 2012

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2010 - 2011 - 2012

 

 

 

 

THE PARLIAMENT OF THE COMMONWEALTH OF AUSTRALIA

 

 

 

 

HOUSE OF REPRESENTATIVES

 

 

 

 

 

 

 

CRIMES LEGISLATION AMENDMENT

(ORGANISED CRIME AND OTHER MEASURES) BILL 2012

 

 

 

 

EXPLANATORY MEMORANDUM

 

 

 

 

 

 

(Circulated by authority of the Minister for Justice,

the Honourable Jason Clare, MP)



Crimes Legislation Amendment (oRGANISED Crime and Other Measures) Bill 2012

 

 

GENERAL OUTLINE

 

This Bill amends the Proceeds of Crime Act 2002 (the POC Act) and the

Criminal Code Act 1995 (the Criminal Code) .

 

The Bill contains measures to improve the investigation and litigation of unexplained wealth matters, expand cross-border firearms trafficking offences and introduce new aggravated offences for dealing in 50 or more firearms or firearm parts.

 

Purpose

 

Schedule 1 will amend the POC Act to strengthen the Commonwealth’s unexplained wealth regime.  These amendments will ensure that the Government has strong laws to target the substantial profits made by serious and organised crime.

 

Schedule 2 will amend Part 9.4 of the Criminal Code to expand existing cross-border firearms trafficking offences to cover firearm parts, and introduce new offences for international firearms trafficking across Australia’s national borders.  Schedule 2 will introduce aggravated offences with a maximum penalty of life imprisonment where 50 or more firearms or firearms parts are trafficked within a six month period.

 

FINANCIAL IMPACT STATEMENT

 

Schedule 1 of the Bill will improve the Commonwealth’s ability to confiscate unexplained wealth.  Other items will have little or no impact on Government revenue.



ACRONYMS AND ABBREVIATIONS

 

AFP                                                     Australian Federal Police

 

PJC-LE                                               Parliamentary Joint Committee on Law Enforcement

 

POC Act                                             Proceeds of Crime Act 2002

Statement of compatibility with human rights

 

This Bill is compatible with the human rights and freedoms recognised or declared in the international instruments listed in section 3 of the Human Rights (Parliamentary Scrutiny) Act 2011

 

An overview of measures in the Bill and their human rights implications is below.

 

Unexplained wealth

 

Overview

 

Schedule 1 of the Bill makes amendments to the Proceeds of Crime Act 2002 (POC Act) to improve the Commonwealth’s unexplained wealth laws. 

 

Unexplained wealth laws were introduced in 2010 as part of a suite of reforms to more effectively prevent, investigate and prosecute organised crime activity, and target the proceeds of organised crime groups.  The laws are located in the POC Act, which provides a comprehensive scheme to trace, investigate, restrain and confiscate proceeds generated from Commonwealth indictable offences, foreign indictable offences and certain offences against State and Territory law.

 

Under Commonwealth unexplained wealth legislation, if a court is satisfied that there are reasonable grounds to suspect that a person’s total wealth exceeds the value of the person’s wealth that was lawfully acquired, the court can compel the person to attend court and prove, on the balance of probabilities, that their wealth was not derived from offences with a connection to Commonwealth power.  If a person cannot demonstrate this, the court may order them to pay to the Commonwealth the difference between their total wealth and their legitimate wealth.

 

There are three types of order which can be sought in relation to unexplained wealth:

 

·          unexplained wealth restraining orders

 

·          preliminary unexplained wealth orders, and

 

·          unexplained wealth orders.

 

Unexplained wealth restraining orders are interim orders that restrict a person’s ability to dispose of or otherwise deal with property.  These provisions ensure that property is preserved and cannot be dealt with to defeat an ultimate unexplained wealth order.

 

Preliminary unexplained wealth orders are orders requiring a person to attend court to demonstrate whether or not his or her wealth was derived from lawful sources.  If the court is not satisfied that the person’s wealth was not derived from an offence against a law of the Commonwealth, a foreign indictable offence or a State offence that has a federal aspect, it may then make an unexplained wealth order.

 

Unexplained wealth orders are final orders that make payable to the Commonwealth an amount which, in the court’s opinion, constitutes the difference between a person’s total wealth and the value of the person’s property which the court is satisfied did not derive from the commission of  a relevant offence.  That is, the difference between their total wealth and their wealth that has been legitimately acquired.

 

In July 2011, the Parliamentary Joint Committee on Law Enforcement (PJC-LE) initiated an inquiry into Commonwealth unexplained wealth laws, the purpose of which was to examine the operation of the existing laws, identify relevant issues and determine ways in which the laws could be made more effective.  The Committee handed down its final report in March 2012, which made 18 recommendations to improve the investigation and litigation of Commonwealth unexplained wealth matters.

 

The amendments in Schedule 1 represent the first tranche of legislative measures introduced by the Government to implement recommendations of the Committee.  These amendments will:

 

·          ensure evidence relevant to unexplained wealth proceedings can be seized under a search warrant

 

·          allow the time limit for serving notice of a preliminary unexplained wealth order to be extended by a court in appropriate circumstances, such as where a person seeks to avoid service

 

·          harmonise provisions relating to the payment of legal expenses for unexplained wealth cases with those for other POC Act proceedings so as to prevent restrained and forfeited assets being used to meet legal expenses

 

·          allow charges to be created over restrained property to secure payment of an unexplained wealth order as can occur with other types of proceeds of crime order

 

·          remove a court’s discretion to make unexplained wealth restraining orders, preliminary unexplained wealth orders and unexplained wealth orders once relevant criteria are satisfied, and

 

·          improve the PJC-LE’s oversight of unexplained wealth investigations and litigation.

 

Human rights implications

 

Schedule 1 of the Bill engages the following rights:

 

·          right to a fair hearing in Article 14 of the International Covenant on Civil and Political Rights (ICCPR)

 

·          minimum guarantees in criminal proceedings in Article 14(3) of the ICCPR

 

·          protection against arbitrary or unlawful interference with privacy provided for in Article 17 of the ICCPR, and

 

·          the prohibition on retrospective punishment in Article 15 of the ICCPR. 

 

Right to a fair hearing

 

Article 14 of the ICCPR guarantees equality before courts and tribunals, and, in the determination of criminal charges, or any suit at law, the right to a fair and public hearing before a competent, independent and impartial court or tribunal established by law.

 

Proceedings under the POC Act are civil proceedings heard by Commonwealth, State and Territory courts in accordance with relevant procedures of those courts.  This affords an affected person adequate opportunity to present his or her case, such that the right to a fair hearing is not limited.  Schedule 1 will not affect the civil court procedures applicable to POC Act proceedings.  Accordingly, the Schedule engages, but does not limit, the fair trial rights provided for in Article 14.

 

In some situations, applications for POC Act orders such as unexplained wealth restraining orders or preliminary unexplained wealth orders may be heard without notice being given to the person who is the subject of the application at the time the application is made.  This is an important feature of the laws, which serves the justified and reasonable purpose of preventing a person from dispersing his or her assets during the time between an order being sought and an order being made.  The POC Act provides mechanisms which allow a person to quickly contest orders made without notice.  The amendments in Schedule 1 will not affect the ability of a person to challenge the making of an order. 

 

Minimum guarantees in criminal proceedings

 

The United Nations Human Rights Committee has stated that criminal charges primarily encompass acts that are declared to be punishable under domestic criminal law, but may also extend to acts that are criminal in nature with sanctions that, regardless of their qualification in domestic law, must be regarded as penal.  Relevant factors in considering whether charges are criminal include whether proceedings are brought by a public authority, whether there is a punitive element to the process and whether there are potentially serious consequences such as imprisonment (see the Human Rights Committee’s General Comment 32).

 

Unexplained wealth proceedings and other proceedings under the POC Act are brought by a public authority and have the punishment and deterrence of breaches of Commonwealth law as one of their stated objects.  However, these proceedings are civil proceedings only and are not criminal in nature - proceeds of crime proceedings cannot create any criminal liability, do not result in any finding of criminal guilt and do not expose people to any criminal sanctions.  As a result, the amendments in Schedule 1 do not engage aspects of Article 14(3) relating to the determination of criminal charges.  However, a brief discussion of aspects of the amendments and the protections in Article 14(3) is included below for information.

 

(i)      Right to legal representation

 

Article 14(3) of the ICCPR provides that everyone shall be entitled to communicate with counsel of his or her own choosing in the preparation of his or her defence, and to have legal assistance assigned in any case where the interests of justice require, if he or she does not have sufficient means to pay for it.

 

The POC Act currently allows people who are subject to unexplained wealth proceedings to use certain restrained assets, or assets subject to their effective control, to meet their legal costs.  This is different to other types of proceedings under the POC Act, which do not allow access to such assets for this purpose and instead provide that a person may be represented by legal aid, with relevant legal aid costs to be paid by the Commonwealth using confiscated assets held in the Confiscated Assets Account.

 

In the final report of its inquiry into Commonwealth unexplained wealth laws, the

PJC-LE recommended that provisions relating to legal expenses should be harmonised so that unexplained wealth provisions and other types of proceedings within the POC Act are treated similarly.  Schedule 1 will amend the POC Act to implement this recommendation. 

The PJC-LE considered submissions and evidence from a range of community, law enforcement and other government bodies in reaching this conclusion, including information from the Attorney-General’s Department about the rationale for harmonisation and procedures relating to the payment of legal aid costs in proceeds of crime matters. 



The POC Act takes this approach to the use of restrained assets so as to prevent the practice of dissipating wealth on legal expenses to frustrate any potential proceeds of crime orders. 

As noted, people who are subject to POC Act proceedings may seek legal representation through legal aid if their unrestrained assets are not sufficient to meet legal costs, to ensure that they are appropriately represented, are not disadvantaged and continue to be equal before courts and tribunals.  To the extent that Schedule 1 may limit a person’s right to legal representation, such limitations are necessary and reasonable in ensuring that wealth is not dissipated on legal expenses to frustrate potential unexplained wealth orders and that the Commonwealth’s unexplained wealth laws operate effectively.

 

POC Act matters have been established as a priority civil law area for the allocation of Commonwealth funded legal services by State and Territory legal aid commissions under the National Partnership Agreement on Legal Assistance Services.  As a matter of practice, many jurisdictions’ legal assistance guidelines provide that, when determining whether legal assistance should be provided in relation to Commonwealth POC Act matters, any of a person’s property that is covered by a restraining order, or is likely to be covered by a restraining order, should be disregarded for the purposes of means tests.

 

(ii)     Determination of criminal charges - judicial discretions

 

Courts hearing unexplained wealth matters currently have a general discretion to decline to make a restraining order, preliminary unexplained wealth order or final unexplained wealth order, even if all relevant criteria for making the orders have been satisfied.  Schedule 1 will remove this discretion and will require courts to make unexplained wealth restraining orders, preliminary unexplained wealth orders and unexplained wealth orders once satisfied that the criteria for making these orders have been met.  This will align unexplained wealth laws with other proceeds of crime orders, which do not allow for a general discretion once the court is satisfied of relevant criteria. 

 

These amendments will not affect the independence of courts hearing unexplained wealth matters.  Courts will retain discretions to refuse to make the above types of orders if they consider it in the interests of justice to do so, or in cases where the amount of suspected unexplained wealth is less than $100,000.  Provisions that allow a person to seek to have unexplained wealth restraining orders or preliminary unexplained wealth orders revoked will not be affected by Schedule 1, with the result that the appropriate and necessary ability of courts to revoke orders on application will continue.  The POC Act also provides other general appeal rights.

 

In the final report of its inquiry into Commonwealth unexplained wealth laws, the PJC-LE concluded that there does not seem to be a strong case for specific judicial discretions relating to unexplained wealth orders, stating that there are already other safeguards in place, such as:

 

·          the requirement for a court to be satisfied that relevant criteria have been met

 

·          the court’s general discretion to refuse to make an order if it is in the public interest to do so

 

·          the court’s ability to revoke orders if it is in the interests of justice

 

·          the court’s ability to order costs, and

 

·          oversight of unexplained wealth laws by the PJC-LE.

 

With regard to oversight of unexplained wealth laws by the PJC-LE, Schedule 1 will improve transparency by introducing new requirements for the Australian Federal Police and other Commonwealth law enforcement agencies to provide de-identified information to the PJC-LE each year outlining the number of matters investigated in which unexplained wealth action is the most likely outcome and the number of unexplained wealth proceedings that have been initiated.  This is an important safeguard that supports the overall compatibility of the laws with human rights obligations.

 

Right to privacy and protection of families and children

 

Article 17 of the ICCPR accords everyone the right to protection against arbitrary or unlawful interference with their privacy, family, home or correspondence.  This includes the right to protection from interferences with a person’s personal information and property, particularly where it is a family home.  Interferences are permissible so long as they are authorised by law and are not arbitrary. 

 

In order for an interference with the right not to be arbitrary, the interference must be for a reason consistent with the ICCPR and be reasonable in the particular circumstances.  Reasonableness in this context incorporates notions of proportionality, appropriateness and necessity.  In essence, this will require that:

 

·          limitations serve a legitimate objective,

 

·          limitations adopt a means that is rationally connected to that objective, and

 

·          the means adopted are not more restrictive than they need to be to achieve that objective.

 

The POC Act enables courts to make a wide range of orders that result in the forfeiture of a person’s wealth or property to the Commonwealth, or in a person being required to pay a specified amount of money to the Commonwealth.  As a result, provisions of the POC Act interact broadly with the right to protection from interference with a person’s property.  However, the Act serves the legitimate and important objective of ensuring that criminals are not able to profit from their crimes and are deterred from further criminal activity, and provides for a range of safeguards and procedures to ensure that it is not more restrictive than necessary in achieving this end.

 

Unexplained wealth laws can require a person to pay an amount to the Commonwealth which represents the component of their wealth that a court is not satisfied was lawfully obtained.  As with other proceeds of crime orders, this may result in a person’s property, potentially including his or her house, being used to satisfy the order, which could affect his or her family or dependents in some circumstances. 

 

Under the POC Act, courts have a general discretion to allow the following to be met out of property covered by a restraining order:

 

·          reasonable living expenses of any of the dependants of a person whose property is the subject of a restraining order

 

·          reasonable living expenses of the person whose property is restrained

 

·          reasonable business expenses of that person, and

 

·          specified debts incurred in good faith by that person.

 

Courts also have a general discretion to order that a specified amount be paid to a person’s dependants, if satisfied that an unexplained wealth order would cause hardship to a person’s dependant s, that the specified amount would relieve that hardship and that, if the dependant s are more than 18 years of age, they had no knowledge of the person's conduct that is the subject of the forfeiture order .

 

To the extent that the amendments in Schedule 1 may affect relevant rights, such limitation is aimed at disrupting and combating serious and organised crime by improving the operation of the Commonwealth’s unexplained wealth laws. 

 

Schedule 1 will amend existing search and seizure powers in the POC Act to allow authorised officers to seize material they find in the course of executing a search warrant that they believe on reasonable grounds will afford evidence for the purpose of initiating or conducting unexplained wealth proceedings.  This amendment is necessary to ensure that officers are able to seize personal financial records, such as payslips and bank statements, that are found in the course of executing a search warrant and will assist in establishing the components of a person’s wealth that have been legitimately acquired and those which may have been illegitimately acquired. 

 

Officers do not currently have the ability to seize these materials in the course of executing a warrant under the POC Act.  The amendments will not expand the grounds on which officers are able to obtain search warrants under the POC Act or empower officers to enter a broader range of premises than they are currently able to under the Act.  Improving the ability of authorised officers to obtain material relevant to establishing components of a person’s wealth may also have an exculpatory effect where further evidence shows that a person’s wealth was lawfully acquired.

 

To the extent that any amendments made by Schedule 1 may affect a person’s right to protection against arbitrary and unlawful interference with their privacy, family, home or correspondence, these effects are reasonable, necessary and proportionate in achieving the intended outcomes of Schedule 1.

 

Prohibition against retrospective punishment

 

Article 15 of the ICCPR prohibits the retrospective operation of criminal laws, including the imposition of a heavier penalty than was applicable at the time when a criminal offence was committed. 

 

The POC Act applies to offences and convictions regardless of whether they occurred before or after the commencement of the Act, with the result that proceeds of crime proceedings, including unexplained wealth proceedings, may involve consideration of offences that were committed, or are suspected to have been committed, at any time in the past.  It is necessary for the POC Act to apply in this fashion due to the fact that criminal conduct from which a person may have profited or gained property may continue over several years or may not be discovered immediately. 

 

Human rights jurisprudence views asset confiscation as a penalty capable of engaging the prohibition on retrospective criminal laws.  However, unexplained wealth orders and other orders under the POC Act are civil asset confiscation orders that cannot create any criminal liability, do not result in any finding of criminal guilt and do not expose people to any criminal sanctions.  Proceeds of crime proceedings are civil proceedings only. 

Accordingly, the amendments in Schedule 1 do not engage the prohibition against retrospective punishment.

 

Under section 179G of the POC Act, the amount of wealth a person has is calculated having regard to property owned, effectively controlled, disposed of or consumed by the person at any time, including before the time the Commonwealth’s unexplained wealth laws commenced.  This is necessary to ensure that orders are not frustrated by requiring the precise point in time at which certain wealth or property was acquired to be established, as this can be extremely difficult for law enforcement agencies to obtain evidence of and prove.

 

To ensure that a person’s wealth can continue to be calculated correctly under the existing laws, several amendments in Schedule 1 relating to restraining orders, preliminary unexplained wealth orders and final unexplained wealth orders are expressed to apply to orders made after commencement only, but allow for the amendments made in Schedule 1 of apply to those orders whether or not they relate to wealth that was acquired, or became subject to a person’s effective control, before or after commencement. 

 

Conclusion

 

Schedule 1 of the Bill is compatible with the human rights and freedoms recognised or declared in the international instruments listed in the definition of human rights in section 3 of the Human Rights (Parliamentary Scrutiny) Act 2011 .  To the extent that these measures may limit those rights and freedoms, such limitations are reasonable, necessary and proportionate in achieving the intended outcomes of Schedule 1.



Firearms trafficking

 

Overview

 

Schedule 2 of the Bill makes a number of amendments to firearms trafficking offences in Part 9.4 of the Criminal Code Act 1995 (Criminal Code).

 

The purpose of these new offences is to address community concerns about the illegal possession, use, disposal and acquisition of firearms, both from domestic and international sources.  The new offences also aim to hold traffickers responsible for the consequences of providing firearms into the black market from both domestic and international sources.  The offences are also intended to support efforts to prevent the diversion of firearms into overseas illegal markets.

 

The current offence of trafficking firearms between States and Territories under Division 360 (cross-border firearms trafficking) will be amended to cover firearm parts as well as firearms, and to include aggravated offences of acquiring or disposing, taking or sending 50 or more firearms or firearm parts across State and Territory borders within a six month period.

 

The Bill will also introduce offences of trafficking firearms across Australia’s national borders, as well as introducing aggravated offences for the importation and exportation of 50 or more firearms or firearm parts without requisite approvals under the Customs Act 1901.

 

The penalty for the new offences for trafficking firearms across Australia’s national borders (international firearms trafficking) will be 10 years imprisonment. 

 

The penalty for the aggravated offences for trafficking firearms between States and Territories, or into or out of Australia, will be life imprisonment.

 

These penalties reflect the serious nature of supplying firearms and firearm parts to the illicit market.  A firearm can remain within the illicit market for many years.  This provides a growing pool of firearms that can be accessed by serious and organised crime groups.

 

Human rights implications

 

Presumption of innocence

 

The presumption of innocence is contained in article 14(2) of the International Covenant on Civil and Political Rights (ICCPR) and is one of the guarantees in relation to legal proceedings provided for by article 14.

 

The presumption of innocence imposes on the prosecution the burden of proving charges, and guarantees that no guilt can be presumed until charges have been proved beyond reasonable doubt.  In general, consistency with the presumption of innocence requires the prosecution to prove each element of a criminal offence beyond reasonable doubt.

 

The new offences created by Schedule 2 interact with the presumption of innocence by applying absolute liability and strict liability to some elements of the offences. 

 

 

i)                     Absolute liability

 

The application of absolute liability engages the presumption of innocence because it allows for a physical element of an offence to be proven without the need to prove fault.

 

The absolute liability elements for the new offences are set out below:

 

 

Offence/s

Absolute liability element(s)

1

Paragraphs 360.2(1)(b), 360.2(2)(b), 360.3(1)(ab), 360.3(1A)(c)

The conduct occurs in the course of trade or commerce among the States or between a State and a Territory or between two Territories.

 

2

Paragraphs 360.2(1)(c), 360.2(2)(c)

The primary element of the underlying offence involves disposing or acquiring a firearm or firearm part.

 

3

Paragraph 360.2(2)(e)

Disposal or acquisition of firearms or parts resulted from conduct on two or more occasions taken together - the occasions of conduct occurred during a 6 month period.

 

4

Paragraph 360.3(1A)(g)

Taking or sending of firearms or parts resulted from conduct on two or more occasions taken together - the occasions of conduct occurred during a 6 month period.

 

5

Paragraphs 361.2(1)(c), 361.2(2)(c), 361.3(1)(c), 361.3(2)(c)

The importation or exportation of the firearm or part was prohibited under the Customs Act 1901 absolutely or was prohibited under that Act unless an appropriate approval had been obtained.

 

6

Paragraphs 361.2(2)(e)

The importation of the firearm or parts resulted from two or more occasions of importation taken together - the occasions of importation occurred during a 6 month period.

 

7

Paragraphs 361.3(2)(e)

The exportation of the firearm or parts resulted from two or more occasions of exportation taken together - the occasions of exportation occurred during a 6 month period.

 

 

Absolute liability is appropriate and required for the element of the offence in row 1 because it is a jurisdictional element.  A jurisdictional element of an offence is an element that does not relate to the substance of the offence, but marks a jurisdictional boundary between matters that fall within the legislative power of the Commonwealth and those that do not.  The issue of whether the person was reckless as to the fact that the conduct occurred in the course of trade or commerce among the states or between a State and a Territory or between two territories is not relevant to their culpability. 

 

This is consistent with Commonwealth criminal law practice, as described in the Guide to Framing Commonwealth Offences, Infringement Notices and Enforcement Powers .

 

Absolute liability is appropriate for the element of the offence in row 2 as the prosecution will be required to establish beyond reasonable doubt all of the elements constituting the relevant underlying offence, including any fault elements applicable to that offence.  It is not appropriate for the prosecution to also have to prove that the person knew or was reckless as to whether the primary element of the underlying offence involved the disposal or acquisition of a firearm or firearm part.  If this were the case, it would be reasonably easy for a defendant to avoid criminal liability for the offence by claiming that they were unaware of the content of the relevant State or Territory law.  For similar reasons, it is not appropriate for the defence of reasonable mistake of fact to be available to the defendant.

 

Absolute liability is appropriate for the elements of the offences in rows 3, 4, 6 and 7 that the occasions of conduct occurred within a six month period.  This specified period has been included to ensure that the offence captures and targets those persons who repeatedly or regularly traffic firearms or firearm parts, including small quantities that would amount to large quantities over time.

 

It is not appropriate for the prosecution to be required to prove that the defendant knew or was reckless as to whether the relevant conduct was all engaged in during the specified six month period.  The defendant’s knowledge of the time period is not relevant to his or her culpability and, if this were the case, it would be reasonably easy for a defendant to avoid criminal liability for the offence by claiming that they intended to deal in the firearms over a far longer period of time.  For similar reasons, it is not appropriate for the defence of reasonable mistake of fact to be available to the defendant.

 

Absolute liability is also appropriate and required for the element of the offence that the importation or exportation of the firearm or firearm part was prohibited (see row 5).  It is not appropriate for the prosecution to also have to prove that the person knew or was reckless as to whether the article was prohibited or required approval.  If this were the case, it would be easy for a defendant to avoid criminal liability for the offence by claiming that they were unaware of relevant legal requirements.  If the person imports or exports firearms or firearm parts, it is reasonable to expect that person to be familiar with the requirements of the Customs Act and comply with those rules.  For similar reasons, it is not appropriate for the defence of reasonable mistake of fact to be available to the defendant.

 

ii)                   Strict liability

 

If strict liability applies to physical elements of an offence, those elements can be proved without the need to prove a corresponding fault element.  However, unlike absolute liability, the defence of honest and reasonable mistake of fact will be available to the defendant.

 

For the aggravated trafficking offences that apply within Australia (paragraphs 360.2(2)(d) and 360.3(1A)(f)), strict liability attaches to the elements of the offence that that 50 or more firearms or firearm parts (or a combination of both) were disposed of or acquired, taken or sent on any occasion or on two or more occasions together.

 

For the import and export offences (paragraphs 361.2(2)(d) and 361.3(2)(d)), strict liability applies to: the elements of the offence that 50 or more firearms or firearm parts (or a combination of both) were imported or exported on any occasion, or on two or more occasions together.

 

Strict liability also attaches to the physical element of circumstance of the offence that an approval had not been obtained at the time firearm or firearm parts were imported or exported (paragraphs 361.2(1), 361.2(2), 361.3(1), and 361.3(2)).

 

Applying strict liability is appropriate in these circumstances, as a person disposing of, acquiring, taking, sending, importing or exporting that quantity of firearms or firearms parts should be expected to be aware of and comply with approval requirements.  It would not be appropriate for the prosecution to have to demonstrate that a person knew the relevant legal requirements.  However, the general defence of mistake of fact will be available to the defendant.  Therefore, if a person mistakenly believed that he or she had obtained the required permit to import or export a firearm or firearm part, the defence of mistake of fact would be available.

 

Section 361.4 engages the presumption of innocence by placing an evidential burden of proof on the defendant that at the time of the conduct constituting the offence, the person was under a mistaken but reasonable belief that the conduct was justified or excused by or under the law of the Commonwealth or of a State or Territory; and had the conduct been so justified or excused, the conduct would not have constituted the offence.  Under international human rights law, a reverse onus provision will not violate the presumption of innocence if the law is reasonable in the circumstances and maintains the rights of the accused.  Such a provision may be justified if the nature of the offence makes it very difficult for the prosecution to prove each element, or if it is clearly more practical for the accused to prove a fact than for the prosecution to disprove it.

 

The purpose of this section is to ensure that administrative errors or misunderstandings occurring in the course of legitimate business do not result in convictions for offences that are intended only to target those involved in the illegal firearms trade.  For example, a bona fide firearms dealer obtains permission from the relevant State or Territory authority for the importation of a firearm.  However, permission should have been obtained from the relevant Commonwealth authority.  The defence under section 361.4 would be available in this type of situation.

 

Conclusion

 

The firearms trafficking measures in Schedule 2 of the Bill are compatible with the human rights and freedoms recognised or declared in the international instruments listed in the definition of human rights in section 3 of the Human Rights (Parliamentary Scrutiny) Act 2011 .  To the extent that these measures may limit those rights and freedoms, such limitations are reasonable, necessary and proportionate in achieving the intended outcome of Schedule 2.

 

 

 



NOTES ON CLAUSES

 

Clause 1:  Short title

 

This clause provides that, when enacted, the Bill may be cited as the Crimes Legislation Amendment (Organised Crime and Other Measures) Act 2012.

 

Clause 2: Commencement

 

This clause sets out when the Act will commence.

 

The Act will commence on the day after it receives Royal Assent.

 

Clause 3:  Schedule(s)

 

This is a formal clause that enables the Schedules to amend Acts by including amendments under the title of the relevant Act.

 

 

 

 



Schedule 1 - Unexplained wealth amendments

 

GENERAL OUTLINE

 

Schedule 1 will strengthen the Commonwealth’s unexplained wealth regime. 

 

Unexplained wealth provisions were introduced into the POC Act in February 2010, as part of a suite of reforms to more effectively prevent, investigate and prosecute organised crime activity, and target the proceeds of organised crime groups.

On 19 March 2012, the Parliamentary Joint Committee on Law Enforcement (PJC-LE) handed down the final report on its Inquiry into Commonwealth unexplained wealth legislation and arrangements.  In this report, the PJC-LE concluded that the unexplained wealth provisions were not operating as effectively as Parliament had intended.

 

Part 1 of Schedule 1 will implement recommendations made in the PJC-LE’s final report. These amendments will

·          ensure evidence relevant to unexplained wealth proceedings can be seized under a search warrant

·          allow the time limit for serving notice of a preliminary unexplained wealth order to be extended by a court in appropriate circumstances

·          harmonise provisions relating to the payment of legal expenses for unexplained wealth cases with those for other POC Act proceedings so as to prevent restrained and forfeited assets being used to meet legal expenses

·          allow charges to be created over restrained property to secure payment of an unexplained wealth order, as can occur with other types of proceeds of crime order

·          remove a court’s discretion to make unexplained wealth restraining orders, preliminary unexplained wealth orders and unexplained wealth orders once relevant criteria are satisfied, and

·          improve the PJC-LE’s oversight of unexplained wealth investigations and litigation.

 

Part 2 of Schedule 1 sets out how these amendments will apply.

 

These amendments will ensure that the Commonwealth has strong laws to target the criminal economy; not only removing the proceeds of crime, but also preventing its reinvestment into further criminal activity.

 



Part 1 - Amendments

 

Proceeds of Crime Act 2002

Item 1 - Subsection 20A(1)

Item 1 amends subsection 20A(1) of the POC Act by omitting ‘may order’ and substituting ‘must order’.

Currently, a court has a discretion in deciding whether to make an unexplained wealth restraining order, even when it is satisfied that the relevant criteria have been met.  This is in contrast to most other types of proceeds of crime orders, which a court must make if it is satisfied that the criteria have been met.

In the PJC-LE’s final report on its Inquiry into unexplained wealth legislation and arrangements, the PJC-LE concluded:

 

The committee is of the view that there does not seem to be a strong case for a specific unexplained wealth judicial discretion relating to restraining orders and preliminary orders to appear, given there is limited impact on an individual subject to those types of orders and that there are already significant safeguards in place, such as:

•        the requirement for a court to be satisfied that the tests for the orders have been met;

•        the judicial discretions of general public interest and the interests of justice tests that need to be satisfied;

•        the standard powers courts have to order costs; and

•        oversight by this committee.

The additional discretion available to courts in unexplained wealth cases provides a disincentive for proceeds of crime authorities to bring unexplained wealth proceedings, as there is greater uncertainty of the outcome (which also leaves the authority more open to an award of costs being made against it).

This amendment (in conjunction with the amendment made by item 3) will remove a court’s general discretion to make an unexplained wealth restraining order where the amount of unexplained wealth is suspected to be $100,000 or more. 

This amendment will provide greater certainty to parties involved in unexplained wealth matters.  The court will continue to have a discretion in deciding whether to make an order in cases where the amount of unexplained wealth is not suspected to be $100,000 or more, which will act as an additional safeguard in smaller cases.

While this item removes the general discretion given to a court under subsection 20A(1), a court will still have the ability to refuse to make a restraining order under subsection 20A(4) if it is satisfied that it is not in the public interest to make the order.  A court may also refuse to make a restraining order if the Commonwealth refuses to give an undertaking with respect to the payment of damages or costs, or both, for the making and operation of the order under section 21 of the POC Act. 

This amendment implements Recommendation 12 of the PJC-LE’s final report.

Item 2 - Subsections 20A(3A) to (3C)

Item 2 repeals subsections 20A(3A) to (3C). 

Subsections 20A(3A) to (3C) allow a court to order that restrained property be disposed of for the purposes of meeting a person’s reasonable legal expenses.  People who are subject to proceeds of crime proceedings (other than unexplained wealth proceedings) are not entitled to meet their legal costs from restrained property. 

The ability of a person to dispose of restrained property to meet their legal costs weakens the effectiveness of the unexplained wealth provisions by allowing the wealth suspected to have been unlawfully acquired to be used to contest proceedings.  This may lead to fewer assets being available for confiscation if an unexplained wealth order is successful and is likely to cause more protracted litigation.

This amendment will harmonise provisions relating to the payment of legal expenses for unexplained wealth cases with those for other proceedings under the POC Act.

Legal aid commissions will continue to be entitled to be reimbursed for legal costs incurred in representing people whose property is covered by a restraining order under the POC Act.  Matters under the POC Act have also been established as a priority civil law area for the allocation of Commonwealth funded legal services by State and Territory legal aid commissions under the National Partnership Agreement on Legal Assistance Services.  As a matter of practice, many jurisdictions’ legal assistance guidelines provide that, when determining whether legal assistance should be provided in relation to Commonwealth POC Act matters, any of a person’s property that is covered by a restraining order, or is likely to be covered by a restraining order, should be disregarded for the purposes of means tests.

This amendment implements Recommendation 10 of the PJC-LE’s final report.

Item 3 - Subsection 20A(4)

Item 3 amends subsection 20A(4) to provide that that a court may refuse to make an unexplained wealth restraining order if it is satisfied that there are not reasonable grounds to suspect that a person’s total wealth exceeds the value of the wealth that the person has lawfully acquired by $100,000 or more.  In addition, a court will continue to be able to refuse to make an order if it is satisfied that it is not in the public interest to make the order.

This amendment is related to item 1, which removes a court’s discretion in deciding whether to make an unexplained wealth restraining order.  This amendment will act as an additional safeguard by ensuring that court’s discretion to make an unexplained wealth restraining order is retained in matters that where the person is suspected of having less than $100,000 of unexplained wealth.

A threshold of $100,000 was suggested by the PJC-LE after consultation with international and domestic criminal justice stakeholders.  The introduction of this threshold also reinforces that the primary purpose of unexplained wealth provisions is to target larger cases involving serious and organised crime, and not individuals with small amounts of wealth.  Providing the court with an additional discretion in these smaller cases will ensure that the courts have greater powers to prevent the potential hardship arising from the use of the provisions in cases where there are only small amounts of unexplained wealth.

This amendment implements Recommendation 12 of the PJC-LE’s final report.

Item 4 - Subsection 20A(4A)

Item 4 amends subsection 20A(4A) by omitting ‘subsection (1)’ and substituting ‘this section’.  This amendment is consequential to item 1 and reflects that a court will no longer have a general discretion to refuse to make an order under subsection 20A(1).  Subsection 20A(4A), as amended, will still allow a court to make an order as to costs if the court refuses to make a section 20A restraining order on other grounds (eg under subsection 20A(4) or section 21).

Item 5 - Subsection 20A(5)

Item 5 amends subsection 20A(5) by omitting ‘may’ and substituting ‘must’.  This amendment is consequential to item 1 and reflects that a court will no longer have a general discretion to refuse to make an order under subsection 20A(1).

Item 6 - After subsection 45(6)

Item 6 inserts a new subsection (6A) at the end of section 45.

Section 45 currently causes restraining orders (with the exception of unexplained wealth restraining orders under section 20A, which are covered by section 45A) to cease in a wide range of situations.  For example, property may cease to be covered by a restraining order if it vests absolutely in the Commonwealth, if it is sold to satisfy the payment of a pecuniary penalty order or if an application for forfeiture is unsuccessful.

Item 6 is related to item 20, which will insert new section 179SA into the POC Act.  This will allow charges to be created and registered over restrained property to secure the payment of unexplained wealth amounts.  In line with other provisions in the POC Act relating to charges, unexplained wealth charges would be automatically created where a person is subject to both an unexplained wealth order and a restraining order under the POC Act. 

Item 6 will support the amendments to section 179SA by amending section 45 to provide that, if a charge is created over restrained property under section 179SA, the restraining order over that property will not cease to be in force until the charge over the property ceases to have effect under proposed subsection 179SA(2).  This provision means that the restraining order will continue to cover that property even if it would usually cease under subsections 45(1), (2), (3), or (6).

This amendment will ensure that property continues to be restrained and cannot be disposed of or dealt with in a way that might frustrate a charge under section 179SA.  It is an offence punishable by five years imprisonment and/or 300 penalty units if a person knowingly or recklessly contravenes a restraining order (eg by selling property, using it as collateral for a loan or moving it out of the jurisdiction).  This will ensure that property continues to be available to secure the payment of unexplained wealth amounts.

Item 7 - Subsection 45A(1)

Item 7 repeals subsection 45A(1) and substitutes it with a new subsection covering when a section 20A restraining order made before an application for an unexplained wealth order ceases to be in force.  This item operates in conjunction with the amendments in item 9, which relate to restraining orders that are made at the same time as or after the application for an unexplained wealth order.

Currently, section 45A establishes three ways in which an unexplained wealth restraining order under section 20A will cease to operate:

  1. An unexplained wealth restraining order has been made, but no subsequent application for an unexplained wealth order is made within 28 days after the restraining order was made.
  2. An application for an unexplained wealth order has been made within 28 days after the restraining order, but a court has refused to make the unexplained wealth order and an appeal against that refusal has not subsequently been brought, or has lapsed or been denied.
  3. An application for an unexplained wealth order has been made within 28 days after the restraining order, the court has made the unexplained wealth order, and the order has subsequently been complied with (ie the person subject to the order has paid the amount they are required to pay under the order), or has been successfully appealed.

In all of the above situations, the current provisions of section 45A assume that an application for an unexplained wealth restraining order will be made before an unexplained wealth order.  However, in practice, restraining orders can also be sought after an unexplained wealth order has been made.  For example, this may occur where further property of a person is identified after the order is made and a restraining order is then applied for to ensure that that further property is available to satisfy the unexplained wealth order.  It may also occur where an order under subsection 179S(3) is made.  As section 45A does not make any provision for such situations, it is not clear how this section would operate.

Item 7 will insert a new subsection 45A(1) covering situations where a restraining order is made before an application for an unexplained wealth order.  Under this subsection, a restraining order under section 20A will lapse if no application for an unexplained wealth order was made before the restraining order was made, and no application for an unexplained wealth order is made within 28 days after the restraining order was made.

In conjunction with the amendments made by item 9, this amendment will help make it clear to people who are bound by a section 20A restraining order when that order ceases to have effect.

Item 8 - Paragraph 45A(2)(c)

Item 8 repeals paragraph 45A(2)(c) and replaces it with a new paragraph that provides that a restraining order will cease to be in force where an application for an unexplained wealth order is made within 28 days after the making of the restraining order, but the court refuses to make either a preliminary unexplained wealth order in connection with the application or the unexplained wealth order, and all appeal avenues are closed.

Current paragraph 45A(2)(c) only provides for a restraining order to cease where the court has refused to make an unexplained wealth order.  However, under section 179E, a court can only make an unexplained wealth order if the court has previously made a preliminary unexplained wealth order.  If a court refuses to make a preliminary unexplained wealth order, then the unexplained wealth order will automatically fail.  Consequently, paragraph 45A(2)(c) has been amended to capture situations where a court refuses to make either a preliminary unexplained wealth order or an unexplained wealth order.

Item 9 - After subsection 45A(3)

Item 9 inserts new subsections (3A) and (3B) after subsection 45A(3).  These new subsections govern when a section 20A restraining order made at the same time as or after an application for an unexplained wealth order will lapse.  This item operates in conjunction with the amendment in item 7, which relates to restraining orders obtained before an application for an unexplained wealth order.

As noted in item 7 above, the current provisions of section 45A assume that an application for an unexplained wealth restraining order will be made before an unexplained wealth order.  However, in practice, restraining orders can also be sought after an unexplained wealth order has been made.  For example, this may occur where further property of a person is identified after the order is made and a restraining order is then applied for to ensure that that further property is available to satisfy the unexplained wealth order, or where an order under subsection 179S(3) is made.  As section 45A does not make any provision for this situation, it is not clear how this section would operate.  Item 9 will clarify when a section 20A restraining order ceases to be in force, where that restraining order was made at the same time or after and application for an unexplained wealth order. 

Under item 9, a section 20A restraining order that was made at the same time as or after an application for an unexplained wealth order would lapse in two circumstances: 

  1. The order would lapse under new subsection 45A(3A) if a court refuses to make a preliminary unexplained wealth order or an unexplained wealth order, and all appeal avenues are closed.  This could be because the time for an appeal against the refusal has expired without an appeal being lodged, an appeal against the refusal has lapsed, or an appeal against the refusal has been dismissed and finally disposed of. 
  2. The order would lapse under new subsection 45A(3B) if an unexplained wealth order is made and either the order is complied with or an appeal against the order has been upheld and finally disposed of.

These amendments, in conjunction with the amendments made by item 7, will help to make it clear to people who are bound by a section 20A restraining order when that order ceases to have effect.

Item 10 - Before subsection 45A(4)

Item 10 inserts a new sub-heading, ‘Court may make costs order if restraining order ceases’.  This amendment is consequential to items 7 and 9, which also insert headings into section 45A to clarify what the different subsections relate to.

Item 11 - Subsection 45A(4)

Item 11 amends subsection 45A(4) by omitting ‘or (2)’ and substituting ‘(2) or (3A)’.  This amendment expands a court’s ability to make costs orders under subsection 45A(4) to also include situations where a restraining order under section 20A ceases to be in force because a court refuses to make a preliminary unexplained wealth order or an unexplained wealth order.  As new subsection 45A(3A) substantially mirrors 45A(2) (which is already listed in subsection 45A(4)), it is appropriate that the court’s powers under subsection 45A(4) apply equally to both of these subsections.

Item 12 - Section 179B (heading)

Item 12 repeals the existing section 179B heading and substitutes ‘179B Making a preliminary unexplained wealth order requiring a person to appear’.

This item will ensure that the heading reflects that section 179B governs the making of preliminary unexplained wealth orders.

Item 13 - Subsection 179B(1)

Item 13 amends subsection 179B(1) of the POC Act by omitting ‘may make an order’ and substituting ‘must make an order’.

Currently, a court has a discretion in deciding whether to make a preliminary unexplained wealth order, even when it is satisfied that the relevant criteria have been met.  This is in contrast to most other types of proceeds of crime orders, which a court must make if it is satisfied that the criteria have been met.

In the PJC-LE’s final report on its inquiry into unexplained wealth legislation and arrangements, the PJC-LE concluded:

 

The committee is of the view that there does not seem to be a strong case for a specific unexplained wealth judicial discretion relating to restraining orders and preliminary orders to appear, given there is limited impact on an individual subject to those types of orders and that there are already significant safeguards in place, such as:

•        the requirement for a court to be satisfied that the tests for the orders have been met;

•        the judicial discretions of general public interest and the interests of justice tests that need to be satisfied;

•        the standard powers courts have to order costs; and

•        oversight by this committee.

Providing the court with additional discretion in unexplained wealth cases creates a disincentive for proceeds of crime authorities to bring unexplained wealth proceedings, as there is greater uncertainty of the outcome (which also leaves the authority more open to an award of costs being made against it).

This amendment (in conjunction with the amendment made by item 15) will remove a court’s discretion to make a preliminary unexplained wealth order where the amount of unexplained wealth is suspected to be $100,000 or more. 

This amendment will provide greater certainty to parties involved in unexplained wealth matters.  The court will continue to have a discretion in deciding whether to make an order in cases where the amount of unexplained wealth is not suspected to be $100,000 or more, which will act as an additional safeguard in smaller cases.  The court also has the power to revoke an order under subsection 179C(5) if it is satisfied that it is in the public interest or otherwise in the interests of justice to do so.

This amendment implements Recommendation 12 of the PJC-LE’s final report.

Item 14 - Before subsection 179B(3)

Item 14 inserts a new sub-heading, ‘Considering application without notice’.  This amendment is consequential to item 15, which (amongst other things) inserts a new heading into section 179B.  This heading articulates the purpose of 179B(3).

Item 15 - At the end of section 179B

Item 15 inserts a new subsection 179B(4), which provides that a court may refuse to make a preliminary unexplained wealth order if it is satisfied that there are not reasonable grounds to suspect that the person’s total wealth exceeds the value of the wealth that the person has lawfully acquired by $100,000 or more.

This amendment is related to item 13, which removes a court’s discretion in deciding whether to make an unexplained wealth restraining order.  This amendment will act as an additional safeguard by ensuring that the court’s discretion to make a preliminary unexplained wealth order is retained in matters where the person is suspected of having less than $100,000 of unexplained wealth.

A threshold of $100,000 was suggested by the PJC-LE after consultation with international and domestic criminal justice stakeholders.  The introduction of this threshold also reinforces that the primary purpose of unexplained wealth provisions is to target larger cases involving serious and organised crime, and not individuals with small amounts of wealth.  Providing the court with an additional discretion in cases involving a smaller amount of wealth will ensure that the courts have greater powers to prevent the potential misuse of these provisions.

This amendment implements Recommendation 12 of the PJC-LE’s final report.

Item 16 - Subsection 179E(1)

Item 16 amends subsection 179E(1) of the POC Act by omitting ‘may make an order’ and substituting ‘must make an order’.

Currently, a court has a discretion in deciding whether to make an unexplained wealth order, even when it is satisfied that the relevant criteria have been met. This is in contrast to most other types of proceeds of crime orders, which a court must make if it is satisfied that the criteria have been met.

In the PJC-LE’s final report on its inquiry into unexplained wealth legislation and arrangements, the PJC-LE observed that, while an unexplained wealth order may have a significant impact upon the individual concerned, the test to be satisfied is substantial.  The PJC-LE also found that the current judicial discretion may limit the effective use of unexplained wealth laws.

Providing the court with additional discretion in unexplained wealth cases provides a disincentive for proceeds of crime authorities to bring unexplained wealth proceedings, as there is greater uncertainty of the outcome (which also leaves the authority more open to an award of costs being made against it).

This amendment (in conjunction with the amendment made by item 17) will remove a court’s discretion to make an unexplained wealth order where the amount of unexplained wealth is $100,000 or more. 

This amendment will provide greater certainty to parties involved in unexplained wealth matters.  The court will continue to have a discretion in deciding whether to make an order in cases where the amount of unexplained wealth is not $100,000 or more, which will act as an additional safeguard in smaller cases.

While the general discretion under subsection 179E(1) is being removed, the court will still have the ability under subsection 179E(6) to refuse to make an unexplained wealth order if the court is satisfied that it is not in the public interest to make the order.

This amendment implements Recommendation 13 of the PJC-LE’s final report.

Item 17 - Subsection 179E(6)

Item 17 amends subsection 179E(6) to provide that that a court may refuse to make an unexplained wealth order if it is satisfied that the person’s unexplained wealth amount is less than $100,000.  The person’s unexplained wealth amount is calculated based on the formula in subsection 179E(2).

In addition, a court will continue to be able to refuse to make an order if it is satisfied that it is not in the public interest to make the order.

This amendment is related to item 16, which removes a court’s discretion in deciding whether to make an unexplained wealth order. This amendment will act as an additional safeguard by ensuring that court’s discretion to make an unexplained wealth order is retained in matters that where the amount of unexplained wealth that the person has is less than $100,000.

A threshold of $100,000 was suggested by the PJC-LE after consultation with international and domestic criminal justice stakeholders.  The introduction of this threshold also reinforces that the primary purpose of unexplained wealth provisions is to target larger cases involving serious and organised crime, and not individuals with small amounts of wealth.  Providing the court with an additional discretion in cases involving a smaller amount of wealth will ensure that the courts have greater powers to prevent any potential hardship arising from the use of these provisions.

This amendment implements Recommendation 13 of the PJC-LE’s final report.

Item 18 - After subsection 179N(2)

Item 18 inserts new subsections 179N(2A) and (2B).  These amendments allow a court to make an order extending the time limit for serving notice of a preliminary unexplained wealth order under subsection 179N(2) by up to 28 days where the court is satisfied that it is appropriate to do so.  However, a court will only be able to make such an order if the responsible authority applies for the order before the end of the period for serving the notice.

New subsection 179N(2B) provides that the court may extend the period for serving notice more than once.

Extending the time limit for giving notice of a preliminary unexplained wealth order will make the provisions more flexible in circumstances where it is not possible for notice to be given within seven days of the order being made.  For example, this may cover situations where a suspect is attempting to avoid service of the notice or is temporarily absent from the jurisdiction.  A court will have the discretion to extend the time limit for serving notice, which will ensure that independent consideration is given as to whether it is appropriate to give an extension.

This amendment implements Recommendation 9 of the PJC-LE’s final report.

Item 19 - Subsection 179S(3)

Item 19 repeals subsection 179S(3) and substitutes a new subsection enabling a court to make a restraining order under section 20A in certain circumstances.

Under subsection 179S(1), where the court has made an unexplained wealth order in relation to a person the responsible authority may apply to the court for an order, declaring that all or part of property within the effective control of that person be made available to satisfy the unexplained wealth order.  Subsection 179S(3) allows a court to also make a restraining order in respect of that property to prevent it being dissipated prior to the enforcement of the unexplained wealth order.  To enable this to occur, subsection 179S(3) deems that certain requirements relevant to the making of a section 20A restraining order have been met.

Currently, there are a number of uncertainties surrounding the effect of subsection 179S(3). In particular, it is not clear what type of restraining order is created when an order is made under subsection 179S(3).  This may cause confusion for people subject to such an order about their legal rights.  These amendments will clarify how this section operates and make it clear that an order made under subsection 179S(3) is a restraining order under section 20A.  If a restraining order is made under subsection 179S(3), a person with an interest in that property has the same rights as if a restraining order under section 20A were made against them.  For example, the person can apply to have his or her interest excluded under section 29A or to have the order revoked under section 42.

Under this item, the court may make a restraining order under section 20A over property covered by a declaration under 179S(1), as if the requirements to obtain a section 20A restraining order had been met.  However, the court can only make an order under subsection 179S(3) following an application by the responsible authority.

This amendment will clarify what a court is required to have regard to when making an order under subsection 179S(3) and also removes the requirement for a court to consider those elements of a section 20A restraining order that are no longer relevant (either because they are captured within subsection 179S(3) or have become redundant following the making of the unexplained wealth order).

Item 20 - Section 179SA

Item 20 repeals section 179SA, which relates to the payment of legal expenses, and substitutes new sections 179SA and 179SB relating to the creation and registration of charges over property subject to a restraining order.

Repeal of existing section 179SA

Currently, section 179SA allows a court to order that property covered by an order under subsection 179S(1) be used to meet a person’s reasonable legal expenses arising from an application under the POC Act, instead of being available to satisfy an unexplained wealth order.  People who are subject to proceeds of crime proceedings (other than unexplained wealth proceedings) are not entitled to meet their legal costs from property covered by an order under the POC Act. 

The ability of a person to use property covered by an order under subsection 179S(1) to meet their legal costs weakens the effectiveness of the unexplained wealth provisions by allowing assets that would otherwise be confiscated to be used to contest proceedings.  This may lead to fewer assets being available for confiscation and is likely to cause more protracted litigation.

This amendment will harmonise provisions relating to the payment of legal expenses for unexplained wealth cases with those for other proceeds of crime proceedings.

Legal aid commissions will continue to be entitled to be reimbursed for legal costs incurred in representing people whose property is covered by a restraining order under the POC Act.  Matters under the POC Act have also been established as a priority civil law area for the allocation of Commonwealth funded legal services by State and Territory legal aid commissions under the National Partnership Agreement on Legal Assistance Services.  As a matter of practice, many jurisdictions’ legal assistance guidelines provide that, when determining whether legal assistance should be provided in relation to Commonwealth POC Act matters, any of a person’s property that is covered by a restraining order, or is likely to be covered by a restraining order, should be disregarded for the purposes of means tests.

This amendment implements Recommendation 10 of the PJC-LE’s final report.

Inclusion of new sections 179SA and 179SB

Unexplained wealth orders create a civil debt payable to the Commonwealth.  As such, an unexplained wealth order does not attach to particular property of a person or require that particular property be forfeited.

Other provisions in the POC Act that create a civil debt payable to the Commonwealth, such as pecuniary penalty orders and literary proceeds orders, allow for the creation and registration of charges over restrained property to secure payment of amounts owing to the Commonwealth.  This ensures that property is available to satisfy a pecuniary penalty order or a literary proceeds order if a person does not pay the amount specified in the order.  However, the same power does not exist for unexplained wealth orders.

Proposed sections 179SA and 179SB will allow charges to be created and registered over restrained property to secure payment of unexplained wealth amounts. 

Under proposed subsection 179SA(1), where an unexplained wealth order has been made against a person and the person is also the suspect in relation to a restraining order, upon the making of the later of the orders a charge is created over restrained property to secure the payment to the Commonwealth of the person’s unexplained wealth amount.

The charge is created over the person’s property and any other property over which the court has found the person has effective control (pursuant to subsection 179S(1).

There are a number of circumstances, set out in subsection 179SA(2), in which the charge may cease to have effect.  Some of those circumstances relate directly to the unexplained wealth order; others relate to the property the subject of the charge.

The charge will cease if a person successfully appeals against either the unexplained wealth order or restraining order, and the relevant order is discharged by the court.  If the person pays out the unexplained wealth amount in full, the charge ceases to have effect.

Certain sales or disposal of property also cause the cessation of the charge.  The property may be disposed of by order of the court under Division 4 of Part 4-1, or by the owner of the property with the consent of the court or (in certain circumstances) the Official Trustee.  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.

The responsible authority for the unexplained wealth order or restraining order can also determine that a charge ceases to have effect in respect of the property.  Any determination must be in writing.  This paragraph has been included to enable a responsible authority to properly manage charges over property to secure unexplained wealth amounts.  For example, if the restrained property over which the charge was created was separately being pursued for forfeiture under the POC Act, the responsible authority could choose to waive the charge over the property and seek to recover the unexplained wealth amount using other means available to it.

Subsection 179SA(3) provides that the charge is subject to all earlier encumbrances on the property that would otherwise have priority (other than an encumbrance in which the person who has had the unexplained wealth order made against them has an interest).  For example, if the restrained property is a house, there may be an earlier mortgage which upon disposal of the property would be paid out prior to payment of the unexplained wealth amount.

By operation of paragraph 179SA(3)(b), the charge has priority over all other encumbrances.

Paragraph 179SA(3)(c) enables a charge to continue to have effect, despite any change in ownership of the property.  However, this is subject to the matters set out in subsection 179SA(2).  For example, if the property was sold to a third person who paid sufficient consideration, had no knowledge that the property was subject to the charge, and otherwise acted in good faith, the charge would be affected by the change in ownership by virtue of paragraph 179SA(2)(d).  However, if the person did know of the charge or if the sale was not for sufficient consideration, then the conditions of paragraph 179SA(2)(d) would not be met, and subsection 179SA(3) would apply.  The property would remain subject to the charge, and may be disposed of to satisfy the unexplained wealth amount.  The purpose of these conditions is to ensure that a person cannot frustrate a charge by selling goods to a friend or family member below market value.

Proposed subsection 179SA(5) provides that a determination by the responsible authority for the unexplained wealth order or restraining order that a charge ceases to have effect in respect of the property made under paragraph 179SA(2)(e) is not a legislative instrument.  This provision has been included to assist readers, as the instrument is not a legislative instrument within the meaning of section 5 of the Legislative Instruments Act 2003 .

Proposed subsection 179SB(1) provides that where a law of the Commonwealth, or of a State or Territory provides for a system of registration for certain types of property the Official Trustee or the responsible authority for the unexplained wealth order or restraining order may cause the charge created under proposed subsection 179SA(1) to be registered in accordance with the provisions of that law.  For example, if a charge was created over real property, the Official Trustee or responsible authority would be able to register that charge in the property register within the state where the property is located.

Once registration has taken place, subsection 179SB(2) has the effect that any person who purchases or otherwise acquires an interest in the property is taken to have notice of the charge.  This means that once a charge is registered, any person who subsequently purchases the property will be deemed to have notice of the charge for the purposes of determining whether the charge should cease under paragraph 179SA(2)(d).

Subsection 179SB(3) provides that registration of a charge on certain types of personal property under the Personal Property Securities Act 2009 , includes the registration of data in relation to those types of property for the purposes of paragraph 148(c) of that Act.

These amendments will improve the enforcement of unexplained wealth orders by ensuring that restrained property can be used to satisfy an unexplained wealth order if a person does not pay an unexplained wealth amount.

This amendment implements Recommendation 11 of the PJC-LE’s final report.

Item 21 - Before subsection 179U(2)

Item 21 inserts a sub-heading ‘Appearing before the Committee’ before subsection 179U(2). This amendment is consequential to item 22, which inserts a new subsection increasing the PJC-LE’s oversight of investigations and litigation in relation to unexplained wealth.

Item 22 - At the end of section 179U

Item 22 inserts new subsections 179U(3) to (5), which will enhance reporting to the PJC-LE on investigations related to unexplained wealth and unexplained wealth litigation.

Under this item, the Commissioner of the AFP will be required to report on the number of matters investigated in the previous financial year by each enforcement agency where the likely outcome may be the initiation of unexplained wealth proceedings, and details on how that number has been calculated.  This will provide the PJC-LE with an overview of the number of unexplained wealth matters at investigation stage, though not all of these matters may ultimately be litigated.  The report will also be required to state the number of applications for unexplained wealth restraining orders and unexplained wealth orders, and the results of those applications.

The role of providing a report to the PJC-LE has been conferred upon the Commissioner of the AFP, as the AFP has conducted the majority of proceeds of crime investigations in the past and is the lead agency in the Criminal Assets Confiscation Taskforce.  It is envisaged that the Commissioner of the AFP is also the most likely authority to undertake litigation in relation to unexplained wealth.  Providing a consolidated response from all agencies will ensure that the report presents a complete picture of relevant investigations and litigation undertaken within the previous financial year.

Under proposed subsection 179U(4), the Commissioner of the AFP must provide the PJC-LE with the report as soon as practicable after the AFP’s annual report is laid before parliament under section 67 of the Australian Federal Police Act 1979 .  This will ensure that reporting under proposed subsection 179U(3) can be done in conjunction with other reporting requirements.

Proposed 179U(5) provides that the Commonwealth Director of Public Prosecutions or Chief Executive Officer (however described) of an enforcement agency must comply with any requests from the Commissioner of the AFP for information that the Commissioner considers is necessary to prepare the report to the PJC-LE under proposed subsection 179U(3).  This subsection will ensure that the Commissioner of the AFP has access to relevant information on investigations and litigation conducted by other agencies for the purpose of providing a consolidated report to the PJC-LE.  It is envisaged that the agency providing this information will remain responsible for the quality of that information and for answering any further questions that arise as a result of that information.

This item implements part of Recommendation 13 of the PJC-LE’s final report.

Items 23 and 24 - After paragraph 227(1)(h) and after paragraph 228(1)(d)

Items 23 and 24 insert new paragraphs into subsections 227(1) and 228(1) respectively.  These items will enable the seizure of things that are relevant to unexplained wealth proceedings during the execution of a warrant granted under section 225.

Under section 225 of the POC Act, a magistrate may issue a warrant to search a premises if satisfied by information on oath that there are reasonable grounds for suspecting  that there is at the premises (or will be within 72 hours) ‘tainted property’ or ‘evidential material’.

Tainted property is defined as proceeds of certain indictable offences or an instrument of an indictable offence.  Evidential material means evidence relating to:

  • property in respect of which action under the POC Act has or could be taken
  • benefits derived from the commission of certain offences, or
  • literary proceeds.

While the current search warrant provisions allow for the collection of some evidence in relation to property relevant to unexplained wealth proceedings, it is currently not possible to seize all evidence that would be relevant to an unexplained wealth investigation or proceeding.  For example, the current search warrant provisions would not necessarily allow the seizure of material relevant to ascertaining the total wealth of a person (such as evidence of a person’s income or legitimately acquired property) or evidence of unlawful activities from which a person has derived wealth.  Furthermore, officers are not able to collect evidence relating to summary offences and foreign offences, even though restraint action in unexplained wealth matters can be based on the commission of summary or indictable Commonwealth offences, or foreign indictable offences.

Item 23 will insert paragraph 227(1)(ha), which will require a search warrant to state the additional things that may be seized under these amendments.  Item 24 will insert paragraph 228(1)(da), which authorises the authorised officer or a person assisting to seize things that they reasonably believe to be things relevant to unexplained wealth proceedings. A definition of ‘things relevant to unexplained wealth proceedings’ will be inserted into section 338 by item 28.

These amendments will ensure that material relevant to unexplained wealth proceedings can be seized when searching premises under a warrant and will enhance the investigation of unexplained wealth matters.

This item implements Recommendation 5 of the PJC-LE’s final report.

Item 25 - Subparagraph 256(1)(b)(ii)

Item 25 amends subparagraph 256(1)(b)(ii) by omitting ‘and’ and substituting ‘or’.  This amendment is consequential to item 26, which inserts a new subparagraph after 256(1)(b)(ii).

Item 26 - At the end of paragraph 256(1)(b)

Item 26 inserts a new subparagraph into paragraph 256(1)(b) relating to the return of things relevant to unexplained wealth proceedings that have been seized under warrant. This amendment provides that the authorised officer responsible for executing the warrant must take reasonable steps to return these things where the reason that the thing was seized no longer exists or if it is decided that the thing is not to be used in evidence.

Item 27 - Subsection 304(2)

Item 27 amends subsection 304(2) by omitting ’42 to 45, 142 and 169’ and substituting ’42 to 45A, 142, 169 and 179SA’.  This item will expand the sections that do not apply in relation to an ‘interstate restraining order’ registered in the Supreme Court of a Territory under Division 1 of Part 4-5 of the POC Act, to also include sections 45A and 179SA. 

Subsection 304(1) of the POC Act provides that once an interstate restraining order is registered in the Supreme Court of a Territory it may be enforced as if it were a restraining order made under sections 17, 18, 19, 20 or 20A.  Division 1 of Part 4-5 also contains a number of provisions that govern the duration of registration of an interstate restraining order, cancellation of registration and creating charges over property that is subject to a registered interstate restraining order.  These provisions have been specifically drafted to take into account differences between how interstate restraining orders are registered and enforced and how restraining orders under sections 17, 18, 19, 20 or 20A of the POCA are obtained and enforced. 

Amending subsection 304(2) to provide that sections 45A and 179SA do not apply to a registered interstate restraining order will make it clear that the provisions in Division 1 of Part 4-5 governing interstate restraining orders are intended to operate to the exclusion of section 45A and 179SA (which provide for the cessation of unexplained wealth restraining orders and the creation of charges over restrained property to secure the payment of unexplained wealth amounts).  This will assist in avoiding confusion as to when the registration of an interstate restraining order ceases and when a charge is created over property covered by an interstate restraining order.

Item 28 - Section 338

Item 28 inserts a new definition of ‘thing relevant to unexplained wealth proceedings’ into section 338.  This definition complements the amendments made by items 23 and 24, which allow for the seizure of things relevant to unexplained wealth proceedings under a warrant granted under section 225.

A thing relevant to unexplained wealth proceedings means things that are reasonably suspected may be relevant for the purposes of initiating or conducting proceedings for an unexplained wealth restraining order under section 20A or under part 2-6 (which relates to the granting of preliminary unexplained wealth orders and unexplained wealth orders amongst other things).  This includes things in electronic form.

Things that might be relevant to an unexplained wealth proceeding may include things that show:

•        whether a person’s total wealth exceeds the value of the person’s wealth that was lawfully acquired

•        the amount by which a person’s total wealth exceeds the value of the person’s wealth that was lawfully acquired

•        whether a person has committed has an offence against a law of the Commonwealth, a foreign indictable offence or a State offence that has a federal aspect

•        whether the whole or any part of a person’s wealth was derived from an offence against a law of the Commonwealth, a foreign indictable offence or a State offence that has a federal aspect, or

•        whether particular property was lawfully acquired by a person, owned by a person or under the effective control of a person.

For example, this may include things that show that a person has legitimately derived part of his or her wealth (such as payslips, business documents, details of inheritances, details of debts or evidence of gifts), as well as things that show that the person’s wealth has not been lawfully derived (things that indicate that a person may have engaged in certain offences or things that indicate that a person is living an extravagant lifestyle that is not supported by their income).  It may also include things that go to quantifying the person’s wealth, such as property documents, information about investments or bank records.



Part 2 - Application of amendments

Item 29 - Application of amendments

Item 29 sets out how the amendments made in Part 1 of Schedule 1 apply.

Section 20A, 45 and 45A

Sub-item 29(1) provides that the amendments to section 20A of the POC Act apply to restraining orders applied for on or after the commencement of item 29, regardless of whether the application for the restraining order relates to property or wealth acquired before on or after commencement or to an offence suspected of being committed before on or after commencement.

Similarly, under Sub-item 29(2) of this item the amendments to sections 45 and 45A of the POC Act apply in relation to a restraining order made on or after commencement, regardless of whether the restraining order relates to property or wealth acquired before on or after commencement or to an offence suspected of being committed before on or after commencement.

While these amendments to section 20A will only apply to restraining orders applied for on or after commencement and the amendments to section 45 and 45A will only apply to restraining orders made on or after commencement, the operation of these amendments is partially retrospective.  However, the amendments do not create retrospective criminal liability.

Applying these provisions retrospectively is necessary to ensure their effective operation.  Under paragraph 20A(2)(a), unexplained wealth restraining orders may apply to all of the property of the suspect.  This property may have been accumulated over decades and it will often be difficult, if not impossible, to ascertain specifically when property or wealth was acquired.  As such, it is necessary for these amendments to apply to a person’s property or wealth regardless of when it was acquired to ensure that orders are not frustrated by requiring the precise point in time at which certain property or wealth was acquired to be established.

It is also necessary for this amendment to apply to offences regardless of when they are suspected to have been committed.  The criminal conduct from which a person may have profited or gained property may continue over several years (including over the time of commencement), may not be discovered immediately, or may not be able to be attributed to a specific date.  This is especially relevant for unexplained wealth proceedings which aim to target the heads of organised crime organisations who may have committed and/or profited from multiple offences over many years.

Sections 179B and 179E

Sub-item 29(3) provides that the amendments to sections 179B and 179E apply in relation to an unexplained wealth order applied for on or after the commencement of this item, regardless of whether that application relates to wealth that was acquired before on or after commencement.

While the amendments to sections 179B and 179E only apply to unexplained wealth orders that are applied for on or after commencement, the operation of these amendments is partially retrospective.  However, the amendments do not create retrospective criminal liability.

Applying these provisions retrospectively is necessary to ensure their effective operation.  Under section 179G of the POC Act, the amount of wealth a person has is calculated having regard to property owned, effectively controlled, disposed of or consumed by a person at any time, including before the time the Commonwealth’s unexplained wealth laws commenced.  This property may have been accumulated over decades and it will often be difficult, if not impossible, to ascertain specifically when property or wealth was acquired.  As such, it is necessary for these amendments to apply to a person’s wealth regardless of when it was acquired to ensure that orders are not frustrated by requiring the precise point in time at which certain wealth or property was acquired to be established.

Section 179N

Sub-item 29(4) provides that the amendments to 179N apply in relation to a preliminary unexplained wealth order obtained on or after commencement, regardless of when the application for the unexplained wealth order on which the preliminary unexplained wealth order is based was made or whether that application relates to wealth acquired before, on or after commencement.

While the amendments to section 179N only apply to preliminary unexplained wealth orders that are made on or after commencement, the operation of these amendments is partially retrospective.  However, the amendments do not create retrospective criminal liability.

Applying these amendments will ensure the effective operation of section 179N.  Under section 179G of the POC Act, the amount of wealth a person has is calculated having regard to property owned, effectively controlled, disposed of or consumed by a person at any time, including before the time the Commonwealth’s unexplained wealth laws commenced.  This property may have been accumulated over decades and it will often be difficult, if not impossible, to ascertain specifically when property or wealth was acquired.  As such, it is necessary for these amendments to apply to a person’s property or wealth regardless of when it was acquired to ensure that a court has the discretion to make an order extending the period for serving notice under subsection 179N(2) without requiring the precise point in time at which certain wealth or property was acquired to be established.

Similarly, these amendments will apply regardless of whether the application for the unexplained wealth order on which the preliminary unexplained wealth order is based was made before, on or after commencement.  This will ensure that a court still has the power to extend the period for serving notice, where it considers it appropriate to do so (for example, where a suspect is attempting to avoid service or it temporarily absent from the jurisdiction).

Section 179S

Sub-item 29(5) provides that amendments to section 179S apply in relation to an unexplained wealth order made on or after the commencement of this item, regardless of whether that unexplained wealth order relates to wealth that was acquired before on or after commencement, and whether the property subject to the order under subsection 179S(1) came under the effective control of the person against whom the unexplained wealth order has been made before, on or after commencement.

While the amendments to section 179S only apply to unexplained wealth orders that are made on or after commencement, the operation of these amendments is partially retrospective.  However, the amendments do not create retrospective criminal liability.

Applying these provisions retrospectively is necessary to ensure their effective operation.  Under section 179G of the POC Act, the amount of wealth a person has is calculated having regard to property owned, effectively controlled, disposed of or consumed by a person at any time, including before the time the Commonwealth’s unexplained wealth laws commenced.  This property may have been accumulated over decades and it will often be difficult, if not impossible, to ascertain specifically when property or wealth was acquired.  As such, it is necessary for these amendments to apply to a person’s wealth regardless of when it was acquired to ensure that orders are not frustrated by requiring the precise point in time at which certain wealth or property was acquired to be established.

Similarly, it will often not be possible to ascertain when certain property became under the effective control of the person who is subject to an unexplained wealth restraining order.  For example, the person who has effective control over property may not be the legal owner of that property or may maintain effective control using a complex system of companies and/or trusts.  As such, applying these provisions retrospectively will ensure that a person is not able to escape the operation of section 179S by arguing about the date that the property came under the effective control of the person subject to the unexplained wealth restraining order.

Repeal of section 179SA

Sub-item 29(6) preserves the operation of 179SA of the POC Act, which is being repealed under section 20, in relation to unexplained wealth orders made before the commencement of this item.  This will ensure that where an unexplained wealth order has been made prior to commencement, a court can still make an order for a person’s reasonable legal expenses to be met out of property covered by an order under subsection 179S(1).

Section 179SA and 179SB

Sub-item 29(7) provides that sections 179SA and 179SB (as inserted by Schedule 1) apply in relation to an unexplained wealth order made on or after the commencement of this item, regardless of whether that unexplained wealth order relates to wealth that was acquired before on or after commencement or whether the restraining order under subsection 179SA(1) is made before, on or after commencement.

While sections 179SA and 179SB will only apply to unexplained wealth orders that are made on or after commencement, the operation of these amendments is partially retrospective.  However, these provisions do not create retrospective criminal liability.

Applying these provisions retrospectively is necessary to ensure their effective operation.  Under section 179G of the POC Act, the amount of wealth a person has is calculated having regard to property owned, effectively controlled, disposed of or consumed by a person at any time, including before the time the Commonwealth’s unexplained wealth laws commenced.  This property may have been accumulated over decades and it will often be difficult, if not impossible, to ascertain specifically when property or wealth was acquired.  As such, it is necessary for these amendments to apply to a person’s wealth regardless of when it was acquired to ensure that these provisions are not frustrated by requiring the precise point in time at which certain wealth or property was acquired to be established.  Charges created under section 179SA will also occur automatically once the requirements of legislation have been met.  As such, if these provisions are not applied retrospectively, it could cause considerable confusion about whether a charge had or hadn’t been created.

Applying these new provisions to restraining orders regardless of when they were made will also ensure that unexplained wealth amounts can be more effectively recovered.  As the unexplained wealth provisions were developed to target the heads of organise crime organisations who may have committed or profited from multiple offences over many years, it is possible that multiple actions may be taken under the POC Act against a person. Applying this provision retrospectively will ensure that if an unexplained wealth order is obtained against a person, a charge can be created against other property that might be subject to a restraining order under the POC Act (regardless of when that order was obtained). 

Subsections 179U(3) to (5)

Sub-item 29(8) provides that subsections 179U(3) to (5) apply only to financial years starting from 1 June 2014. This provision has been included to give the Commissioner of the AFP and the CEOs of other enforcement agencies sufficient time to put in place structures to enable them to comply with their reporting obligations.

Sections 227, 228 and 256

Sub-item 29(9) provides that amendments to sections 227, 228 and 256 apply in relation to a search warrant that is applied for under this Act on or after commencement, regardless of whether the thing relates to property or wealth acquired, or an offence suspected of having been committed before, on or after commencement.

While the amendments to sections 227, 228 and 258 will only apply to unexplained wealth orders that are made on or after commencement, the operation of these amendments is partially retrospective.  However, these provisions do not create retrospective criminal liability.

Applying these provisions retrospectively is necessary to ensure their effective operation.  In deciding whether to initiate proceedings for an unexplained wealth restraining order and unexplained wealth order, it is often necessary to have regard to the total property owned by a suspect (including property that is under the person’s effective control, or that has been consumed or disposed of).  This property may have been accumulated over decades and it will often be difficult, if not impossible, to ascertain specifically when property or wealth was acquired.  As such, it is necessary for these amendments to apply to a person’s wealth regardless of when it was acquired to ensure that search warrants are not frustrated by requiring the precise point in time at which certain wealth or property was acquired to be established.

It is also necessary for this amendment to apply to offences regardless of when they are suspected to have been committed.  The criminal conduct from which a person may have profited or gained property may continue over several years (including over the time of commencement), may not be discovered immediately, or may not be able to be attributed to a specific date.  This is especially relevant for unexplained wealth proceedings which aim to target the heads of organised crime organisations who may have committed and/or profited from multiple offences over many years.



Schedule 2 - Firearms trafficking amendments

 

GENERAL OUTLINE

The purpose of this Schedule is to expand existing cross-border firearms trafficking offences in the Criminal Code and to introduce new aggravated offences for dealing in 50 or more firearms and firearm parts.

The amendments are aimed at expanding existing cross-border firearms trafficking offences in Part 9.4 of the Criminal Code to deal with firearms parts.  This is necessary to ensure that criminals cannot evade existing offences by breaking down firearms prior to trafficking them across national borders.

The amendments also introduce an aggravated offence targeting the trafficking of 50 or more firearms or firearms parts over a period of six months.  The aim of the aggravated offences is to hold traffickers responsible for the consequences of providing firearms and firearm parts from both domestic and international sources into the illicit market. 

In addition to expanding existing offences relating to the trafficking of firearms and firearm parts within Australia, this Schedule will also insert new international firearms trafficking offences into the Criminal Code.  The new offences will cover the importation and exportation of firearms and firearms parts and will also include an aggravated offence where 50 or more firearms are trafficked within a six month period.

As well as seeking to prevent firearms or firearm parts being illegally diverted for use by criminals or sale on the black market, these offences are intended to support efforts to prevent the flow of firearms to overseas illegal markets and work towards compliance with international obligations regarding the illicit trade of firearms. 

Cross-border trafficking offences

Part 9.4 of the Criminal Code contains offences criminalising the disposal or acquisition of a firearm where that activity occurs in the context of interstate trade or commerce.

The offences rely on existing State and Territory offences regarding the disposal and acquisition of a firearm.

The current offences only cover dealings in whole firearms, not firearm parts.  The amendments will ensure that firearms which are broken down into component parts, or parts that are trafficked to supply the illicit market, are covered by the cross-border trafficking offences.

The amendments in this Schedule will also introduce new aggravated cross-border trafficking offences.  The aggravated offences are directed at circumstances where 50 or more firearms or firearm parts are trafficked during a six month period.  These circumstances attract a higher penalty of life imprisonment, reflecting the seriousness of contributing large numbers of firearms to the illicit firearms market.  

International trafficking offences

Importing or exporting prohibited firearms is covered by existing offences under section 233BAB of the Customs Act 1901 .  The amendments to the Criminal Code to include international trafficking offences will strengthen the integrity of the import and export regime by introducing harsher penalties for the illegal importation or exportation of larger numbers of firearms.

It is an offence under the Customs Act to intentionally import or export firearms (which are classified as Tier 2 goods) without obtaining appropriate approval, with maximum penalties of 2,500 penalty units or 10 years imprisonment, or both.  The penalties for the new basic international trafficking offences are consistent with those in the Customs Act.

The amendments in this Schedule will also introduce new aggravated offences for international firearms trafficking.  The aggravated offences are directed at circumstances where 50 or more firearms or firearm parts are imported or exported during a six month period.  These circumstances attract a higher penalty of life imprisonment, reflecting the seriousness of contributing large numbers of firearms to the illicit firearms market within a short period of time.



Schedule 2 - Firearms trafficking amendments

 

Criminal Code Act 1995

Item 1

Section 360.1 currently defines disposal and acquisition of a firearm for the purposes of Division 360.  The amendments in Schedule 2 will broaden the scope of Division 360 to include firearm parts in addition to firearms.

Item 8 will insert a new definition of firearm part to mean either of the following within the meaning of the firearm law concerned: a firearm part; a part of, or for, a firearm or weapon. 

Item 1 will add ‘or firearm part’ to the end of the section 360.1 heading ‘Disposal and acquisition of a firearm’.

Item 2

Subsection 360.1(1) currently defines disposal of a firearm for the purposes of Division 360.  The amendments in Schedule 2 will broaden the scope of Division 360 to include firearm parts in addition to firearms.

Item 8 will insert a new definition of firearm part to mean either of the following within the meaning of the firearm law concerned: a firearm part; a part of, or for, a firearm or weapon. 

Item 2 will insert ‘or a firearm part’ after the first occurrence of ‘firearm’ in subsection 360.1(1).

Item 3

Paragraphs 360.1(1)(a), (b) and (c) currently define what constitutes the disposal of a firearm for the purposes of Division 360.  The amendments in Schedule 2 will broaden the scope of Division 360 to include firearm parts in addition to firearms.

Item 8 will insert a new definition of firearm part to mean either of the following within the meaning of the firearm law concerned: a firearm part; a part of, or for, a firearm or weapon. 

Item 3 will insert ‘or part’ after each occurrence of ‘firearm’ in paragraphs 360.1(1)(a), (b) and (c).

Item 4

Subsection 360.1(2) currently defines acquisition of a firearm for the purposes of Division 360.  The amendments in Schedule 2 will broaden the scope of Division 360 to include firearm parts in addition to firearms.

Item 8 will insert a new definition of firearm part to mean either of the following within the meaning of the firearm law concerned: a firearm part; a part of, or for, a firearm or weapon.

Item 4 will insert ‘or a firearm part’ after the first occurrence of ‘firearm’ in subsection 360.1(2).

Item 5

Paragraphs 360.1(2)(a), (b) and (c) currently define what constitutes the acquisition of a firearm for the purposes of Division 360.  The amendments in Schedule 2 will broaden the scope of Division 360 to include firearm parts in addition to firearms.

Item 8 will insert a new definition of firearm part to mean either of the following within the meaning of the firearm law concerned: a firearm part; a part of, or for, a firearm or weapon.

Item 5 will insert ‘or part’ after each occurrence of ‘firearm’ in paragraphs 360.1(2)(a), (b) and (c).

Item 6

The heading to section 360.2 currently refers to the ‘Cross-border offence of disposal or acquisition of a firearm’.  The amendments in Schedule 2 will broaden the scope of section 360.2 to cover cross-border trafficking of firearms parts, as well as whole firearms.

Item 8 will insert a new definition of firearm part to mean either of the following within the meaning of the firearm law concerned: a firearm part; a part of, or for, a firearm or weapon.

Item 6 amends the heading of section 360.2 to add ‘or firearm part’ at the end of the heading.

Item 7

This item repeals the existing cross-border firearms trafficking offences in subsections 360.2(1) and (2) and substitutes new, expanded offences.

Subsection 360.2(1) - Basic offence

New subsection 360.2(1) creates a new basic offence of cross-border trafficking of firearms or firearms parts.

To establish that the offence under subsection 360.2(1) has been committed, the prosecution will need to prove that:

·          the person has engaged in conduct that constitutes an offence against a firearm law (the underlying offence) as defined in subsection 360.2(3)

 

·          the person does so in the course of trade and commerce among the States, between a State and a Territory or between two Territories, and

 

·          the primary element of the underlying offence involves the disposal or acquisition of a firearm or firearm part by the person. 

Proposed paragraph 360.2(1)(a) relies on the existing State and Territory offences governing the disposal and acquisition of a firearm.  The proposed new offence imports elements of those State and Territory offences to ensure that the Commonwealth does not create offences with different or conflicting requirements.  Firearm law is defined for the purposes of paragraph 360.2 to be a law of a State or Territory which is prescribed by the regulations for the purposes of Division 360. 

Proposed new subsection 360.2(2A) provides that there is no fault element for the physical element in paragraph 360.2(1)(a) other than the fault elements for the underlying offence.  The underlying offences themselves have specific physical and fault elements that must be proved by the prosecution.  The prosecution will be required to establish beyond reasonable doubt all of the physical elements constituting the relevant underlying offence, including any fault elements applicable to that offence.

Paragraph 360.2(1)(b) requires the prosecution to prove that the person engaged in the relevant conduct in the course of trade or commerce among the States, between a State and Territory or between two Territories.  The prosecution may establish this element by proving, for example, that the firearms were taken from Queensland to South Australia and that a sum of money changed hands when they were delivered.  If the same conduct took place but the firearms were taken from Melbourne to Mildura, the offence in subsection 360.2(1) would not apply as the firearms did not cross a State or Territory border.  In that case, it would be open for the person to be prosecuted for an offence under Victorian law.

In accordance with paragraph 360.2(1)(c), the primary element of the underlying offence must involve the disposal or acquisition of a firearm or firearm part, as defined in subsection 360.1.  An unrelated offence under a firearm law will not fall within this requirement.  For example, an offence against a State or Territory firearm law where a bona fide seller fails to safely convey a firearm across a State or Territory border should not attract the same penalties that a purchaser in illicit cross-border trafficking should incur.  The application of absolute liability is discussed in detail below.

The basic offence will be punishable by a maximum penalty of 10 years imprisonment or a fine of 2,500 penalty units, or both.  This is consistent with the penalty for the existing offence under subsection 360.2(1). 

Paragraph 360.2(2B)(a) provides that, for the avoidance of doubt, a person does not commit the underlying offence for the purposes of paragraph 360.2(1)(a) if the person has a defence to the underlying offence.  This subsection will make it clear that a defendant is able to rely on any defences or special liability provisions that apply to the underlying offence.

Paragraph 360.2(2B)(b) provides that a person may be convicted of an offence against subsection 360.2(1) even if the person has not been convicted of the underlying offence.  The person must have engaged in the conduct that constitutes the underlying offence, but it is not necessary for them to have been convicted of that offence. 

Subsection 360.2(2C) applies absolute liability to the physical elements of the offence in paragraphs 360.2(1)(b) and (c) that:

·          the conduct occurs in the course of trade or commerce among the States or between a State and a Territory or between two Territories, and

 

·          the primary element of the underlying offence involves either the disposal of a firearm or firearm part or the acquisition of a firearm or firearm part, by the person.

Absolute liability is set out in section 6.2 of the Criminal Code.  The effect of applying absolute liability to an element of an offence is that no fault element needs to be proved and the defence of mistake of fact under section 9.2 of the Criminal Code is not available. 

Absolute liability is appropriate for the element of the offence that the conduct occurred in the course of trade or commerce among the States or between a State and a Territory or between two Territories because this element is a jurisdictional element of the offence.  A jurisdictional element of the offence is an element that does not relate to the substance of the offence, but marks a jurisdictional boundary between matters that fall within the legislative power of the Commonwealth and those that do not.  The issue of whether the person was reckless as to the fact that the conduct occurred in the course of trade or commerce among the States or between a State and a Territory or between two Territories is not relevant to their culpability. 

The application of absolute liability is also appropriate for the element of the offence that the primary element of the underlying offence involves either the disposal of a firearm or firearm part or the acquisition of a firearm or firearm part, by the person.  It is not appropriate for the prosecution to have to prove that the person knew or was reckless as to whether the primary element of the underlying offence involved the disposal or acquisition of a firearm or firearm part as, if this were the case, it would be reasonably easy for a defendant to avoid criminal liability for the offence by claiming that they were unaware of the content of the relevant State or Territory law.  Whether or not a defendant has knowledge of the content of the underlying offence is not relevant to their culpability.  For similar reasons, it is not appropriate for the defence of reasonable mistake of fact to be available to the defendant.  As set out in subsection 360.2(2A), the prosecution will be required to establish beyond reasonable doubt all of the elements constituting the relevant underlying offence, including any fault elements applicable to that offence.

This is consistent with Commonwealth criminal law practice, as described in the Guide to Framing Commonwealth Offences, Infringement Notices and Enforcement Powers .

The general defences available under Part 2.3 of the Criminal Code will be available to a person accused of an offence under subsection 360.2(1).

Subsection 360.2(2) - Aggravated offence

New subsection 360.2(2) will introduce an aggravated offence of disposing of or acquiring 50 or more firearms or firearm parts in a six month period, in a domestic cross-border context.

To establish this offence, the prosecution must prove that:

·          a person engaged in conduct on one or more occasions that constituted an offence (the underlying offence) against a firearm law as defined in subsection 360.2(3)

 

·          the conduct occurred in the course of trade or commerce among the States, between a State and Territory or between two Territories, and

 

·          the conduct on any occasion, or on two or more occasions taken together, results in the disposal or acquisition, by the person of:

 

-    50 or more firearms

-    50 or more firearm parts that might be used to constitute one or more firearms, or

 

-    a combination of firearms and firearms parts such that the sum of the actual firearms and the firearms that might be constituted by the parts is 50 or more, and

 

·          the relevant occasions of conduct, if more than one, happened within a six month period.

As with the basic offence in subsection 360.2(1), proposed paragraph 360.2(1)(a) relies on importing elements of underlying State and Territory offences to ensure that the Commonwealth does not create offences with different or conflicting requirements.  Firearm law is defined for the purposes of paragraph 360.2 to be a law of a State or Territory which is prescribed by the regulations for the purposes of Division 360. 

Subsection 360.2(2A) provides that there is no fault element for any of the physical elements described in paragraph 360.2(2)(a) (that the person engages in conduct on one or more occasions that constitutes an offence against a firearm law) other than the fault elements for the underlying offence.  The underlying offences themselves have specific physical and fault elements that must be proved by the prosecution.  The prosecution will be required to establish beyond reasonable doubt all of the elements constituting the relevant underlying offence, including any fault elements applicable to that offence. 

Paragraph 360.2(2)(b) requires the prosecution to prove that the person engaged in the relevant conduct in the course of trade or commerce among the States, between a State and Territory or between two Territories.  For example, to establish this element the prosecution may prove that firearms were taken from Queensland to South Australia and that a sum of money changed hands when they were delivered.  If the same conduct took place but the firearms were taken from Melbourne to Mildura, the offence in subsection 360.2 would not apply as the firearms did not cross a State or Territory border.  In accordance with subsection 360.2(2C), absolute liability will apply to this physical element.  The application of absolute liability is discussed in detail below.

In accordance with paragraph 360.2(2)(c), the primary element of the underlying offence must involve the disposal or acquisition of a firearm or firearm part, as defined in subsection 360.1.  An unrelated or minor offence under a firearm law will not fall within this requirement.  For example, an offence against a State or Territory firearm law where a bona fide seller fails to safely convey a firearm across a State or Territory border should not attract the same penalties that a purchaser in illicit cross-border trafficking should incur.  In accordance with subsection 360.2(2C), absolute liability will apply to this physical element.  The application of absolute liability is discussed in detail below.

Paragraph 360.2(2)(d) requires the prosecution to prove that the conduct resulted in the disposal or acquisition of 50 or more firearms or firearm parts or a combination.  The disposal or acquisition could occur all on one occasion (for example by 55 firearms being disposed of on a particular day) or on two or more occasions (eg 20 firearms being disposed of on three separate occasions within a six month period).  For example, a person in Victoria sells 28 handguns to a person in South Australia, and then subsequently acquires from the buyer 36 upper receivers on the delivery of the firearms. In accordance with subsection 360.2(2D), strict liability will apply to this physical element.  This application of strict liability is discussed in detail below.

Subparagraph 360.2(2)(d)(ii) provides that the offence covers conducts that results in the disposal, or acquisition, by the person of 50 or more firearm parts that might be used to constitute one or more firearms.  Relevant examples include:

·          A person in New South Wales sells 50 firearm barrels to a person in Queensland.  These 50 barrels, together with other firearm parts and components, can be used to constitute 50 firearms.

 

·          A person in South Australia obtains from an associate in New South Wales: a barrel, trigger mechanism, bolt and breech block for one firearm and 46 other firearm barrels.  The first barrel, trigger mechanism, bolt and breech block could, together with other firearm parts and components, be used to constitute one firearm.  The remaining 46 barrels could be used with other firearm parts and components to constitute 46 other firearms.

The threshold quantity of 50 or more firearms or firearm parts was chosen with reference to ‘trafficable’ quantities in State and Territory legislation.  For example, in Victoria, a trafficable quantity is referred to in the context that a person must not possess or acquire or dispose more than 10 firearms that are unregistered (section 7C and 101A Firearms Act 1996 ).

The threshold quantity of 50 or more firearms or firearm parts represents a significantly higher threshold than those in existing State or Territory offences, reflecting the severity of the penalties proposed.

The quantity also reflects the serious nature of supplying firearms and firearm parts to the illicit market.  Further, the imperishable nature of firearms means that illicit firearms can remain a serious threat to the Australian community for many years.

Paragraph 360.2(2)(e) requires the prosecution to prove that all of the relevant occasions of conduct on which the firearms or parts were disposed of or acquired happened within a six month period.  In accordance with subsection 360.2(2C), absolute liability will apply to this physical element.  This application of absolute liability is discussed in detail below.

For example, in a six month period starting in July, a person in New South Wales engages in the following conduct:

·          on 21 July, the person sells 40 firearms to a person in the ACT, who does not hold a  relevant licence to possess or use a firearm.

 

·          on 1 August, the person purchases two firearms from a person in Victoria

 

·          on 30 October, the person purchases five firearm barrels (firearm part) from a person in Victoria, and

 

·          on 15 December, the person sells three firearm upper receivers (firearm part) to a person in Queensland.

The time period of six months takes into account the time required for transport and also to take into account the different methods used by traffickers to avoid detection by law enforcement agencies.  This involves breaking up shipments or breaking downs firearms into their major component parts and transporting articles separately.

The aggravated offence will be punishable by a maximum penalty of life imprisonment, or a fine of 7,500 penalty units, or both.  This penalty reflects the higher level of culpability associated with an offence where the conduct involves the disposal or acquisition of large numbers of firearms or firearm parts in breach of State or Territory law.   This penalty is also reflective of the agreement and support between Australian Government, State and Territory Police Ministers for significant penalties for illegal importation and trafficking of firearms under the National Firearm Trafficking Policy Agreement 2002.

Paragraph 360.2(2B)(a) provides that, for the avoidance of doubt, a person does not commit the underlying offence for the purposes of paragraph 360.2(2)(a) if the person has a defence to the underlying offence.  This subsection will make it clear that a defendant is able to rely on any defences or special liability provisions that apply to the underlying offence.

Paragraph 360.2(2B)(b) provides that a person may be convicted of an offence against subsection 360.2(2) even if the person has not been convicted of the underlying offence.

Paragraph 360.2(2B)(c) provides that it is immaterial whether the underlying offence, or the conduct constituting the underlying offence, is the same on each occasion; or whether the firearms or firearm parts to which the conduct relates are of the same kind.  This provision will make it clear that an offence against subsection 360.2(2) may be committed even though the type of underlying offence, conduct constituting the underlying offence, or firearms or firearm parts to which the conduct relates may vary.

Subsection 360.2(2C) applies absolute liability to the physical elements of the offence in paragraphs 360.2(2)(b), (c) and (e) that:

·          the conduct occurs in the course of trade or commerce among the states or between a state and a territory or between two territories

 

·          the primary element of the underlying offence involves either the disposal of a firearm or firearm part or the acquisition of a firearm or firearm part, and

 

·          the occasions of conduct happened within a six month period.

Absolute liability is set out in section 6.2 of the Criminal Code.  The effect of applying absolute liability to an element of an offence means that no fault element needs to be proved and the defence of mistake of fact under section 9.2 of the Criminal Code is not available. 

Absolute liability is appropriate and required for paragraph 360.2(2)(b) of the offence (that the conduct occurred in the course of trade or commerce among the States or between a State and a Territory or between two Territories) because this element is a jurisdictional element of the offence.  A jurisdictional element of the offence is an element that does not relate to the substance of the offence, but marks a jurisdictional boundary between matters that fall within the legislative power of the Commonwealth and those that do not.  The issue of whether the person was reckless as to the fact that the conduct occurred in the course of trade or commerce among the states or between a state and a territory or between two territories is not relevant to their culpability.  This is consistent with Commonwealth criminal law practice, as described in the Guide to Framing Commonwealth Offences, Infringement Notices and Enforcement Powers .

Absolute liability is appropriate for paragraph 360.2(2)(c) of the offence (that the primary element of the underlying offence involves either the disposal or acquisition of a firearm or firearm part).  As set out in subsection 360.2(2A), the prosecution will be required to establish beyond reasonable doubt all of the elements constituting the relevant underlying offence, including any fault elements applicable to that offence.  It is not appropriate for the prosecution to also have to prove that the person knew or was reckless as to whether the primary element of the underlying offence involved the disposal or acquisition of a firearm or firearm part.  If this were the case, it would be reasonably easy for a defendant to avoid criminal liability for the offence by claiming that they were unaware of the content of the relevant State or Territory law.  Whether or not a defendant has knowledge of the content of the underlying offence is not relevant to their culpability.  For similar reasons, it is not appropriate for the defence of reasonable mistake of fact to be available to the defendant.  As set out in subsection 360.2(2A), the prosecution will be required to establish beyond reasonable doubt all of the elements constituting the relevant underlying offence, including any fault elements applicable to that offence.

Absolute liability is appropriate for paragraph 360.2(2)(e) of the offence (that the occasions of conduct happened within a six month period).  The six month period has been included to ensure that the offence only captures serious offending which indicates that the person was involved in trafficking high numbers of firearms within a short period.  It is not appropriate for the prosecution to be required to prove that the defendant knew or was reckless as to whether the relevant conduct was all engaged in during the specified six month period.  If this were the case, it would be reasonably easy for a defendant to avoid criminal liability for the offence by claiming that they thought the dealings in the firearms occurred over a longer period of time.  Whether or not a defendant has knowledge of the specific period of time over which they were trafficking firearms is not relevant to their culpability.  For similar reasons, it is not appropriate for the defence of reasonable mistake of fact to be available to the defendant.  The application of absolute liability is therefore appropriate.

Subsection 360.2(2D) applies strict liability to the physical element of the offence in paragraph 360.2(2)(d), that the conduct on any occasion, or on two or more occasions taken together, results in the disposal or acquisition, by the person of:

·          50 or more firearms, or

 

·          50 or more firearm parts that might be used to constitute one or more firearms, or

 

·          a combination of firearms and firearms parts such that the sum of the actual firearms and the firearms that might be constituted by the parts is 50 or more.

Strict liability is set out in section 6.1 of the Criminal Code.  The effect of applying strict liability to an element of an offence means that no fault element needs to be proved and the defence of mistake of fact is available. 

The application of strict liability is appropriate for the element that the defendant disposed of or acquired 50 or more firearms or firearm parts as it is reasonable to expect a defendant to take steps to ensure they are aware of the quantity of firearms or firearm parts they are disposing of or acquiring.  However, the defendant will still have the general defence of mistake of fact under section 9.2 of the Criminal Code available to them.

The defence of mistake of fact is set out in section 9.2 of the Criminal Code.  The defence provides that a person is not criminally responsible for an offence that includes a physical element to which strict liability applies if:

·            at or before the time of the conduct constituting the physical element, the person considered whether or not facts existed, and is under a mistaken but reasonable belief about those facts, and

·            had those facts existed, the conduct would not have constituted an offence.

For example, a defendant could adduce evidence to indicate that he or she had considered the number of firearms being disposed of and was under a reasonable belief that it was only 48 firearms.  If the prosecution is not able to disprove this, the person will not be subject to the aggravated offence.

The general defences under Part 2.3 of the Criminal Code will also be available to a person accused of an offence under subsection 360.2(2).

Finally, item 7 will insert the heading ‘Definitions’ before subsection 360.2(3).

Item 8

This item will amend subsection 360.2(3) to insert a definition of firearm part for the purposes of section 360.2.  A firearm part means either of the following within the meaning of the firearm law concerned: a firearm part; a part of, or for, a firearm or weapon. 

For example, a firearm part may include, but is not limited to, a frame for a firearm, a trigger mechanism, pistol slide, a barrel or a breech. 

Item 9

The heading to section 360.3 currently refers to ‘Taking or sending a firearm across borders’.  The amendments in Schedule 2 will broaden the scope of section 360.2 to cover cross-border trafficking of firearms parts, as well as whole firearms.

Item 8 will insert a new definition of firearm part to mean either of the following within the meaning of the firearm law concerned: a firearm part; a part of, or for, a firearm or weapon.

Item 9 amends the heading of section 360.3 to add ‘or firearm part’ at the end of the heading.

Item 10

This item inserts the heading ‘Basic offence’ before subsection 360.3(1).  This is necessary to distinguish the basic offence from the aggravated offence to be added into section 360.3 by item 15.

 

 

Item 11

Subsection 360.3(1) begins with the words ‘A person is guilty of an offence if’.  Item 11 omits the words ‘is guilty of an offence’ and substitutes ‘commits an offence against this subsection’.  This amendment reflects the preferred style of drafting offences in the Criminal Code.

Item 12

This item repeals paragraph 360.3(1)(a) and re-inserts the same items, separated into three separate paragraphs.  The proposed amendments made by this item bring the offence in subsection 360.3(1) into line with preferred drafting practice and ensure the physical and fault elements are consistent with the other offences (as amended by this Schedule) in Part 9.4.

To establish that an offence has been committed, under the new formulation the prosecution must establish beyond a reasonable doubt that:

·          the person intentionally takes or sends a thing from one State or Territory to another State or Territory

 

·          the person is reckless as to whether the thing is a firearm or a firearm part, and

 

·          the person does so in the course of trade or commerce among the States, between a State or Territory or between two Territories.

 

Proposed subsection 360.3(1B) provides that absolute liability applies to the physical element in paragraph 360.3(1)(ab) that the person did so in the course of trade and commerce among the States, between a State or Territory or between two Territories. 

Absolute liability is set out in section 6.2 of the Criminal Code.  The effect of applying absolute liability to an element of an offence means that no fault element needs to be proved and the defence of mistake of fact under section 9.2 of the Criminal Code is not available. 

Absolute liability is appropriate and required for paragraph 360.3(1)(ab) of the offence (that the conduct occurred in the course of trade or commerce among the States or between a State and a Territory or between two Territories) because this element is a jurisdictional element of the offence.  A jurisdictional element of the offence is an element that does not relate to the substance of the offence, but marks a jurisdictional boundary between matters that fall within the legislative power of the Commonwealth and those that do not.  The issue of whether the person was reckless as to the fact that the conduct occurred in the course of trade or commerce among the States or between a State and a Territory or between two Territories is not relevant to their culpability.  This is consistent with Commonwealth criminal law practice, as described in the Guide to Framing Commonwealth Offences, Infringement Notices and Enforcement Powers .

Item 13

Paragraph 360.3(1)(b) currently refers to a firearm being disposed of in a State or Territory.  The amendments in Schedule 2 will broaden the existing definitions to include firearm parts in addition to firearms.

Item 8 will insert a new definition of firearm part to mean either of the following within the meaning of the firearm law concerned: a firearm part; a part of, or for, a firearm or weapon. 

Item 13 will amend paragraph 360.3(1)(b) to include firearm parts by inserting ‘or part’ after ‘firearm’.

Item 14

Subparagraphs 360.3(1)(c)(i) and (ii) currently refer to a firearm being acquired or disposed of.  The amendments in Schedule 2 will broaden the existing definitions to include firearm parts in addition to firearms.

Item 8 will insert a new definition of firearm part to mean either of the following within the meaning of the firearm law concerned: a firearm part; a part of, or for, a firearm or weapon. 

Item 14 will amend subparagraphs 360.3(1)(c)(i) and (ii) to include firearm parts by inserting ‘or part’ after ‘firearm’.

Item 15

New subsection 360.3(1A) will introduce an aggravated offence of taking or sending 50 or more firearms or firearm parts in a six month period, in a domestic cross-border context.  This provision targets couriers who are agents in the illegal trafficking of firearms and firearm parts and who may not be directly captured by various disposal or acquisition offences under State or Territory law, yet are paid a premium to convey the illegal firearms across State and Territory borders and are aware they are illegal.

To establish this offence, the prosecution must prove beyond a reasonable doubt that:

·          the person intentionally takes or sends (on one or more occasions) one or more things from one State or Territory to another State or Territory

 

·          the person is reckless as to whether each thing is a firearm or firearm part

 

·          the person does so in the course of trade or commerce among the States, between a State and a Territory or between two Territories

 

·          the person intends that any of the firearms of firearm parts will be disposed of in the other State or Territory (whether by the person or another)

 

·          the person knows that, or is reckless as to whether, the disposal of any of the firearms or firearm parts, or any acquisition of any of the firearms or firearm parts, would happen in circumstances that would constitute an offence against the firearm law of that other State or Territory, and

 

·          the conduct on any occasion, or on two or more occasions taken together, results in the taking, or sending, by the person of:

 

-    50 or more firearms

 

-    50 or more firearm parts that might be used to constitute one or more firearms, or

 

-    a combination of firearms and firearms parts such that the sum of the actual firearms and the firearms that might be constituted by the parts is 50 or more, and

 

·          all of the relevant occasions of conduct occurred during a six month period.

‘Firearm law’ is defined in subsection 360.2(3) to mean a law of a State or Territory which is prescribed by the regulations for the purposes of Division 360.

An example of such an offence is where a person sends 12 firearms from Canberra to Queanbeyan where they are stored for a period of two months.  After that period has passed, the person collects the firearms from Queanbeyan and sells them to a person residing in Batemans Bay.  The person knows that the firearms are being sold outside of the framework established for the transfer of ownership by the laws of New South Wales.

Paragraph 360.3(1A)(c) requires the prosecution to prove that the person engaged in the relevant conduct in the course of trade or commerce among the States, between a State and Territory or between two Territories.  For example, to establish this element the prosecution may prove that firearms were taken from Queensland to South Australia and that a sum of money changed hands when they were delivered.  If the same conduct took place but the firearms were taken from Melbourne to Mildura, the offence in subsection 360.3(1A) would not apply as the firearms did not cross a State or Territory border.  In accordance with subsection 360.3(1B), absolute liability will apply to this physical element.  The application of absolute liability is discussed in detail below.

Paragraph 360.3(1A)(e) requires that an offender must either know or be reckless as to whether the disposal of any of the firearms or firearm parts, or any acquisition of any of the firearms or firearm parts subsequent to the disposal will contravene the relevant State or Territory law in the receiving State or Territory.  State and Territory laws impose a high standard of regulation on bona fide sellers or disposers of firearms or firearm parts.  These requirements include a seller or disposer requiring evidence from any purchaser or acquirer that that purchaser or acquirer is bona fide.

Paragraph 360.3(1A)(f) requires the prosecution to prove that the conduct resulted in the taking or sending of 50 or more firearms or firearm parts.  The taking or sending could occur all on one occasion (for example by 55 firearms being taken interstate on a particular day) or on two or more occasions (eg 20 firearms being sent interstate on three separate occasions within a six month period).  For example, a person in Victoria takes 28 handguns to a person in South Australia, and the following day takes 36 upper receivers from South Australia back to New South Wales. In accordance with subsection 360.3(1C), strict liability will apply to this physical element.  This application of strict liability is discussed in detail below.

Subparagraph 360.3(1A)(f)(ii) provides that the offence covers conduct that results in the taking, or sending, by the person of 50 or more firearm parts that might be used to constitute one or more firearms.  Relevant examples include:

·          A person in New South Wales sends 50 firearm barrels to a person in Queensland.  These 50 barrels, together with other firearm parts and components, can be used to constitute 50 firearms.

 

·          A person in South Australia takes to New South Wales: a barrel, trigger mechanism, bolt and breech block for one firearm and 46 other firearm barrels.  The first barrel, trigger mechanism, bolt and breech block could, together with other firearm parts and components, be used to constitute one firearm.  The remaining 46 barrels could be used with other firearm parts and components to constitute 46 other firearms.

The threshold quantity of 50 or more firearms or firearm parts was chosen with reference to ‘trafficable’ quantities in State and Territory legislation.  For example, in Victoria, a trafficable quantity is referred to in the context that a person must not possess or acquire or dispose more than 10 firearms that are unregistered (section 7C and 101A Firearms Act 1996 ).

The threshold quantity of 50 or more firearms or firearm parts represents a significantly higher threshold than those in existing State or Territory offences, reflecting the severity of the penalties proposed.

The quantity also reflects the serious nature of supplying firearms and firearm parts to the illicit market.  Further, illicit firearms can remain a serious threat to the Australian community for many years.

Paragraph 360.3(1A)(g) requires the prosecution to prove that all of the relevant occasions of conduct on which the firearms or parts were disposed of or acquired happened within a six month period.  In accordance with subsection 360.3(1B), absolute liability will apply to this physical element.  This application of absolute liability is discussed in detail below.

For example, in a six month period starting in July, a person in New South Wales engages in the following conduct:

·          on 21 July, the person sends 40 firearms to a person in the ACT, who does not hold a  relevant licence to possess or use a firearm

 

·          on 1 August, the person takes two firearms to Victoria

 

·          on 30 October, the person sends five firearm barrels to Victoria, and

 

·          on 15 December, the person sends three firearm upper receivers (firearm part) to Queensland.

The time period of six months takes into account the time required for transport and also to take into account the different methods used by traffickers to avoid detection by law enforcement agencies.  This involves breaking up shipments or breaking downs firearms into their major component parts and transporting articles separately.

The aggravated offence will be punishable by a maximum penalty of life imprisonment, or a fine of 7,500 penalty units, or both.  This penalty reflects the higher level of culpability associated with an offence where the conduct involves the taking or sending of large numbers of firearms or firearm parts while knowing or being reckless to the fact that the disposal or acquisition of any of the firearms or firearm parts would happen in circumstances that would be in breach of a State or Territory firearm law.

Subsection 360.3(1B) applies absolute liability to the elements of the offence that:

·          the conduct occurs in the course of trade or commerce among the States or between a state and a Territory or between two Territories, and

 

·          the occasions of conduct happened within a six month period.

Absolute liability is set out in section 6.2 of the Criminal Code.  The effect of applying absolute liability to an element of an offence means that no fault element needs to be proved and the defence of mistake of fact under section 9.2 of the Criminal Code is not available. 

Absolute liability is appropriate and required for paragraph 360.3(1A)(c) of the offence (that the conduct occurred in the course of trade or commerce among the States or between a State and a Territory or between two Territories) because this element is a jurisdictional element of the offence. 

A jurisdictional element of the offence is an element that does not relate to the substance of the offence, but marks a jurisdictional boundary between matters that fall within the legislative power of the Commonwealth and those that do not.  The issue of whether the person was reckless as to the fact that the conduct occurred in the course of trade or commerce among the States or between a State and a Territory or between two Territories is not relevant to their culpability.  This is consistent with Commonwealth criminal law practice, as described in the Guide to Framing Commonwealth Offences, Infringement Notices and Enforcement Powers .

Absolute liability is appropriate and required for paragraph 360.3(1A)(g) (that the occasions of conduct happened within a six month period.  The six month period has been included to ensure that the offence only captures serious offending which indicates that the person involved in trafficking high numbers of firearms within a short period.  It is not appropriate for the prosecution to be required to prove that the defendant knew or was reckless as to whether the relevant conduct was all engaged in during the specified six month period.  If this were the case, it would be reasonably easy for a defendant to avoid criminal liability for the offence by claiming that they thought the dealings in the firearms occurred over a longer period of time.  Whether or not a defendant has knowledge of the specific period of time over which they were trafficking firearms is not relevant to their culpability.  For similar reasons, it is not appropriate for the defence of reasonable mistake of fact to be available to the defendant.  The application of absolute liability is therefore appropriate.

Subsection 360.3(1C) applies strict liability to paragraph 360.3(1A)(f), that the conduct resulted in the taking or sending by the person of 50 or more firearms, firearm parts that might be used to constitute one or more firearms, or a combination of firearms and firearm parts such that the sum of the actual firearms and the firearms that might be constituted by the parts is 50 or more.

Strict liability is set out in section 6.1 of the Criminal Code.  The effect of applying strict liability to an element of an offence means that no fault element needs to be proved and the defence of mistake of fact is available.  Accordingly, in relation to paragraph 360.3(1A)(f), the prosecution will not need to prove that the defendant was reckless as to the fact that 50 or more firearms or firearm parts were taken or sent on any occasion or on two or more occasions taken together.

The application of strict liability is appropriate for the element that the defendant took or sent 50 or more firearms or firearm parts on any occasions or on two or more occasions taken together, as it is reasonable to expect a defendant to take steps to ensure they are aware of the quantity of firearms or firearm parts they are taking or sending.  However, the defendant will still have the general defence of mistake of fact under section 9.2 of the Criminal Code available to them.

For example, a defendant could adduce evidence to indicate they had considered the number of firearms and were under a reasonable belief that they were only sending 48.  If the prosecution is not able to disprove this, the person will not be subject to the aggravated offence.

The defence of mistake of fact is set out in section 9.2 of the Criminal Code.  The defence provides that a person is not criminally responsible for an offence that includes a physical element to which strict liability applies if:

·            at or before the time of the conduct constituting the physical element, the person considered whether or not facts existed, and is under a mistaken but reasonable belief about those facts, and

·            had those facts existed, the conduct would not have constituted an offence.

The general defences under Part 2.3 of the Criminal Code will also be available to a person accused of an offence under subsection 360.2(2).

To avoid doubt, subsection 360.3(1D) will provide that it is immaterial for the purposes of paragraphs 360.3(1A)(b) and (f) whether the firearms or firearm parts are of the same kind.  This provision will make it clear that an offence against subsection 360.3(1A) may be committed even though the type of firearms or firearm parts may vary.

Finally, item 15 will insert the heading ‘Definitions’ before subsection 360.3(2).

Item 16

This item will amend the definition under subsection 360.3(2) of firearm , for the purposes of section 360.3.  The amendment will add ‘or (1A)(e) (as the case requires)’ to the end of the definition that firearm means a firearm within the meaning of the firearm law mentioned in paragraph (1)(c).

This amendment reflects the addition of the aggravated offence in subsection 360.3(1A) by item 15 of this Schedule.

Item 17

This item will amend subsection 360.3(2) to insert a definition of firearm part for the purposes of section 360.3. 

A firearm part means either of the following within the meaning of the firearm law mentioned in paragraph (1)(c) or (1A)(e) (as the case requires): a firearm part; a part of, or for, a firearm or weapon.

For example, a firearm part may include, but is not limited to, a frame for a firearm, a trigger mechanism, pistol slide, a barrel or a breech.  Reference to the relevant State or Territory definitions is necessary for this Division.

Item 18

New section 360.3A addresses double jeopardy and alternative verdicts. 

Subsection 360.3A(1) will prevent a person who has been convicted or acquitted of an aggravated offence from being convicted of a basic offence relating to that aggravated offence that is alleged to have been committed in the period during which the person was alleged to have committed the aggravated offence.  This provision will ensure that a person cannot be convicted for both an aggravated and basic trafficking offence based on the same or substantially similar evidence.

Subsection 360.3A(2) will make it clear that subsection 360.3A(1) does not prevent an alternative verdict under subsection 360.3A(4).  Subsection 360.3A(4) allows for an alternative verdict if the trier of fact is not satisfied that the defendant is guilty of an aggravated offence, but is satisfied beyond a reasonable doubt that the defendant is guilty of a basic offence.

Subsection 360.3A(3) will prevent a person who has been convicted or acquitted of a basic offence relating to an aggravated offence from being convicted of the aggravated offence if any of the occasions relied on as evidence of the commission of the aggravated offence includes the conduct that constituted the basic offence.

Subsection 360.3A(4) allows for an alternative verdict if, on a trial for an aggravated offence, the trier of fact is not satisfied that the defendant is guilty of the aggravated offence, but is satisfied beyond reasonable doubt that the defendant is guilty of the basic offence relating to the aggravated offence.  This is on the condition that the defendant has been accorded procedural fairness in relation to the finding of guilt.

The purpose of this subsection is to ensure that offenders do not escape conviction on these lesser charges where an aggravated offence cannot be proven beyond reasonable doubt, but a lesser charge can.

Subsection 360.3A(5) defines ‘aggravated offence’ and ‘basic offence’ for the purposes of section 360.3A.  Aggravated offence is defined as an offence against subsection 360.2(2) or subsection 360.3(1A).  Basic offence relating to an aggravated offence is defined as:

·          if the aggravated offence is an offence against subsection 360.2(2), the basic offence is an offence under 360.2(1), and

 

·          if the aggravated offence is an offence against subsection 360.3(1A), the basic offence is an offence against subsection 360.3(1).

 

Item 19

This item inserts the number (1) before the existing text under section 360.4.  This reflects the fact that item 20 inserts new subsections 360.4(2) and (3).

Item 20

This item will insert additional subsections into section 360.4.

New subsection 360.4(2) will provide that, without limiting subsection 360.4(1), Division 360 is not intended to exclude or limit the concurrent operation of a law of a State or Territory that makes an act or omission that is an offence against a provision of Division 360, or a similar act or omission, an offence against the law of the State or Territory.

New subsection 360.4(3) will provide that subsection 360.4(2) will apply even if the law of the State or Territory does any one or more of the following:

·          provides for a penalty for the offence that differs from the penalty provided for in Division 360

 

·          provides for a fault element in relation to the offence that differs from the fault elements applicable to the offence under Division 360

 

·          provides for a defence in relation to the offence that differs from the defences applicable to the offence under Division 360.

The purpose of these subsections is to ensure that State and Territory laws that create overlapping offences or that regulate activities in relation to the trafficking of firearms or firearm parts will continue to operate alongside Division 360.

This approach of allowing overlapping Commonwealth, State and Territory offences to operate concurrently is consistent with Parliament’s approach to other serious crimes, including terrorism, serious harm, fraud, money laundering and sexual servitude offences.

Item 21

Division 361 - International firearms trafficking

This item inserts new Division 361 ‘International firearms trafficking’ into the Criminal Code.  The new Division will contain basic and aggravated offences for the importation and exportation of firearms and firearm parts.  They also mirror offences in the Customs Act 1901 , which prohibit absolutely the importation of firearms and firearm parts, without relevant permissions.

The basic and international firearms trafficking offences have been inserted into the Criminal Code to link and ensure consistency with the existing cross-border offences in the Criminal Code that apply to trafficking across State and Territory borders. 

Section 361.1 - Definitions

This subsection inserts necessary new definitions for the purposes of new Division 361.

Export of a firearm or firearm parts means export the firearm or part from Australia.

The definition of firearm has the same meaning as in the Customs (Prohibited Imports) Regulations 1956 .  These Regulations currently define a firearm to be a device designed or adapted to discharge shot, bullets or other projectiles by means of an explosive charge or a compressed gas, whether that device is fitted with a magazine or other feeding device designed to be used with it or not.  The definition specifically includes a deactivated firearm. 

The definition of firearm part has the same meaning as in the Customs (Prohibited Imports) Regulations 1956.  These Regulations currently define a firearm part to be any of the following items, whether or not complete, damaged, temporarily or permanently inoperable, or unfinished:

·          a gas piston, friction assembly, action bar, breech bolt or breech block

·          a firearm barrel

 

·          an assembled trigger mechanism

 

·          a receiver

 

·          something, other than a complete firearm, that includes one or more of these items.

Import a firearm or firearm part means import the firearm or part into Australia, and includes deal with the firearm or part in connection with its importation.

The definitions of import and export pick up the ordinary legal meaning of those terms. The definitions clarify that the import or export is into or out of Australia, and to extend the ordinary meaning of import to cover dealings in connection with importation. This is modelled on the definition in section 300.2 of the Criminal Code that applies for the purposes of the serious drugs offences in Part 9.1 of the Criminal Code.

Section 361.2 - Importing prohibited firearms and firearm parts

Basic offence

Section 361.2(1) will introduce the basic offence of importing prohibited firearms or firearms parts.  A person commits an offence under this section if they import a firearm or firearm part and the importation is prohibited under the Customs Act 1901 absolutely or the person has not obtained the requisite approval to import.

To establish the basic offence, the prosecution will need to prove beyond reasonable doubt that:

·          a person intentionally imports a thing

 

·          the person is reckless as to whether the thing is a firearm or firearm part, and

 

·          the importation of the firearm or firearm part was:

 

-            prohibited under the Customs Act 1901 absolutely, or

 

-           was prohibited under the Customs Act unless the approval of a particular person had been obtained and, at the time of importation, that approval had not been obtained.

The basic offence will be punishable by a maximum penalty of 10 years imprisonment or a fine of 2,500 penalty units, or both.  This is consistent with the penalty for the cross-border trafficking offences under Division 360 of the Criminal Code.

An example of this offence is where a person imports a fully automatic rifle, of which the importation is prohibited under the Customs Act without the appropriate approval, and is aware that it is highly likely that such an item would be prohibited but decides to nonetheless proceed with the importation. 

 

Subsection 361.2(3) provides that absolute liability applies to paragraph 361.2(1)(c), that the importation of the firearm or firearm part was prohibited under the Customs Act 1901 absolutely or was prohibited under the Act unless the approval of a particular person had been obtained and, at the time of the importation, will be absolute liability.  The application of absolute liability is, however, subject to subsection 361.2(4) as discussed in further detail below.

 

Absolute liability is set out in section 6.2 of the Criminal Code.  The effect of applying absolute liability to an element of an offence means that no fault element needs to be proved and the defence of mistake of fact under section 9.2 of the Criminal Code is not available.   Accordingly, the prosecution will not be required to prove that the defendant knew or was reckless to the fact that the importation of the firearm or firearm part was prohibited under the Customs Act 1901 absolutely or was prohibited under that Act unless the requisite approval had been obtained.

 

Absolute liability is appropriate and required for the element of the offence that the importation of the firearm or firearm part was prohibited.  It is not appropriate for the prosecution to also have to prove that the person knew or was reckless as to whether the importation of the article was prohibited or required approval.  If this were the case, it would be reasonably easy for a defendant to avoid criminal liability for the offence by claiming that they were unaware of the requirements of the Customs Act.  Whether or not a defendant has knowledge of the content of the Customs Act is not relevant to their culpability.  If the person imports firearms or firearm parts, it is reasonable to expect that they should be aware of the requirements of the Customs Act. For similar reasons, it is not appropriate for the defence of reasonable mistake of fact to be available to the defendant. The application of absolute liability is therefore appropriate.

 

Subsection 361.2(4) will apply strict liability to the physical element of circumstance of the offence that an approval had not been obtained at the time of the importation.

Strict liability is set out in section 6.1 of the Criminal Code.  The effect of applying strict liability to an element of an offence will mean that no fault element needs to be proved and the defence of mistake of fact is available.  The prosecution will still be required to prove the physical element that a permit was required and that the person did not hold a permit.

 

The application of strict, rather than absolute, liability to this element of the offence will make available the general defence of mistake of fact.  Therefore, if a person mistakenly believed that he or she had obtained the required permit to import a firearm or firearm part, the defence of mistake of fact would be available.

The defence of mistake of fact is set out in section 9.2 of the Criminal Code.  The defence provides that a person is not criminally responsible for an offence that includes a physical element to which strict liability applies if:

·          at or before the time of the conduct constituting the physical element, the person considered whether or not a fact existed, and is under a mistaken but reasonable belief about those facts, and

·          had those facts existed, the conduct would not have constituted an offence.

The general defences under Part 2.3 of the Criminal Code will also be available to a person accused of an offence under subsection 361.2(2).

Aggravated offence

New subsection 361.2(2) will introduce an aggravated offence that will apply if a person imports 50 or more prohibited firearms or firearm parts in a six month period. 

To establish this offence under subsection 361.2(2), the prosecution will need to prove beyond reasonable doubt that:

·          the person intentionally imports a thing

 

·          the person is reckless as to whether the thing is a firearm or firearm part

 

·          the importation of the firearm or firearm part:

 

-           was prohibited under the Customs Act 1901 absolutely, or

 

-           was prohibited under the Customs Act unless the approval of a particular person had been obtained and, at the time of importation, that approval had not been obtained

 

·          any occasion of importation, or two or more occasions taken together, results in the importation by the person of:

-    50 or more firearms, or

 

-    50 or more firearm parts that might be used to constitute one or more firearms, or

 

-    a combination of firearms and firearms parts such that the sum of the actual firearms and the firearms that might be constituted by the parts is 50 or more, and

·          the relevant occasions of importation occurred during a six month period.

An example of this offence is where a person imports 45 handguns knowing that it is highly likely that such items would require approval.  The person does not seek approval to bring the item into Australia.  The following month, the person arranges a further shipment of seven firearm receivers, with the intention of manufacturing seven firearms from these parts.

 

The aggravated offence will be punishable by a maximum penalty of life imprisonment, or a fine of 7,500 penalty units, or both.  This penalty reflects the higher level of culpability associated with an offence where the conduct involves importation of large numbers of firearms or firearm parts in breach of Commonwealth law. This penalty is also reflective of the agreement and support between the Australian Government and State and Territory Police Ministers for significant penalties for illegal importation and trafficking of firearms under the National Firearm Trafficking Policy Agreement 2002.

The threshold quantity of 50 or more firearms or firearm parts was chosen with reference to ‘trafficable’ quantities in State and Territory legislation.  For example, in Victoria, a trafficable quantity is referred to in the context that a person must not possess or acquire or dispose more than 10 firearms that are unregistered (section 7C and 101A Firearms Act 1996 ).

The threshold quantity of 50 or more firearms or firearm parts represents a significantly higher threshold than those in existing State or Territory offences, reflecting the severity of the penalties proposed.

The quantity also reflects the serious nature of supplying firearms and firearm parts to the illicit market.  Further, the imperishable nature of firearms means that illicit firearms can remain a serious threat to the Australian community for many years.

The six month period has been included to ensure that the offence only captures serious offending which indicates that the person involved in trafficking high numbers of firearms within a short period.  The time period of six months takes into account the time required for international transport and also to take into account the different methods used by traffickers to avoid detection by law enforcement agencies and Australian Customs Border Protection Service.  This involves breaking up shipments or breaking downs firearms into their major component parts and transporting articles separately.

Paragraph 361.2(2)(d) and (e) requires the prosecution to prove that all of the relevant occasions of conduct on which the firearms or parts were imported happened within a six month period.  For example, in a six month period starting in January, a person in Australia engages in the following conduct:

·          in January, they order 40 firearm barrels (firearm part) from the USA

 

·          in March, they purchase two handguns from Germany

 

·          in April, they purchase seven trigger mechanisms (firearm part) from  New Zealand

 

·          in July, they purchase three firearms from Papua New Guinea.

Subparagraph 361.2(2)(d)(ii) provides that the offence covers conduct that results in the importation by the person of 50 or more firearm parts that might be used to constitute one or more firearms.  Relevant examples include:

·          A person in Australia imports 50 firearm barrels from New Zealand.  These 50 barrels, together with other firearm parts and components, can be used to constitute 50 firearms.

 

·          A person in Australia imports: a barrel, trigger mechanism, bolt and breech block for one firearm and 46 other firearm barrels.  The first barrel, trigger mechanism, bolt and breech block could, together with other firearm parts and components, be used to constitute one firearm.  The remaining 46 barrels could be used with other firearm parts and components to constitute 46 other firearms.

Subsection 361.2(3) provides that absolute liability applies to the physical elements in paragraph 361.2(2)(c) that the importation of the firearm or firearm part was prohibited under the Customs Act 1901 absolutely or was prohibited under that Act unless the approval of a particular person had been obtained and, at the time of the importation, it had not been obtained.  The application of absolute liability is, however, subject to subsection 361.2(4) as discussed in further detail below.

 

Absolute liability is set out in section 6.2 of the Criminal Code.  The effect of applying absolute liability to an element of an offence is that no fault element needs to be proved and the defence of mistake of fact under section 9.2 of the Criminal Code is not available. 

 

Accordingly, the prosecution will not be required to prove that the defendant was reckless to the fact that the import of the firearm or firearm part was prohibited under the Customs Act 1901 absolutely or was prohibited under that Act unless the requisite approval had been obtained.

 

It is not appropriate for the prosecution to have to prove that the person knew or was reckless as to whether the import of the article was prohibited or required approval.  If this were the case, it would be reasonably easy for a defendant to avoid criminal liability for the offence by claiming that they were unaware of the requirements of the Customs Act.  Whether or not a defendant has knowledge of the content of the Customs Act is not relevant to their culpability.  If the person imports firearms or firearm parts, it is reasonable to expect that they should be aware of the requirements of the Customs Act.  For similar reasons, it is not appropriate for the defence of reasonable mistake of fact to be available to the defendant.  The application of absolute liability is therefore appropriate.

 

Subsection 361.2(4) will apply strict liability to the physical element of circumstance of the offence that an approval had not been obtained at the time of the importation.

Strict liability is set out in section 6.1 of the Criminal Code.  The effect of applying strict liability to an element of an offence will mean that no fault element needs to be proved and the defence of mistake of fact is available.  The prosecution will still be required to prove the physical element that a permit was required and that the person did not hold a permit.

The application of strict, rather than absolute, liability to this element of the offence will make available the general defence of mistake of fact.  Therefore, if a person mistakenly believed that he or she had obtained the required permit to import a firearm or firearm part, the defence of mistake of fact would be available.

The defence of mistake of fact is set out in section 9.2 of the Criminal Code.  The defence provides that a person is not criminally responsible for an offence that includes a physical element to which strict liability applies if:

·          at or before the time of the conduct constituting the physical element, the person considered whether or not a fact existed, and is under a mistaken but reasonable belief about those facts, and

·          had those facts existed, the conduct would not have constituted an offence.

The general defences under Part 2.3 of the Criminal Code will also be available to a person accused of an offence under subsection 361.2(2).

Subsection 361.2(5) will also apply strict liability to paragraph 361.2(2)(d), which provides that any occasion of importation, or two or more occasions taken together, results in the importation by the person of:

·          50 more firearms

 

·          50 or more firearm parts that might be used to constitute one or more firearms, or

 

·          a combination of firearms and firearm parts such that the sum of the actual firearms and the firearms that might be constituted by the parts is 50 or more.

Accordingly, the prosecution will not be required to prove that the defendant was reckless as to the fact that 50 or more firearms or firearm parts were imported. 

The application of strict liability is appropriate for the element that the defendant imported 50 or more firearms or firearm parts as it is reasonable to expect a person to take steps to ascertain the quantity of firearms or firearm parts they are importing.  However, the defendant will still have the general defence of mistake of fact under section 9.2 of the Criminal Code available to them.

Subsection 361.2(6) will provide that in order to avoid doubt, it is immaterial for the conduct of importing 50 or more firearms or firearm parts, whether the firearms or firearm parts are of the same kind.  This provision will make it clear that an offence against subsection 361.2(2) may be committed even though the type of firearm of firearm part may vary.

 

Section 361.3 - Exporting prohibited firearms and firearm parts

Basic offence

Section 361.3(1) introduces the basic offence of exporting prohibited firearms or firearms parts.  A person commits an offence under this section if they export a firearm or firearm part and the exportation is prohibited under the Customs Act 1901 absolutely or the person has not obtained the requisite approval to export.

To establish the basic offence, the prosecution will need to prove beyond reasonable doubt that:

·          a person intentionally exports a thing

 

·          the person is reckless as to whether the thing is a firearm or firearm part, and

 

·          the exportation of the firearm or firearm part was:

 

-           prohibited under the Customs Act 1901 absolutely, or

 

-           was prohibited under the Act unless the approval of a particular person had been obtained and, at the time of exportation, that approval had not been obtained.

The basic offence will be punishable by a maximum penalty of 10 years imprisonment or a fine of 2,500 penalty units, or both.  This is consistent with the penalty for the cross-border trafficking offences under Division 360 of the Criminal Code.

An example of this offence is where a person exports a handgun, of which the exportation is prohibited under the Customs Act without the appropriate approval, and is aware that it is highly likely that such an item would be prohibited but decides to nonetheless proceed with the exportation. 

 

Subsection 361.3(3) provides that, subject to subsection 361.3(4), absolute liability applies to  paragraphs 361.3(1)(c) that the exportation of the firearm or firearm part was prohibited under the Customs Act 1901 absolutely or was prohibited under that Act unless the approval of a particular person had been obtained.

 

Absolute liability is set out in section 6.2 of the Criminal Code.  The effect of applying absolute liability to an element of an offence means that no fault element needs to be proved and the defence of mistake of fact under section 9.2 of the Criminal Code is not available.  

 

Accordingly, the prosecution will not be required to prove that the defendant knew or was reckless to the fact that the exportation of the firearm or firearm part was prohibited under the Customs Act 1901 absolutely or was prohibited under that Act unless the requisite approval had been obtained.

 

It is not appropriate for the prosecution to have to prove that the person knew or was reckless as to whether the export of the article was prohibited or required approval.  If this were the case, it would be reasonably easy for a defendant to avoid criminal liability for the offence by claiming that they were unaware of the requirements of the Customs Act.  Whether or not a defendant has knowledge of the content of the Customs Act is not relevant to their culpability.  If the person exports firearms or firearm parts, it is reasonable to expect that they should be aware of the requirements of the Customs Act.  For similar reasons, it is not appropriate for the defence of reasonable mistake of fact to be available to the defendant.  The application of absolute liability is therefore appropriate.

 

Subsection 361.3(4) will apply strict liability to the physical element of circumstance of the offence that an approval had not been obtained at the time of the exportation.

 

Strict liability is set out in section 6.1 of the Criminal Code.  The effect of applying strict liability to an element of an offence will mean that no fault element needs to be proved and the defence of mistake of fact is available.  The prosecution will still be required to prove the physical element that a permit was required and that the person did not hold a permit.

 

Applying strict liability to this element of the offence is appropriate given it would very unlikely that the accused was not aware that they had not obtained export permission.  However, the application of strict, rather than absolute, liability to this element of the offence will make available the general defence of mistake of fact.  Therefore, if a person mistakenly believed that he or she had obtained the required permit to import a firearm or firearm part, the defence of mistake of fact would be available.

 

The defence of mistake of fact is set out in section 9.2 of the Criminal Code.  The defence provides that a person is not criminally responsible for an offence that includes a physical element to which strict liability applies if:

·          at or before the time of the conduct constituting the physical element, the person considered whether or not a fact existed, and is under a mistaken but reasonable belief about those facts, and

·          had those facts existed, the conduct would not have constituted an offence.

The general defences under Part 2.3 of the Criminal Code will also be available to a person accused of an offence under subsection 361.2(2).

Aggravated offence

New subsection 361.3(2) will introduce an aggravated offence that will apply if a person exports 50 or more prohibited firearms or firearm parts in a six month period. 

To establish this offence under subsection 361.3(2), the prosecution will need to prove beyond reasonable doubt that:

·          the person intentionally exports a thing

 

·          the person is reckless as to whether the thing is a firearm or firearm part

 

·          the exportation of the firearm or firearm part:

 

-        was prohibited under the Customs Act 1901 absolutely, or

 

-        was prohibited under the Act unless the approval of a particular person had been obtained and, at the time of exportation, that approval had not been obtained

 

·          any occasion of exportation, or two or more occasions taken together, results in the exportation by the person of:

-   50 or more firearms, or

 

-   50 or more firearm parts that might be used to constitute one or more firearms, or

 

-   a combination of firearms and firearms parts such that the sum of the actual firearms and the firearms that might be constituted by the parts is 50 or more, and

·          the occasions of exportation occurred during a six month period

The aggravated offence will be punishable by a maximum penalty of life imprisonment, or a fine of 7,500 penalty units, or both.  This penalty reflects the higher level of culpability associated with an offence where the conduct involves exportation of large numbers of firearms or firearm parts in breach of Commonwealth law.

The threshold quantity of 50 or more firearms or firearm parts was chosen with reference to ‘trafficable’ quantities in State and Territory legislation.  For example, in Victoria, a trafficable quantity is referred to in the context that a person must not possess or acquire or dispose more than 10 firearms that are unregistered (section 7C and 101A Firearms Act 1996 ).

The threshold quantity of 50 or more firearms or firearm parts represents a significantly higher threshold than those in existing State or Territory offences, reflecting the severity of the penalties proposed.

The quantity also reflects the serious nature of supplying firearms and firearm parts to the illicit market.  Further, the imperishable nature of firearms means that illicit firearms can remain a serious threat to the Australian community for many years.

 

The six month period has been included to ensure that the offence only captures serious offending which indicates that the person involved in trafficking high numbers of firearms within a short period.  The time period of six months takes into account the time required for international transport and also to take into account the different methods used by traffickers to avoid detection by law enforcement agencies and Australian Customs Border Protection Service.  This involves breaking up shipments or breaking downs firearms into their major component parts and transporting articles separately.

Paragraph 361.3(2)(d) and (e) requires the prosecution to prove that all of the relevant occasions of conduct on which the firearms or parts were exported happened within a six month period.  For example, in a six month period starting in January, a person in Australia engages in the following conduct:

·          in January, they export 40 firearm barrels (firearm part) to the USA

 

·          in March, they export two handguns to Germany

 

·          in April, they export seven trigger mechanisms (firearm part) to New Zealand

 

·          in July, they export three firearms to Papua New Guinea.

Subparagraph 361.3(2)(d)(ii) provides that the conduct results in the exportation by the person of 50 or more firearm parts that might be used to constitute one or more firearms.  Relevant examples include:

·          A person in Australia exports 50 firearm barrels to New Zealand.  These 50 barrels, together with other firearm parts and components, can be used to constitute 50 firearms.

 

·          A person in Australia exports: a barrel, trigger mechanism, bolt and breech block for one firearm and 46 other firearm barrels.  The first barrel, trigger mechanism, bolt and breech block could, together with other firearm parts and components, be used to constitute one firearm.  The remaining 46 barrels could be used with other firearm parts and components to constitute 46 other firearms.

Subsection 361.3(3) provides that, subject to subsection 361.3(4), absolute liability applies to the physical elements described in paragraph 361.3(2)(c) that the exportation of the firearm or firearm part was prohibited under the Customs Act 1901 absolutely or was prohibited under the Act unless the approval of a particular person had been obtained; and paragraph 361.3(2)(e) that the occasions of exportation occurred during a six month period.

Absolute liability is set out in section 6.2 of the Criminal Code.  The effect of applying absolute liability to an element of an offence means that no fault element needs to be proved and the defence of mistake of fact under section 9.2 of the Criminal Code is not available. 

Accordingly, the prosecution will not be required to prove that the defendant was reckless to the fact that the exportation of the firearm or firearm part was prohibited or was prohibited under the Customs Act 1901 unless the requisite approval had been obtained.

It is not appropriate for the prosecution to also have to prove that the person knew or was reckless as to whether the article was prohibited or required approval.  If this were the case, it would be reasonably easy for a defendant to avoid criminal liability for the offence by claiming that they were unaware that approval was required.  If the person has a legitimate business involving the import of firearms or firearm parts, they would be very familiar with the requirements of the Customs Act and would be actively engaged in complying with those rules. For similar reasons, it is not appropriate for the defence of reasonable mistake of fact to be available to the defendant. The application of absolute liability is therefore appropriate. Subsection 361.3(4) will apply strict liability to the physical element of circumstance of the offence that an approval had not been obtained at the time of the exportation.

Strict liability is set out in section 6.1 of the Criminal Code.  The effect of applying strict liability to an element of an offence will mean that no fault element needs to be proved and the defence of mistake of fact is available.  The prosecution will still be required to prove the physical element that a permit was required and that the person did not hold a permit.

Applying strict liability to this element of the offence is appropriate given it would very unlikely that the accused was not aware that they had not obtained export permission.  However, the application of strict, rather than absolute, liability to this element of the offence will make available the general defence of mistake of fact.  Therefore, if a person mistakenly believed that he or she had obtained the required permit to import a firearm or firearm part, the defence of mistake of fact would be available.

The defence of mistake of fact is set out in section 9.2 of the Criminal Code.  The defence provides that a person is not criminally responsible for an offence that includes a physical element to which strict liability applies if:

·          at or before the time of the conduct constituting the physical element, the person considered whether or not a fact existed, and is under a mistaken but reasonable belief about those facts, and

·          had those facts existed, the conduct would not have constituted an offence.

The general defences under Part 2.3 of the Criminal Code will also be available to a person accused of an offence under subsection 361.2(2).

Subsection 361.3(5) will also apply strict liability to subsection 361.3(2)(d), which provides that any occasion of exportation, or two or more occasions taken together, results in the exportation by the person of:

·          50 more firearms, or

 

·          50 or more firearm parts that might be used to constitute one or more firearms, or

 

·          a combination of firearms and firearm parts such that the sum of the actual firearms and the firearms that might be constituted by the parts is 50 or more.

Accordingly, the prosecution will not be required to prove that the defendant was reckless as to the fact that 50 or more firearms or firearm parts were exported during the six month period.

 

The application of strict liability is appropriate for the element that the defendant exported 50 or more firearms or firearm parts as it is reasonable to expect a person to take steps to ascertain the quantity of firearms or firearm parts they are exporting.  However, the defendant will still have the general defence of mistake of fact under section 9.2 of the Criminal Code available to them.

 

Subsection 361.3(6) will also provide that in order to avoid doubt, it is immaterial for the conduct of exporting 50 or more firearms or firearm parts, whether the firearms or firearm parts are of the same kind.  This provision will make it clear that an offence against subsection 361.3(2) may be committed even though the type of firearm of firearm part may vary.

 

Section 361.4 - Defence - reasonable belief that conduct is justified or excused by or under law

 

Section 361.4 sets out a defence to an offence against Division 361 if at the time of the conduct constituting the offence, the person was under a mistaken, but reasonable belief that the conduct was justified or excused by or under a law of the Commonwealth or of a State or Territory and had the conduct been so justified or excused, the conduct would not have constituted the offence.

The defences are modelled on the defences applying to comparable serious drug importation and exportation offences in Part 9.1 of the Criminal Code and are aimed at ensuring administrative errors or misunderstandings occurring in the course of bona fide legitimate business do not result in convictions for offences that are intended only to target those involved in the illicit firearms trade. 

In this type of situation, a person would not be covered by the lawful authority defence in section 10.5 of the Criminal Code, because there would be no actual justification or excuse under law if that lawful authority was defective, even if it the defendant believed it was effective.

Under section 13.3(3) of the Criminal Code, the defendant bears an evidential burden for this defence.  This means that the defendant has the burden of adducing or pointing to evidence that suggests a reasonable possibility that they were under a mistaken but reasonable belief that the conduct was justified or excused under a law of the Commonwealth, State or Territory.  If the defendant meets this burden, and the prosecution bears a legal burden of disproving the matter in accordance with subsection 13.2(2) of the Criminal Code.  If the prosecution is not able to disprove the defence beyond a reasonable doubt, the defendant is not criminally responsible for an offence against Division 361.

It will generally be much easier for a defendant, rather than the prosecution, to produce evidence showing that the circumstances to which the defence applies do in fact exist because such evidence will be peculiarly within the knowledge of the defendant.  The defendant will more easily be able to lead evidence of the belief that he or she held that the conduct was justified or excused by a law and point to evidence of why it was reasonable for him or her to hold that belief.

This defence is designed to protect those who reasonably believe that their conduct of importing or exporting prohibited firearms is permitted but do not in fact have the requisite permission due administrative or technical problems (for example, if a relevant authority informs them that they are authorised to import or export but in fact they are not authorised as the permission was not provided by the appropriate authority). This defence will ensure that legitimate industry will not be inadvertently caught by the new offences.

Section 361.5 - Double jeopardy and alternative verdicts

New section 361.5 addresses double jeopardy and alternative verdicts. 

Subsection 361.5(1) will prevent a person who has been convicted or acquitted of an aggravated offence from being convicted of a basic offence relating to that aggravated offence that is alleged to have been committed in the period during which the person was alleged to have committed the aggravated offence.  This provision will ensure that a person cannot be convicted for both an aggravated and basic offence based on the same or substantially similar evidence.

Subsection 361.5(2) will make it clear that subsection 361.5(1) does not prevent an alternative verdict under subsection 361.5(4).  Subsection 361.5(4) allows for an alternative verdict if the trier of fact is not satisfied that the defendant is guilty of an aggravated offence, but is satisfied beyond a reasonable doubt that the defendant is guilty of a basic offence

Subsection 361.5(3) will prevent a person who has been convicted or acquitted of a basic offence relating to an aggravated offence from being convicted of the aggravated offence if any of the occasions relied on as evidence of the commission of the aggravated offence includes the conduct that constituted the basic offence.

Subsection 361.5(4) allows for an alternative verdict if, on a trial for an aggravated offence, the trier of fact is not satisfied that the defendant is guilty of the aggravated offence, but is satisfied beyond reasonable doubt that the defendant is guilty of the basic offence relating to the aggravated offence.  This is on the condition that the defendant has been accorded procedural fairness in relation to the finding of guilt.

The purpose of this subsection is to ensure that offenders do not escape conviction on these lesser charges where an aggravated offence cannot be proven beyond reasonable doubt, but a lesser charge can.

Subsection 361.5(5) defines ‘aggravated offence’ and ‘basic offence’ for the purposes of section 361.5.  Aggravated offence is defined as an offence against subsection 361.2(2) or 361.3(2).  Basic offence relating to an aggravated offence means:

·          if the aggravated offence is an offence against subsection 361.2(2), the basic offence is an offence under 360.2(1), and

 

·          if the aggravated offence is an offence against subsection 361.3(2), the basic offence is an offence against subsection 361.3(1).

as it is reasonable to expect a person to take steps to ascertain the quantity of firearms or firearm parts they are importing.