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Tuesday, 5 May 1987
Page: 2593

Mr LINDSAY(4.17) —The Sea Installations Bill 1987 is one of a number of Bills required to put in place a scheme to regulate the operation of certain off-shore sea installations fixed or moored to the sea bed of the Australian continental shelf beyond the territorial sea. This Bill will facilitate the development of technically sound, environmentally acceptable and economically viable sea installations. The Bill provides a basis for the application of important Commonwealth laws, and for State or Territory laws to be adopted as Commonwealth laws. These provisions are parallel to those already applying under the Petroleum (Submerged Lands) Act 1967 which regulates off-shore petroleum and mineral exploration and extraction.

The central purpose of the Bill is to require a person to obtain a permit before operating a sea installation installed in the waters beyond the Australian territorial sea but within the outer limits of the continental shelf or Australia's 200-nautical mile fishing zone. `Sea Installation' is defined in clause 3 (1) of the Bill as a man-made structure which can be used for an `environment related activity'. Off-shore drilling rigs and drilling vessels are expressly excluded, as are defence installations and, by virtue of paragraph (g) of the definition, prescribed structures. The term `environment related activity' is defined as any activity relating to tourism or recreation, the carrying on of a business, the exploitation of the living resources, marine archaeology or by virtue of paragraph (e) of the relevant definition, any prescribed purpose.

Just over two years ago the Hawke Government-an authentic Australian government-decided that legislation should be provided to regulate the operation of off-shore tourist installations fixed or moored to the Australian continental shelf and beyond the territorial sea and the Great Barrier Reef region and to ensure a satisfactory revenue outcome. The decision was largely prompted by a proposal by Barrier Reef Holdings Ltd to build a large floating tourist complex on John Brewer Reef, a large coral formation seven kilometres long by three kilometres wide lying some 70 kilometres north-east of Townsville. Townsville is becoming an increasingly attractive holiday destination with the Sheraton-Breakwater Casino and the renowned Great Barrier Reef Wonderland Aquarium, which will be officially opened next month by the Prime Minister and the Premier of Queensland.

Mr Cohen —And its member is an attraction in himself.

Mr LINDSAY —I thank the Minister. The concept of a permanent accommodation facility located on the Great Barrier Reef which would permit extended stays by visitors to the reef is an idea developed over a number of years by Mr Doug Tarca, the owner and operator of Reef Link, an existing business that operators day trips to John Brewer Reef. Mr Tarca concluded many years ago from his extensive experience of the Great Barrier Reef that the John Brewer Reef was of ideal size and location for such a holiday resort. Barrier Reef Holdings Ltd has described the floating tourist complex as one of the most existing resorts and convention venues ever conceived. The hotel will be anchored in a tranquil lagoon on John Brewer Reef, part of Australia's Great Barrier Reef. Barrier Reef Holdings Ltd has stated that no hotel anywhere else in the world has required the degree of research, planning and technology which has been employed to bring this unique concept to reality. I believe that no hotel in the world will have at its doorstep such a galaxy of undersea colour, fascination and mystery.

The resort, to be known as the Four Seasons Barrier Reef Hotel, is a 12,000-tonne, 7-storey, 200-bedroom floating hotel outfitted and operated to first-class standards. The concept of a floating accommodation facility is well proven, having been introduced by the off-shore oil industry in the mid-1970s. The floating hotel is a further development of these concepts in order to provide luxury standards of accommodation. It will be approximately 90 metres long by 27 metres wide and is designed to accommodate up to 426 hotel guests. The resort will be professionally managed by Four Seasons Ltd which is Australia's second largest wholly owned hotel group and the country's largest tourist oriented hostelier. It was founded over 20 years ago and has been wholly owned by IEL (Australia) Pty Ltd since 1984. IEL is one of Australia's largest public companies with a market capitalisation at 23 May 1986 of nearly $2.5 billion.

The resort will be moored by a single point mooring system which will allow it to adjust its mooring to conform with changing wind patterns when required. In keeping with the high priority given to concern for the environment, special measures are planned to keep sound from the hotel's power generating plant to virtually noiseless levels. With a capacity of 2,300 kilowatts, the plant will provide lighting, power for the resort's lifts and the remainder of electrical services and facilities of a resort in the luxury class. Fresh water will be supplied through a desalination plant with a storage capacity of seven days of normal resort operations. All wastes, even the waste water, will be strictly controlled through treatment or incineration plants, as the case may be. No wastes, not even those treated, will be released into the reef lagoon at John Brewer Reef. They will be carried by barge to the mainland or, in the case of some treated components deposited at selected and approved locations at sea.

The environmental considerations, so important for the success of this venture in the delicate marine wonderland of the Pacific, involve experts from Australia's Great Barrier Reef Marine Park Authority under the ministerial jurisdiction of the Minister for Arts, Heritage and Environment (Mr Cohen). This will be a continuing arrangement, designed to expand scientific knowledge and enhance public understanding and appreciation of this massive collection of coral formations, the Great Barrier Reef, extending 2,000 kilometres along Australia's north-eastern coastline. This project is a rare undertaking in which science will work through the avenues of tourism to better understand the reef, the world's biggest living creature, and in the process the Great Barrier Reef and its myriad of colour and mystery will open up to the world.

I now refer to Part V of the Bill. There is no doubt about the constitutional power of the Commonwealth of Australia to regulate structures on the continental shelf. Indeed, Federal legislation controlling such structures would be consistent with the off-shore constitutional settlement. It would also be consistent with existing Commonwealth regulation and control of off-shore petroleum structures. It would enable Australia to ensure that its international obligations, including limitations imposed by international law over control of off-shore structures, were complied with. I am not confident that any State legislation would contain the necessary limitations. It would permit the Commonwealth, if it wished, to override inconsistent and unacceptable State or Northern Territory legislation and thus enable the Commonwealth to control the body of law applicable to sea installations. I understand that the Queensland Offshore Facilities Act 1986 acknowledges that State laws apply except where application of a law would be inconsistent with Commonwealth law. The Queensland legislation purports to control installations up to the outer edge of the continental shelf from the Queensland coast. I believe the constitutional basis for the Queensland Act is uncertain. It is not clear that a law purporting to apply such a distance from the coast is a law for the peace, welfare and good government of Queensland for the purposes of the Queensland Constitution.

Clause 45 of the Bill provides that existing State laws will apply as Commonwealth laws in relation to installations installed in an adjacent area of a State, as if that area were part of the State and the Commonwealth. Thus, a State law will continue to apply outside the boundary of the territorial sea, notwithstanding that the Sea Installations Bill 1987 will apply to structures fixed or moored in an area adjacent to a State. However, criminal laws within the meaning of the Crimes at Sea Act 1979 will continue to apply by virtue of that Act, notwithstanding the sea installations legislation. This will enable the Commonwealth to modify any relevant State law. For example, the Commonwealth will be able to decide about allowing recent Queensland industrial laws to apply to sea installations. This Bill also invests State and Territory courts with Federal jurisdiction in matters pertaining to issues in this Bill.

I now refer to the application of income tax and sales tax laws to tourist installations in Australia's off-shore areas. The Government has decided that the scope of the income tax law should be extended to income derived from fixed tourist and other installations in the waters surrounding Australia. The sales tax law is also to be amended to extend its application to such installations in Australia's off-shore areas. The relevant provisions of the income tax law are now to be amended to reflect Australia's jurisdiction, under international law, over installations within the outer limits of the continental shelf or within 200 nautical miles of Australia. The sales tax law is also to be amended to extend its application to fixed installations such as tourist installations in the waters of those areas.

I now refer to the Sea Installations Levy Bill 1987. The Bill provides for a levy to be paid to the Commonwealth by a permit holder in relation to the operation of a sea installation. This will ensure that the administrative costs of the States and Territories are met, and that general revenue can benefit, as it would if similar installations were located on the mainland. The levy is expressed as a percentage of a valuation of the installation. Levies will be fixed which have regard to State taxes and charges for relevant activities. The concept of the levy Bill avoids the duplication by the Commonwealth of all those State taxing and charging laws that would ordinarily apply if the operation were land-based.

An example of how the levy is to work is in the area of liquor licensing. If an operator of an installation wants a liquor licence, he or she will apply under the relevant State and Commonwealth law for a liquor licence, but will not be charged a licence fee as this would amount to a tax. The amount that would have been payable if the application had been in respect of a land-based operation is taken into account as a component of the levy. The levy is expressed as a percentage of a valuation of the asset-the sea installation-and this is analogous to local government charges. However, the level of percentage also reflects those other State charges or fees not usually reflected in local government rates. The valuation of the installation will be calculated annually in accordance with the valuation practice by valuers of the Australian Taxation Office whose decisions will be subject to review by the Administrative Appeals Tribunal.

I now refer to the Sea Installations (Miscellaneous Amendments) Bill 1987. This Bill amends other Commonwealth legislation. The Customs Act 1901 and the Excise Act 1901 are amended to give to officers administering the respective Acts power over such installations, ships and aircraft, persons and goods arriving with, or at, the installations or departing overseas from such installations. The Migration Act 1958 is amended to identify the point when sea installations and the persons on board enter Australia and when such installations become, or cease to be, part of Australia. The amendments to the Quarantine Act 1908 apply to a wide range of controls under the Act, to sea installations. The principal control is to make newly arrived installations, persons and goods on these installations, subject to quarantine.

To sum up, the benefits of the proposed legislation include the application of the rule of law to sea installations establishing the rights and obligations of owners, users and others affected by the operation of such installations, the prevention of evasion of Commonwealth and State laws, such as Commonwealth and State tax laws-Customs, quarantine-by the use of sea installations. It includes the establishment of a regime to protect the marine environment, the safe operation of such installations and the provision of appropriate standards of construction and safety for sea installations especially as the Commonwealth could face significant rescue and removal costs in the event of disaster involving damage to an installation.

Finally, I wish to pay tribute to not only Mr Doug Tarca, the originator of this wonderful concept which will bring such knowledge and pleasure to so many millions of people in the years to come, but also Mr Owen Kelvin Griffith, the Executive Director of Barrier Reef Holdings Ltd whose indefatigable efforts and expertise in guiding this wonderful project to a situation whereby it will be officially opened in October 1987, must be applauded by not only people involved in the tourist industry but also all Australians now and forever more.