2010 - 2011

 

 

 

 

THE PARLIAMENT OF THE COMMONWEALTH OF AUSTRALIA

 

 

 

 

 

 

 

HOUSE OF REPRESENTATIVES

 

 

 

 

 

 

MUTUAL ASSISTANCE IN CRIMINAL MATTERS AMENDMENT (REGISTRATION OF FOREIGN PROCEEDS OF CRIME ORDERS) BILL 2011

 

 

 

 

 

 

EXPLANATORY MEMORANDUM

 

 

 

 

 

 

 

 

(Circulated by authority of the Minister for Justice

the Honourable Brendan O’Connor MP)

MUTUAL ASSISTANCE IN CRIMINAL MATTERS AMENDMENT (REGISTRATION OF FOREIGN PROCEEDS OF CRIME ORDERS) BILL 2011

 

GENERAL OUTLINE

The Bill amends section 34A of the Mutual Assistance in Criminal Matters Act 1987 , section 45 of the International War Crimes Tribunal Act 1995 and section 156 of the International Criminal Court Act 1995 to address issues raised by the High Court in the case of International Finance Trust Company Ltd v New South Wales Crime Commissio n [2009] HCA 49 ( International Finance ).  The amendments will give courts discretion to refuse to register a foreign proceeds of crime order if it would be contrary to the interests of justice to register the order.  Courts will now also have discretion to refuse to hear an application for registration on an ex parte basis.

The High Court in International Finance found provisions in New South Wales legislation, which allowed for the making of a restraining order ex parte, was constitutionally invalid because it infringed the constitutional integrity of the NSW Supreme Court in a way that was inconsistent with its status as a Chapter III court under the Constitution.  The Court had no discretion whether to hear from a person affected by the order, and there was no statutory provision available which allowed the person affected to challenge the making of the order.

Current provisions in the Mutual Assistance in Criminal Matters Act 1987 , International Criminal Court Act 2002 and the International War Crimes Tribunal Act 1995 state that a court must register a foreign proceeds of crime order if requested to do so by the Commonwealth Executive.  A court is also required, under the Mutual Assistance in Criminal Matters Act 1997 and the International Criminal Court Act 2002 , to hear an application for registration of a foreign order on an ex parte basis if requested to do so by the Commonwealth Director of Public Prosecutions.  While the Commonwealth scheme allowing for the registration in Australia of a proceeds of crime order issued by a foreign court, international war crimes tribunal or the International Criminal Court provides the court with a more active role in the registration proceedings, in light of the International Finance decision, amendments are being made to the current provisions to address any potential invalidity.

PURPOSE

The purpose of the Bill is to address possible constitutional issues with Australia’s current legislative scheme for registering proceeds of crime orders.  The amendments will ensure that the scheme for providing assistance to foreign countries, international tribunals and the International Criminal Court in registering proceeds of crime orders issued by them continues to operate as intended.   

FINANCIAL IMPACT STATEMENT

 

The amendments in this Bill have no financial impact on Government revenue.

ACRONYMS  

DPP                                                     Director of Public Prosecutions

ICC Act                                              International Criminal Court Act 2002 (Cth)

International Finance                          International Finance Trust Company Ltd v New South Wales Crime Commissio n [2009] HCA 49

IWCT Act                                           International War Crimes Tribunals Act 1995 (Cth)

MA Act                                               Mutual Assistance in Criminal Matters Act 1987 (Cth)

 

NOTES ON CLAUSES

 

Clause 1: Short Title

 

This clause provides that when the Bill is enacted, it is to be cited as the Mutual Assistance in Criminal Matters Amendment (Registration of Foreign Proceeds of Crime Orders) Act 2011 .

 

Clause 2: Commencement

 

This clause provides that the Act will commence on Royal Assent.

 

Clause 3: Schedule(s)

 

This is a formal clause that enables Schedule 1 to amend the MA Act, IWCT Act and the ICC Act, under the title of the Act.

 

 

Schedule 1 - Amendments

 

International Criminal Court Act 2002

Part 11 of the ICC Act enables forfeiture orders made by the International Criminal Court in relation to property that is reasonably suspected of being in Australia to be enforced in Australia.  Subsection 156(1) requires the court to register an order once the DPP applies for it to do so.  Subsection 156(3) requires the court to consider an application by the DPP on an ex parte basis if the DPP requests the court to do so.  Following the High Court’s decision in International Finance , legislative schemes requiring a judge to hear ex parte applications, which do not provide for adequate supervision over the making or enforcement of orders, could be found to be inconsistent with principles found in Chapter III of the Commonwealth Constitution.

Item 1 - amendment to subsection 156(1)

This item will amend subsection 156(1) of the ICC Act to provide the court with discretion to refuse to register a forfeiture order issued by the International Criminal Court if satisfied that it would be contrary to the interests of justice to do so.  The amended wording will reflect the drafting of section 34A of the MA Act (as amended by item 6) to ensure consistency in the process for registering a proceeds of crime order that has been issued by a foreign court or tribunal.  In considering whether to register the order, it is not intended that Australian courts will entertain challenges to the validity of the foreign order as this is a matter most appropriately dealt with by the International Criminal Court. 

The principal object of the ICC Act is to facilitate compliance with Australia’s obligations under the International Criminal Court Statute (as articulated in section 3 of the ICC Act). The provision will maintain a presumption in favour of registering the foreign proceeds of crime order by providing that the court must register the order, unless satisfied that it is contrary to the interests of justice to do so.  Australia’s continued ability to register an order issued by the International Criminal Court will ensure Australia meets its international obligations under articles 93 and 109 of the Rome Statute of the International Criminal Court to provide assistance in enforcing forfeiture orders issued by the Court.

Item 2 - amendment to subsection 156(3)

Subsection 156(3) requires a court to hear an application for the registration of a forfeiture order issued by the International Criminal Court on an ex parte basis at the request of the DPP.  Item 4 will omit ‘must’ from the subsection and replace it with ‘may’.  This will have the effect of giving a court a discretion in determining whether to hear an application for registration of a forfeiture order issued by the International Criminal Court on an ex parte basis if requested to do so by the DPP.  It is intended that the court will take account of the object of the ICC Act when determining whether to exercise the discretion to not hear a matter on an ex parte basis.    

International War Crimes Tribunal Act 1995

Part 6 of the IWCT Act enables forfeiture orders made by a Tribunal to be enforced in Australia.  Subsection 45(1) requires the court to register an order if the DPP applies for it to do so.  Subsection 45(1) also requires the court to direct the DPP to give notice of the registration to specified persons the court has reason to believe may have an interest in the property, or otherwise publish notice of the registration.   Following the High Court’s decision in International Finance , legislative schemes requiring a judge to hear ex parte applications, which do not provide for adequate supervision over the making or enforcement of orders, could be found to be inconsistent with principles found in Chapter III of the Commonwealth Constitution.

Item 3 - amendment to subsection 45(1)

This item will amend subsection 45(1) of the IWCT Act to provide a court with greater discretion in determining whether to register an order of a War Crimes Tribunal. 

The amended provision will require a court to register the order at the request of the DPP, unless the court is satisfied that it would be contrary to the interests of justice to do so.  The provision will maintain a presumption in favour of registering the foreign forfeiture order by providing that the court must register the order, unless satisfied that it is contrary to the interests of justice to do so.   

In considering whether registration of the order would be contrary to the ‘interests of justice’, it is not intended that Australian courts will entertain challenges to the validity of the foreign order.  Issues relating to the validity of the foreign order are matters most appropriately dealt with by the tribunal that issued the order.  This is consistent with the objective of the Act set out in section 3(e) to enable Australia to give effect to forfeiture orders issued by specified international war crimes tribunals.

The amended provision will reflect the drafting of subsection 34A(1) MA Act in this Bill.  This will ensure consistency in the process required to register a proceeds of crime order issued by a foreign court or tribunal.

This item will also repeal the requirement that a court direct the DPP to give notice of the registration of the order to specified persons the court has reason to believe may have an interest in the property, or otherwise publish notice of the registration.

This will be replaced with a new subsection (which will be inserted by item 4) governing when and how notice is to be given to specified persons with an interest in the property. 

Item 4 - Subsections 45(1A) and 45(1B)

This item will insert subsections 45(1A) and 45(1B) into the Act.  The new subsections will ensure that the operation of section 45 is consistent with section 34A of the MA Act (as amended by items 6 and 7). 

New subsection 45(1A) will place an onus (subject to new subsection 45(1B)) on the DPP to give notice of the application for the registration of the order to specified persons the DPP has reason to suspect may have an interest in the property (paragraph 45(1A)(a)) and to other persons as directed by the court (paragraph 45(1A)(b)).  Previously, subsection 45(1) required the court to instruct the DPP to give notice of the registration of the order to people who the court suspected of having an interest in the property. 

The new subsection will ensure those with an interest in the property subject to the order receive notice of the application to register the order, rather than notice once the order has been registered.  This amendment may also reduce the administrative burden on the court by requiring the DPP to give notice without first requiring the court to issue a direction. 

Despite the operation of new subsection 45(1A), new subsection 45(1B) will provide a court with the discretion to consider the application on an ex parte basis if requested to do so by the DPP.  The current operation of subsection 45(1) does not provide the court with the ability to hear from interested parties prior to registering the order.  This amendment is consistent with the amendments to the ICC Act (in item 2) and to the MA Act (in item 7).

Mutual Assistance in Criminal Matters Act 1987

Part VI of the MA Act enables foreign proceeds of crime orders to be registered in Australia.  Subsection 34A(1) requires a court to register a foreign order if the DPP applies for it to do so.  Subsection 34A(3) requires the court to consider an ex parte application by the DPP if the DPP requests the court to do so.  Following the High Court’s decision in International Finance , legislative schemes requiring a judge to hear ex parte applications, which do not provide for adequate curial supervision, could be found to be inconsistent with principles found in Chapter III of the Commonwealth Constitution.

Item 5 - Object of Subdivision A Division 2, Part VI

Australia is a party to a number of international agreements that aim to ensure countries take expeditious action in response to requests by foreign countries to identify, freeze, seize and confiscate laundered property or proceeds from criminal offences. 

This item will insert a provision articulating the object of Subdivision A to Division 2 of Part VI in line with our international obligations.  The object of Subdivision A which will be inserted into the Act is to facilitate international cooperation in the recovery of property through the registration and enforcement of foreign orders in Australia. 

A further subsection will also be inserted which will state that for the purpose of achieving this object, it is the intention of the Parliament that the validity of foreign orders not be examined.

The new object clause and the clause stating the intent of Parliament are designed to ensure that when interpreting the provisions in the Subdivision, courts will have due regard to the overall objective of the Subdivision which is to give effect to foreign orders in situations where property related to serious foreign offences is located in Australia.  It is not the intention of the regime in Subdivision A that issues relating to the validity of the foreign order be considered by Australian courts.  These matters are most appropriately dealt with by the foreign court (either at the time the order is issued, or on application for review of the order).

As such, for the purposes of subsection 34A(1) (as amended by item 6), a court should have due regard to the overall objective of the Subdivision and the intent of Parliament when considering when it would be ‘contrary to the interests of justice’ to register a foreign order.  It should not, in determining whether registration of the foreign order is contrary to the interests of justice, examine the validity of the foreign order.

This is consistent with the principle of international comity and recognises the fundamental importance of reciprocity in international cooperation in criminal matters. 

Item 6 - amendment to subsection 34A(1)

This item inserts the words, ‘unless the court is satisfied it would be contrary to the interests of justice to do so’ at the end of subsection 34A(1) of the MA Act.  The effect of the amendment will be to give the court discretion to refuse to register a foreign proceeds of crime order if the court is satisfied it would be contrary to the interests of justice to register the foreign order.  The provision will maintain a presumption in favour of registering the foreign proceeds of crime order by providing that the court must register the order, unless satisfied that it is contrary to the interests of justice to do so.  This presumption reflects the overall objective of the MA Act to enable Australia to assist other countries effectively and expeditiously with direct enforcement of foreign orders made in respect of benefits derived from criminal activity. 

Consistent with principles of statutory interpretation, as set out in section 15AA of the Acts Interpretation Act 1901 , in interpreting what might be ‘contrary to the interests of justice’, judges are able to take account of the purpose of the Act and Subdivision A of Division 2, Part VI in particular.  The objective of the Subdivision, as confirmed by item 5, is to facilitate international cooperation in the recovery of property through the registration and enforcement of foreign orders in Australia.  In considering what might be ‘contrary to the interests of justice’, an Australian court should not consider issues surrounding the validity of the foreign order.  Challenges of this nature should be left to the issuing foreign court to consider as the most appropriate forum.

Item 7 - amendment to subsection 34A(3)

Subsection 34A(3) requires the court to hear an application for the registration of a foreign proceeds of crime order ex parte at the request of the DPP.  This item will omit ‘must’ from the subsection and replace it with ‘may’.  This will have the effect of giving the court a discretion when determining whether to hear an application for registering a foreign order on an ex parte basis if requested to do so by the DPP.  It is intended that the court will take account of the object of the Subdivision (as confirmed by item 5) when determining whether to exercise the discretion not to hear a matter on an ex parte basis following an application by the DPP. 

Application of the amendments

Item 8 - Application clause

This item provides that amendments made by Schedule 1 will apply in relation to applications considered by the court on or after the commencement of the Act.  The amendments will apply regardless of when the request to have the relevant order registered was made.

Item 9 - Registration of foreign orders before commencement

This item will provide that the amendments made by this Schedule do not affect the validity of any foreign orders that have been registered under the relevant provisions before the commencement of the Bill.