BILLS DIGEST NO. 35, 2015–16              22 October 2015

Maritime Legislation Amendment Bill 2015

Sophie Power and Bill McCormick
Science, Technology, Environment and Resources Section

Date introduced: 9 September 2015

House:  House of Representatives

Portfolio: Infrastructure and Regional Development

Commencement:  The substantive provisions of Schedule 1 commence 28 days after Royal Assent while those of Schedule 2 commence the later of 28 days after Royal Assent or 1 March 2016.

Links: The links to the Bill, its Explanatory Memorandum and second reading speech can be found on the Bill’s home page, or through the Australian Parliament website.

When Bills have been passed and have received Royal Assent, they become Acts, which can be found at the ComLaw website.

Purpose of the Bill

The purpose of the Maritime Legislation Amendment Bill 2015 (the Bill) is to:

•       amend the Protection of the Sea (Prevention of Pollution from Ships) Act 1983 (Prevention of Pollution from Ships Act) to ensure offences relating to ships carrying heavy grade oil in Antarctic waters include situations where such oil is being carried as ballast[1]

•       amend the definition of ‘dangerous goods’ in the Navigation Act 2012[2] to refer to the International Convention for Safety of Life at Sea[3] and

•       correct drafting errors in the Navigation Act, the Prevention of Pollution from Ships Act, the Protection of the Sea (Civil Liability) Act 1981 and the Protection of the Sea (Civil Liability for Bunker Oil Pollution Damage) Act 2008.[4]

Structure of the Bill

The Bills contains two schedules. In Schedule 1:

•       Part 1 amends the definition of dangerous goods in the Navigation Act

•       Part 2 makes minor drafting corrections to the Protection of the Sea (Civil Liability) Act and the Protection of the Sea (Civil Liability for Bunker Oil Pollution Damage) Act and

•       Part 3 amends the Prevention of Pollution from Ships Act in relation to waters of the sea that are within the limits of a state or an external territory of Australia.

Schedule 2 amends the Prevention of Pollution from Ships Act to ensure offences relating to ships carrying heavy grade oil in Antarctic waters include situations where such oil is being carried as ballast.

Background

Australia is a party to numerous conventions relating to the safety of shipping, including:

•       International Convention for Safety of Life at Sea (SOLAS), which is concerned with the safety of merchant ships and specifies minimum standards for the construction, equipment and operation of those ships[5] and

•       International Convention for the Prevention of Pollution from Ships (MARPOL), the main international convention covering the prevention of pollution of the marine environment by ships (from accidental or operational causes).[6]

These treaties are administered by the International Maritime Organization (IMO), a United Nations agency with responsibility for the safety and security of shipping and the prevention of marine pollution by ships.[7]

Preventing pollution from ships

MARPOL regulates six sources of ship-sourced marine pollution through its six separate Annexes:

•       Oil (Annex I)

•       Noxious Liquid Substances in Bulk (Annex II)

•       Harmful Substances Carried by Sea in Packaged Form (Annex III)

•       Sewage from Ships (Annex IV)

•       Garbage from Ships (Annex V) and

•       Air Pollution from Ships (Annex VI).

Decisions on the amendment of MARPOL are made by the Marine Environment Protection Committee of the IMO.[8] In Australia, MARPOL is given effect domestically through the Prevention of Pollution from Ships Act and the Navigation Act.[9]

Prohibition on heavy grade oil in the Antarctic area

Regulation 43 in Annex I of MARPOL prohibits the carriage of heavy grade oil (HGO) for use as fuel or as cargo in bulk in the Antarctic area.[10] The intent is to prevent the possibility of HGO being spilt in the sensitive and vulnerable waters of the Antarctic Area. This prohibition is reflected in Australia in sections 10A and 10B of the Prevention of Pollution from Ships Act.

Heavy grade oil has a higher density and viscosity than light oils[11] and is defined to mean:

•       crude oil having a density at 15°C higher than 900 kg/m3

•       oil, other than crude oil, having a density at 15°C higher than 900 kg/m3 or a kinematic viscosity at 50°C higher than 180 mm2/s or

•       bitumen, tar and their emulsions.[12]

Incident in 2013

In April 2013, Chinese flagged krill fishing vessel, the Kai Xin, caught fire and sank in the Bransfield Strait, approximately 1,000 kilometres south of South America, between the South Shetland Islands and the Antarctic Peninsula.[13] Initial news reports stated that all 97 crew were rescued and there was no indication of an oil spill.[14]

An oil spill was feared, however maritime governor for Chile’s Antarctic Region, Captain Juan Villegas, said that due to a fire on board environmental disaster was unlikely. ‘Experts say if there was any fuel on board it would have burned out.’[15]

It was discovered that the 104 metre long fishing vessel was carrying heavy grade oil (HGO) in its ballast tanks for use outside Antarctic waters.[16] As noted above, Annex I of MARPOL specifically prohibits the carriage of HGO for use as fuel or as cargo in bulk in the Antarctic area. However, because MARPOL did not specifically refer to the use of HGO as ballast, some countries considered the practice acceptable.[17] As a result of this incident, an amendment to Regulation 43 of Annex I of MARPOL was proposed to eliminate this loophole. The amendment, which inserts ‘use of ballast’ between the words ‘the carriage of bulk as cargo’ and ‘or carriage and use as fuel’, was adopted by the Marine Environment Protection Committee of MARPOL on 17 October 2014.[18]

Committee consideration

Joint Standing Committee on Treaties

The Joint Standing Committee on Treaties has considered the amendments to MARPOL relating to the use of HGO as ballast.[19] The Committee supported the amendments to MARPOL and recommended that binding treaty action be taken.[20] In doing so, the Committee noted that:

The amendment to Annex I will ensure that the original intent of the Parties to MARPOL is given effect by explicitly banning the carriage of HGO in bulk as cargo in ballast tanks in the Antarctic Area.[21]

Selection of Bills Committee

The Selection of Bills Committee decided not to refer the Bill to a committee.[22]

Senate Standing Committee for the Scrutiny of Bills

The Senate Standing Committee for the Scrutiny of Bills had no comment on this Bill.[23]

Policy position of non-government parties/independents

At the time of writing, no non-government parties or independents appear to have commented on the Bill.

Position of major interest groups

At the time of writing, no major interest groups appear to have commented on the Bill.

Financial implications

According to the Explanatory Memorandum, the Bill is not expected to have any significant financial impact.[24]

Statement of Compatibility with Human Rights

As required under Part 3 of the Human Rights (Parliamentary Scrutiny) Act 2011 (Cth), the Government has assessed the Bill’s compatibility with the human rights and freedoms recognised or declared in the international instruments listed in section 3 of that Act. The Government considers that the Bill is compatible.[25]

Parliamentary Joint Committee on Human Rights

The Parliamentary Joint Committee on Human Rights considered that the Bill does not raise human rights concerns.[26]

Key issues and provisions

Prohibition on heavy grade oil in the Antarctic Area

Schedule 2 contains the main substantive amendments in the Bill. These amendments implement the MARPOL amendments to prohibit the use of HGO as ballast in the Antarctic Area as discussed in the background section of this Digest.[27]

In particular, Schedule 2 amends sections 10A and 10B of the Prevention of Pollution from Ships Act.[28] Section 10A currently prohibits the carriage or use of heavy grade oil on Australian ships in the Antarctic Area, while section 10B prohibits the carriage or use of heavy grade oil on foreign ships in the Australian Antarctic Territory.[29] The maximum penalty is 2,000 penalty units which currently equates to $360,000, while the penalty for the strict liability offence in subsections 10A(2) and 10B(2) is 500 penalty units or $90,000.[30] Exceptions are provided where it is necessary to secure the safety of a ship or save life at sea.[31]

In order to implement the amendments to Annex I of MARPOL as outlined in the background section of this Digest, item 1 of Schedule 2 amends section 10A to insert wording to ensure these offences extend to HGO being used as ballast in Australian ships in the Antarctic Area. Item 3 makes the same amendments to section 10B to prohibit HGO being used as ballast in foreign ships in the Australian Antarctic Territory. Items 2 and 4 extend the existing exemptions so that the offences will not apply to situations where HGO is being carried as ballast for the purpose of securing the safety of a ship or saving life at sea.

Definition of dangerous goods in the Navigation Act

As noted earlier in this Digest, the International Convention for Safety of Life at Sea, or SOLAS, is concerned with the safety of merchant ships. Chapter VII of SOLAS regulates carriage of dangerous goods and requires the carriage of dangerous goods to be in compliance with the International Maritime Dangerous Goods Code (IMDG Code).[32] The IMDG Code is issued by the IMO and was developed under SOLAS as a uniform international code for the transport of dangerous goods by sea covering such matters as packing, container traffic and stowage. The Code classifies dangerous goods into different classes, and describes characteristics and properties of the substances, material and articles which would fall within each class or division. Individual dangerous goods are also listed in the Dangerous Goods List under the IMDG Code.[33]

Part 1 of Schedule 1 of the Bill amends the definition of dangerous goods in the Navigation Act 2012.[34] Currently, section 14 defines ‘dangerous goods’ as the ‘goods listed in the International Maritime Dangerous Goods Code’. Item 1 of Part 1 of Schedule 1 repeals this definition and inserts a new definition which states that ‘dangerous goods has the same meaning as in Chapter VII of the Safety Convention’.[35] The ‘Safety Convention’ is already defined in section 14 to mean SOLAS ‘as amended and in force for Australia from time to time’.[36] Under SOLAS, dangerous goods are defined to mean ‘the substances, materials and articles covered by the IMDG Code’.[37]

The Explanatory Memorandum suggests this amendment will ‘broaden the definition’ of dangerous goods and will also ensure ‘consistency with Australia’s treaty obligations, State and Territory legislation, and industry practice’.[38] As the Explanatory Memorandum states:

The current definition … limits the scope of dangerous goods to those listed in the IMDG Code, whereas the IMDG Code also covers goods that are properly characterised as dangerous, but which are not yet listed.[39]

The current definition of dangerous goods in the Navigation Act could indeed be restrictively interpreted to mean only those goods listed in the IMDG Code, rather than the broader classes of dangerous goods identified by the IMDG Code. However, the practical implications of these different definitions are unclear. No examples are given in the Explanatory Memorandum of any dangerous goods that might not be covered by the current definition. Perhaps another option to achieve the same result may have been to amend the definition of dangerous goods in the Navigation Act to simply replace the word ‘listed’ with the word ‘covered by’, given that SOLAS itself defines dangerous goods as the ‘substances, material and articles covered by the IMDG Code’.

Definitions of ‘sea near’ a State or external Territory

Part 3 of Schedule 1 of the Bill proposes to amend the definition of ‘sea near’ a state or external territory in the Prevention of Pollution from Ships Act. These amendments relate to provisions which attempt to clarify the application of the Act in the context of Commonwealth and state or territory jurisdictional boundaries over certain maritime areas.[40] In particular, the Prevention of Pollution from Ships Act contains a number of ‘roll back’ provisions which are designed ‘to prevent Commonwealth legislation prevailing over state/territory legislation where such legislation applies to that particular sea area’.[41] For example, section 9 of the Prevention of Pollution from Ships Act contains a prohibition on the discharge of oil into sea, including into the ‘sea near a State’ where there is no relevant state law.[42]

The Maritime Legislation Amendment Act 2012 (2012 Act) amended some of these ‘roll back provisions’ with the aim of clarifying the operation of the Prevention of Pollution from Ships Act, and the application of Commonwealth jurisdiction in parts of the territorial sea.[43] The 2012 Act attempted to do this by inserting new definitions of the terms ‘sea near’ and ‘outer territorial sea’ into section 3 of the Prevention of Pollution from Ships Act. The idea was, in applying various offence provisions in the Prevention of Pollution from Ships Act, to distinguish between activities that occur in the ‘sea near’ a state or territory (which may be subject to legislation by the state or territory) and activities which occur in the ‘outer territorial sea’ (over which the Commonwealth has jurisdiction).[44]

As a result of the 2012 Act, subsection 3(1A) of the Prevention of Pollution from Ships Act currently provides that, for the purposes of the Act, the sea near a State is:

(a)      the part or parts of the territorial sea that are:

(i)         within 3 nautical miles of the baseline of the territorial sea; and

(ii)        adjacent to the State; and

(b)      the waters of the sea that are:

(i)         on the landward side of the baseline of the territorial sea; and

(ii)        adjacent to the State and not within the limits of the State.[45]

Part 3 of Schedule 1 amends this definition of ‘sea near’ a state or external territory in the Prevention of Pollution from Ships Act. Item 10 of Schedule 1 proposes to repeal paragraph 3(1A)(b), and replace it with:

(b)              the waters of the sea that are on the landward side of that part or those parts of the territorial sea (including any waters of the sea that are within the limits of the State).

Item 11 makes the same amendment to paragraph 3(1C)(b), which defines the ‘sea near an external Territory’.

According to the Explanatory Memorandum, these amendments will ‘reinstate the law so that it applies to any waters of the sea that are within the limits of the State’.[46] The Explanatory Memorandum further states that ‘an unintended consequence’ of the 2012 amendment was that a number of offence provisions in the Prevention of Pollution from Ships Act that operate by reference to a sea near a state ‘no longer apply in some waters of the sea that are within the limits of that State’.[47] No further explanation is provided. It appears that this may mean, for example, internal waters on the landward side of the baseline of the territorial sea, such as certain bays, gulfs, estuaries, inlets, ports or harbours which might be ‘within the limits of the State’.[48] As such, the 2012 amendments may have actually excluded these sorts of internal state coastal waters from the operation of the Prevention of Pollution from Ships Act. This is because the definitions of ‘sea near a State’ and ‘sea near an external Territory’ excluded waters within the limits of the state or territory. This may have left a gap in coverage and implementation of MARPOL in certain situations where the particular state or territory has no relevant legislation. However, it is unclear whether this has had any practical implications or consequences, and no examples are given in the Explanatory Memorandum.

Minor drafting corrections

Item 3 of Part 1 of Schedule 1 corrects a minor drafting error in section 96 of the Navigation Act, which provides a simplified outline of Chapter 3 of the Act (which relates to Vessel Safety).

Items 7, 8 and 9 in Part 2 of Schedule 1 correct minor drafting errors in the Protection of the Sea (Civil Liability for Bunker Oil Pollution Damage) Act 2008 (Bunkers Act).[49] These errors appear to have occurred during the enactment of the Navigation Act. In particular, the current definition of ‘domestic voyage ship’ in section 3 of the Bunkers Act states that it has the meaning given by subsection 10(3). However, there is no subsection 10(3) in the Bunkers Act. That subsection was repealed by the Navigation (Consequential Amendments) Act 2012, which introduced the concept of a ‘regulated Australian vessel’ rather than ‘domestic voyage ship’. Those amendments also referred to the definition of ‘regulated Australian vessel’ which can be found in section 15 the Navigation Act.[50] Items 7, 8 and 9 in this Bill remove remaining references to the concept of a domestic voyage ship and replace them with references consistent with the concept of regulated Australian vessels.

Items 4, 5 and 6 in Part 2 of Schedule 1 make similar minor amendments to the Protection of the Sea (Civil Liability) Act to refer to the concept of regulated Australian vessel, instead of a ‘ship defined by subsection 7(4)’, as subsection 7(4) no longer exists in that Act.[51]

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[1].              Protection of the Sea (Prevention of Pollution from Ships) Act 1983 (Cth), accessed 29 September 2015.

[2].              Navigation Act 2012 (Cth), accessed 29 September 2015.

[3].              International Convention for the Safety of Life at Sea (SOLAS), done at London 1 November 1974, [1983] ATS 22 (entered into force for Australia 17 November 1983), accessed 1 October 2015.

[4].              Protection of the Sea (Civil Liability) Act 1981 (Cth) and the Protection of the Sea (Civil Liability for Bunker Oil Pollution Damage) Act 2008 (Cth), both accessed 29 September 2015.

[5].              International Convention for the Safety of Life at Sea, op. cit.; see also International Maritime Organization (IMO), ‘International Convention for the Safety of Life at Sea (SOLAS), 1974’, IMO website, accessed 30 September 2015.

[6].              Protocol of 1978 relating to the International Convention for the Prevention of Pollution from Ships (MARPOL), done at London 17 February 1978, [1988] ATS 29 (entered into force for Australia 1 July 1988).

[7].              IMO, ‘Introduction to IMO’ and ‘List of IMO conventions’, IMO website, accessed 30 September 2015.

[8].              See further IMO, ‘International Convention for the Prevention of Pollution from Ships (MARPOL)’ and ‘Structure of IMO’, IMO website, accessed 29 September 2015.

[9].              Department of Infrastructure and Regional Development, ‘The International Convention for the Prevention of Pollution from Ships (MARPOL)’, The Department website, accessed 29 September 2015.

[10].              The ‘Antarctic Area’ is defined in Regulation 1 of Annex I of MARPOL to mean ‘the sea area south of latitude 60°S’. See also IMO, ‘Antarctic fuel oil ban and North American ECA MARPOL amendments enter into force on 1 August 2011’, briefing, 44, 29 July 2011, accessed 29 September 2015.

[11].              R Meyer and E Attanasi, ‘Heavy oil and natural bitumen—strategic petroleum resources’, fact sheet, 70-03, US Geological Survey website, August 2003, accessed 30 September 2015.

[12].              Defined in both MARPOL and subsection 3(1) of the Prevention of Pollution from Ships Act.

[13].              Personal communication, Department of Infrastructure and Regional Development.

[14].              L Henao, ‘Environmental disaster ‘ruled out’ as Chinese ship sinks in Antarctic, Chile says’, NBC News website, 23 April 2013, accessed 24 September 2015.

[15].              Professional Skipper, ‘Chinese ship burns on Antarctic waters’, Professional Skipper magazine, July/August 2013, p. 44, accessed 24 September 2015.

[16].              ‘Ballast’ is any heavy material (usually water) carried by a ship or boat to ensure proper stability.

[17].              Antarctic and Southern Ocean Coalition, Vessel Management in the Antarctic Treaty Area, Information paper, presented at the XXXVII Antarctic Treaty Consultative Meeting, Brasilia, 31 March 2014, accessed 24 September 2015.

[18].              Marine Environment Protection Committee (MEPC), Resolution MEPC.256(67), Amendment to MARPOL Annex I, adopted on 17 October 2014, accessed 24 September 2015.

[19].              Joint Standing Committee on Treaties, Report 152: Treaty tabled on 16 June 2015, Canberra, 18 August 2015, accessed 29 September 2015.

[20].              Ibid., pp. 8–9.

[21].              Ibid., p. 7.

[22].              Selection of Bills Committee, Report, 12, 2015, The Senate, Canberra, 17 September 2015, p. 3, accessed 24 September 2015.

[23].              Senate Standing Committee for the Scrutiny of Bills, Alert digest, 10, 2015, The Senate, Canberra, 16 September 2015, p. 4, accessed 29 September 2015.

[24].              Explanatory Memorandum, Maritime Legislation Amendment Bill 2015, p. 1, accessed 24 September 2015.

[25].              The Statement of Compatibility with Human Rights can be found at pages 2–3 of the Explanatory Memorandum to the Bill.

[26].              Parliamentary Joint Committee on Human Rights, Twenty-eighth report of the 44th Parliament, Canberra, 17 September 2015, p. 1, accessed 29 September 2015.

[27].              As noted previously, the ‘Antarctic Area’ is defined in Regulation 1 of Annex I of MARPOL to mean ‘the sea area south of latitude 60°S’.

[28].              The sections were added by the Protection of the Sea (Prevention of Pollution from Ships) Amendment (Oils in the Antarctic Area) Act 2011 in order to implement changes made to Annex I of MARPOL at that time; see further J Tomaras, Protection of the Sea (Prevention of Pollution from Ships) Amendment (Oils in the Antarctic Area) Bill 2011, Bills digest, 61, 2011–12, Parliamentary Library, Canberra, 13 October 2011, accessed 29 September 2015.

[29].              Further information on the Australian Antarctic Territory is available at Department of the Environment, Australian Antarctic Division (AAD), ‘Antarctic territorial claims’, AAD website, accessed 1 October 2015.

[30].              One penalty unit is equal to $180 under section 4AA of the Crimes Act 1914 (Cth).

[31].              Prevention of Pollution from Ships Act, subsections 10A(4) and (5), 10B(4) and (5).

[32].              IMO, International Convention for the Safety of Life at Sea (SOLAS), 1974, IMO website, accessed 22 October 2015.

[33].              IMO, ‘International Maritime Dangerous Goods (IMDG) Code’, IMO website, accessed 30 September 2015.

[34].              Navigation Act 2012 (Cth), accessed 29 September 2015.

[35].              Item 2 of Part 1 of Schedule 1 is a consequential amendment to repeal the definition of the IMDG Code, a term which is no longer referred to in the Navigation Act as a result of the amendment in item 1.

[36].              International Convention for the Safety of Life at Sea, op. cit.

[37].              SOLAS, Chapter VII, Regulation 1.

[38].              Explanatory Memorandum, Maritime Legislation Amendment Bill 2015, p. 2, accessed 29 September 2015.

[39].              Ibid., p. 4.

[40].              For further information on the division of responsibility between the Commonwealth, states and territories in relation to offshore areas, see Attorney-General’s Department (AGD), ‘Offshore constitutional settlement’, AGD website, accessed 1 October 2015. For a useful outline of the definitions of ‘territorial sea baseline’, ‘coastal waters’, ‘territorial sea’ and other maritime boundary definitions, see also Geoscience Australia, ‘Maritime boundary definitions’, Geoscience Australia website, accessed 1 October 2015.

[41].              Explanatory Memorandum, Maritime Legislation Amendment Bill 2012, p. 13, accessed 30 September 2015.

[42].              Prevention of Pollution from Ships Act, subparagraph 9(1B)(b)(i).

[43].              Maritime Legislation Amendment Act 2012, accessed 30 September 2015; see also Explanatory Memorandum, Maritime Legislation Amendment Bill 2015, p. 1, accessed 30 September 2015.

[44].              See further P Pyburne, ‘Maritime Legislation Amendment Bill 2012’, Bills digest, 3, 2012–13, 14 August 2012, pp. 6–7, accessed 30 September 2015.

[45].              In comparison, the definition of ‘sea near a State’ prior to the 2012 amendments was (a) the territorial sea of Australia adjacent to the State; and (b) the sea on the landward side of the territorial sea of Australia adjacent to the State. See subsection 3(1A) of the Protection of the Sea (Prevention of Pollution from Ships) Act 1983 as at 25 September 2012, accessed 21 October 2015.

[46].              Explanatory Memorandum, Maritime Legislation Amendment Bill 2015, p. 6.

[47].              Ibid.

[48].              See section 14 of the Seas and Submerged Lands Act 1973 (Cth), accessed 19 October 2015, which suggests that waters within the limits of the state might include bays, gulfs, estuaries, rivers, creeks, inlets, ports or harbours.

[49].              Protection of the Sea (Civil Liability for Bunker Oil Pollution Damage) Act 2008 (Cth), accessed 30 September 2015. This Act gives effect to Australia’s obligations under the International Convention on Civil Liability for Bunker Oil Pollution Damage, done at London on 23 March 2001, [2009] ATS 14 (entered into force for Australia 16 June 2009).

[50].              Navigation (Consequential Amendments) Act 2012 (Cth), Schedule 2, items 51 and 52, accessed 30 September 2015.

[51].              Protection of the Sea (Civil Liability) Act 1981 (Cth), accessed 30 September 2015. This Act gives effect to Australia’s obligations under the International Convention on Civil Liability for Oil Pollution Damage, done at Brussels on 29 November 1969, [1984] ATS 3 (entered into force for Australia 5 February 1984).