Autonomous Sanctions (Export Sanctioned Goods—Russia) Amendment (No.1) Designation 2022

Administered by Department of Foreign Affairs and Trade

Legislation au F2022L00522 Not in force Legislative Instrument

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Explanatory Statement

 

Issued by the Authority of the Minister for Foreign Affairs

 

Autonomous Sanctions Regulations 2011

 

Autonomous Sanctions (Export Sanctioned Goods—Russia) Amendment (No. 1) Designation 2022

 

Autonomous sanctions are measures not involving the use of armed force which the Australian Government imposes and implements as a matter of foreign policy.  They are a discretionary tool which the Government can apply, alone or with like-minded countries where appropriate, to address egregious situations of international concern. 

 

The Autonomous Sanctions Regulations 2011 (the Regulations) make provision for, amongst other things, the designation of goods as ‘export sanctioned goods’ for a country or part of a country.  The supply, sale or transfer of ‘export sanctioned goods’ to Russia, for use in Russia or for the benefit of Russia is prohibited under regulations 4 and 12 of the Regulations. 

 

Russia’s aggression towards Ukraine presents a serious threat to the international rules-based order which underpins global security.  The purpose of the Autonomous Sanctions (Export Sanctioned Goods—Russia) Amendment (No. 1) Designation 2022 (the Amendment Designation) is to expand, under subregulation 4(3) of the Regulations, what goods are ‘export sanctioned goods’ for Russia to include certain luxury goods.  In prohibiting the export of such goods, Australia is demonstrating its condemnation of Russia’s illegal and unjustified invasion of Ukraine. Through banning the export of luxury goods to Russia, Australia’s sanctions remain targeted at Russian elites.

 

When considering whether to apply autonomous sanctions, the Government considers Australia’s national interest, including bilateral, regional and multilateral equities, and the impact of sanctions on Australia’s economic, security or other interests.

 

Details of the Amendment Designation are set out at Attachment A.

 

The legal framework for the imposition of autonomous sanctions by Australia, of which the Regulations are part, was the subject of extensive consultation with governmental and non-governmental stakeholders when introduced, and when amended to include the Russia/Ukraine sanctions.  The application of the existing sanctioned supply prohibitions to Russia was subject to targeted consultation within government, including in the Department of Foreign Affairs and Trade and with the Australian Border Force.  The Minister considered such consultation to be appropriate and practicable in the circumstances, given the urgency presented by Russia’s actions, and because the proposed amendment does not alter the operation of the existing regulatory framework.

 

The luxury goods designated as export sanctioned goods for Russia in the Amendment Designation are described by reference to codes in the Australian Harmonized Export Commodity Classification (AHECC). This document is incorporated as existing at the time of the commencement of the Amendment Designation and could in March 2022 be freely accessed on the Australian Bureau of Statistics website (Australian Harmonized Export Commodity Classification (AHECC), 2022 | Australian Bureau of Statistics (abs.gov.au)).

 

The Office of Best Practice Regulation (OBPR) has advised that a Regulation Impact Statement is not required (reference: OBPR22-02074).

 

The Amendment Designation 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. A statement of compatibility with human rights is at Attachment B.

Attachment A

 

Autonomous Sanctions (Export Sanctioned Goods—Russia) Amendment (No. 1) Designation 2022

 

Section 1

The title of the instrument is the Autonomous Sanctions (Export Sanctioned Goods—Russia) Amendment (No. 1) Designation 2022 (the Amendment Designation).

 

Section 2

Subsection 2(1) provides that the Amendment Designation commences the day after the end of the period of three days beginning on the day this instrument is registered.  

 

Subsection 2(2) is a technical provision that makes clear that any information inserted in column 3 of the table about the specific date of commencement is not part of the Amendment Designation and can be inserted or edited at a later date.

 

Section 3

The Amendment Designation is made under subregulation 4(3) of the Autonomous Sanctions Regulations 2022 (the Regulations).

 

Section 4

Each instrument that is specified in a Schedule to the Amendment Designation is amended or repealed as set out in the applicable items in the Schedule concerned, and any other item in a Schedule to the Amendment Designation has effect according to its terms.

 

Schedule 1

 

Item 1

Item 1 inserts a heading into Schedule 1 of the Autonomous Sanctions (Export Sanctioned Goods—Russia) Designation 2022 (the Principal Designation) to reflect that there are now two Parts in the Schedule.

 

Item 2

 

Regulation 4 of the Regulations sets out what constitutes a sanctioned supply for a country or part of country.  Provision of a sanctioned supply is prohibited under regulation 12, unless the Minister has granted a permit under regulation 18.  

 

Item 3A of the table in subregulation 4(2) of the Regulations provides that export sanctioned goods for Russia are: (i) arms and related materiel and (ii) specified items suited to use in certain categories of oil exploration or production projects in Russia.  The Minister for Foreign Affairs has the authority, under subregulation 4(3) of the Regulations, to designate by legislative instrument, additional goods as export sanctioned goods for a country or part of a country mentioned in the designation.  This mechanism exists to ensure that the Australian Government is able to act swiftly to expand the existing export prohibitions that apply in respect of a sanctioned country, enabling Australia to be responsive to evolving situations of international concern.

 

Goods that are designated as export sanctioned goods for Russia under subregulation 4(3) are set out in the Principal Designation.  Item 2 of the Amendment Designation amends Schedule 1 of the Principal Designation to insert a new Part 2 to designate certain luxury goods as export sanctioned goods for Russia.  A good is captured if it falls within a specified Australian Harmonized Export Commodity Classification (AHECC) code, meets the description, and meets the relevant value threshold (where applicable) as set out in the table in Part 2 of Schedule 1.

 

 

Attachment B

 

STATEMENT OF COMPATIBILITY WITH HUMAN RIGHTS

 

Prepared in accordance with Part 3 of the Human Rights (Parliamentary Scrutiny) Act 2011.

 

AUTONOMOUS SANCTIONS (EXPORT SANCTIONED GOODS—RUSSIA) AMENDMENT (NO. 1) DESIGNATION 2022

 

The Autonomous Sanctions (Export Sanctioned Goods—Russia) Amendment (No. 1) Designation 2022 (the Amendment Designation) 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.

 

Overview of the Amendment Designation

 

Autonomous sanctions are measures not involving the use of armed force which the Australian Government imposes and implements as a matter of foreign policy.  They are a discretionary tool which the Government can apply, alone or with like-minded countries where appropriate, to address egregious situations of international concern. 

 

The Autonomous Sanctions Regulations 2011 (the Regulations) make provision for, amongst other things, the designation of goods as ‘export sanctioned goods’ for a country or part of a country.  The supply, sale or transfer of ‘export sanctioned goods’ to Russia, for use in Russia or for the benefit of Russia is prohibited under regulations 4 and 12 of the Regulations. 

 

Russia’s aggression towards Ukraine presents a serious threat to the international rules-based order which underpins global security.  The purpose of the Amendment Designation is to expand, under subregulation 4(3) of the Regulations, what goods are ‘export sanctioned goods’ for Russia to include certain luxury goods.  In prohibiting the export of such goods, Australia is demonstrating its condemnation of Russia’s illegal and unjustified invasion of Ukraine. Through banning the export of luxury goods, Australia’s sanctions remain targeted at Russian elites.

 

When considering whether to apply autonomous sanctions, the Government considers Australia’s national interest, including bilateral, regional and multilateral equities, and the impact of sanctions on Australia’s economic, security or other interests.

 

Human rights implications

 

The Amendment Designation 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.

  

The Amendment Designation expands, under subregulation 4(3) of the Regulations, what goods are ‘export sanctioned goods’ for Russia to include luxury goods, including alcoholic beverages, tobacco products, works of art, and cosmetics. The supply, sale or transfer of such goods therefore become subject to the existing prohibition on making a sanctioned supply under regulation 12 of the Regulations.  The Amendment Designation does not change the overarching operation of the Regulations.

 

The human rights obligation that may possibly be affected by including luxury goods as ‘export sanctioned goods’ for Russia is the presumption of innocence.  Article 14(2) of the International Covenant on Civil and Political Rights (ICCPR) provides that everyone charged with a criminal offence shall have the right to be presumed innocent until proven guilty according to law.  As strict liability offences allow for the imposition of criminal liability without the need to prove fault, all strict liability offences engage the presumption of innocence in article 14(2) of the ICCPR. A strict liability offence will not necessarily violate the presumption of innocence provided that it is: (i) aimed at achieving a purpose which is legitimate; (ii) based on reasonable and objective criteria, and (iii) proportionate to the aim to be achieved.

 

Regulation 12 of the Regulations provide that strict liability applies unless the sanctioned supply is authorised by a permit under regulation 18 of the Regulations.  The Amendment Designation has the effect of making certain luxury goods ‘export sanctioned goods’ for Russia.  The effect of this is that strict liability applies to the existence or otherwise of a sanctions permit. For an individual, strict liability will not apply to any other element of the offence. 

 

The Amendment Designation is compatible with human rights because the limitations that arise are reasonable, necessary and proportionate measures which enable Australia to maintain its foreign policy and national security interests.

 

Conclusion

 

This Amendment Designation is compatible with human rights as the measures in the Amendment Designation do not raise any human rights issues.

 

 

 

Overview

The Autonomous Sanctions Regulations 2011, amended by the Autonomous Sanctions (Export Sanctioned Goods—Russia) Amendment (No. 1) Designation 2022, were enacted to address the problem of Russia's aggression towards Ukraine, which poses a serious threat to the international rules-based order. This legislation was introduced by the Minister for Foreign Affairs, in accordance with the Australian Government's foreign policy, as a discretionary tool to address egregious situations of international concern. The purpose of this Amendment Designation is to expand the scope of 'export sanctioned goods' for Russia to include certain luxury goods, demonstrating Australia's condemnation of Russia's illegal and unjustified invasion of Ukraine. By prohibiting the export of luxury goods, Australia's sanctions remain targeted at Russian elites. The policy objective is to maintain Australia's national interests, including bilateral, regional and multilateral equities, and the impact of sanctions on Australia's economic, security or other interests. The Amendment Designation is compatible with human rights as it imposes reasonable, necessary and proportionate measures to enable Australia to maintain its foreign policy and national security interests.

Scope and Application

The Autonomous Sanctions Regulations 2011, amended by the Autonomous Sanctions (Export Sanctioned Goods—Russia) Amendment (No. 1) Designation 2022, apply to all individuals and entities within Australia who engage in the export of specified goods to Russia. These goods now include certain luxury items as designated by the Amendment Designation. The scope of the regulations extends to any person or entity involved in the supply, sale, or transfer of these sanctioned goods to Russia, either for use within Russia or for the benefit of Russia. The regulations apply across the Commonwealth of Australia and are aimed specifically at addressing the threat posed by Russia’s aggression towards Ukraine by imposing economic measures. These measures are designed to target Russian elites without broadly affecting the Russian populace. The regulations do not apply to any goods or entities outside the scope of the Autonomous Sanctions Regulations 2011, nor do they extend to activities or entities outside of Australian jurisdiction. Subordinate instruments may further define the scope and application of these sanctions, but the primary legislative framework remains as set out in the Regulations and the Amendment Designation.

Key Provisions

The main operative sections of the Autonomous Sanctions (Export Sanctioned Goods—Russia) Amendment (No. 1) Designation 2022 (the Amendment Designation) include the provisions that designate certain luxury goods as export sanctioned goods for Russia. This expansion under subregulation 4(3) of the Autonomous Sanctions Regulations 2011 (the Regulations) aims to prohibit the supply, sale, or transfer of these luxury goods to Russia, for use in Russia, or for the benefit of Russia. This amendment is designed to target Russian elites and to demonstrate Australia's condemnation of Russia's illegal and unjustified invasion of Ukraine. The luxury goods are identified by reference to codes in the Australian Harmonized Export Commodity Classification (AHECC) and include alcoholic beverages, tobacco products, works of art, and cosmetics. The Amendment Designation imposes obligations on parties and entities that engage in the supply, sale, or transfer of goods to Russia. It is required that they ensure that any goods they provide fall outside the newly designated list of export sanctioned goods. This includes conducting due diligence to confirm that the goods they intend to supply do not constitute export sanctioned goods. Failure to comply with these obligations may result in sanctions under the Regulations, which prohibit the making of a sanctioned supply unless authorised by a permit under regulation 18 of the Regulations. Any breach of the provisions that prohibit the supply, sale, or transfer of export sanctioned goods to Russia is subject to civil and criminal penalties. Under regulation 12 of the Regulations, a strict liability offence is created, meaning that the burden of proof does not rest on the prosecution to establish fault. The maximum penalty for contravening this provision is substantial, reflecting the seriousness of the breach. The precise penalties are not detailed in the Amendment Designation but would be governed by the overarching provisions of the Regulations, which provide for significant fines and potential imprisonment. The strict liability regime ensures that individuals and entities are held accountable for breaches, regardless of intent, thereby reinforcing the effectiveness of the sanctions regime.

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