EXPLANATORY STATEMENT
Issued by the authority of
the Parliamentary Secretary to the Minister for Transport and Regional Services
Navigation Act 1912
DIRECTION UNDER SUBSECTION 421(1)
Part VI of the Navigation Act 1912 (the Act) provides for the granting of permits and licences for ships to engage in the domestic coasting trade of Australia. Section 7 of the Act deems a ship to be engaging in the coasting trade where, except in defined circumstances, the ship “takes on board passengers or cargo at any port in a State, or a Territory, to be carried to, and landed or delivered at, any other port in the same State or Territory or in any other State or other such Territory”.
Subsection 421(1) of the Act provides that the Minister may direct that a class of ships is exempt from provisions of the Act.
Shipping between Christmas Island and other states and territories was granted an exemption from Part VI of the Act in 1998 by the former Minister for Workplace Relations and Small Business, the Hon Peter Reith MP, on the basis that:
- It allowed Christmas Island Phosphates to access shipping services at competitive freight rates; and
- It removed an anomaly whereby Christmas Island was the only Commonwealth island territory without an exemption.
The exemption was valid for three years and expired on 7 April 2001. The former Minister for Transport and Regional Services, the Hon John Anderson MP, renewed the exemption in 2001 and again in 2004. The current exemption is due to expire on 7 April 2007.
The supply of shipping services to meet the needs of Christmas Island has not changed significantly since 2004. The island’s position away from the main trading routes results in limited appeal for shipping companies to meet the island’s needs. Exemption from the licence and permit system provides greater flexibility in meeting the island’s shipping requirements.
Subsection 421(2) of the Act provides that the exemption must be granted for a specified period. Subsections 421(6) and 421(7) provide that before making a direction under s421(1) the Minister must be satisfied that:
- The direction would not be inconsistent with an obligation of Australia under an international agreement; and
- The direction would not jeopardise the safety of a ship or persons on board a ship.
There is nothing to suggest that a continuation of the current exemption would violate either of these provisions.
The Direction is a legislative instrument for the purposes of the Legislative Instruments Act 2003.
Consultation external to the Australian Government is unnecessary as the Direction is of a minor or machinery nature and does not alter existing arrangements.
The Direction commences on 8 April 2007 and remains in force until 7 April 2010.
Overview
The Navigation Act 1912, enacted by the Commonwealth Parliament, governs the regulation of maritime transport within Australia, including the issuance of permits and licenses for ships engaged in the coasting trade. To address specific needs, the Act includes provisions for the Minister to exempt certain classes of ships from certain requirements. The exemption for shipping services to Christmas Island was initially granted in 1998 to facilitate competitive freight rates and to correct an anomaly where Christmas Island was the only Commonwealth island territory without such an exemption. This exemption was subsequently renewed in 2001 and 2004, and this latest direction extends the exemption until 7 April 2010, ensuring continued flexibility in meeting the island’s shipping requirements without compromising safety or international obligations.
Scope and Application
The Navigation Act 1912 applies to ships engaging in the domestic coasting trade within Australia, including those taking on board passengers or cargo at any port in a state or territory for carriage to another port within the same state or territory or to another state or territory, except under specific circumstances. Part VI of the Act, which governs the granting of permits and licences for such ships, is subject to exemptions that the Minister may direct under subsection 421(1). An exemption currently in place allows certain classes of ships to bypass the permit and licence requirements for shipping services to and from Christmas Island. This exemption was initially granted in 1998 to facilitate access to competitive freight rates for Christmas Island Phosphates and to address an anomaly where Christmas Island was the only Commonwealth island territory without an exemption. The exemption has been periodically renewed, with the current exemption set to expire on 7 April 2007, and it has now been extended by a Direction under subsection 421(1) to remain in effect until 7 April 2010. The Minister must ensure that the exemption does not conflict with Australia's international obligations or compromise the safety of ships and their passengers before granting such exemptions.
Key Provisions
The key operative sections of this legislation under the Navigation Act 1912 (the Act) include sections 421(1) and 421(2), which empower the Minister to direct that a class of ships is exempt from certain provisions of the Act, and section 7, which defines the coasting trade. Section 421(1) of the Act allows the Minister to exempt a class of ships from the provisions of the Act if specific criteria are met. This exemption, as referenced in the Explanatory Statement, was initially applied to shipping between Christmas Island and other states and territories in 1998, and has been renewed periodically since then. The exemption aims to provide flexibility in meeting the island's shipping requirements, given its remote location and limited appeal to shipping companies.
The Act imposes several obligations and requirements on the parties and entities it governs. Firstly, the Minister must ensure that any exemption granted under section 421(1) does not conflict with Australia's obligations under any international agreements and does not jeopardise the safety of ships or persons on board. This obligation is clearly stated in subsections 421(6) and 421(7) of the Act. Additionally, the exemption must be granted for a specified period, as outlined in subsection 421(2). These obligations are designed to maintain a balance between facilitating shipping services to remote areas like Christmas Island and ensuring maritime safety and compliance with international standards.
In terms of consequences for breach, the Act does not explicitly detail specific offences, penalties, or civil/criminal consequences for non-compliance with the exemption provisions. However, generally under the Navigation Act 1912, unauthorised operation of ships, including those not complying with the permit and licensing requirements, could lead to penalties. Such penalties can include fines and potential imprisonment, depending on the severity of the breach and any additional statutory provisions that may apply. The specifics of these penalties would need to be referred to under the broader framework of the Act and any relevant maritime regulations.