Protection of the Sea (Prevention of Pollution From Ships) Amendment (Polar Code) Bill 2017 - Commentary on Ministerial Responses [2017] AUSStaCSBSD 151 (10 May 2017)

• Protection of the Sea (Prevention of Pollution from Ships) Amendment (Polar Code) Bill 2017
• Strict liability 52
• Reversal of evidential burden of proof56

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Protection of the Sea (Prevention of Pollution from Ships) Amendment (Polar Code) Bill 2017

Purpose	This bill seeks to amend the Protection of the Sea (Prevention of Pollution from Ships) Act 1983 to implement amendments of the International Convention for the Prevention of Pollution from Ships 1973, to ensure that there are strict discharge restrictions for oil, noxious liquid substances, sewage and garbage for certain ships operating in polar waters
Portfolio	Infrastructure and Regional Development
Introduced	House of Representatives on 16 February 2017
Bill status	Before Senate
Scrutiny principle	Standing Order 24(1)(a)(i)

2.173 The committee dealt with this bill in Scrutiny Digest No. 3 of 2017. The Minister responded to the committee's comments in a letter dated 28 March 2017. Set out below are extracts from the committee's initial scrutiny of the bill and the Minister's response followed by the committee's comments on the response. A copy of the letter is at Appendix 2.

Strict liability ^[52]

Initial scrutiny – extract

2.174 Proposed subsection 26BCC(3) and (4) make it an offence of strict liability if the master and the owner of a ship discharge sewage from the ship in the Antarctic Area and Artic waters in certain circumstances. The offence carries a significant penalty of 500 penalty units. The Guide to Framing Commonwealth Offences, Infringement Notices and Enforcement Powers states that strict liability offences are generally only considered appropriate where the offence is punishable by a fine of up to 60 penalty units for an individual (300 for a body corporate).^[53]

2.175 The explanatory memorandum provides the following justification as to why the offences are subject to strict liability:

The justification for the need for the strict liability offences is to ensure the integrity of the regulatory regime as it relates to the pristine natural environments of the Antarctic Area and Arctic waters. Further, the offences do not include imprisonment as a penalty and this approach ensures drafting consistency with the Protection of the Sea (Prevention of Pollution from Ships) Act 1983.^[54]

2.176 In a criminal law offence the proof of fault is usually a basic requirement. However, offences of strict liability remove the fault (mental) element that would otherwise apply. The committee expects the explanatory memorandum to provide a clear justification for any imposition of strict liability, including outlining whether the approach is consistent with the Guide to Framing Commonwealth Offences, Infringement Notices and Enforcement Powers. In particular, the committee expects clear justification where the proposed penalty for a strict liability offence exceeds 60 penalty units. This has not been explained in the explanatory memorandum.

2.177 The committee requests a detailed justification from the Minister for each proposed strict liability offence with reference to the principles set out in the Guide to Framing Commonwealth Offences, Infringement Notices and Enforcement Powers,^[55] in particular the justification for the proposed penalty.

Minister's response

2.178 The Minister advised:

Section 26BCC(3) creates an offence for the master and owner of an Annex IV Australian ship where sewage is discharged in the Antarctic Area outside Australia's exclusive economic zone. The purpose of this strict liability offence is to manage the risk of Australian ships discharging sewage into the pristine waters of the Antarctic. This type of discharge could have a significant adverse impact on the environment, human health, safety and other users of the sea, particularly when it is a reoccurring activity.
Shipping companies are engaging in high-investment, high-return commercial activities. Stringent regulatory regimes designed to better manage safety and environment issues throughout the world's oceans are agreed internationally through the International Maritime Organization (IMO). Those ships travelling through Antarctic and Arctic waters are subject to additional internationally agreed regulatory regimes designed to protect these sensitive waters. Australia has a particular responsibility for parts of the Antarctic waters through the Antarctic Treaty system.
The imposition of the strict liability offence through Section 26BCC(3) is appropriate given the importance of maintaining the integrity of the environmental regulatory regime in the remote Antarctic Area. The offence is directed at the master and owner of the ship, who have a shared responsibility and can both be expected to be fully aware of the requirements of the legislation (and of Annex IV). Both have a responsibility to be aware of the restrictions on the discharge of sewage and to adhere to these restrictions. Therefore, if sewage is discharged contrary to the requirements of the legislation, the master and the owner of the ship should be liable without any need to prove intention or recklessness on their part with respect to the contravention of that requirement. Furthermore, it may be difficult to prove that they had the requisite mental element (ie intention or recklessness) and thus a requirement to prove a mental element would make Section 26BCC(3) harder to enforce.
The offence is consistent with offence provisions in other parts of the Protection of the Sea (Prevention of Pollution from Ships) Act 1983. In my view, it is also consistent with the principles relating to strict liability at 2.2.6 of the Guide to Framing Commonwealth Offences, Infringement Notices and Enforcement Powers, although the proposed penalty is higher than recommended in that Guide. Given the significant consequences of noncompliance for the Antarctic, it is important that the penalty for non-compliance is high enough to be a real incentive to industry. In order to ensure compliance with environmental regimes, high initial outlays by the shipping industry are sometimes required. In these circumstances, and given the very high level of expenditure routinely incurred in shipping operations, it is considered that the normal upper limit of 60 penalty units for strict liability offences is inadequate as a meaningful deterrent. The proposed 500 penalty units is necessary for that purpose.
Section 26BCC(4) creates a similar offence, being an offence for the master and the owner of an Annex IV Australian ship where sewage is discharged in Arctic waters. While Australia does not have the additional burdens of responsibilities for the Arctic area as is the case for the Antarctic under the Antarctic treaty system, the same concerns outlined above in relation to the Antarctic apply to this offence in the Arctic.
Given the above, the imposition of strict liability offences under Section 26BCC, and a higher than normal level of penalties for such offences, is considered to be justified in this instance.

Committee comment

2.179 The committee thanks the Minister for this response. The committee notes the Minister's advice that the imposition of strict liability is appropriate given the importance of maintaining the integrity of the environmental regulatory regime in the remote Antarctic Area and Artic waters. The committee also notes the Minister's advice that both the master and owner of the ship can be expected to be fully aware of the requirements of the legislation and restrictions on the discharge of sewage and if sewage is discharged contrary to the requirements of the legislation, the master and the owner of the ship should be liable without any need to prove intention or recklessness and it may be difficult to prove that they had the requisite mental element. The committee also notes the advice that it is important that the penalty for non-compliance is high enough to be a real incentive to industry, and given the very high level of expenditure routinely incurred in shipping operations, it is considered that the normal upper limit of 60 penalty units for strict liability offences is inadequate as a meaningful deterrent.

2.180 The committee requests that the key information provided by the Minister be included in the explanatory memorandum, noting the importance of these documents as a point of access to understanding the law and, if needed, as extrinsic material to assist with interpretation (see section 15AB of the Acts Interpretation Act 1901).

2.181 In light of the detailed information provided, the committee makes no further comment on this matter.

Reversal of evidential burden of proof^[56]

Initial scrutiny – extract

2.182 Proposed subsections 26BCC(5), (6), (7), (8) and (9) provide exceptions (offence specific defences) to the strict liability offences relating to the discharge of sewage from a ship in the Antarctic Area and Artic waters.

2.183 Subsection 13.3(3) of the Criminal Code Act 1995 provides that a defendant who wishes to rely on any exception, exemption, excuse, qualification or justification bears an evidential burden in relation to that matter.

2.184 While the defendant bears an evidential burden (requiring the defendant to raise evidence about the matter), rather than a legal burden (requiring the defendant to positively prove the matter), the committee expects any such reversal of the evidential burden of proof to be justified. The reversal of the evidential burden of proof in proposed section 26BCC has not been addressed in the explanatory materials.

2.185 As neither the statement of compatibility nor the explanatory memorandum address this issue, the committee requests the Minister's advice as to why it is proposed to use offence-specific defences (which reverse the evidential burden of proof) in this instance. The committee's consideration of the appropriateness of a provision which reverses the burden of proof is assisted if it explicitly addresses relevant principles as set out in the Guide to Framing Commonwealth Offences, Infringement Notices and Enforcement Powers.^[57]

Minister's response

2.186 The Minister advised:

A number of provisions in the Bill (Sections 26BCC(5), (6), (7), (8) and (9)) provide defences to the strict liability offences proposed at Sections 26BCC(3) and (4). These provisions describe exceptions to the strict liability offences and require the defendant to raise evidence about the matters outlined in each provision.
A defendant who seeks to rely on one of the defences in Section 26BCC has an evidential burden to provide evidence of the facts which constitute the defence. This is because the defendant is the person most likely to have relevant knowledge of those facts. Once the defendant discharges an evidential burden, the prosecution must disprove those matters beyond reasonable doubt.
Section 26BCC(5) creates two exceptions. The first is an exception to the strict liability offences where safety of life at sea is endangered. Only those present during a particular incident are able to make an assessment as to what is necessary to ensure the safety of life at sea, and the master of the ship is charged with the responsibility for making this judgement. As the master of the ship is also subject to the direction of the shipowner, evidence from both parties, only knowable to those parties, may explain the assessments made at the time.
The second exception requires evidence to be presented about the precautions taken throughout a voyage to minimise damage and the decision about the need to discharge sewage. Again, the circumstances surrounding a particular incident, the precautions needed to address that situation, and the assessment undertaken in making a decision, can only be known by those present (specifically the master of the ship). As the master of the ship is also subject to the direction of the shipowner, evidence from both parties, only knowable to those parties, may explain the assessments made at the time.
Section 26BCC(6) creates an exception requiring evidence to be presented about a combination of factors: the location of the discharge and the speed of the ship when the discharge occurs. Section 26BCC(7) also creates an exception requiring evidence to be presented about a combination of factors: the location of the discharge and the physical nature of the discharge when the discharge occurs. Section 26BCC(8) creates an exception requiring evidence to be presented about the nature of the sewage discharged. Section 26BCC(9) creates an exception requiring evidence to be presented about the location of the discharge. The matters described in each of these exceptions is knowable only by those present and charged with decision making responsibilities, being the master of the ship in control of the ship at the time, subject to the direction of the shipowner.
The burden of proof is placed on the defendant in all of the above provisions because the facts in issue in the defence might be said to be peculiarly within the knowledge of the accused and the defendants are best placed to give evidence as to their decision making at the time when a discharge occurs. This appears to be a situation in which the relevant facts are likely to be within the knowledge of the defendant, and in which it could be difficult for the prosecution to prove the defendant's state of mind. The Senate Standing Committee for the Scrutiny of Bills has previously indicated that the burden of proof may be imposed on a defendant under these circumstances. In my view, this approach is also consistent with 4.3.1 of the Guide to Framing Commonwealth Offences, Infringement Notices and Enforcement Powers.
Given the above, I consider it to be appropriate in this instance for the Bill to include the offence-specific defences.

Committee comment

2.187 The committee thanks the Minister for this response. The committee notes the Minister's advice that the defendant is the person most likely to have relevant knowledge of the relevant facts, with much of the requisite information only knowable by those present and charged with decision making responsibilities, being the master of the ship in control of the ship at the time, subject to the direction of the shipowner, and therefore are matters peculiarly within the knowledge of the defendant.

2.188 The committee requests that the key information provided by the Minister be included in the explanatory memorandum, noting the importance of these documents as a point of access to understanding the law and, if needed, as extrinsic material to assist with interpretation (see section 15AB of the Acts Interpretation Act 1901).

2.189 In light of the detailed information provided, the committee makes no further comment on this matter.

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[52] Item 14, subsection 26BCC(3) and (4).

[53] Attorney-General's Department, Guide to Framing Commonwealth Offences, Infringement Notices and Enforcement Powers, September 2011, p 23.

[54] Explanatory memorandum, p. 6.

[55] Attorney-General's Department, Guide to Framing Commonwealth Offences, Infringement Notices and Enforcement Powers, September 2011, pp 22–25.

[56] Item 14, subsection 26BCC(6).

[57] Attorney-General's Department, Guide to Framing Commonwealth Offences, Infringement Notices and Enforcement Powers, September 2011, pp 50–52.