Customs Amendment (Strengthening and Modernising Licensing and Other Measures) Bill 2024 - Commentary on Ministerial Responses [2024] AUSStaCSBSD 181 (11 September 2024)

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Purpose	This bill seeks to amend the Customs Act 1901 with the aim of modernising and strengthening the customs licensing regime and seeks to make amendments to streamline administrative processes including digitisation of forms. The customs licensing regime encompasses depot, warehouse and customs broker’s licences. The bill also seeks to amend the AusCheck Act 2007 to support these reforms by allowing for the disclosure of security identity card information to an officer of Customs for the purposes of the Customs Act.
Portfolio	Home Affairs
Introduced	House of Representatives on 26 June 2024
Bill status	Received the Royal Assent 5 September 2024

Coercive powers^[81]

2.53 This bill seeks to amend the Customs Act 1901 (Customs Act) to provide that a collector may, at any time, gain access to and enter, if necessary by force, any place covered by a depot licence and examine any goods at the place.^[82] A collector is taken to be either the Comptroller-General or a Customs officer under the Customs Act.^[83]

2.54 In Scrutiny Digest 9 of 2024 the committee requested the minister’s advice as to:

Minister for Home Affairs’ response^[85]

2.55 In relation to why the current permit conditions are insufficient, the minister advised that subsection 77N(10) is limited to review and inspection of documents and does not include the power to inspect goods under customs control in the depot or to ensure compliance with other conditions imposed upon the depot licence under the Customs Act.

2.56 The minister highlighted subsection 77N(11) of the Customs Act, which permits licence holders to refuse access to the depot unless the authorised officer produces written evidence that the person requesting access is an authorised officer. However, the minister noted that if a licence holder is not present it may not be possible to seek permission for entry into the depot, and if a licence holder asserts there are no commercial documents, it may be difficult to establish that an officer had reasonable grounds to believe commercial documents were present.

2.57 The minister advised that subsection 77N(6) could be amended to give, as a condition of the licence, the Australian Border Force (ABF) authority to enter and access a licenced place. However, the minister advised this would not account for circumstances where a licence holder may refuse the ABF’s request to shield either non-compliant or criminal behaviour.

2.58 In relation to why seeking a warrant would be impractical, the minister advised that the ABF requires timely powers of access and examination due to the speed and complexity of supply chain operations, as once goods under customs control are released for home consumption the ABF has limited jurisdiction over them. The minister also advised that currently the ABF can only access the defined licensed places or Customs controlled areas whereas if entry and access is required to other places a warrant would be required in relation to non-customs controlled areas.

2.59 In relation to what safeguards would apply if a collector entered premises without consent or warrant, the minister advised that an existing provision of the Customs Act provides an identical entry and search power but in relation to warehouse premises. The minister also advised that the ABF Operational Safety Order 2021 sets out the ABF operational safety and use of force practice, reporting, training, assessment, qualification and administration requirements. The minister stated that an ABF employee would need to complete a Basic Operational Safety Training Course (BOST) to be issued with a use of force permit. However, the minister also noted that this training qualification does not cover forced entry capability (as provided for in the proposed new entry and search power).

2.60 In relation to when an officer may need to use force to enter premises, the minister advised where a licence holder is not present, an ABF officer will first exhaust all options to seek permission, including requesting consent from the licence holder, requesting the licence holder attend the place to allow access, or requesting the licence holder facilitate access. The minister advised that in most cases the licence holder will provide consent or facilitate access remotely. The minister advised force may be necessary where a license holder refuses permission to enter a licenced place, noting this may indicate criminal behaviour or intent to interfere with goods subject to customs control prior to ABF intervention.

2.61 Finally, in relation to the lack of any statutory requirement for a licence holder to be notified after a search has occurred, the minister advised that the ABF will use various powers to seek licence holder compliance when attending licensed places such as announcing the ABF officers’ presence and requesting permission to enter. The licence holder would have an opportunity to provide consent, permit entry and seek confirmation of the ABF officers’ credentials.

Committee comment

2.62 The committee thanks the minister for this response. The committee acknowledges the minister’s advice regarding the need for the ABF to gain access and examine goods in a timely manner, but considers it has not been established why stronger licence conditions requiring access would not be sufficient, or why a warrant could not be sought (noting that warrants for other matters can be made urgently where necessary).

2.63 In relation to the existing power imposing conditions on a depot licence, the committee notes the advice that subsection 77N(6) could be amended to give the required search and entry power. It is not clear to the committee why amending subsection 77N(6) to require licence holders to grant access to examine goods would not be sufficient, noting the Customs Act already provides that it is a criminal offence to breach a condition of a depot licence.^[86] Further, it is unclear why, if this was considered insufficient, the Customs Act could not have been amended to include standard warrant provisions, such as triggering the provisions of the Regulatory Powers (Standard Provisions) Act 2014 (Regulatory Powers Act). The Regulatory Powers Act provides for a standard suite of provisions in relation to monitoring and investigation powers, which if triggered can be used to check compliance with a regulatory regime. The Regulatory Powers Act is an Act of general application and represents best practice in relation to regulatory powers, providing a standard baseline of regulatory powers while protecting important common law privileges.

2.64 The committee notes the advice provided that the officer of the ABF conducting the search will exhaust all available options to seek permission to enter the licensed premises before using force to enter the location, yet notes that none of these are statutory requirements. Overall, the committee considers the provision should better align with the requirements of the Attorney-General’s Department’s Guide to Framing Commonwealth Offences, Infringement Notices and Enforcement Powers.^[87]

2.65 Further, in relation to the committee’s request for applicable safeguards, the committee notes the advice that the ABF operational safety and use of force practice, reporting, training, assessment, qualification and administration requirements are contained within the ABF Operational Safety Order 2021. However, while the committee notes the advice in relation to Basic Operational Safety Training that all ABF employees must successfully complete, it is not clear to the committee how this is intended to operate as a safeguard on the use of force to enter and search licensed premises, as the advice provided also indicates this training does not cover forced entry capability, which the new power intends to provide ABF officers with. Effectively, it would appear customs officers are not trained to use force to enter and search licensed premises even though the new section 77ZAA allow for officers to use such force.

2.66 The committee notes the minister’s advice that the new section 77ZAA aligns with existing section 91 of the Customs Act. However, section 91 of the Customs Act was inserted in 1980 and has not been amended since. As the power is identical to the one that would be introduced by new section 77ZAA, the committee considers that existing section 91 demonstrates similar scrutiny concerns to what has been detailed in relation to new section 77ZAA. The committee does not consider either of these provisions sufficiently protect individual rights and liberties ‑– allowing an overly broad power, without relevant safeguards regarding the use of such powers.

2.67 The committee also notes that the advice provided does not address the question of why license holders cannot be notified after a search has occurred. Although the committee notes the advice that every effort will be made to seek permission from the licence holder prior to the search, the advice states that there are situations where the licence holder is not present to provide consent. The committee’s query was in relation to these circumstances where permission cannot be sought from the licence holder and consequently, why there are no reporting obligations placed on customs officers on the face of the bill.

2.68 The committee considers that both section 91 of the Customs Act 1901 and new section 77ZAA are overly broad in allowing for customs officers to enter licensed depot and warehouse premises to search goods without any requirement to seek consent or do so under a warrant.

2.69 The committee notes that this bill has now passed both Houses of Parliament. As such, the committee considers the entry and search powers in the Customs Act should be reviewed to ensure the provisions are in line with best practice and the Attorney-General's Department’s Guide to Framing Commonwealth Offences, Infringement Notices and Enforcement Powers.

^[80]\\\\ This entry can be cited as: Senate Standing Committee for the Scrutiny of Bills, Customs Amendment (Strengthening and Modernising Licensing and Other Measures) Bill 2024, Scrutiny Digest 11 of 2024; [2024] AUSStaCSBSD 181.

^[81] Schedule 1, item 121, proposed paragraph 15(2)(e). The committee draws senators’ attention to this provision pursuant to Senate standing order 24(1)(a)(i).

^[85] The minister responded to the committee’s comments in a letter dated 22 August 2024. A copy of the letter is available on the committee’s webpage (see correspondence relating to Scrutiny Digest 11 of 2024).

Australian Senate Standing Committee for the Scrutiny of Bills - Scrutiny Digests