Commonwealth Numbered Regulations - Explanatory Statements

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CUSTOMS (PROHIBITED EXPORTS) REGULATIONS (AMENDMENT) 1991 NO. 24

EXPLANATORY STATEMENT

Statutory Rules 1991 No. 24

CUSTOMS ACT 1901

CUSTOMS (PROHIBITED EXPORTS) REGULATIONS (AMENDMENT)

ISSUED BY THE AUTHORITY OF THE MINISTER OF STATE FOR SMALL BUSINESS AND CUSTOMS

Section 112 of the Customs Act 1901 provides in part that:

"1)       The Governor-General may, by regulation, prohibit the exportation of goods from Australia.

2)       The power conferred by sub-section (1) may be exercised:

(a)       by prohibiting the exportation of goods absolutely;

(aa)       by prohibiting the exportation of goods in specified circumstances;

(b)       by prohibiting the exportation of goods to a specified place; or

(c)       by prohibiting the exportation of goods unless specified conditions or restrictions are complied with.

2A)       Without limiting the generality of paragraph (2)(c), the Regulations - ...(a) may provide that the exportation of the goods is prohibited unless a licence, permission, consent or approval to import the goods or a class of goods in which the goods are included has been granted as prescribed by the regulations; and ..."

The Customs (Prohibited Exports) Regulations ("the Regulations") control the exportation of the goods specified in the various Regulations or the Schedules to the Regulations, by prohibiting exportation absolutely, or making exportation subject to the permission of a specified person or Minister of State.

The proposed Regulations contain several amendments to the Iraq/Kuwait export sanctions legislation enacted on 8 August 1990.

Background

In August 1990 action was taken to implement the trade sanctions against Iraq agreed to in United Nations Security Council Resolutions Numbers 661 and 666. Those measures comprised, amongst other things, amendments to the Customs (Prohibited Exports) Regulations (Statutory Rules 1990 No. 264) to prohibit the exportation from Australia of;

       any goods to Iraq or Kuwait;

       goods of Iraqi or Kuwaiti origin to any other country; or any goods which the Minister certifies he has reasonable grounds for believing the ultimate intended destination of which is Iraq or Kuwait; or

       any goods which the Minister (Foreign Affairs and Trade) certifies he has reasonable grounds for believing the ultimate intended destination of which is Iraq or Kuwait or the goods are of Iraqi or Kuwaiti origin.

The exportation from Australia of all three classes of goods is prima facie prohibited unless the permission of the Minister to export those goods is first obtained.

The proposed amendments to the Regulations retain the existing prohibitions in respect of the exportation of goods from Australia to Iraq or Kuwait, or goods of Iraqi or Kuwaiti origin. A new subregulation is proposed however with respect to these two classes of goods to expressly provide that where such trade is exempted from the prima facie prohibition via the Minister's permission, such permission may not be given if the exportation would be inconsistent with the United Nations Security Council Resolutions Numbers 661 and 666 dealing with the sanctions measures against Iraq and Kuwait (new subregulation 13CA(2A) refers).

       The Minister's discretion to date has in fact only been exercised where such is the case

In respect of the third class of goods (ie. goods exported to third countries, where the ultimate intended destination is Iraq or Kuwait), the existing-prohibition has been amended to prohibit absolutely such exportation only if the exportation would be inconsistent with the sanctions resolutions.

       The existing prohibition required the Minister to certify that he had reasonable grounds for believing such 3rd country trade was in fact destined for Kuwait or Iraq before such trade could be prohibited.

       In preparation for its return to Kuwait, the legitimate Government of Kuwait is undertaking a global purchasing program to obtain supplies and material necessary for the reconstruction of the country following its anticipated liberation. It is understood that goods purchased under the program will be stockpiled in Dubai and other third countries pending the return of the Kuwaiti Government.

The proposed amendments remove any doubt that exportations by, or on behalf of, the legitimate Government of Kuwait are not prima facie caught by this sanctions legislation (new subregulation 13CA(2B) refers).

The details of the amendments are set out in greater detail in the Attachment hereto.

Proposed Regulation 1:       is a machinery provision which provides that the Customs (Prohibited Exports) Regulations are amended as set out in these Regulations.

Proposed Regulation 2: Regulation 13CA (Exportation of goods to Iraq and Kuwait): amends Regulation 13CA of the Principal Regulations as follows:

Proposed subregulation 2.1 inserts a definition of sanctions resolutions in the Regulations to expressly cover the two United Nations Security Council Sanctions Resolutions concerning Iraq.

Proposed subregulation 2.2 omits existing subregulation 13CA(2) and inserts the following new subregulations:

       New Subregulation 13CA(2) provides that the exportation from Australia of goods to Iraq or Kuwait, or the exportation from Australia to any country of goods of Iraqi or Kuwaiti origin, is prohibited unless the permission in writing of the Minister or an authorised person is produced to a Collector.

-       This effectively repeats the current prohibition in paragraphs 13CA(2)(a) and (b)

       New Subregulation 13CA(2A) inserts the new provision in respect of the above prohibition to provide that permission to export goods prohibited by subregulation 13CA(2) above must not be given it the exportation would be inconsistent with the sanctions resolutions. The sanctions resolutions however, expressly allow trade with Iraq or occupied Kuwait where such trade is strictly for medical or humanitarian purposes, or in order to assist the legitimate Government of Kuwait.

       New subregulation 13CA(2B) remakes the existing prohibition in paragraph 13CA(2)(c) to provide that the exportation of goods to countries other than Iraq or Kuwait, where the ultimate intended destination of the trade is Iraq or Kuwait, is prohibited where such exportation would be inconsistent with the sanctions resolutions. The effect of this new provision is that where third country trade ultimately destined for Kuwait is expressly for the rehabilitation and reconstruction of the legitimate Government of Kuwait, such trade no longer comes within the sanctions legislation regime.


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