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Michael Murray’s on-going commentary on issues in corporate and personal insolvency law and related policy and law reform, in Australia and internationally. Given the scope of insolvency, this extends to business, consumer and professional conduct, and ethics, governance and regulation, criminal, tax, environmental and administrative law, and the courts and government.

 

Red tape committee turns to alcohol, with cabotage to follow

The Senate Red Tape Committee has decided to focus itself more, by inquiring into and reporting on specific areas.

Alcohol

It is starting off with an inquiry into red tape in the sale, supply and taxation of alcohol. 

Submissions close 31 January 2017 with a report due by 14 March 2017.

Further red tape issues

Following inquiries will look at:

  • Cabotage (that is, the restriction on foreign ships transporting cargo between Australian ports);
  • tobacco retail;
  • environmental assessment and approvals  
  • retail trading;
  • small business compliance; and
  • policy and process to limit and reduce red tape.

Cabotage

The issue of cabotage is an interesting one on the list.  It is the subject of a present on-going inquiry by the Senate Rural and Regional Affairs and Transport References Committee into so-called “flag of convenience shipping”. This is an aspect of the government’s move to deregulate the shipping industry, through the passing of the Shipping Legislation Bill 2015, which would replace the existing three tiered licensing system for ships with a single permit system, available to both Australian and foreign vessels, allowing access to the Australian coast for a period of 12 months. It would also establish a framework of entitlements for seafarers on foreign vessels engaging in coastal shipping, but only for voyages over 183 days.  Opposition to the Bill has seen submissions raising contentious issues of jobs, seafarer welfare, conditions and pay rates. The safety of flag of convenience ships is raised, including their use in illegal activities. Counter submissions dismiss these concerns as demonstrating an anti-foreigner view, indeed that “flag of convenience” is an old and pejorative term, that does not acknowledge developments in regulation of shipping under international treaties and countries’ local laws.  

The Senate Rural and Regional Affairs and Transport References Committee published an interim report in 2016, which ultimately supported change, saying that the reform “removes impediments, leverages strengths and reduces costs, and [the Bill’s] passage will benefit the economy greatly”. The report examines the issue of cabotage, in the context of its recommendations about what it says are the “potential security risks posed by flag of convenience vessels and by foreign crews”. The committee examined the US Merchant Marine Act 1920 (the ‘Jones Act’) “cited in evidence as an example of a healthy and sustainable domestic shipping industry. This was due to the protection it offers US domestic shipping, as well as the way it strengthens the US national security system and economic interests”.  That in itself is a matter of international contention although current limitations in the US shipping fleet may necessitate some long-awaited exceptions to the Jones Act to be made. 

The issue is significant for Australia given its long coastline. The industry is said not to be competitive, with the government claiming that “it is cheaper to ship sugar from Thailand to Australia than it is to ship Australian sugar around our own coastline”.

That Senate committee is to give its final report by 19 July 2017.

But first, we await the outcome of the red tape alcohol inquiry in March 2017. 

We all wait to see how cabotage fits within the committee’s red tape inquiry and why it is listed at all.

We probably already know that red tape in insolvency regulation is not on the committee’s list of priorities.

 

 

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