24 June, 2016
What you need to know
- On 16 June 2016, the Biosecurity Act 2015 (Cth) will replace the Quarantine Act 1908 (Cth) as the foremost piece of biosecurity legislation in Australia.
- This change will have particular implications for offshore oil and gas operators, especially as a result of an effective rolling-back of the Commonwealth's biosecurity jurisdiction from 200nm to 12nm.
- This jurisdictional change is set to affect how fixed and mobile oil and gas facilities situated outside of 12nm are recognised for biosecurity purposes.
- Further changes are also likely in the future with respect to the management of ballast water.
What you need to do
- Industry participants should familiarise themselves with the new Biosecurity Act 2015 (Cth) and its related regulations, and be aware of how their operations will be impacted.
- Participants should also monitor the continuing progress of Australia's international obligations under the Convention for the Control and Management of Ship's Ballast Water and Sediments.
- Further information on the objectives and breadth of the Biosecurity Act 2015 (Cth) is also available from the Department of Agriculture's website here.
Background
Rolling back Australia's biosecurity reach
On June 16 2016, the Biosecurity Act 2015 (Cth) (Biosecurity Act) will replace the Quarantine Act 1908 (Cth) (Quarantine Act) in what will be the largest transformation in Australian biosecurity regulation in more than a century. Among the many changes that are set to occur, is a reduction in Australia's biosecurity jurisdiction. Upon the introduction of the Biosecurity Act, Australia's biosecurity jurisdiction will be effectively "rolled back" from 200nm offshore to just 12nm. This change will have specific implications for offshore oil and gas operators. In particular, it will change how fixed and mobile oil and gas facilities affixed to the seabed (Installations) outside of Australia's territorial waters are classified for biosecurity purposes; and it may affect how those facilities are required to manage their ballast water.
Biosecurity classification
What was once national becomes international
While Australian territorial waters cease at 12nm, the various definitions that currently appear in the
Quarantine Act operate to capture many activities that occur in waters up to 200nm from the Australian coast. In particular, Installations that attach to the seabed outside of Australia's territorial waters but within 200nm from Australia are currently subject to quarantine under the Quarantine Act. Installations can, however, apply to be released from quarantine, and upon inspection and release are recognised as a "place in Australia" under the Quarantine Act. Once recognised as a place in Australia, Australian vessels (free of disease) travelling between a port in Australia and the Installation are not subject to quarantine and have no pre-arrival and pre-departure reporting obligations. Overseas vessels travelling directly to the Installation continue to be subject to quarantine.
The new Biosecurity Act no longer provides for Installations to be regulated in this way. From 16 June 2016,1 Installations outside Australia's territorial waters will not be recognised as part of Australia. This change is directed toward reducing the burden and costs of compliance for Installations. However, this may not be realised in practice.
As Installations operating outside territorial waters will now be operating outside of Australian biosecurity jurisdiction, the domestic vessels and aircraft (Conveyances) that interact with them will automatically be deemed "exposed" under the new Biosecurity Act. These exposed Conveyances will, in turn, be subject to biosecurity and a slew of related reporting and arrival procedures upon returning to territorial waters.
In an effort to curb the impact this will have on domestic Conveyances visiting Installations on a regular basis during their normal operations, the Department of Agriculture and Water Resources (DAWR) has drafted targeted exceptions to the effects of the "exposure" classification. The operation of these exceptions will be such that exposed Conveyances will not be required to apply to be recognised under the exceptions, but instead will simply need to be aware they (and in some cases the Installation they interact with) are operating in accordance with a specific exception.
The exceptions are intended to apply to interactions between:
a) Installations (which under the Biosecurity Act includes vessels attached permanently or semi- permanently to an Installation);
b) Petroleum Industry Vessels (a vessel other than an installation that is or will be used wholly or principally in exploring or exploiting petroleum); and
c) Domestic Conveyances.
Foreshadowed exceptions
The exceptions drafted by the DAWR provide that where a Conveyance interacts with either an Installation or a Petroleum Industry Vessel outside of territorial waters they will not be subject to biosecurity upon re-entry to Australian territory in three specific circumstances:
- First, where no person or goods (other than fuel, petroleum or canisters of petroleum) from the Installation or Petroleum Industry Vessel are aboard the exposed Conveyance;
- Second, where the level of biosecurity risk on the Installation or Petroleum Industry Vessel is low (within the meaning given in the determination); or
- Third, where the biosecurity risks of the Installation or Petroleum Industry Vessel are managed in accordance with an Approved Arrangement with DAWR.
As is to be expected of any type of exception to biosecurity regulation, these exceptions are prefaced by a requirement that the exposed Conveyance is not subject to any contamination, infestation or infection, and that there are no human remains on board. Additionally, no person on board the exposed Conveyance can have been exposed to any diseased plant or animal, or show signs of a listed human disease at the time the exposed Conveyance is in Australian territorial waters.
Practical difficulties of shifting responsibility
Even where these exceptions function as they are intended to, there are a range of potential risks and costs to operators of Conveyances arising from the new regime as a result of the reporting requirements and corresponding liabilities it implements.
Under the Biosecurity Act, a person in charge of either the goods or the vessel carrying the goods can be held liable for failing to report any biosecurity incident they are aware of that is recognised as "reportable" under a determination. This seems to shift responsibility on private enterprises to manage and assess the level of biosecurity risks their Conveyance is exposed to.
In the context of offshore oil and gas operations, it is anticipated that operators of domestic Conveyances may seek contractual protection from operators against any biosecurity liability that arises following interactions with an Installation or Petroleum Industry Vessel. The flow on effect of this would be that both Installations and Petroleum Industry Vessels would need to proactively manage their biosecurity status to mitigate the potential liability for any noncompliance. Further, operators of Installations are likely to bear a cost increase passed on by domestic Conveyance operators looking to offset their own increased compliance costs and risks arising from the shift of responsibility for biosecurity risks.
Ballast Water Management
Managing ballast water in Australia
There are currently a series of controls on ballast water and ballast water sediment in Australia stemming from the Quarantine Act, State legislation and the 2001 Australian Ballast Water Management Requirements (BWMR). Currently, these controls act to manage the ballast water activities of international vessels and Installations by prohibiting the discharge of international ballast water into Australian territorial seas. Under the Biosecurity Act however, ballast water regulation in Australia will undergo a substantial change.
Changes to ballast water management under the Biosecurity Act
Currently, ballast water falls within the legislative definition of "goods" under the Quarantine Act with the effect that ballast water regulations apply up to 200nm offshore.2 Although the regime will apply to Installations within the 200nm EEZ, it is currently limited in its application to international vessels and ballast water taken up in international waters. This stands at odds with Australia's obligations as a signatory to the International Maritime Organisation's Convention for the Control and Management of Ship's Ballast Water and Sediments (the Ballast Water Convention).
The Ballast Water Convention, is designed to form a global framework for the management of ballast water and ballast water sediment and (whilst not yet in effect) requires signatories to strictly manage the ballast water of all vessels regardless of whether the ballast water has
been taken up domestically or internationally. It is with the stated intention of better enabling the management of ballast water consistent with Australia's international obligations that the regime under the Biosecurity Act is said to have been conceived.
Under the Biosecurity Act, ballast water is no longer regulated by way of its inclusion in the legislative definition of "goods". Instead, ballast water is managed by a specific regime set out in chapter five of the Biosecurity Act. Specifically, chapter five prescribes a range of restrictions, reporting requirements and offences which apply to both domestic and international Conveyances, whether their ballast water was taken up domestically or internationally.
Whilst this change does appear on its face to have the effect of broadening the application of ballast water regulation, the operation of the Biosecurity Act limits this to within 12nm. As a result of the jurisdictional roll-back discussed above, the ballast water of Conveyances outside of 12nm will not be subject to regulation under the Biosecurity Act.
The difficulty with this approach is that, despite the stated intention of enabling regulation consistent with the Ballast Water Convention, it is still likely to be inconsistent with Australia's present international obligations under the Convention. As we have noted in our earlier update (Biosecurity Bill (Cth) – take 2, Australia 26 August 2014, available here), Australia is required under article 18 of the Vienna Convention of the Law of Treaties to refrain in good faith from anything that would defeat the object and purpose of the Ballast Water Convention. Given that the Ballast Water Convention expressly requires that ballast water exchanges must wherever possible take place at least 200nm offshore, and in any case in water that is at least 200m deep, the changes under the Biosecurity Act (which arguably reduce the reach of Australia's ballast water regulations) raise queries regarding how Australia intends to adhere to the Ballast Water Convention.
Practical changes to ballast water management now and into the future
Recent comment from the DAWR on this issue suggests that, in practice, the DAWR intends to oversee the management of ballast water outside of territorial waters but within 200nm in the same fashion as they have done under the Quarantine Act and the associated BWMR. With the Ballast Water Convention currently close to coming into effect, the DAWR has said that the Biosecurity Act is likely to be amended sometime within the next 24 months to more fully reflect the Ballast Water Convention requirements as it comes into effect. However, it remains unclear how the DAWR will ensure that Installations and Conveyances will continue to manage ballast water consistent with the currently accepted processes under the new legislative framework of the Biosecurity Act pending the amendment of the Biosecurity Act to address the Ballast Water Convention requirements.
Closing comments
It remains to be seen whether the stated intention of the Biosecurity Act to "reduce red tape and compliance costs", and "implement Australia's international ballast water obligations", will be achieved in practice. The legislation appears more likely to maintain the costs of those operating offshore oil and gas installations, with the possibility that costs may increase as operators of Conveyances seek to pass on the costs and risk of managing the shift in compliance responsibility under the Biosecurity Act. Additionally, the new framework for the management of ballast water does not currently implement Australia's obligations under the Ballast Water Convention beyond 12nm.
Reliance on the current practice until the Ballast Water Convention is ratified essentially parks the problem for resolution in the future.
1 The Act takes effect by operation of Biosecurity Act 2015 (Cth) s 2(1), 12 months after the Act received Royal Assent.
2 Quarantine Act 1908 (Cth) s 5.
For further information, please contact:
Shane Bosma, Ashurst
shane.bosma@ashurst.com
