On 13 September 2017, the Minister for Infrastructure and Transport, introduced the Coastal Trading (Revitalising Australian Shipping) Amendment Bill 2017 (Bill) into Parliament to amend to the Coastal Trading Act 2012 (Cth) (Act). The stated purpose is to adjust the existing regime rather than a full scale restructure and follows initial consultation with the industry, in light of complaints about the onerous and cumbersome licensing procedures currently in place under the Act.

According to the Minister, the aim of the Bill is to reduce unnecessary red tape in the coastal shipping sector, by simplifying the temporary license application procedure to encourage the use of shipping for domestic freight.

Key changes proposed by the Bill are:

  • Removal of the minimum requirement of five scheduled voyages for the issue of a temporary licence and replaces it with a single voyage requirement.
  • Relaxation of the strict tolerance restrictions on voyage timing and cargo weight – currently temporary licenses only allow tolerances of five days before or after the approved loading date and loading of 20% more or less than the approved amount of cargo.
  • Relaxation of the consultation requirements where no suitable vessel is on the general register.
  • A vessel will not be deemed to be imported for the purposes of the Customs Act 1901 while a vessel is “docked for service” under a temporary licence. “Docked for service” is a new definition which includes a vessel in dry dock, or a vessel that is docked for maintenance, repairs, cleaning or painting and not undertaking a voyage.
  • Extension of the temporary licence regime to cover the carriage of cargoes from floating production storage and offloading units and floating storage unit (newly defined as “offshore facilities”) to ports in Australia.

Unsurprisingly, the industry response reported to date has been mixed, with maritime unions anticipating erosion of the Australian fleet in contrast to others in the industry that see potential benefit for Australian producers in getting their goods to domestic markets.

The second reading speech also took place on 13 September 2017 and the Bill will now be tabled in the Senate (Upper House) for approval. Given that the Government does not have a majority in the Senate and that the opposition has to date opposed any amendments to the Act, the Bill’s passage remains uncertain.