Explanatory Memorandum
(Circulated by authority of the Attorney-General, the Honourable Daryl Williams AM QC MP)Schedule 1 - Amendment of the Criminal Code Act 1995
This Schedule inserts proposed new Chapter 5 (The integrity and security of the Commonwealth) and proposed new Part 5.3 (Terrorism) into the Criminal Code. Proposed Division 103 of Part 5.3 contains a new offence directed at the financing of terrorism.
Item 1
This Item inserts proposed Chapter 5 of the Criminal Code The integrity and security of the Commonwealth.
Item 2
This Item inserts proposed new Part 5.3 (Terrorism) into the Criminal Code. Proposed Division 103 of Part 5.3 introduces a new financing of terrorism offence. Proposed Division 100 contains definitions and application provisions relevant to the new financing of terrorism offence and to proposed terrorism offences in the Security Legislation Amendment (Terrorism) Bill 2002, which will also be inserted into Part 5.3.
Proposed section 100.1 - Definitions
Proposed section 100.1 contains definitions of terms used in proposed Part 5.3 of the Criminal Code.
Commonwealth place is given the same meaning as in the Commonwealth Places (Application of Laws) Act 1970 where it means a place (not being the seat of government) with respect to which the Parliament, by virtue of section 52 of the Constitution, has, subject to the Constitution, exclusive power to make laws for the peace, order, and good government of the Commonwealth. The new financing of terrorism offence in proposed section 103.1 will extend to actions that take place in a Commonwealth place. This definition is one of the mechanisms that aligns the ambit of the offence with the scope of Commonwealth legislative power under the Constitution.
constitutional corporation is defined to mean a corporation within the terms of paragraph 51(xx) of the Constitution. Paragraph 51(xx) of the Constitution covers foreign, trading and financial corporations. The new financing of terrorism offence in proposed section 103.1 will extend to actions that affect constitutional corporations or that are carried out by constitutional corporations. This definition is one of the mechanisms that aligns the ambit of the offence with the scope of Commonwealth legislative power under the Constitution.
funds is defined as property and assets of every kind and legal documents or instruments in any form. The definition is broad in scope and is derived from Article 1 of the International Convention for the Suppression of the Financing of Terrorism. The breadth of the definition will ensure that the financing of terrorism offence applies regardless of whether a person facilitates a terrorist act through the provision of money, equipment or weapons.
organisation is defined as a body corporate or an unincorporated body, whether or not it is based in Australia, consists of persons who are not Australian citizens, or is part of a larger organisation. The definition of organisation is relevant to the proscribed organisations offence in Schedule 2 to Security Legislation Amendment (Terrorism) Bill 2002. The definition is included to defeat any argument that a group of persons is not an organisation because it does not have a particular formal attribute or structure.
terrorist act is defined to mean a specified action or threat of action that is made with the intention of advancing a political, religious or ideological cause. The types of actions covered by the definition of terrorist act are set out in proposed subsection 100.1(2) and include actions involving serious harm to persons, serious damage to property and interference with essential electronic systems. The new offence in proposed section 103.1 will apply to the financing of actions which fall within this definition.
Lawful advocacy, protest and dissent, and industrial action are expressly excluded from the ambit of the definition.
Proposed subsection 100.1(2) sets out the types of action referred to in the proposed subsection 100.1(1) that can constitute a terrorist act. The types of actions listed involve serious harm, damage or disruption. A terrorist act includes action that involves serious harm to a person or serious damage to property, endangers life, creates a serious risk to the health or safety of the public or a section of the public, or is designed to seriously interfere with, seriously disrupt, or destroy, an electronic system. Electronic systems include information systems; telecommunications systems; financial systems; and systems used for essential government services, essential public utilities and transport providers.
Proposed subsection 100.1(3) provides that a reference in proposed Division 100 to any person or property is a reference to any person or property within or outside Australia. It also provides that a reference to the public includes a reference to the public of a foreign country.
Proposed section 100.2 - Constitutional basis for offences
Proposed section 100.2 provides a broad constitutional basis for the new financing of terrorism offence in proposed section 103.1 and the proposed terrorism offences in the Security Legislation Amendment (Terrorism) Bill 2002, which will also be inserted into Part 5.3. An action or threat of action will give rise to an offence under Part 5.3 where it is within the scope of the Commonwealths legislative power under the Constitution.
Proposed subsection 100.2(2) draws on the various bases of Commonwealth legislative power in section 51 of the Constitution to specify particular circumstances in which an action or threat of action will give rise to an offence.
These include circumstances where the action:
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- affects the interests of the Commonwealth, a Commonwealth authority, or a foreign, trading or financial corporation;
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- disrupts foreign or interstate trade or commerce, banking or insurance;
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- takes place outside Australia; or
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- is an action in relation to which the Commonwealth is obliged to create an offence under international law (for example, United Nations Security Council Resolution 1373 obliges Australia to criminalise the collection and provision of funds for terrorist acts).
Item 3
This Item inserts proposed Division 103 of the Criminal Code Financing terrorism. This contains the financing terrorism offence in proposed section 103.1
Proposed section 103.1 - Financing terrorism
Proposed section 103.1 makes it an offence for a person to provide or collect funds where the person is reckless as to whether those funds will be used to facilitate or carry out a terrorist act (as defined in proposed section 100.1). The maximum penalty for the offence is imprisonment for life. The maximum fine is $220,000 for a natural person and $1,100,000 for a body corporate under the existing $110 value for a penalty unit in section 4AA of the Crimes Act, and the provisions for calculating maximum fines in section 4B of that Act.
The maximum penalty of life imprisonment is consistent with the penalties applicable to the proposed terrorism offences in the Security Legislation Amendment (Terrorism) Bill 2002. Financing terrorism warrants a penalty comparable to engaging in a terrorist act because financing is central to organised terrorist activity and influences both the extent and the seriousness of those activities.
The offence implements Article 2 of the Convention for the Suppression of the Financing of Terrorism and paragraph 1(b) of United Nations Security Council Resolution 1373, and draws on the language used in those international instruments.
Proposed subsection 103.1(3) applies Category D geographical jurisdiction, as set out in section 15.4 of the Criminal Code, to an offence against subsection 103.1(1). Category D jurisdiction is unrestricted. Its application to the financing of terrorism offence means that the offence will be committed whether or not the conduct or the result of the conduct constituting the offence occurs in Australia. In view of the very serious nature of this offence and the depth of international concern regarding the financing of terrorism it is appropriate for Australia to criminalise this conduct regardless of where it occurs.
However, where the conduct constituting the offence occurs wholly in a foreign country and the person charged or to be charged is not of Australian nationality, section 16.1 of the Criminal Code will require that the Attorney-General's consent be obtained for a prosecution for an offence against proposed section 103.1.
The consent requirement enables the Attorney-General to decide in his or her discretion whether it is appropriate that a prosecution should proceed having regard to considerations of international law, practice and comity, international relations, prosecution action that is being or might be taken in another country, and other public interest considerations. However, an arrest may be made and charges laid before consent is given.