House of Representatives

Explanatory Memorandum (Extracts Only)

(Circulated by authority of the Treasurer, the Hon Peter Costello, MP)

General outline and financial impact

General Outline

This Bill inserts new provisions into the Criminal Code Act 1995 criminalising the smuggling of persons from Australia to another country, or from a country other than Australia to a third country, with or without transit through Australia. Where there is no transit through Australia, the offences will apply where the person who organised or facilitated the smuggling either engaged in that conduct in Australia or is an Australian citizen or resident.

The Bill also contains offences prohibiting making, providing or possessing false travel or identity documents intended for use in securing the unlawful entry of a person into a foreign country. An offence of taking possession of or destroying another person's travel or identity documents is also included.

The people smuggling offences and all but one of the associated document offences are based on the Protocol Against The Smuggling of Migrants By Land, Sea and Air, Supplementing The United Nations Convention Against Transnational Organized Crime, to which Australia is a signatory.

This Bill also inserts into the Criminal Code two cross-border firearms trafficking offences. The first offence makes it unlawful, in the course of trade and commerce between the States and Territories to dispose of or acquire a firearm, where the disposal or acquisition of that firearm is an offence under a State or Territory law.

A related provision also makes it an offence, in the course of trade and commerce between the States and Territories, to take or send a firearm from one State or Territory to another, intending that the firearm will be disposed of in the other State or Territory in circumstances that would constitute an offence against the firearm law of that other State or Territory.

The Bill also amends existing criminal law and justice legislation. Schedule 3 makes a number of minor amendments to the theft and fraud offences in the Criminal Code, which have now been in operation for over a year. Those amendments resolve some problems with the offences which have emerged during that time. Schedule 3 also amends the sentencing provisions in the Crimes Act 1914, includes the substance 'fantasy' as a psychotropic drug in the Crimes (Traffic in Narcotic Drugs and Psychotropic Substances) Act 1990, amends the International Transfer of Prisoners Act 1997 to clearly define the role of the Minister for Immigration and Multicultural and Indigenous Affairs and amends the Financial Transaction Reports Act 1988 to ensure that remittance dealers are covered by the definition of 'cash dealer' in that Act. Schedule 3 also fixes a cross-reference in that Act.

Financial Impact

There is no financial impact flowing directly from the offence provisions of this Bill.

Abbreviations

Abbreviations used in the Explanatory Memorandum

Notes on clauses

Clause 1 - Short title

This is a formal clause which provides for the citation of the Bill.

Clause 2 - Commencement

This clause set out when the various parts of the Bill commence.

Sections 1-4 of the Bill (the short title, the commencement, the schedules provision and the transitional provision for the Crimes Act 1914 amendments in Schedule 3) will commence on the day that the Bill receives Royal Assent.

Schedules 1 and 2 of the of the Bill, which insert people smuggling and firearms trafficking offences into the Criminal Code Act 1995, will commence on the 28th day after the Bill receives Royal Assent.

Schedule 3 of the Bill contains amendments to a number of Acts. All of those items except one (Item 23 of Schedule 3) will commence on the 28th day after the Bill receives Royal Assent.

Item 23 of Schedule 3 amends a cross-reference in the Financial Transaction Reports Act 1988 (FTR Act) to the Commonwealth's money laundering legislation. The existing cross-reference is to sections 81 and 82 of the Proceeds of Crime Act 1987, which will be repealed when the new money laundering legislation (Division 400 of the Criminal Code) comes into effect on 1 January 2003. To ensure that there is no gap in the application of the relevant provision in the FTR Act, the amendment is scheduled to commence on 1 January 2003, consistent with the new money laundering legislation to which it refers. This early application of the provision is justified because the amendment will not take away a person's rights, but will actually ensure that a protection currently in the FTR Act will continue to apply.

Clause 3 - Schedule(s)

This clause makes it clear that the Schedules to the Bill will amend the Acts set out in those Schedules in accordance with the provisions set out in each Schedule.

Clause 4 Transitional - items 1, 2, and 3 of Schedule 3

Clause 4 is a transitional provision. Items 1 and 2 of Schedule 3 operate to repeal sections 16G and 19AG from the Crimes Act 1914 ('Crimes Act'). Item 3 removes a cross-reference in subsection 19AR(6) of the Crimes Act to section 19AG.

The effect of repealing sections 16G and 19AG of the Crimes Act is that when sentencing federal offenders, courts will no longer have to take into account whether or not remissions are available in the particular State or Territory in which the person is being sentenced.

Clause 4 provides that the amendments will only apply to a sentence which is imposed after the provisions commence.

Schedule 3 - Other measures

Schedule 3 amends a number of law and justice Acts. The Schedule makes a number of minor amendments to the theft and fraud offences in the Criminal Code, which have now been in operation for over a year. The amendments resolve some issues which have emerged during that time. Schedule 3 also amends the sentencing provisions in the Crimes Act 1914, includes the substance 'fantasy' as a psychotropic drug in the Crimes (Traffic in Narcotic Drugs and Psychotropic Substances) Act 1990, amends the International Transfer of Prisoners Act 1997 to clearly define the role of the Minister for Immigration and Multicultural and Indigenous Affairs and amends the Financial Transaction Reports Act 1988 to ensure that remittance dealers are covered by the definition of 'cash dealer' in that Act. Schedule 3 also fixes a cross-reference in that Act.

Crimes Act 1914

Item 1 - Section 16G

This Item repeals section 16G of the Crimes Act 1914 ('Crimes Act')

Section 16G provides that where a federal sentence is to be served in a State or Territory prison where State or Territory sentences cannot be remitted or reduced, the court must take that matter into account in determining the length of sentence and adjust the sentence accordingly. Section 19AG of the Crimes Act has the same effect with regard to the determination of non-parole periods. Item 2 of this Schedule repeals section 19AG.

The provisions were introduced in 1989 following the abolition of remissions in New South Wales. The inclusion of sections 16G and 19AG was intended to address concerns that New South Wales' abolition of remissions would result in higher sentences being imposed on federal prisoners in that state than any other jurisdiction.

However, as more jurisdictions have abolished remissions (only Western Australia and Tasmania still have some form of remission), sections 16G and 19AG have had the effect of reducing the maximum applicable prison term for all Commonwealth offences by one third. Further, West Australian legislation abolishing remissions is intended to commence in 2003, and the Tasmanian Attorney-General has signalled an intent to remove automatic remissions. In any event, remissions in Tasmania have already been reduced from one third of most sentences to a maximum of three months.

In addition, the provisions have created intra-state disparity between Commonwealth and State prisoners in jurisdictions where there are no state remissions. This is contrary to Commonwealth sentencing policy which promotes the maintenance of intra-state parity of sentences.

There has been considerable judicial consideration and criticism of the application of 16G and 19AG on the grounds outlined above, and it is undesirable that the maximum prison terms which appear on the statute books are discounted in this way. Given the abolition of remissions in most jurisdictions, and their limited application in Tasmania at the present time, it is appropriate that sections 16G and 19AG now be repealed.

Clause 2 of this Bill provides that the amendments will come into effect 28 days after the Bill receives Royal Assent. Clause 4 of this Bill provides that the amendments will only apply to a sentence which is imposed after the provisions commence.

Item 2 - Section 19AG

Item 2 repeals section 19AG of the Crimes Act, for the reasons set out under Item 1 of this Schedule.

Item 3 - Subsection 19AR(6)

Item 3 removes a cross-reference in subsection 19AR(6) of the Crimes Act to section 19AG (which is repealed by Item 2 of this Schedule).

Financial Transaction Reports Act 1988

Item 21 - Subsection 3(1) (subparagraph (k)(ib) of the definition of cash dealer )

Item 21 of Schedule 3 amends subparagraph (k)(ib) of the definition of "cash dealer" in subsection 3(1) of the Financial Transaction Reports Act 1988 (FTR Act). The item inserts the words "or making electronic funds transfers" into the subparagraph to ensure that a person who carries on a business of remitting or transferring currency or prescribed commercial instruments or making electronic funds transfers into or out of Australia on behalf of other persons is included in the definition of cash dealer. This amendment, together with the amendment at item 22 of Schedule 3, is intended to remove any doubt that the actual transfer of currency into or out of Australia is required for remittance dealers to be within the definition of "cash dealer".

Item 22 - Subsection 3(1) (after paragraph (k) of the definition of cash dealer )

Item 22 of Schedule 3 inserts a new paragraph (l) into the definition of "cash dealer" in subsection 3(1) of the FTR Act. The new paragraph (l) is intended to ensure that persons who carry on a business in Australia on behalf of other persons of arranging for remittance of funds outside Australia or for remittance of funds into Australia are within the definition of "cash dealer". This amendment, together with the amendment at item 21 is intended to ensure that the term "cash dealer" includes "hawala" or "underground banking"; in other words that it covers a person who carries on a business of transmission of money or value including through informal money or value transfer systems or networks.

Item 23 - Section 17

Item 23 of Schedule 3 is a technical amendment to section 17 FTR Act to ensure that the existing protection for cash dealers from money laundering offences in the Proceeds of Crime Act 1987 will carry over to the replacement money laundering offences in Division 400 of the Criminal Code.