Insights

Colin Biggers & Paisley activities

The Norwegian Maritime Law Association Seminar

Stuart Hetherington attended the Comite Maritime International (CMI) Executive Council and Assembly meetings in Oslo in September and at the same time, the Norwegian Maritime Law Association one day seminar held at the magnificent premises and facilities of DNV outside Oslo. (The seminar included a tour of this extensive establishment.)

The papers given at the seminar were highly informative and topical. They included:

  • Regulatory Challenges in the High North by Thor Jorgen Juttormsen, the President of the Norwegian Ship Owners Association
  • The Polar Code Negotiations – Power and Compromises by Turid Stemere of the Norwegian Maritime Directorate
  • The Northern Sea Route – A Viable Commercial Alternative by Felix Tschudi of Tschudi Shipping Company AS
  • Technology Outlook 2020 – A Study on the Mega Trends of Our Future by Elisabeth Harstad of DNV Research and Innovation
  • Shipping and the Environment: Drivers, Responses and the Implications of it all by Eirik Nyhus of DNV International Affairs – Environment
  • The Commercial Lawyer in a New Adventure by Erik Rosaeg of The Scandinavian Institute of Maritime Law

The theme of the seminar was "A Futuristic View on Shipping – Mega Trends for the Future" and the papers accurately reflected that theme. This was especially so in relation to those papers that dealt with the opening up of shipping routes (and the development of trade) in the Arctic region, as well as the huge costs which the shipping industry will be facing in coming years to meet the international regulatory regimes which are in place to meet new environmental standards concerning CO2, SOx, NOx and ballast requirements.

Copies of the PowerPoint presentations can be supplied on request.

The Maritime Law Association of Australia and New Zealand Annual Conference 

Stuart Hetherington presented a paper on CMI’s Review of the Salvage Convention (which he is chairing) at the recent annual conference of The Maritime Law Association of Australia and New Zealand (held jointly with the Canadian and United States Maritime Law Associations) in Hawaii, coinciding with the seventieth anniversary of Pearl Harbour. The following papers were also given at the conference:-

  • The President of the New South Wales Court of Appeal, Allsop P - The Influence of the United States on the development of Admiralty Law in Australia
  • Rares J - Regulatory Regimes for Off Shore Oil and Gas – An International Convention on Off Shore Hydrocarbon Leaks
  • Captain Steven Poulin of the US Coast Guard - Fair Treatment of Seafarers, Piracy, Limits of Liability and Trans Boundary Pollution
  • Martin Davies - The Master to Sign Bills of Lading as Presented by The Charterer: A Comparative Analysis (between United States and United Kingdom Law).
  • Ron Salter - Marine Insurance – Inherent Vice, Perils of the Sea and Proximate Cause
  • A panel of speakers on Maritime Arbitration Issues, including enforcement of International Arbitration Awards and the requirement for arbitrators to give reasons for their decisions
  • The President of the United States Maritime Law Association gave the Frank Stewart Dethridge memorial address, in which he revisited the years 1911 and 1912 in our respective countries. In part he reminded us that "the more things change the more they remain the same", particularly when he quoted from comments made by Frank Tudor, Minister for Trade and Customs, in the House of Representatives on 16 July 1912, when he explained the reasons behind the provisions in the Navigation Act dealing with cabotage when he said: "Our aim is to ensure that the conditions prevailing in the coasting trade on board foreign ships shall be the same as applied to our own people".

Copies of the papers can be obtained by emailing Stuart Hetherington, swh@cbp.com.au.

Colin Biggers & Paisley asbestos litigation seminar

In December 2011 Colin Biggers & Paisley hosted a half day asbestos litigation seminar with Finity Consulting, an actuarial firm in Sydney, to discuss various issues, both legal and actuarial. The meeting was extremely well attended.

For a discussion of a recent High Court judgement in a prominent asbestos case, please see our website article All asbestos exposures may be deemed a cause of mesothelioma.

Southampton University Institute of Maritime Law

Colin Biggers & Paisley will be hosting a three day seminar to be conducted by the University of Southampton Institute of Maritime Law on "International Trade and Cargo Claims" between 21-23 May 2012. Brochures incorporating booking forms are available from CBP Lawyers, swh@cbp.com.au
 

Australian government legal developments

There has been a mixed reaction to the reforms announced by the Federal Minister for Infrastructure and Transport on 9 September 2011. One commentator, Ian Hanke (in The Australian Financial Review on 8 November 2011) noted the irony in the government’s announcement of measures to support an ailing shipping industry at the same time as the national airline, Qantas, is seeking to introduce significant reform in order to enable it to compete internationally. In announcing the legislative framework for reform of the shipping industry, the Minister expressed the rationale of the proposed changes as being to:

"...remove the disincentives that have made it uneconomic to operate Australian ships in a global environment. We are determined to create an environment that will encourage and sustain growth and productivity in our shipping industry."

Without knowing the identity of the maker of that statement, followers of the recent Qantas dispute might be forgiven for thinking that the speaker was the CEO of Qantas who mistakenly referred to "ships" and the "shipping industry" when he intended to refer to "aircraft" and the "airline industry".

Reforms to affect the shipping industry

The reform package announced by the Minister includes:-

  • tax reform (to include a zero tax rate ie no company tax); accelerated depreciation arrangements (10 years instead of 20); rollover relief for selected capital assets; tax exemptions for seafarers working overseas on qualifying vessels; a royalty withholding tax exemption where vessels are demise or bareboat chartered to an Australian company from a foreign owner
  • creation of an Australian International Shipping Register in which such vessels will only be required to employ a minimum of two Australian crew (preferably a Master and Chief Engineer)
  • a new licensing regime for the Australian coast involving a three tier licensing regime:-
    • a general licence providing Australian flag vessels with unrestricted access to the coastal trade for up to five years
    • a temporary licence to enable foreign flag vessels to operate in the coastal trade, to be available for 3-12 months and subject to time, trade and/or voyage conditions; this will replace the single, continuous and urgent voyage permits and will require very much more information to be supplied by an applicant
    • an emergency licence to be available for cargo or passenger movements in emergency situations

Transitional arrangements will permit foreign flag vessels holding a current licence to transition to the Australian flag.

The Minister has also referred to workforce skills development by way of a maritime workforce development forum which is to be established for five years.

A further aspect referred to by the Minister in his September announcement was labour productivity reform which will include a review of safe manning laws.

Commenting on the reforms, the Shadow Transport Minister noted that the proposed reforms were "thin on detail" and was particularly critical of the proposed abolition of the single voyage permit which, he said, "has the potential to make domestic freight movement even less competitive". It is worth noting that the application of the Fair Work Act and domestic rates of pay to ships on coastal voyages is already, presumably, having such an effect. The detailed legislation is awaited.

Reform of Australian maritime law

Concurrent reforms being introduced into the Australian maritime legal system by the Australian government include:-

  • introduction of a single maritime safety regulator with commonwealth law applying to all commercial vessels in Australian waters
  • a rewrite of the Navigation Act 1912
  • the implementation of the Maritime Labour Convention
  • the extension of the ship tracking system (REEFVTS) to cover the entire Great Barrier Reef
  • the Maritime Legislation Amendment Bill which creates new offences for a Master and Charterer (as well as an owner of a ship) that causes oil to be discharged into the sea and offences by Masters for operating a ship in a manner that causes pollution or damage to the environment, both in Australian waters and on the high seas – in the latter case by Australian ships; to create an offence for failing to report an incident and to increase levels of penalties under the Protection of The Sea (Prevention of Pollution from Ships) Act 1983 for the discharge of oil or oil residues; the increase in penalty is from 500 penalty units to 20,000 penalty units, taking potential fines to $2.2 million for an individual and $11 million for a corporation
  • the coming into effect of the Personal Property Securities Act 2009 which creates a new statutory regime governing security interests in personal property in Australia. There is now to be a single national system of registration for a security interest in personal property which arises from a transaction that in substance secures the payment or performance of an obligation. The new process for registering personal property interests commences on 30 January 2012. Well informed and prudent operators (particularly suppliers who provide goods or services on credit terms or who hire equipment or leave costly tools or inventory on customers’ premises) are opening a PPSA account, registering as a secured party group, reviewing the PPSA terms and conditions and reviewing their security documentation. It is advisable to obtain proper security agreements and register them in such circumstances.
 

New South Wales government developments

  • In our last CBP Shipping News (15 August 2011) we noted that some in the industry were "speculating whether any changes" to the management of the principal ports in New South Wales might be announced in the budget. As is now well known, the New South Wales government announced in the budget the privatisation of Port Botany which, apart from Melbourne, is the largest container port in the country. The privatisation will, it is understood, involve a lease for 99 years. To maximise its value it is anticipated that the state will need to demonstrate that it is serious about improving associated infrastructure such as rail and road access to the port, as well as ancillary storage facilities.
  • Marine Pollution Bill 2011; this is a comprehensive repeal and re-enactment of the Marine Pollution Act 1987 with the additional implementation of aspects of the MARPOL Convention, in particularly provisions relating to harmful substances in packaged form and the discharge of sewage and garbage.

Shipping cases

  • The District Court in Brisbane issued fines of $600,000 each to two companies involved in the oil spill from the "Pacific Adventurer" in 2009.
  • IMC Aviation Solutions Pty Limited v Altain Khuder LLC [2011] VCA 248.
This case has raised eyebrows in some legal circles. The Victorian Court of Appeal reversed a first instance decision that had followed decisions in Singapore and the United Kingdom in allowing an arbitration award, which had been made in a foreign country, to be enforced in Australia. The Court of Appeal, in reversing the first instance decision, held that the party seeking to enforce the award had the burden of establishing that the other party against whom it sought to enforce the award was a party to the arbitration agreement itself. For a discussion of this case, please see our website article Lack of uniformity in enforcement of international arbitral awards.
  • Jebsens Orient Shipping Services and Interfert Australia. This case, which is being heard in the South Australian Supreme Court, has raised a question which was long ago answered in relation to the Sea Carriage of Goods Act 1924 and which has been untested, until now, under the Carriage of Goods by Sea Act 1991. The question raised was whether an arbitration clause in a voyage charter party requiring disputes to be resolved in another jurisdiction is struck down by the provisions contained in section 11(2)(c)(i) of the Act. The judgment is not as yet available, but it is understood that the Court has decided that a voyage charter party is not a "sea carriage document" for the purposes of that section and therefore the arbitration clause is valid.

It is understood that this issue has also arisen in a Federal Court case, which is also the subject of a reserved judgment.
 

International developments

The coming into effect of the UK Bribery Act 2010 on 1 July 2011 is a significant matter for those companies or subsidiaries which carry on business or part of their business in the UK to an extent which would be considered as a "demonstrable presence" in the UK. For a discussion of the impact of this legislation, please see our website article UK Bribery Act affects Australian companies with UK presence.
 

Appointments

The Colin Biggers & Paisley Trade and Transport Team congratulates Ken Fitzpatrick, who takes over the role as Chairman of Shipping Australia from Michael Phillips, who did not stand for re-election.
 

Christmas and new year

The Colin Biggers & Paisley Trade and Transport Team wishes all our readers a safe and happy Christmas and new year.


 

This article has been published by Colin Biggers & Paisley for information and education purposes only and is a general summary of the topic(s) presented. This article is not specific legal advice. Please seek your own legal advice for any questions you may have. All information contained in this article is subject to change. Colin Biggers & Paisley cannot be held responsible for any liability whatsoever, or for any loss howsoever arising from any reliance upon the contents of this article.​

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