Department of Agriculture and Water Resources s1

DEPARTMENT OF AGRICULTURE AND WATER RESOURCES CARGO CONSULTATIVE COMMITTEE

MINUTES 73rd DCCC Meeting 9.00 am to 1.00 pm Wednesday 9 March 2016 Central East Regional Office 1 Crewe Place Rosebery NSW

Agenda Item 1 – Chair’s Introduction

Present Raelene Vivian Department of Agriculture and Water Resources Wayne Terpstra Department of Agriculture and Water Resources David Ironside Department of Agriculture and Water Resources Tina Hutchison Department of Agriculture and Water Resources Robyn Cleland Department of Agriculture and Water Resources Nico Padovan Department of Agriculture and Water Resources Jagtej Singh Department of Agriculture and Water Resources Rick Hawe Department of Agriculture and Water Resources Dennis Way Department of Agriculture and Water Resources Lee Cale Department of Agriculture and Water Resources Melanie Cairns Department of Agriculture and Water Resources Matt Ryan Department of Agriculture and Water Resources (part meeting) Joe Menegazzo Department of Agriculture and Water Resources (part meeting) Sean Evans Department of Agriculture and Water Resources (part meeting) Stephen Morris CBFCA Brian Lovell AFIF Hart Krtschil AIWGB Tony Beaver FBIA Rod Nairn SAL John Warda ICHCA Paul Zalai FTA Andrew Hudson ECA Leigh Bryant ACCI John Begley Ministerial Freight Advisory Council (Victoria) Craig Birchall BARA Paul Bagnall CAPEC (alternate)

Observers T +61 2 6272 3933 F +61 2 6272 5161 18 Marcus Clarke Street Canberra City ACT 2601 GPO Box 858 Canberra ACT 2601 agriculture.gov.au ABN 24 113 085 695 Geoff Clark AIWGB (part meeting)

Apologies Jock O’Hagan Asciano

of 9 Secretariat Services Bernie Murphy Department of Agriculture and Water Resources Kathleen Quan Department of Agriculture and Water Resources

Ms Vivian opened the meeting at 9:10 am and welcomed members, Assistant Secretary Compliance Arrangements Dr Robyn Cleland, First Assistant Secretary Service Delivery Mr Nico Padovan, Assistant Secretary Operations Integrations Mr Jagtej Singh, and new CAPEC member Mr Paul Bagnall. The meeting minutes were accepted by members, noting that the comments received had been addressed. An update was provided against the action items from DCCC meeting 72. All action items had been completed or were on the agenda for discussion.

Agenda Item 2 – Service Delivery Operations

The department’s service standards have been in place for some time but some need some consideration as to whether they are contemporary. Mr Way suggested that a small working group to progress service standards would be useful. Mr Way has been engaging with the CBFCA and the FTA to discuss service standards in relation to COLS. Mr Hawe noted that as per previous discussions, the email lodgement channel will be closed at the end of March, with the main channel for receiving lodgements to be through COLS.

Mr Begley raised the importance of considering service standards in the context of the international trading environment. Mr Krtschil noted that there were other options available such as approved arrangements which would also assist in reducing the number of assessments to be undertaken by the department. Mr Lovell raised inconsistency in service delivery times across different locations. Mr Hawe explained that the preference is to understand the causes of the issues and mobilise the workforce to address these effectively.

Mr Beaver raised the issue of the increased turnaround time to process import permit applications. Ms Hutchison provided an update that the department is investing into an enhancement process for the assessment and permit issuing tool used by import programs to alleviate some of the current issues and inefficiencies. This is expected to be delivered for testing in June 2016 with a late June release dependant on the outcome of testing.

Mr Hawe welcomed members to nominate to participate in the working group for service standards.

Action item: DCCC industry members to nominate to participate in the working group for service standards by contacting the DCCC secretariat.

Agenda Item 3 – Biosecurity Legislation

Ms Cale provided an update following the industry session held on 23 February in Canberra. Feedback from that session is being used to shape the content of the upcoming industry sessions. The sessions are scheduled from 15 March until 6 April, covering every capital city. There is a range of draft regulations that are available for comment. The department is progressing changes as a result of the new legislation, including training staff, updating instructional material, and making changes to IT systems.

Following discussion at the session held on 23 February, it was agreed that an e-learning package would be made available for industry. Once published on the website, the link will be

of 9 distributed to members. As a result of the 23 February session, an information pack will also be available for attendees of the session and DCCC members.

Action item: DCCC Secretariat to distribute the link to the department’s website of the biosecurity legislation e-learning package once available.

Mr Krtschil noted that information previously provided was not sufficiently detailed for industry to understand what would be changing. Mr Ironside noted that a number of projects are working on this, and the upcoming industry sessions will cover topics in more detail. The committee discussed the potential for change between draft regulations and the final regulations.

The committee discussed infringement notices and the department’s expected compliance posture under the new biosecurity legislation. Mr Terpstra explained that information on the department’s compliance posture will be published, and there will also be guidelines published on infringement mechanisms. There will likely be similarities with how the illegal logging legislation was implemented, with a period of time allowed to work with industry to get it right. However this would not change the department’s ability to deal with deliberate non-compliance.

From the commencement of the Biosecurity Act 2015, the below compliance principles will apply:

1) Where equivalent enforcement responses exist in the Quarantine Act and Biosecurity Act, in the same area of the business then our approach will be to apply sanctions from commencement on 16 June 2016 (for example, infringement notices for airline passengers).

2) Where new powers exist under the Biosecurity Act, or are being applied to a new area of the business, then our approach will be to allow a transition period to adjust following commencement. During this time the department will engage and educate clients to enable voluntarily compliance.

3) Where the Biosecurity (Consequential Amendments and Transitional Provisions) Act provides for a transition period, existing clients will be transitioned to the new requirements as their existing authorisations expire. That is, no special arrangements will be made to accelerate the expiry of arrangements in order to enforce new requirements from commencement. In the case of locations such as first points of entry, new requirements will apply from the end of the transition period. For new clients/arrangements/locations, the new requirements will apply from commencement.

4) Where the compliance posture allows for a period of adjustment, indications of deteriorating compliance or deliberate non-compliance will immediately result in the full application of the sanction powers provided within the Biosecurity Act.

5) The compliance posture does not in any circumstance limit the requirement of biosecurity officials or authorised officers to apply controls in order to manage real or suspected biosecurity risks.

of 9 Note: The transition period (1) within the compliance posture where the department will respond with educative compliance action is six months from commencement on 16 June 2016.

Action item: Mr Terpstra to distribute information on infringement notices and guidelines on when notices will be utilised.

Agenda Item 4 – Cost Recovery

Mr Ryan provided an update via phone, accompanied by Mr Joe Menegazzo and Mr Sean Evans. The new fees and charges regime has been in place since 1 December 2015. The Cost Recovery Impact Statements were reduced from five to one, with three components (import clearance, seaports, and post entry quarantine). The first three months of the new regime is tracking well, with revenue covering the department’s expenditure. The department is considering the implementation of a remission program to drawn down on the reserves in the import clearance reserve.

Mr Lovell asked about the powers under the new biosecurity legislation that could allow for the department to recover unpaid fees and charges from the service provider. Mr Ryan clarified that there had been some misrepresentation on this issue, and confirmed that this power already exists under the Quarantine Act 1908. A frequently asked questions sheet will be provided to industry to provide guidance on the powers.

Action item: Mr Ryan to provide guidance to industry on the use of the power to recover unpaid fees and charges from the service provider.

Agenda Item 5 – Emerging Risks and Issues

Mr Terpstra introduced this item and explained that the department is doing some work to manage workforce and risk and preparing some forecasting around the department’s future workload. The department is interested to receive feedback from industry on future trends, and potential fluctuations in trade volumes, locations, commodities for both import and export activity.

Ms Bryant commented that the mining sector is changing, though heavy machinery is still being imported due to a lack of supply locally. There has been a shift in recycled goods being turned into carbon product, with goods being both imported and exported. Mr Zalai noted that each port corporation has a forward plan for the next 20-30 years. These documents include predictions on future trade and well as information on intermodal facilities.

Mr Begley noted that they had not seen a significant increase in shipping as a result of the new free trade agreements. Increases in trade of 7-8 per cent that have been seen in previous years are not likely to occur in the future.

Ms Bryant commented that forecasts of population growth would also be a useful indicator, especially on a state by state basis. Mr Beaver noted that there is expected to be increased growth in the import of food and beverages, as there has been over previous years. There

1 For cases where transition periods are not specified in the Biosecurity (Consequential Amendments and Transitional Provisions) Act 2015.

of 9 could be potential for growth in imported meats, should conditions change to allow for their import. This will also be an important consideration for food safety requirements.

Mr Nairn noted that no significant change in containerised trends is expected. Volumes are not looking very healthy, and Mr Nairn did not expect to see that change in the near future. There is a slight increase and improvement in the dry bulk market.

Agenda Item 6 – MARS

Ms Hutchison provided an update about the Maritime Arrivals Reporting System (MARS) and referred to the paper provided. MARS is not only about developing new IT systems, but will be a new business system for vessel arrivals. The key change imbedded in MARS is the vessel compliance system – which will assist vessel agents and masters to understand the department’s requirements and to better manage their own compliance. It will also provide guidance for departmental officers and will assist with greater consistency. Industry acceptance testing will occur in June, though early feedback suggests that largely it is working well for them and will meet industry’s needs. There will be an e-learning package available for industry and the department will seek industry’s assistance in promoting it. There will also be other guidance materials developed to assist industry.

Ms Hutchison thanked Mr Nairn and Shipping Australia for their ongoing support of the project. Ms Vivian noted that the risk assessment process that will be implemented through MARS will be of interest to members, and it was agreed this would be discussed at a future DCCC meeting.

Agenda Item 7 – BICON

Ms Hutchison provided an update about BICON to the committee. The implementation of BICON went relatively smoothly with only minor issues arising over the rollout. There is a program of minor maintenance enhancements which have improved the performance of both the internal and external interfaces. A post implementation review is planned for the first quarter of the 2016-17 financial year. Industry representatives will be given the opportunity to comment during the review to ensure that the department continues to improve its practices for these types of projects.

Mr Beaver noted that while permit issuing was initially slow on the full release of BICON, this has now mostly been resolved, especially for simple products. Mr Krtschil also commented that the issuing of permits is a different issue to the conditions contained within BICON. Mr Begley asked if there was a process to raise concerns with content in BICON. Ms Hutchison agreed to discuss with this issue with the BICON team to determine how best to raise issues.

Action item: Ms Hutchison to discuss BICON content issues with the BICON team to determine the best process for industry to raise issues for consideration.

Agenda Item 8 – Compliance Updates

Mr Ironside spoke to the paper provided about the Electronic Imported Food Inspection Report. This report will replace the manual inspection report, so once the inspection is completed it can be emailed to the customs broker. Feedback from industry has been positive,

of 9 especially from laboratories. Mr Beaver confirmed that industry were supportive of this improvement.

Mr Ironside spoke to the paper provided about Mandatory Producer Codes and explained this was to assist in better tracing food both forwards and backwards along the supply chain. The department is working with the Department of Immigration and Border Protection (DIBP) to implement an enhancement to the Integrated Customs System (ICS) so that customs brokers can generate their own producer codes. This ICS enhancement is expected to be implemented in March, in advance of the requirement for producer codes from June 2016.

Mr Terpstra introduced the Biosecurity Compliance Statement, and members were provided with printed copies. The compliance statement covers the compliance tools and how the department will use them. The document will be revised once the new biosecurity legislation is implemented to include further information and tools. Members were invited to provide any feedback on the compliance statement to the DCCC Secretariat.

A compliance plan will also be produced, detailing areas the department will target, and what the department is interested in. The compliance statement will be reviewed and updated on a periodic basis and the compliance plan will be updated on an annual basis.

Mr Terpstra spoke to the two compliance reports provided. Most of the information contained in the reports is consistent in trends over time. A supplementary report on import pathways was also provided, to assist in understanding the data provided, common problems encountered and improvements underway. The additional paper provided is a summary of prosecution outcomes from recent years.

Mr Zalai asked if the information was publically available. Mr Terpstra agreed to review if these could be released more broadly.

Action item: Mr Terpstra to advise if reports provided could be made publically available.

Mr Ironside provided an update on approved arrangements, noting that the team is working towards the implementation of the new biosecurity legislation. The department is continuing to work with DIBP on the trusted trader programme. Mr Bagnall asked if industry participants needed to be approved by DIBP first, before engaging with the department. Mr Ironside explained that this was not necessary and that there were already a range of arrangements in place, separate to DIBP requirements. The focus for the department is to work with DIBP to bring into place single consistent arrangements, though this will be tested through pilots with a small number of industry participants.

Ms Vivian provided an update on the Export Regulation Review. The department is developing improvements to agricultural export legislation, to better support exporters meet importing country requirements and capture and maintain overseas markets. This work will be a significant exercise for the department and is expected to take several years to rollout. Consultation with stakeholders will be an ongoing priority during the development and implementation process. More information can be found on the department’s website, including more details on the outcome of the review and the proposed improvements.

of 9 Agenda Item 9 – DCCC Work Plan

Ms Vivian introduced the DCCC work plan report. Members noted the update provided.

Agenda Item 10 – Other Business

On behalf of the DCCC, Ms Vivian thanked the members who had recently resigned from the Committee and presented them each with a Certificate of Acknowledgment.

Mr Hart Krtschil Mr Clark thanked Mr Krtschil for his personal contribution and commitment to the IWGQ, as the AICCC Secretariat and as a DCCC representative since 1993. Mr Clark also noted Mr Krtschil’s longstanding experience, at the forefront of quarantine and biosecurity issues since 1967. On behalf of the DCCC, Ms Vivian commented that Mr Krtschil had truly made a difference to biosecurity in Australia and wanted to put this on the meeting record. On behalf of Mr Colin Hunter, Ms Vivian also thanked Mr Krtschil for his tireless efforts and contributions.

Ms Vivian and Mr Clark both commented on Mr Krtschil’s well-renowned filing system – which has meant he has been able to put his hand on any document from the past 50 years in just a matter of minutes.

Mr Geoff Clark On behalf of the DCCC, Ms Vivian thanked Mr Clark for his contribution as a member on the DCCC, and previous AICCC, representing CAPEC since 1998 and wanted to put this on the meeting record. In his role with CAPEC, Mr Clark contributed significantly to the development of co-regulatory arrangements during the early 2000s. This work laid the foundations for some of the more significant industry arrangements that the department manages today. More recently, Mr Clark helped champion industry’s role in the introduction of the department’s SAC paperless initiative, which had time and resources savings for both parties. Mr Clark has been a forthright and constructive industry leader. The depth of his logistics experience and ability to draw on a wide circle of similarly experienced leaders, has influenced and enhanced how the department manages biosecurity risk.

Mr John Begley On behalf of the DCCC, Ms Vivian thanked Mr Begley for his contribution as a DCCC member since 2012, representing the Ministerial Freight Advisory Council Victoria and wanted to put this on the meeting record. Mr Begley started his working career in the shipping department of Myer Melbourne, where he progressed to Senior Management over a 26 year period. Mr Begley has extensive experience representing the freight industry, but also in running his own brokerage firm, Begley, Hobba and Manton, which will celebrate its 40th anniversary in 2016. Mr Begley has volunteered his time and expertise to a range of industry bodies for the benefit of industry.

Mr Nairn noted that SAL will be putting together a feature on biosecurity legislation in their magazine. Mr Nairn will contact the department to discuss relevant content. Mr Hudson noted that he had recently written an article for Lloyd’s List, also on the biosecurity legislation, which would be published soon.

of 9 Mr Hudson asked about the work underway on the government single window exercise. Ms Vivian confirmed that the department was involved in the process and will provide input as required.

Agenda Item 11 – Next Meetings

Ms Vivian asked members about their preferences for the next meeting scheduled in Melbourne on 27 July. It was proposed that a site visit of the new post entry quarantine facility be undertaken, following the meeting. Members agreed, and Ms Vivian welcomed members to contact the DCCC secretariat with any further ideas or suggestions for both the site visit and agenda items. It was noted that Mr Nairn has raised the issue of ballast water for discussion at the next meeting.