SUBMISSION IN RELATION TO THE RED MEAT INDUSTRY COMMENTARY ON THE REGULATION OF LIVESTOCK CARRIERS

Introduction The Australian Maritime Safety Authority (AMSA) has been invited by the Productivity Commission to provide a response to representations in the Red Meat Industry submission to the Commission regarding shipping re uirements administered by AMSA! The Red Meat Industry submission emphasises the "##$ Report of the %ivestoc& '(port Revie) (the *eniry Report) finding that AMSA re uirements +lead the )orld in ship design for livestoc& e(ports+! This statement )as made in the conte(t of there being no specialised international standards regulating the transport of animals on livestoc& carriers! ,ence Australia has led the field in developing national standardsgiven the importance of the livestoc& e(port industry to the Australian rural and regional economy and the community interest in animal )elfare aboard ships! These standards are no) being used by several overseas administrations to regulate these types of ships carrying livestoc& from their ports! AMSA made Marine .rders Part /$- Cargo and Cargo Handling - Livestock (M./$) pursuant to the Common)ealth Navigation Act 1912- to regulate the conditions for the sto)age and carriage of livestoc& as cargo! These ship0based standards include the si1e of pens and provision by the ship of livestoc& services- such as ventilationlighting- drainage and systems delivering food and )ater! The Red Meat Industry submission outlines the regulatory standards applying to livestoc& carriers! ,o)ever- there needs to be a distinction made bet)een responsibility for ship safety and pollution prevention standards- for )hich AMSA is responsible- and standards protecting animal )elfare- for )hich the Australian 2uarantine and Inspection Service (A2IS) and the 3epartment of Agriculture4orestry and 4isheries (3A44) are responsible! The administration of animal )elfare standards includes the re uirement for stoc&men and veterinarians to be carried aboard certain livestoc& carriers! AMSA's ursuit o! "#st r$ctic# r#%u&$tion AMSA )ishes to highlight the e(tent of industry consultation in the performance of its regulatory role and AMSA5s striving to maintain a best practice regulatory process in close liaison )ith the .ffice of 6est Practice Regulation (formerly the .ffice of Regulatory Revie))!

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AMSA5s establishment legislation- the Australian Maritime Safety Authority Act 199 re uires in section 7" that AMSA consult- )here appropriate- )ith governmentcommercial- industrial- consumer and other relevant bodies and organisations in the performance of its functions and the e(ercise of its po)ers! AMSA has established a number of specialised consultative committees to encourage sta&eholders )ith a direct interest in AMSA5s )or& to be consulted in the performance of our functions and po)ers- particularly our regulatory po)ers! In the case of the regulation of livestoc& cargo- AMSA established a specialist %ivestoc& Advisory Committee (%AC) to provide input and feedbac& on regulation of livestoc& carriers! Membership of the committee includes representatives of the 3epartment of Agriculture- 4isheries and 4orestry (3A44)- the Australian 2uarantine and Inspection Service (A2IS)- State 3epartments of Agriculture- livestoc& ship o)ner8operators- livestoc& e(porters- shippers and agents- the Australian %ivestoc& '(port Corporation %td (%ivecorp)- the Cattle and Sheep Meat Councils- and the Royal Society for the Prevention of Cruelty to Animals (RSPCA)! The Committee includes %iveShip- an independent body representing ma9or ship o)ners and operators! %iveShip became independent of %ivecorp in late "##/! AMSA consults )ith the .ffice of 6est Practice Regulation in the ma&ing of its Marine .rders as re uired and in line )ith the !est "ractice #egulation Hand$ook- )hich applies to all Australian :overnment regulatory agencies! R#c#nt diss$tis!$ction #' r#ss#d (it) AMSA's r#%u&$tor* ro&# AMSA has consulted closely )ith the %AC over many years and their vie)s are reflected in the current structure and content of the regulatory frame)or& established by Marine .rders Part /$! ;ntil recently- AMSA understood that its regulation of livestoc& carriers )as appreciated and supported by the members of the %ACincluding ship operators and o)ners! There seems to have been a recent turnaround in the approach of some ship operators to the established consultative process and they are no) critical of regulatory developments that previously )ere agreed by the %AC! The Red Meat Industry submission confirms that these issues have been raised )ith the .ffice of 6est Practice Regulation- but )ithout there being consultation )ith AMSA in a substantive )ay about these concerns! AMSA is maintaining a constructive dialogue )ith all relevant sta&eholders and has received support from several individual ship operators- )hich have publicly endorsed AMSA5s regulatory role and have stated that they do not agree )ith the criticism of the established regulatory regime and regulatory improvements! The Red Meat Industry submission appears critical of the implementation of the changed regulatory environment since the Australian :overnment5s endorsement of the *eniry report in "##$! ,o)ever- AMSA<s consultations )ith ma9or sta&eholders have indicated support for the revised regulatory regime- including the development

$ in "##/ of the underpinning industry standards by &ey sta&eholders in 3A44<s %ivestoc& '(port Standards Advisory Committee (%'SAC)! *ey sta&eholders- including those represented in the Red Meat Industry submissione(pressed at the time their appreciation of the Australian :overnment<s recognition during this standards development process that the inspection- survey and certification of dedicated livestoc& ships are highly specialised tas&s! There )as support for the regulatory oversight of ship design- construction- operation and maintenance under the ne) standards being retained by AMSA! Ship operator representatives advised the :overnment that they understood the need for- and )ere generally comfortable )ith- the e(isting high level of regulatory scrutiny of the ships involved in the e(port trade! In their vie)- the continuing uniform and consistent administration by AMSA of Marine .rders Part /$ )as the &ey to future ship planning and investment decisions- not to mention the overall )ellbeing of the industry! They considered that the Marine .rder provided a comprehensive set of prescriptive re uirements that )ere generally firmly and fairly enforced by AMSA! =hen considered in con9unction )ith 3A44<s livestoc& e(port standards- they felt the regulatory regime more than ade uately met the specific needs of shipping interests in the Australian livestoc& trade! AMSA's r#c#nt r#%u&$tor* c)$n%#s in r#&$tion to &i+#stoc, c$rri#rs The Red Meat Industry submission appears to ta&e issue )ith three regulatory changes made to Marine .rders Part /$ over the past five years! T)o of these regulatory changes arose from decisions agreed in the %AC before the implementation of the *eniry report reforms- but )hich did not come into operation until "##> and "##?! The third change )as in direct response to the development by 3A44 of the livestoc& e(port standards in "##/- )hich made redundant the continued coverage of animal )elfare standards in AMSA5s Marine .rder! This proposed change to the Marine .rder )as clearly signalled by AMSA in its submission to the *eniry revie) in "##$ and has been reinforced in preceding and ongoing discussions in the %AC and in correspondence )ith the industry! 4ollo)ing is a more detailed discussion of these three regulatory changes@ Increased redundancy in ships5 systems operative from 7 Aanuary "##> The Marine .rder )as changed in "##" to provide for increased redundancy in ships5 systems by 7 Aanuary "##> )ith the aim of ensuring shipboard livestoc& servicesparticularly ventilation- are maintained at a level necessary for the )elfare of the livestoc& carried aboard ship! The Marine .rder also provided a performance0based alternative for a ship operator to demonstrate ade uate redundancy in a ship5s systems and e uipment by supplying to AMSA5s Chief Marine Surveyor )ith a ris& analysis of the systems involved! This regulatory change )as primarily in response to several incidents of very high livestoc& mortality on certain voyages from Australia arising from the failure of ship systems to support the livestoc& on board! In one instance- over ?## cattle diedrepresenting >B per cent of the livestoc& shipment- )hen the ship5s electrical po)er

/ supply failed to the ventilation system and insufficient air )as available to the animals! It can be appreciated these instances are contrary to Australian community standards in relation to the )elfare of animals in transit and received considerable attention from animal )elfare groups! There )as a strong public interest concern )ith the high impact of these incidents of the system failure aboard ship and the demand that this be addressed to prevent such incidents in future! A five0year implementation period )as provided to allo) e(isting livestoc& carriers in the Australian trade to plan and carry out modifications to achieve compliance )ith the ne) re uirements for additional redundancy in ship systems before "##>! The five0year period also coincided )ith a ship5s normal survey and certification cycle! Some e(isting livestoc& carriers needed to upgrade the redundancy level of their shipboard livestoc& systems to meet the standards that came into operation in "##>! There )ere some older livestoc& vessels- )hich their o)ners decided to retire from the Australian trade- although they could be used in overseas livestoc& trades! Some shipo)ners also elected to invest in ne) and more economic vessels or converted vessels to livestoc& carriers that already met the upgraded re uirements- so there )as an overall improvement in the standard of vessels servicing the Australian trade by "##>! The "##" Marine .rder )as developed in full consultation )ith AMSA5s %AC! The cost to the industry of this measure )as part of the %AC5s consideration- along )ith the considerable community concern )ith ensuring the humane transport of livestoc& at sea from Australia! International environment standards regulating se)age discharge from ships AMSA is responsible for administration of the Common)ealth Navigation Act 1912 and "rotection of the Sea %"revention of "ollution from Shi&s' Act 19() ! The Cavigation Act is the main legislation implementing standards covering ship construction and survey- ship safety- cre)ing- seafarer ualifications- and safe carriage of cargoes! The Protection of the Sea Act implements environment protection standards covering ship operations! The legislation references standards in international maritime conventions primarily promulgated by the ;nited Cations5 International Maritime .rgani1ation (IM.) and reflecting the international nature of the global shipping industry! Australia is a party to these conventions and hence is obliged to implement these standards into national la)! The IM.5s International Convention for the Prevention of Pollution from Ships (the MARP.% Convention) is the ma9or maritime convention providing internationally agreed environment protection standards- )hich )as made by the IM. in the 7D>#s! It contains si( technical anne(es dealing )ith prevention of pollution by ships from oilbul& no(ious li uid substances- harmful substances in pac&aged forms- se)agegarbage and air pollution respectively! In September "##$- the MARP.% Convention5s Anne( IE- "revention of "ollution $y Se*age- came into force internationally after gaining the necessary number of acceptances by IM. Member States! Australia acceded to Anne( IE in 4ebruary

B "##/ and it passed into Australian national la) on the commencement in May "##/ of the Common)ealth Maritime Legislation Amendment %"revention of "ollution from Shi&s' Act 2 )! AMSA issued Marine Cotices in "##$ and "##/ notifying the shipping industry of the prospective implementation by Australia of the ne) international standards in relation to the discharge of se)age from ships! Anne( IE of the MARP.% Convention re uired ships to be e uipped )ith a standard discharge connection and a holding tan&- an approved se)age treatment plant or an approved se)age comminuting and disinfecting system! These standards applied to livestoc& carriers and the discharge of drainage from spaces containing live animals! Conse uently- AMSA made amendments to Marine .rders Part /$ to implement these ne) international environment protection standards in relation to livestoc& carriers! In accordance )ith the MARP.% re uirements- all livestoc& carriers of /## gross tonnage and above )ere re uired to be fitted )ith a se)age system to meet the se)age discharge standards in Anne( IE! Ships certified to carry livestoc& and built or converted prior to September "##$ )ere given five years to comply )ith the ne) standards by September "##?! In addition to its Marine Cotices- AMSA also has included the re uirement to comply )ith the ne) standard on livestoc& carrier certificates for several years to ensure operators )ere a)are of the need to ade uately prepare for the improved environment protection standards! Again AMSA5s %AC )as consulted about the changes re uired to Marine .rders Part /$ to implement these ne) international standards in relation to livestoc& carriers! Removal of animal )elfare standards from Marine .rders Part /$ and prevention of high0ris& old ships from entering the trade AMSA5s submission to the *eniry revie) in Covember "##$ discussed the then comple( interaction bet)een the ship safety and operational standards regulated by AMSA under the Navigation Act 1912 and the animal )elfare standards covered by the Australian Meat and Livestock +ndustry Act 199, and -.&ort Control Act 19(2administered by 3A44 and A2IS! AMSA sought support from the revie) for the removal of the animal )elfare standards- )hich had been included in Marine .rders Part /$ at the behest of the livestoc& industry and ship o)ners and operators! AMSA sought the transfer of these standards to legislation administered by 3A44! AMSA advised the *eniry revie) that this change had been discussed )ith the %AC)hich had been presented )ith proposed amendments to remove these provisions from Marine .rders Part /$ in "##$! The shipping industry and animal )elfare representatives on the %AC felt that removal of the animal )elfare provisions from the Marine .rder )ould be premature at that stage! They as&ed AMSA to )ait until 3A44 had produced its animal )elfare regulations to ta&e up these functions and satisfactory operational e(perience )ith the ne) regulatory regime to be administered by 3A44 and A2IS! In 3ecember "##/- the Australian Standards for the '(port of %ivestoc& (AS'%) came into operation under the 3A44 administered Australian Meat and Livestock Act 199,/ ,ence AMSA again sought removal of the animal )elfare provisions from its Marine

F .rders Part /$- as these )ere covered by the AS'% and did not concern ship safety or pollution prevention- )hich are )ithin AMSA5s regulatory responsibilities! AMSA originally proposed issuing the revised Marine .rder removing the animal )elfare provisions in 4ebruary "##F! ,o)ever- consultations through %AC )ith interested parties- the RSPCA and livestoc& industry representative organi1ationsadvocated retention of some of these provisions )ithin the Marine .rder- particularly those relating to reporting by ships5 masters about livestoc& shipments! AMSA felt the reporting re uirement )as not re uired for its ship safety purposes and should be transferred to a 3A44 administered regulatory instrument! AMSA issued a draft of the revised Marine .rder in April "##F for public comment and follo)ing feedbac& from industry parties and 3A44- the final Marine .rder )as promulgated in 3ecember "##F! This retained the ship master5s reporting re uirement in direct response to representations by the %ivestoc& '(porters Council3A44 and the RSPCA! 3A44 re uires this information to comply )ith its livestoc& shipment reporting re uirements to the Australian Parliament specified in section B>AA of the Common)ealth Australian Meat and Livestock +ndustry Act 199,- and considered continued inclusion of the reporting re uirement in Marine .rders Part /$ )ould be more effective than creating its o)n regulatory instrument / The "##F Marine .rder also included the introduction of a sunset clause for older ships- )ith the proposal that all livestoc& carriers should be re uired to comply by 7 Aanuary "#77 )ith the 7D?7 amendments to the IM.5s International Convention on the Safety of %ife at Sea (the S.%AS Convention)! These S.%AS Convention amendments applied to vessels constructed on or after 7 September 7D?/ (ie ships affected by the "#77 cut0off date )ould be at least "> years old at that date)! After consultation )ith the industry- including %iveShip- %iveCorp- ship operators and ship o)ners- no ships )ere identified in the Australian trade that )ould be affected by the "#77 cut0off date for older ships! ,o)ever- one ship operator )anted the cut off date reduced so "# year old ships )ould be e(cluded from the trade- given that the )or&ing life of a vessel is around "# years! The aim of the regulation )as to prevent high ris&- older vessels entering the Australian livestoc& trade in future and thereby undermining the established safety and environmental standards of vessels and imposing greater regulatory costs on the Australian livestoc& e(porting industry! In each of the above three regulatory changes- AMSA has carefully consulted )ith interested sta&eholders and ta&en account of their vie)s )here appropriate! In each instance- a lead0time of many years has been provided to allo) for vessels to adapt to the ne) re uirements! In t)o cases (the MARP.% Convention se)age pollution standards and compliance )ith the S.%AS Convention standards)- the changes reflected the implementation of international shipping standards in line )ith Australia5s commitment to the relevant international treaties! A&t#rn$ti+#s to AMSA r#%u&$tion o! &i+#stoc, c$rri#rs In relation to consideration of alternative options to regulatory action such as self0 regulation- all livestoc& carriers loading livestoc& from Australian ports for overseas destinations are foreign flag vessels! Their flag state administration (ie another

> country5s maritime agency) is primarily responsible for ensuring these ships meet international ship safety and environmental standards! As indicated above- there is no international standard specifically regulating the carriage of livestoc& as cargo! ,ence Australia has developed a national regulatory system that applies to foreign flag ships loading livestoc& at Australian ports! It is not practical or effective in these circumstances to e(pect foreign flag ships to implement and enforce a self0regulatory mechanism- in line )ith Australian community standards for animal )elfare! The effectiveness of self0regulation depends on si1e and structure of the industry- the ease of entry and e(it- the ease of containing e(ternality effects (eg environmental impacts) and the coverage of the industry by reputable industry bodies! In the case of foreign flag livestoc& carriers- there is no suitably effective shipping industry body and no acceptance of mutual obligations bet)een the several participating shipping companies! There is a large number of purchasers of shipping services )ithin the Australian livestoc& e(port industry- )hich are primarily concerned about price and timeliness of shipment- rather than the safety of the ship or its operational practices in relation to the humane treatment of livestoc& during the voyage overseas! The international community generally has re9ected self0regulation in shipping and has adopted a regulatory system based on international treaties primarily negotiated through the IM.! AMSA has a longer term goal to encourage international adoption of standards for the seagoing carriage of livestoc& cargo- )hich )ould address some of the concerns of the Red Meat Industry submission )ith meeting international competition in the global livestoc& e(port mar&et! Mean)hile- the overall aim for AMSA is to ensure that livestoc& carriers loading animals at Australian ports are operated in a safe- humane and environmentally responsible )ay- )hile recognising the importance of the livestoc& e(port industry to Australia! This re uires a careful balance bet)een the strong Australian public interest )ith animal )elfare- the high impact of an incidence of systems5 failure aboard a ship upon the mortality level in a shipment of livestoc& and maintaining a cost effective regulatory environment!