Upcoming Mallesons seminarsThe Bill will have direct consequences for any person or body corporate in Australia involved in the export of goods and services that may be subject to UN sanctions.
What do you need to do?If this Bill effects your business, you should ensure you have an appropriate compliance program in place. Such compliance programs will become even more important following passage of the Bill.
Mikkeli Godfree
Solicitor
Mark Weber
Partner
T +61 3 9643 4304
Melbourne
Cheng Lim
Canberra
Adam Bartlett
Following the highly publicised report of the Cole Inquiry into the activities of a number of high profile Australian companies in relation to the UN Oil-For-Food Programme , the Australian Government is taking measures to strengthen Australian laws regarding compliance with United Nations Security Council sanctions.
Background
The International Trade Integrity Bill 2007 had its second reading speech in the House of Representatives on 14 June 2007. If passed in its current form, the Bill will have direct consequences for any person or corporation in Australia involved in the export of goods and services that are subject to UN sanctions.
The Bill in its current form will, when passed, amend the following Commonwealth Acts:
- Charter of the United Nations Act 1945
- Customs Act 1901
- Criminal Code 1995, and
- Income Tax Assessment Act 1997.
Key impacts of the Bill
Key impacts of the Bill include the following:
Amendments to the Charter of the United Nations Act 1945
- The creation of a new offence for persons (including corporations) who engage in conduct that contravenes a UN sanction in force in Australia, with increased penalties for breaches.
- The introduction of strict liability for corporations which engage in conduct that contravenes a UN sanction in force in Australia, including in relation to UN counter-terrorism financing sanctions.
- The creation of a new offence for persons (including corporations) who knowingly or recklessly provide false or misleading information in connection with the administration of UN sanctions, including in relation to the issuance of permits or authorisations.
- The invalidation of any permission granted in reliance on information that is false or misleading in a material particular.
- Agencies responsible for administering UN sanctions will be granted new information gathering powers to determine compliance.
- There will be a requirement to retain, for five years, documentation in connection with permit applications and compliance with permit conditions.
Amendments to the Customs Act 1901
New criminal offences will be introduced for:
- importing or exporting goods the subject of United Nations sanctions without valid permission, and
- providing information that is false or misleading in a material particular, or omits a material particular, in an application for permission to import or export sanctioned goods.
Penalties
Offences under the proposed amendments carry potential penalties, depending on the offence, of up to the greater of A$1.1 million or three times the value of any relevant transaction (where a court can determine the value of the transaction). Penalties for individuals include prison sentences up to a maximum of 10 years.
Action required
You should be aware of the potential effect of this Bill if your business involves exporting or importing goods or services which may be subject to a UN sanction, or if you do business with foreign entities (including foreign states, corporations and individuals) who are the subject of UN sanctions.
If your business includes such activities, you should ensure you have an appropriate compliance program in place. Such compliance programs will become even more important following passage of the Bill.
Further information
Read the full report of Royal Commissioner, Mr TRH Cole QC.