Australia Set to Reform Its Coastal Shipping

The Australian Government is proposing a reform of the country’s coastal shipping sector stating as its aim the reduction of regulatory burden imposed on the sector.

The proposals were released in a discussion paper titled Coastal Shipping Reforms Discussion Paper and the government is seeking comment from ship operators, shipping companies, and other relevant stakeholders on proposed changes.

As disclosed, the Federal Government is proposing “greater flexibility for coastal shipping and new training opportunities…aimed at boosting coastal shipping activity.”

“Currently, 15 per cent of Australia’s domestic freight is moved by ship, but with Australia’s extensive coastline and broad network of ports, there is the potential for shipping to play a larger role in the national freight task,” Minister for Infrastructure and Transport Darren Chester said.

“However, it has become clear that limitations in the current regulatory system are working against that potential being realised.

“We need to address a range of administrative issues in the Coastal Trading (Revitalising Australian Shipping) Act 2012, which place unnecessary burdens on shipping companies and the Australian businesses that rely on coastal shipping.

“The intention of this discussion paper is to elicit views about how modifying the Act could help to redress this situation, without changing the basic structure of the current coastal trading regulatory regime,” Chester said.

Written submissions to the discussion paper should be sent by Friday, 28 April 2017.

Earlier in February, the country’s industry body Shipping Australia Limited called for unleashing of the the country’s coastal shipping’s potential.

“It’s now time for some sensible bi-partisan changes that will allow international shipping to carry coastal cargo efficiently and sustainably for the benefit of Australian manufacturers, primary producers, and consumers,” Shipping Australia’s CEO Rod Nairn said.

“Efficient coastal shipping will create jobs in Australia by reducing import substitution.  It will reduce the amount of greenhouse gas produced by inefficient overland transport. It will reduce the demand for road infrastructure spending and reduce road congestion and accidents.”

Among the changes to current regime offered by Nairn are: getting rid of the “five-voyage” requirement and the volume variation restrictions from the temporary licensing regime, providing a blanket exemption under Ministerial determination (like for cruise ships greater than 5,000 GT) for non-competitive cargoes on the coast, such as break bulk, heavy lift, and container ships with TEU capacity exceeding 2,500, and removing the application of the Fair Work Act to coastal freight.