Australia May Repeal Cabotage Regulations
Australia has issued a proposal for potential lifting of the cabotage regulations it adopted in 2012.
Lloyd's List reports:
Australia to scrap cabotage rules
Canberra consultation hopes to make coastal trades more competitive
THE Australian government has published a consultation document to investigate options that could see the country’s cabotage rules overturned.
Launching the paper, Approaches to Regulating Coastal Shipping in Australia, acting prime minister and infrastructure minister Warren Truss said Australia’s shipping industry was being hindered by red tape and a lack of competition.
If the recommendations in the consultation document are adopted, the government could scrap laws designed to protect local ship operators from competition from foreign owners.
The paper states that the regulation is damaging the Australian economy due to increased shipping costs and by restricting access to timely and flexible services.
Australia’s cabotage regulations were introduced under the Labour government in 2012.
Foreign-flag vessels operating in Australian waters require a licence and are subject to local employment and taxation laws.
The licence process allows Australian ships to make the case to undertake voyages that are proposed to be undertaken by foreign vessels.
“Trade movements to and from, as well as around, Australia’s coast are unique in their requirements because of geographic conditions and the nature of the commodities carried,” the paper says.
“The lack of competitiveness of Australian shipping has not only led to a decline in its participation in international trades, but has also affected the domestic coastal trades through either high freight rates or the loss of freight to the road and rail sectors.”
The report adds that Australia is heavily dependent on shipping, with 99% of international trade volumes transported by ship and Australian ports managing 10% of the world’s sea trade.
“A viable shipping industry is recognised by a wide range of OECD and developing countries as an important factor of national economic prosperity and it is clear that shipping will have to play a stronger role in our transport task into the future,” it says.
Despite this, the number of Australia-flagged ships has halved over the past decade, according to Mr Truss.
With volumes expected to double by 2030, a framework was required to manage this growth.
The OGSR will revert with any future updates.
