IMPORTED FOOD CONTROL AMENDMENT BILL 2017 Explanatory Memorandum

Commonwealth of Australia Explanatory Memoranda

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IMPORTED FOOD CONTROL AMENDMENT BILL 2017

2016-2017 THE PARLIAMENT OF THE COMMONWEALTH OF AUSTRALIA HOUSE OF REPRESENTATIVES IMPORTED FOOD CONTROL AMENDMENT BILL 2017 EXPLANATORY MEMORANDUM (Circulated by authority of the Deputy Prime Minister and Minister for Agriculture and Water Resources, the Hon. Barnaby Joyce MP)

CONTENTS GENERAL OUTLINE ............................................................................................................... 1 BACKGROUND ........................................................................................................................ 1 FINANCIAL IMPACT STATEMENT ..................................................................................... 2 REGULATION IMPACT STATEMENT ................................................................................. 2 ACRONYMS, ABBREVIATIONS AND COMMONLY USED TERMS ............................... 3 STATEMENT OF COMPATIBILITY WITH HUMAN RIGHTS ........................................... 4 Human rights implications ........................................................................................... 5 Part 1--Food safety management certificates ............................................................. 5 Part 2--Holding orders ................................................................................................ 7 Part 3--Classification of food...................................................................................... 8 Part 4--Recognition of foreign country's food safety system ..................................... 8 Part 5--Enforcement.................................................................................................... 9 Part 6--Record-keeping ............................................................................................. 29 Part 7--Making of orders or determinations ............................................................. 34 Part 8--Use and disclosure of information ................................................................ 34 Part 9--Other amendments ........................................................................................ 35 Conclusion ................................................................................................................. 35 NOTES ON CLAUSES ........................................................................................................... 36 Preliminary ............................................................................................................................... 36 Schedule 1--Amendments ................................................................................................ 37 PART 1--FOOD SAFETY MANAGEMENT CERTIFICATES ........................................... 37 PART 2--HOLDING ORDERS .............................................................................................. 40 PART 3--CLASSIFICATION OF FOOD .............................................................................. 44 PART 4--RECOGNITION OF FOREIGN COUNTRY'S FOOD SAFETY SYSTEM ........ 46 PART 5--ENFORCEMENT ................................................................................................... 47 PART 6--RECORD-KEEPING .............................................................................................. 68 PART 7--MAKING OF ORDERS OR DETERMINATIONS .............................................. 70 PART 8--USE AND DISCLOSURE OF INFORMATION ................................................... 71 PART 9--OTHER AMENDMENTS ...................................................................................... 72 REGULATION IMPACT STATEMENT ............................................................................... 75

IMPORTED FOOD CONTROL AMENDMENT BILL 2017 GENERAL OUTLINE The Imported Food Control Amendment Bill 2017 (the Bill) will amend the Imported Food Control Act 1992 (the Act). The amendments will strengthen the current risk-based management approach of imported food safety to better protect the health of consumers while reducing the regulatory burden for compliant food importers. The Bill supports Australia's international obligations, including under the World Health Organization International Health Regulations 2005 and the World Trade Organization Agreement on the Application of Sanitary and Phytosanitary Measures 1994 (The SPS Agreement). BACKGROUND Whilst Australia has a robust food safety system, foodborne illness is a serious and costly public health and safety issue for government and industry. The consequences of food safety incidents are broad; including economic loss and reduced consumer confidence, as well as serious risks to human health. Consumers rely on existing food regulation and market forces to ensure imported food is safe for human consumption. Recent food safety issues with imported food, such as the Australian outbreak of hepatitis A linked to imported frozen berries in 2015, exposed limitations with the current imported food regulatory system. Management of imported food safety risks is challenged by increasing globalisation of food supply and increasingly complex supply chains. Border testing alone is no longer sufficient to provide assurance of a food's safety, particularly for foods intended to be eaten raw or after minimal processing. Assurance of food safety must be drawn from preventative controls throughout the supply chain. Internationally, many countries are moving toward requiring preventative approaches to manage imported food safety risks. The Bill will:  require documentary evidence from importers to demonstrate that they have effective internationally recognised food safety controls in place throughout the supply chain for the types of food where at-border testing alone is insufficient to provide assurance of food safety;  broaden Australia's emergency powers to allow food to be held at the border where there is uncertainty about the safety of a particular food and where the scientific approach to verify its safety is not established;  provide additional powers to monitor and manage new and emerging risks;  recognise an entire foreign country's food safety regulatory system where it is equivalent to Australia's food safety system, which will facilitate less intervention at the border for food products from that country;  align the definition of food with other Commonwealth legislation;  establish differentiated enforcement provisions to enable a graduated approach to non-compliance;  require all importers of food to be able to trace food one step forward and one step backward;  address minor technical issues with the current legislation to ensure efficient administration of the imported food legislation. 1

Formal and public consultation occurred during the development of the Bill with imported food industry representatives, state and territory food authorities, trading partners, and relevant Commonwealth agencies, which included the Department of Health and Food Standards Australia New Zealand. FINANCIAL IMPACT STATEMENT The Bill will have no financial impact on the Australian Government Budget. REGULATION IMPACT STATEMENT The Regulation Impact Statement is included and commences at page 75. 2

ACRONYMS, ABBREVIATIONS AND COMMONLY USED TERMS the Act Imported Food Control Act 1992 Acts Interpretation Act Acts Interpretation Act 1901 Crimes Act Crimes Act 1914 Criminal Code Criminal Code Act 1995 the Department the Department administered by the Minister administering the Imported Food Control Act 1992 the Guide to Framing the Guide to Framing Commonwealth Offences, Commonwealth Offences Infringement Notices and Enforcement Powers published by the Attorney-General's Department Legislation Act Legislation Act 2003 the Minister the Minister administering the Imported Food Control Act 1992 the Privacy Act Privacy Act 1988 the regulations the regulations made under the Imported Food Control Act 1992 Regulatory Powers Act Regulatory Powers (Standard Provisions) Act 2014 the Secretary the Secretary of the Department administered by the Minister administering the Imported Food Control Act 1992 3

STATEMENT OF COMPATIBILITY WITH HUMAN RIGHTS Prepared in accordance with Part 3 of the Human Rights (Parliamentary Scrutiny) Act 2011. Imported Food Control Amendment Bill 2017 This Bill is compatible with the human rights and freedoms recognised or declared in the international instruments listed in section 3 of the Human Rights (Parliamentary Scrutiny) Act 2011. Overview of the Bill The purpose of the Bill is to strengthen the current risk-based management approach of imported food safety. The amendments will build upon the current provisions of the Act to better protect the health of consumers, while also reducing the regulatory burden for compliant food importers and upholding Australia's international obligations. In achieving this purpose, the Bill promotes the right to health contained in the International Covenant on Economic, Social and Cultural Rights (the ICESCR). Globalisation of the food supply has driven increasingly complex supply chains and this, along with the growth in the amount of food imported to Australia, raises the risk of foodborne illness from imported food. Foodborne illness is a serious and costly public health and safety issue for government and industry. The Bill will:  require documentary evidence from importers to demonstrate that they have effective internationally recognised food safety controls in place throughout the supply chain for the types of food where at-border testing alone is insufficient to provide assurance of food safety;  broaden Australia's emergency powers to allow food to be held at the border where there is uncertainty about the safety of a particular food and where the scientific approach to verify its safety is not established;  provide additional powers to monitor and manage new and emerging risks;  recognise an entire foreign country's food safety regulatory system where it is equivalent to Australia's food safety system, which will facilitate less intervention at the border for food products from that country;  align the definition of food with other Commonwealth legislation;  establish differentiated enforcement provisions to enable a graduated approach to non-compliance;  require all importers of food to be able to trace food one step forward and one step backward;  address minor technical issues with the current legislation to ensure efficient administration of the imported food legislation. The Bill also seeks to ensure that enforcement measures are appropriate to the circumstances of the contravention or the act of non-compliance, and will achieve the regulatory outcomes sought. The proposed amendments reflect the shared responsibility for the safety of imported food between governments at all levels, business, industries, trading partners and the community. It promotes good governance, shared responsibility, efficient processes and procedural fairness. 4

The Bill draws upon and supports various international and domestic agreements and obligations. Internationally, these include:  Agreement on the Application of Sanitary and Phytosanitary Measures (the SPS Agreement)  Agreement on Technical Barriers to Trade (the TBT Agreement)  International Health Regulations 2005 (the International Health Regulations)  Agreement between the Government of Australia and the Government of New Zealand Concerning a Joint Food Standards System, and  Trans-Tasman Mutual Recognition Arrangement. Domestically, these include the Food Regulation Agreement and the National Health Security Agreement. The Australian Government will continue to work collaboratively with state and territory governments to complement existing powers in the management of imported food safety risks. Human rights implications This Bill engages, or has the potential to engage, the following rights:  Article 14(1) of the ICCPR - Right to a fair and public hearing  Article 14(2) of the ICCPR - Right to the presumption of innocence  Article 14(3) of the ICCPR - Right to be free from self-incrimination  Article 14(7) of the ICCPR - Right not to be tried or punished again for an offence for which a person has already been finally convicted or acquitted  Article 15 of the ICCPR - Prohibition on retrospective application of criminal laws  Article 17 of the ICCPR - Right to privacy, and  Article 12 of the ICESCR - Right to health. Part 1--Food safety management certificates Right to health Article 12 of the ICESCR promotes the right of all individuals to enjoy the highest attainable standards of physical and mental health. In its General Comment No. 14: The Right to the Highest Attainable Standard of Health (Art. 12) (2000) (General Comment No 14), the United Nations Committee on Economic, Social and Cultural Rights (UNCESCR) stated that health is a 'fundamental human right indispensable for the exercise of other human rights', and that the right to health is not the right to be healthy, but rather a right to a system of health protection that provides equal opportunity for people to enjoy the highest attainable level of health. That document further states that health is defined as an inclusive right, extending not only to timely and appropriate health care, but also to the underlying determinants of health, which includes access to an adequate supply of safe food. Article 4 of the ICESCR provides that countries may subject economic, social and cultural rights--such as the right to health--only to such limitations 'as are determined by law in so far as this may be compatible with the nature of these rights and solely for the purpose of promoting general welfare in a democratic society'. The United Nations Committee has stated that such limitations must be proportionate, and must be the least restrictive alternative where several types of limitations are available. Further, where such limitations are permitted, they should be of limited duration and should be subject to review. 5

The Bill takes positive steps to promote the right to health through measures which include:  increasing importer accountability to source safe food  broadening emergency powers to improve incident response, and  improving monitoring and management of new and emerging food safety risks. Part 1 of Schedule 1 to the Bill seeks to place increased accountability upon importers to ensure the food they bring into Australia is safe for human consumption. This Part makes amendments to require documentary evidence from importers to demonstrate that effective internationally recognised food safety controls are in place throughout the supply chain for particular types of food where at-border testing alone is insufficient to provide assurance of food safety. Importers will be required to demonstrate supply chain assurance through a recognised food safety management certificate. Summary Part 1 of Schedule 1 to the Bill is compatible with the right to health under Article 12 of the ICESCR. Criminal process rights (Article 14) Article 14 of the ICCPR requires that, in the determination of criminal charges, everyone shall be entitled to a fair and public hearing by a competent, independent and impartial tribunal established by law. Various other rights are provided for persons charged with criminal offences. Part 1 of Schedule 1 to the Bill engages the fair trial rights, minimum guarantees in the determination of a criminal charge and other criminal process rights contained in Article 14 of the ICCPR. The amendments proposed by Part 1 of Schedule 1 to the Bill engage, but do not limit, the right to a fair and public hearing provided for by Article 14(1) of the ICCPR. The hearing must be by a competent, independent and impartial tribunal established by law. As the Bill is consistent with the Criminal Code and operates within the Australian criminal justice system, any conviction under a provision proposed by Part 1 of Schedule 1 to the Bill can be reviewed by a higher tribunal. New section 18A(3) of the Act seeks to establish an offence, subject to a penalty of 10 years imprisonment, where a person knowingly forges or utters a certificate that is proposed to be treated as a recognised food safety management certificate. The penalty proposed by new subsection 18A(3) of the Act is proportionate to the offence, as it is necessary to deter the proscribed conduct of knowingly forging or uttering a food safety management certificate. Offending conduct may result in a reduced rate of inspection for a food which may pose a significant risk to human health. The penalty proposed by new subsection 18A(3) of the Act is in line with the principles in the Guide to Framing Commonwealth Offences, and is consistent with the penalty for a similar offence in current subsection 18(3) of the Act, which relates to recognised foreign government certificates. Article 14(7) of the ICCPR provides that 'no one shall be liable to be tried or punished again for an offence for which he has already been finally convicted or acquitted in accordance with the law and penal procedure of each country'. This prohibition on double jeopardy is a fundamental safeguard in the common law of Australia. It means that a person who has been convicted or acquitted of a criminal charge is not to be re-tried for the same or substantially the same offence. As the Bill is consistent with the Criminal Code and operates within the 6

Australian criminal justice system, Part 1 of Schedule 1 to the Bill engages, but does not limit, the rights provided for in Article 14(7) of the ICCPR. Summary Part 1 of Schedule 1 to the Bill is compatible with human rights because, to the extent that it engages the criminal process rights in Article 14 of the ICCPR, it does not limit those rights. Part 2--Holding orders Right to health Article 12 of the ICESCR promotes the right of all individuals to enjoy the highest attainable standards of physical and mental health. In its General Comment No 14, the UNCESCR stated that health is a 'fundamental human right indispensable for the exercise of other human rights', and that the right to health is not the right to be healthy, but rather a right to a system of health protection that provides equal opportunity for people to enjoy the highest attainable level of health. That document further states that health is defined as an inclusive right, extending not only to timely and appropriate health care, but also to the underlying determinants of health, which includes access to an adequate supply of safe food. Article 4 of the ICESCR provides that countries may subject economic, social and cultural rights--such as the right to health--only to such limitations 'as are determined by law in so far as this may be compatible with the nature of these rights and solely for the purpose of promoting general welfare in a democratic society'. The United Nations Committee has stated that such limitations must be proportionate, and must be the least restrictive alternative where several types of limitations are available. Further, where such limitations are permitted, they should be of limited duration and should be subject to review. As noted above, the Bill takes positive steps to promote the right to health through measures which include:  increasing importer accountability to source safe food  broadening emergency powers to improve incident response, and  improving monitoring and management of new and emerging food safety risks. Part 2 of Schedule 1 to the Bill promotes the protection of human health by ensuring the Australian Government has the power to control the spread of foodborne illness and communicable diseases (such as hepatitis or listeriosis). These measures will assist in ensuring Australia's obligations as a signatory to the International Health Regulations are met. The purpose of the International Health Regulations is to prevent, protect against, control and provide a public health response to the international spread of disease in ways that are commensurate with and restricted to, public health. Item 9 of the Bill seeks to expand existing powers for holding orders by empowering the Secretary to place a holding order on food if the Secretary is satisfied that there are reasonable grounds for believing that food of a particular kind may pose a serious risk to human health (see new subsection 15(3) of the Act). 7

Summary Part 2 of Schedule 1 to the Bill is compatible with the right to health under Article 12 of the ICESCR. Right to privacy Article 17 of the ICCPR prohibits arbitrary or unlawful interference with an individual's privacy, family, home or correspondence, and protects a person's honour and reputation from unlawful attacks. The right to privacy can be limited to achieve a legitimate objective where the limitations are lawful and not arbitrary. In order for an interference with the right to privacy to be permissible, the interference must be authorised by law, be for a reason consistent with the ICCPR and be reasonable in the circumstances. The United Nations Human Rights Committee has interpreted the requirement of 'reasonableness' as implying that any interference with privacy must be proportionate to a legitimate end and be necessary in the circumstances. New subsection 15(9) of the Act engages the protection against arbitrary or unlawful interference with privacy. To the extent that new subsection 15(9) of the Act may limit the rights protected under Article 17 of the ICCPR, those limitation are not arbitrary, and are reasonable, necessary and proportionate to the achievement of a legitimate objective. New subsection 15(9) of the Act requires the Secretary to publish orders made under current subsection 15(1) and new subsection 15(3) of the Act. It is necessary and reasonable to publish orders made under current subsection 15(1) and new subsection 15(3) of the Act in order to achieve the legitimate objective of protecting human health from the serious risk that may be posed by the food that is subject to an order under those subsections of the Act. Publication of the orders will also enable importers to effectively manage risk where there is a current order in place in relation to the type of food they intend to import into Australia. Finally, to ensure there is no arbitrary interference with an individual's privacy, the powers and functions in new subsection 15(9) of the Act must be exercised in compliance with the Privacy Act. The Privacy Act provides for protections on the collection, storage, use, disclosure or publication of personal information. Summary Part 2 of Schedule 1 to the Bill is compatible with human rights because, to the extent that it may limit the right to privacy in Article 17 of the ICCPR, that limitation is reasonable, necessary and proportionate to the achievement of a legitimate objective. Part 3--Classification of food Part 3 of Schedule 1 of the Bill is compatible with the human rights and freedoms recognised or declared in the international instruments listed in section 3 of the Human Rights (Parliamentary Scrutiny) Act as it does not engage any human rights. Part 4--Recognition of foreign country's food safety system Right to health Article 12 of the ICESCR promotes the right of all individuals to enjoy the highest attainable standards of physical and mental health. 8

In its General Comment No 14, the UNCESCR stated that health is a 'fundamental human right indispensable for the exercise of other human rights', and that the right to health is not the right to be healthy, but rather a right to a system of health protection that provides equal opportunity for people to enjoy the highest attainable level of health. That document further states that health is defined as an inclusive right, extending not only to timely and appropriate health care, but also to the underlying determinants of health, which includes access to an adequate supply of safe food. Article 4 of the ICESCR provides that countries may subject economic, social and cultural rights--such as the right to health--only to such limitations 'as are determined by law in so far as this may be compatible with the nature of these rights and solely for the purpose of promoting general welfare in a democratic society'. The United Nations Committee has stated that such limitations must be proportionate, and must be the least restrictive alternative where several types of limitations are available. Further, where such limitations are permitted, they should be of limited duration and should be subject to review. As noted above, the Bill takes positive steps to promote the right to health through measures which include:  increasing importer accountability to source safe food  broadening emergency powers to improve incident response, and  improving monitoring and management of new and emerging food safety risks. Part 4 of Schedule 1 to the Bill improves supply chain assurance by placing greater accountability upon importers to ensure safe food is being sourced. This objective is achieved through the recognition of a foreign country's food safety system. Summary Part 4 of Schedule 1 to the Bill is compatible with the right to health under Article 12 of the ICESCR. Part 5--Enforcement Criminal process rights (Articles 14 and 15) Article 14 of the ICCPR requires that, in the determination of criminal charges, everyone shall be entitled to a fair and public hearing by a competent, independent and impartial tribunal established by law. Various other rights are provided for persons charged with criminal offences. Part 5 of Schedule 1 to the Bill engages the fair trial rights, minimum guarantees in the determination of a criminal charge and other criminal process rights contained in Article 14 of the ICCPR. The amendments proposed by Part 5 of Schedule 1 to the Bill engage, but do not limit, the right to a fair and public hearing provided for by Article 14(1) of the ICCPR. The hearing must be by a competent, independent and impartial tribunal established by law. As the Bill is consistent with the Criminal Code and operates within the Australian criminal justice system, any conviction under a new provision proposed by Part 5 of Schedule 1 to the Bill can be reviewed by a higher tribunal. 9

New section 8 of the Act seeks to establish offences where a person imports food into Australia which either:  does not meet applicable standards (new subsection 8(1) of the Act), or  poses a risk to human health (new subsection 8(3) of the Act). The proposed offences in new section 8 of the Act, and the corresponding penalty of 10 years imprisonment for each offence, are necessary to achieve the legitimate objective of deterring conduct that involves importation of food that poses an unacceptable human health risk. They are reasonable and proportionate to this legitimate objective of deterring the proscribed conduct, as food that does not meet applicable standards or that poses a risk to human health can result in serious health issues, and occasionally death. This has the potential to result in widespread community anxiety regarding the safety of food, which may significantly impact Australia's general wellbeing. As some food is imported into Australia for the purpose of being further manufactured into another food product and then exported, committing an offence under these provisions may have an extensive and ongoing economic impact and damage to the reputation of Australia as a world-class food producer. New subsections 8(1) and (3) of the Act support various international agreements and obligations--such as the SPS Agreement, the TBT Agreement and the International Health Regulations--by protecting against the international spread of disease in a way that is commensurate with human health risks, while minimising any negative impacts on international traffic and trade. The penalties proposed by new subsections 8(1) and (3) of the Act are in line with the principles in the Guide to Framing Commonwealth Offences. New subsection 8A(1) of the Act seeks to establish an offence where:  a person deals with food to which the Act applies  the food has been imported into Australia, and  at the time the person deals with the food, the food does not meet applicable standards relating to information on labels for packages containing food. Current section 3 of the Act provides that the term deal with food includes moving, altering or interfering with food in any physical manner whatsoever; and entering into a transaction whereby the ownership of the food, or of any beneficial interest in the food, passes from one person to another. The proposed offence in new subsection 8A(1) of the Act, and the corresponding penalty of 10 years imprisonment, is necessary to achieve the legitimate objective of deterring the proscribed conduct, as consumers rely upon labelling for assurance of the contents of the food and incorrect labelling can result in serious health issues, and occasionally death, for undeclared allergens. In addition, it is a legal requirement to meet labelling requirements set out in the Food Standards Australia New Zealand Code. Failure to meet these requirements in relation to disclosure of the manufacturer, importer or supplier on labelling of food may result in the inability to effectively trace and identify food that may pose a serious risk to human health. New section 8A of the Act supports various international agreements and obligations--such as the SPS Agreement, the TBT Agreement and the International Health Regulations--by protecting against the international spread of disease in a way that is commensurate with human health risks, while minimising any negative impacts on international traffic and trade. The penalty proposed by new subsection 8A(1) of the Act is in line with the principles in the Guide to Framing Commonwealth Offences. 10

New subsection 8A(3) of the Act provides an exception that is additional to the defence of honest and reasonable mistake of fact, which is available under section 9.2 of the Criminal Code. The exception states that new subsection 8A(1) of the Act does not apply to a dealing with food for the purpose of altering or replacing the label on the package containing food in order to meet applicable standards relating to information on labels for packages containing food. New section 9 of the Act seeks to establish offences where a person deals with an examinable food that has been knowingly imported into Australia where:  the person knows a food control certificate has not been issued and the person has not obtained appropriate approval to deal with the food in that particular manner (new subsection 9(1) of the Act)  the person knows a food control certificate has been issued, the person knows an imported food inspection advice has not been issued and the person has not obtained appropriate approval to deal with the food in that particular manner (new subsection 9(3) of the Act), and  the person knows a food control certificate has been issued, the person knows the food has been identified in a imported food inspection advice as failing food, and the person has not obtained appropriate approval to deal with the food in that particular manner (new subsection 9(6) of the Act). The proposed offences in new section 9 of the Act, and the corresponding penalty of 10 years imprisonment for each offence, are necessary to achieve the legitimate objective of deterring conduct that involves a person dealing with food that is required to be inspected, or inspected and analysed, and which may be been identified as failing food. The proposed offences are reasonable and proportionate to this legitimate objective of deterring the proscribed conduct, which can result in serious health issues, and occasionally death. This has the potential to result in widespread community anxiety regarding the safety of food, which may significantly impact Australia's general wellbeing. As some food is imported into Australia for the purpose of being further manufactured into another food product and then exported, committing an offence under these provisions may have an extensive and ongoing economic impact and damage to the reputation of Australia as a world-class food producer. In addition, the proposed offences support various international agreements and obligations--such as the SPS Agreement, the TBT Agreement and the International Health Regulations--by protecting against the international spread of disease in a way that is commensurate with human health risks, while minimising any negative impacts on international traffic and trade. The penalties proposed by new subsections 9(1), (3) and (6) of the Act are in line with the principles in the Guide to Framing Commonwealth Offences. New subsection 9(5) of the Act provides an exception that is additional to the defence of honest and reasonable mistake of the fact, which is available under section 9.2 of the Criminal Code. The exception states that new subsection 9(3) of the Act does not apply to dealing with food for the purpose of altering or replacing the label on the package containing the food in order to meet applicable standards relating to information on labels for packages containing food. Article 14(7) of the ICCPR provides that 'no one shall be liable to be tried or punished again for an offence for which he [or she] has already been finally convicted or acquitted in accordance with the law and penal procedure of each country'. This prohibition on double jeopardy is a fundamental safeguard in the common law of Australia. It means that a person 11

who has been convicted or acquitted of a criminal charge is not to be re-tried for the same or substantially the same offence. As the Bill is consistent with the Criminal Code and operates within the Australian criminal justice system, Part 5 of Schedule 1 to the Bill engages, but does not limit, the rights provided for in Article 14(7) of the ICCPR. Item 25 of the Bill repeals current sections 21 to 32 of the Act and substitutes new sections 21 to 26 of the Act, which seek to trigger the standard provisions of Parts 2, 3, 4, 5 and 6 of the Regulatory Powers Act for the use of monitoring powers, investigation powers, civil penalty provisions, infringement notices and enforceable undertakings. Due to the amendments at item 25 of the Bill, the standard provisions pertaining to monitoring and investigation will apply to the Act. Accordingly, the fair trial rights, minimum guarantees in the determination of a criminal charge, and other criminal process rights contained in Article 14 of the ICCPR are engaged. Applying the standard provisions pertaining to monitoring powers in Part 2 of the Regulatory Powers Act to the Act will enable an authorised person to enter any premises and exercise monitoring powers for the purpose of determining whether provisions subject to monitoring have been, or are being, complied with, or determining whether information subject to monitoring is correct. However, an authorised person may not enter the premises unless the occupier has provided consent or the authorised person is in possession of a monitoring warrant. New subsection 22(1) of the Act provides that a provision is subject to monitoring under Part 2 of the Regulatory Powers Act if it is a provision of the Act, or an offence against the Crimes Act or the Criminal Code that relates to the Act. New subsection 22(3) of the Act states that information given in compliance or purported compliance with a provision of the Act is subject to monitoring under Part 2 of the Regulatory Powers Act. A monitoring warrant may only be issued by a Magistrate or a Judge of certain specified courts. The general monitoring powers of an authorised person set out in Part 2 of the Regulatory Powers Act include the power to:  search premises and any thing on the premises  examine or observe activities on the premises  inspect documents on the premises  ask persons on the premises questions and request the production of documents  bring equipment and materials onto the premises  inspect, examine, take measurements of or conduct tests on any thing on the premises  take images of things or make copies of documents  operate electronic equipment, and  secure evidence of contraventions for up to 24 hours. Further, if entry is under a monitoring warrant, the authorised person may:  require persons on the premises to answer questions or produce documents relating to the provisions or information that are subject to monitoring, and  secure electronic equipment for the purposes of obtaining expert assistance. Item 25 of the Bill also amends the Act to trigger the provisions pertaining to investigation powers in Part 3 of the Regulatory Powers Act, which will enable an authorised person to enter any premises and exercise investigation powers where the authorised person suspects on reasonable grounds that there may be material on the premises related to the contravention of 12

an offence provision or a civil penalty provision subject to investigation under Part 3 of the Regulatory Powers Act. However, an authorised person may not enter the premises unless the occupier has provided consent or the authorised person is in possession of an investigation warrant. New subsection 23(1) of the Act provides that a provision is subject to investigation under Part 3 of the Regulatory Powers Act if it is an offence against or a civil penalty provision of the Act, or an offence against the Crimes Act or the Criminal Code that relates to the Act. An investigation warrant may only be issued by a Magistrate or a Judge of certain specified courts. The general investigation powers of an authorised person set out in Part 3 of the Regulatory Powers Act include the power to:  search the premises and any thing on the premises  inspect, examine, take measurements of or conduct tests on evidential material  ask persons on the premises questions and request the production of documents  bring equipment and materials onto the premises  take images of things, and  operate electronic equipment. Further, if entry is under an investigation warrant, the authorised person may:  seize a disk, tape or other storage device on the premises if: - it is not practicable to put the evidential material into documentary form or transfer it to a separate disk, tape or other storage device brought onto the premises for the exercise of investigation powers, or - possession of the equipment or disk, tape or other storage device by the occupier could constitute an offence;  seize evidential material that is not of the kind specified in the warrant if: - the authorised person finds the thing in the course of searching for material of the kind specified in the warrant, and - the authorised person believes on reasonable grounds that:  the thing is evidential material of another kind, or  a related provision has been contravened with respect to the thing, or  the thing is evidence of a contravention of a related provision, or  the thing is intended to be used to contravene a related provision, and - the authorised person believes on reasonable grounds that it is necessary to seize the thing in order to prevent its loss, concealment or destruction;  require persons on the premises to answer questions or produce documents relating to evidential material of the kind specified in the warrant. Parts 2 (monitoring) and 3 (investigation) of the Regulatory Powers Act provide questioning powers to authorised persons. Under subsection 24(3) of the Regulatory Powers Act, where entry is authorised by a monitoring warrant, the authorised person may require any person on the premises to answer questions or produce documents relating to information or provisions subject to monitoring. If the person fails to do so, this is an offence under subsection 24(5) of the Regulatory Powers Act. The penalty for this offence is 30 penalty units. Similarly, under section 54(3) of the Regulatory Powers Act an authorised person who enters premises under an investigation warrant may require persons on the premises to answer questions or produce documents relating to evidential material of the kind specified in the warrant. If the person fails to do so, this is an offence under subsection 54(5) of the Regulatory Powers Act. The penalty for this offence is 30 penalty units. 13

Subsections 24(5) and 54(3) of the Regulatory Powers Act do not limit the person's access to a fair trial or limit the other criminal process rights in any way. Sections 17 and 47 of the Regulatory Powers Act make it clear that the privileges against self-incrimination and legal professional privilege have not been abrogated by the monitoring and investigation powers provisions, including the offence provisions. These protections guarantee the criminal process rights protected in paragraphs 14(3)(d) and (g) of the ICCPR. The usual guarantees and criminal process rights will apply to these offences and are not abrogated by any new provisions proposed by Part 5 of Schedule 1 to the Bill or the triggered provisions of the Regulatory Powers Act. Item 33 of the Bill provides for the application of the amendments in Part 5 of Schedule 1 to the Bill in relation to monitoring and investigation powers, and makes it clear that the amendments apply in relation to:  determining compliance with a provision identified by new subsection 22(1) or (2) of the Act before, on or after the commencement of Part 5 of Schedule 1 to the Bill,  determining the correctness of information identified by new subsection 22(3) of the Act that is given before, on or after the commencement of Part 5 of Schedule 1 to the Bill, and  evidential material that relates to a provision identified by new subsection 23(1) of the Act, if the suspected contravention of the provision occurred before, on or after the commencement of Part 5 of Schedule 1 to the Bill. Item 33 of the Bill will ensure that an authorised person may exercise powers and functions under Parts 2 and 3 of the Regulatory Powers Act from the time of the commencement of Part 5 of Schedule 1 to the Bill, regardless of whether or not the non-compliance or the suspected contravention occurred before, on or after that commencement. Part 5 of Schedule 1 to the Bill commences on the 28th day after the Bill receives the Royal Assent. With the exception of new subsection 22(3) of the Act, which provides for the ability to monitor information, Part 5 of Schedule 1 to the Bill does not expand the existing regulatory framework of the Act in relation to monitoring and investigation powers. Accordingly, the retrospective application provided for by item 33 does not impact upon the rights of, or impose liabilities on, a person who will be subject to the:  monitoring powers under Part 2 of the Regulatory Powers Act, as that Part applies to a provision identified by new subsection 22(1) or (2) of the Act, and  investigation powers under Part 3 of the Regulatory Powers Act, as that Part applies to the provisions identified in new subsection 23(1) of the Act. The application of monitoring powers to information given in compliance or purported compliance with a provision of the Act identified in new subsection 22(3) of the Act is important for the purposes of an effective monitoring scheme. It is necessary to extend current monitoring powers of the Act to information, as information is necessary for various provisions of the Act, and monitoring the correctness of that information upholds the objects of the Act. The ability to monitor the correctness of information given in compliance, or purported compliance, with a provision of the Act or the regulations made under the Act complements the existing monitoring powers framework of the Act. There is currently no equivalent to this provision in the Act. 14

Accordingly, the prohibition on retrospective application of criminal laws provided for by Article 15 of the ICCPR is engaged but is not limited due to the exception in Article 15(2) of the ICCPR. That is, the relevant conduct was contravened the Act at the time it was committed. New section 34A of the Act seeks to provide the Secretary with a power to require information or documents. New subsection 34A(5) of the Act prescribes an offence of strict liability, subject to 60 penalty units, for a failure to comply with a notice under new subsection 34A(1) of the Act. Accordingly, the fair trial rights, minimum guarantees in the determination of a criminal charge, and other criminal process rights contained in Article 14 of the ICCPR are engaged. However, the proposed offence provision does not limit the person's access to a fair trial or limit the other criminal process rights in any way, as it does not seek to abrogate any privileges (for example, the privilege against self-incrimination). As such, the usual guarantees and criminal process rights in Article 14 of the ICCPR will apply to new section 34A of the Act. Summary Part 5 of Schedule 1 to the Bill is compatible with human rights because, to the extent that it may limit the criminal process rights in Articles 14 and 15 of the ICCPR those limitations are reasonable, necessary and proportionate to the achievement of a legitimate objective. Civil penalties and Article 14 Item 24 of the Bill will insert new section 9A of the Act, which seeks to prescribe conduct that is subject to a civil pecuniary penalty. The penalty for a contravention of the conduct prescribed in new subsections 9A(1), (2), (3), (5), (6) and (8) of the Act is 120 penalty units for each provision. Item 25 of the Bill repeals current sections 21 to 32 of the Act and substitutes new sections 21 to 26 of the Act, which seek to trigger the standard provisions of Parts 2, 3, 4, 5 and 6 of the Regulatory Powers Act for the use of monitoring powers, investigation powers, civil penalty provisions, infringement notices and enforceable undertakings. Due to the amendments at item 25 of the Bill, the enforcement framework for the civil penalty provisions inserted by item 24 of the Bill will be provided for by Part 4 of the Regulatory Powers Act. Prescribing conduct that is subject to a civil penalty, and triggering the civil penalty provisions of the Regulatory Powers Act, could engage criminal process rights if the imposition of civil penalties is classified as 'criminal' under international human rights law. Guidance Note 2: Offence provisions, civil penalties and human rights (December 2014), which is published by the Parliamentary Joint Committee on Human Rights, states that civil penalty provisions may engage criminal process rights under Articles 14 and 15 of the ICCPR, regardless of the distinction between criminal and civil penalties in domestic law. When a provision imposes a civil penalty, an assessment is required as to whether it amounts to a 'criminal' penalty for the purposes of the ICCPR. Determining whether penalties could be considered to be criminal under international human rights law requires consideration of the classification of the penalty provisions under Australian domestic law, the nature and purpose of the penalties, and the severity of the penalties. 15

The penalty provisions inserted by item 24 of the Bill are expressly classified as civil penalties. New subsections 9A(1), (2), (3), (5), (6) and (8) of the Act seek to create solely pecuniary penalties in the form of a debt payable to the Commonwealth. The purpose of these penalties is to encourage compliance with the importing, labelling and dealing with food obligations of the Act. The new civil penalty provisions of the Act do not seek to impose criminal liability, and do not lead to the creation of a criminal record. The penalties only apply to those persons and importers who do not fulfil their importing, labelling and dealing with food obligations under the Act, rather than to the public in general. Further, the imposition of the civil penalties is not dependent on a finding of guilt. Each civil penalty provision proposed by new subsections 9A(1), (2), (3), (5), (6) and (8) of the Act will be subject to a pecuniary penalty of 120 penalty units. As item 25 of the Bill applies the standard provisions of Part 4 of the Regulatory Powers Act, the proposed provisions will attract the corporate multiplier provision in subsection 82(5) of the Regulatory Powers Act. This means that an individual who contravenes new subsection 9A(1), (2), (3), (5), (6) or (8) of the Act will be subject to a pecuniary penalty of 120 penalty units, and bodies corporate that contravene new subsection 9A(1), (2), (3), (5), (6) or (8) of the Act will be subject to a pecuniary penalty of 600 penalty units. Subsection 82(5) of the Regulatory Powers Act provides that, where the person is not a body corporate, a pecuniary penalty must not be more than the penalty specified for the civil penalty provision. If the person is a body corporate, the pecuniary penalty must not be more than five times the pecuniary penalty specified for the civil penalty provision. The prescribed penalties for civil penalty provisions under new section 9A of the Act (that is, 120 penalty units for individuals and 600 penalty units for bodies corporate) are reflective of the seriousness of the conduct and the risk contravening behaviour may pose to human health. The proposed penalties are also consistent with other penalties for similar conduct provisions across the Commonwealth statute book. The amendments proposed by item 25 of the Bill will also apply section 85 of the Regulatory Powers Act, which provides that a relevant court may make a single civil penalty order against a person for multiple contraventions of a civil penalty provision if proceedings for the contraventions are founded on the same facts, or if the contraventions form, or are part of, a series of contraventions of the same or a similar character; however, the penalty must not exceed the sum of the maximum penalties that could be ordered if a separate penalty were ordered for each of the contraventions. There are no criminal consequences associated with civil penalty orders for multiple contraventions. For example, they do not carry the possibility of imprisonment. As such, these civil penalties are not sufficiently severe that they could be considered to be criminal penalties for the purposes of Australia's human rights obligations. These factors all suggest that the civil penalties inserted by item 24 of the Bill are civil rather than criminal in nature. Accordingly, the criminal process rights provided for by Articles 14 and 15 of the ICCPR are not engaged by items 24 and 25 of the Bill. Due to the application of the standard provisions of Part 4 of the Regulatory Powers Act by item 25 of the Bill, the current regulatory framework of the Act will be expanded. As the civil penalties proposed by item 24 of the Bill are not sufficiently severe that they could be considered to be criminal penalties for the purposes of Australia's human rights obligations, the criminal process rights provided for by Article 14 of the ICCPR are not engaged. However, for completeness and to demonstrate that items 24 and 25 of the Bill comply with 16

the rights provided for by Article 14 of the ICCPR, key provisions of the Regulatory Powers Act, which will apply to the Act by virtue of item 25 of the Bill, are set out below. Article 14 of the ICCPR requires that, in the determination of criminal charges, everyone shall be entitled to a fair and public hearing by a competent, independent and impartial tribunal established by law. Various other rights are provided for persons charged with criminal offences. Due to the operation of subsection 82(2) of the Regulatory Powers Act, the time period for the making of an application for a civil penalty order will be within 6 years of the alleged contravention. As the criminal process rights in Article 14 of the ICCPR are not engaged by the amendments proposed by items 24 and 25 of the Bill, the right to be tried without undue delay provided by paragraph 14(3)(c) is not engaged. Under section 82 of the Regulatory Powers Act, civil penalty orders can only be granted by a relevant court, which must consider all relevant matters before determining the amount of the penalty. Accordingly, the right to a fair hearing is not limited. Section 90 of the Regulatory Powers Act clarifies that criminal proceedings may be commenced against a person for conduct that is the same, or substantially the same, as conduct that would constitute a contravention of a civil penalty provision, regardless of whether a civil penalty order has been made against the person in relation to the contravention. This section recognises the importance of criminal proceedings and criminal penalties in dissuading and sanctioning contraventions of the triggering Act, and ensures that criminal remedies are not precluded by earlier civil action. Section 90 of the Regulatory Powers Act engages the process rights in Article 14 of the ICCPR, but does not limit those rights. Article 14(7) of the ICCPR provides that 'no one shall be liable to be tried or punished again for an offence for which he has already been finally convicted or acquitted in accordance with the law and penal procedure of each country'. This prohibition on double jeopardy is a fundamental safeguard in the common law of Australia. It means that a person who has been convicted or acquitted of a criminal charge is not to be re-tried for the same or substantially the same offence. As section 90 of the Regulatory Powers Act permits both civil and criminal proceedings, but not multiple criminal proceedings for the same conduct, Article 14(7) of the ICCPR is not infringed. Further, section 88 of the Regulatory Powers Act provides that a court cannot make a civil penalty order against a person for a contravention of a civil penalty provision if the person has been convicted of an offence constituted by conduct that is the same, or substantially the same, as the conduct constituting the contravention. Section 91 of the Regulatory Powers Act provides that evidence of information given, or evidence of the production of documents, by an individual is not admissible in criminal proceedings against the individual if:  the individual previously gave the information or produced the documents in proceedings for a civil penalty order against the individual for an alleged contravention of a civil penalty provision (whether or not the order was made), and  the conduct alleged to constitute the offence is the same, or substantially the same, as the conduct alleged to constitute the contravention. 17

Section 91 of the Regulatory Powers Act ensures that information or documents produced during civil proceedings are not relied upon to support subsequent criminal proceedings, unless those proceedings are criminal proceedings relating to falsifying evidence in civil proceedings. Accordingly, that section engages, but does not limit, the criminal process rights in Article 14 of the ICCPR. Section 93 of the Regulatory Powers Act provides that if an act or thing is required under a civil penalty provision to be done within a particular period or before a particular time, the obligation to do that act or thing continues until that act or thing is done, even if the period has expired or the time has passed. This section further provides that a person commits a separate contravention of the civil penalty provision in respect of each day during which the contravention occurs, including the day the civil penalty order is made (or any later day). This section is necessary to ensure that failure to comply with an obligation does not excuse a person from meeting that obligation. As discussed above, section 85 of the Regulatory Powers Act provides that a relevant court may make a single civil penalty order against a person for multiple contraventions of a civil penalty provision if proceedings for the contraventions are founded on the same facts, or if the contraventions form, or are part of, a series of contraventions of the same or a similar character; however, the penalty must not exceed the sum of the maximum penalties that could be ordered if a separate penalty were ordered for each of the contraventions. There are no criminal consequences associated with civil penalty orders for multiple contraventions. For example, they do not carry the possibility of imprisonment. Accordingly, the application of section 93 of the Regulatory Powers Act does not engage any human rights. Section 96 of the Regulatory Powers Act provides that, in proceedings for a civil penalty order against a person for a contravention of a civil penalty provision, a person bears an evidential burden where that person wishes to rely on any exception, exemption, excuse, qualification or justification provided by the law creating the civil penalty provision. As section 96 of the Regulatory Powers Act only relates to proceedings for civil penalty orders, not offences, the right to be presumed innocent in Article 14(2) of the ICCPR is not engaged. Sections 84, 85, 86, 87, 88, 89, 92, 94, 95 and 97 of the Regulatory Powers Act relate to:  conduct contravening more than one civil penalty provision  multiple contraventions of civil penalty provisions  the ability to hear two or more civil penalty order proceedings together  the application of the rules and evidence and procedure for civil matters  the limitations on civil proceedings after criminal proceedings  the stay of civil proceedings during criminal proceedings  ancillary contraventions of civil penalty provisions  the relevance of a person's state of mind  mistake of fact, and  vicarious liability of employees, agents or officers of a body corporate, respectively. These provisions do not impact upon criminal proceedings and do not engage the criminal process rights in Article 14 of the ICCPR. There are no additional human rights implications beyond those discussed above. Summary Items 24 and 25 of the Bill do not engage the criminal process rights provided for by Article 14 of the ICCPR. Items 24 and 25 of the Bill are compliant with the right to a fair 18

hearing before a competent, independent and impartial tribunal contained in Article 14(1) of the ICCPR. Infringement notices and Article 14 Item 25 of the Bill repeals current sections 21 to 32 of the Act and substitutes new sections 21 to 26 of the Act, which seek to trigger the standard provisions of Parts 2, 3, 4, 5 and 6 of the Regulatory Powers Act for the use of monitoring powers, investigation powers, civil penalty provisions, infringement notices and enforceable undertakings. Due to the amendments at item 25 of the Bill, the enforcement framework for infringement notices issued in relation to provisions of the Act identified in new subsection 25(1) of the Act will be provided for by Part 5 of the Regulatory Powers Act. Under the amendments in item 25 of the Bill, infringement notices can be issued under the Regulatory Powers Act in relation to the strict liability offences against the Act and the civil penalty provisions of the Act. An infringement notice issued under Part 5 of the Regulatory Powers Act is a notice of a pecuniary penalty imposed on a person. It sets out the particulars of an alleged contravention of a law. An infringement notice gives the person to whom the notice is issued the option of paying the penalty set out in the notice, or electing to have the matter dealt with by a court. There are no criminal consequences associated with infringement notices for civil penalty provisions. For example, they do not carry the possibility of imprisonment if the person does not pay the penalty or attend court. Section 104 of the Regulatory Powers Act provides that an infringement notice is required to state that the person may choose not to pay the penalty and notify them that, if they do so, proceedings seeking a civil penalty order may be brought against them in a court. Accordingly, the person must always be advised of the consequences of not paying the penalty, and of their right to have the matter dealt with by a court. As the person may elect to have the matter heard by a court, rather than pay the penalty, the right to a fair hearing in civil matters provided for by Article 14(1) of the ICCPR is not limited. Where the infringement notice relates to a strict liability offence, if the person chooses not to pay the penalty amount in the infringement notice, they may be prosecuted for the offence. The right to a fair and public hearing provided for by Article 14(1) of the ICCPR is consequently engaged. Section 104 of the Regulatory Powers Act provides that an infringement notice is required to state that the person may choose not to pay the penalty, and notify them that, if they do so, that person may be prosecuted in a court for the alleged offence. As the person may elect to have the matter heard by a court, rather than pay the penalty, the right to a fair and public hearing by a competent, independent and impartial tribunal is not limited. Article 14 of the ICCPR also provides for other criminal process rights, such as the right to be presumed innocent. It sets out the minimum guarantees in criminal proceedings, such as the right to be informed promptly of the charge, the right to freedom from self-incrimination and the right to be tried in person. These rights are not limited by the amendments in item 25 of the Bill. The minimum guarantees and the right to be presumed innocent apply to proceedings relating to contraventions of the Act, except to the extent that they are expressly limited by law (for example, see new section 32 of the Act, as inserted by item 37 of the Bill, which is discussed below). 19

Summary Item 25 of the Bill is compatible with human rights because, to the extent that it engages the human rights provided for by Article 14 of the ICCPR, it does not limit those rights. Right to privacy Article 17 of the ICCPR prohibits arbitrary or unlawful interference with an individual's privacy, family, home or correspondence, and protects a person's honour and reputation from unlawful attacks. The right to privacy can be limited to achieve a legitimate objective where the limitations are lawful and not arbitrary. In order for an interference with the right to privacy to be permissible, the interference must be authorised by law, be for a reason consistent with the ICCPR, and be reasonable in the circumstances. The United Nations Human Rights Committee has interpreted the requirement of 'reasonableness' as implying that any interference with privacy must be proportionate to a legitimate end and be necessary in the circumstances. Items 25 and 26 of the Bill engage the protection against arbitrary or unlawful interference with privacy. To the extent that the measures in items 25 and 26 of the Bill limit the rights protected under Article 17 of the ICCPR, these limitations are not arbitrary, and are reasonable, necessary and proportionate to the achievement of a legitimate objective. The Act pursues the legitimate objective of strengthening the current risk based management approach of imported food safety to better protect the health of consumers while reducing the regulatory burden for compliant food importers. The proposed measures in items 25 and 26 of the Bill ensure that Australia can meet its ongoing domestic and international obligations in relation to the importation of food. Meeting domestic obligations is essential for the efficient and effective operation of the Australian food safety management system, including in its protection of human health. In addition, promoting the global protection of human health is essential in meeting Australia's international obligations and role as a good international citizen. The proposed measures in items 25 and 26 of the Bill are necessary in order to assess the level of risk to human health that a food imported into Australia may pose. Item 25 of the Bill repeals current sections 21 to 32 of the Act and substitutes new sections 21 to 26 of the Act, which seek to trigger the standard provisions of Parts 2, 3, 4, 5 and 6 of the Regulatory Powers Act for the use of monitoring powers, investigation powers, civil penalty provisions, infringement notices and enforceable undertakings. Due to the amendments at item 25 of the Bill, the monitoring and investigation framework for the Act will be provided for by Parts 2 and 3 of the Regulatory Powers Act. The entry, monitoring, search, seizure and information gathering powers in the triggered provisions of the Regulatory Powers Act are provided for by law. The monitoring and investigation powers are necessary to enable the monitoring of compliance with the Act and the collection of evidential material relating to contraventions. They are constrained in various ways as set out below, ensuring that their use is not arbitrary. The regime under the Regulatory Powers Act protects against arbitrary interference with privacy, as the monitoring and investigation powers cannot be exercised without consent being given to the entry into the premises, or prior judicial authorisation in the form of a warrant. Where entry is based on the consent of the occupier, consent must be informed and voluntary, and the occupier of premises can restrict entry by authorised persons to a particular 20

period. Additional safeguards are provided through provisions requiring authorised persons, and any persons assisting them, to leave the premises if the occupier withdraws their consent. The Regulatory Powers Act also provides restrictions on the issuing of a monitoring or investigation warrant. For example, in the case of an investigation warrant, an issuing officer may issue an investigation warrant only when satisfied, by oath or affirmation, that there are reasonable grounds for suspecting that there is, or may be within 72 hours, evidential material on the premises. An issuing officer must not issue a warrant unless the issuing officer has been provided, either orally or by affidavit, with such further information as they require concerning the grounds on which the issue of the warrant is being sought. Such constraints on this power ensure adequate safeguards against arbitrary limitations on the right to privacy in the issuing of warrants. In addition, an authorised person cannot enter premises under a warrant unless their identity card is shown to the occupier of the premises. If entry is authorised by warrant, the authorised person must also provide a copy of the warrant to the occupier of the premises. This provides for the transparent utilisation of the powers and mitigates arbitrariness and risk of abuse. The monitoring and investigation powers may only be exercised in certain circumstances set out in the Regulatory Powers Act. For example, under section 52 of the Regulatory Powers Act, the power to seize evidence of a kind not specified in a warrant may only be exercised where:  the authorised person finds the thing in the course of searching for material of the kind specified in an investigation warrant, and  the authorised person believes on reasonable grounds that: - the thing is evidential material of another kind, or - a related provision has been contravened with respect to the thing, or - the thing is evidence of a contravention of a related provision, or - the thing is intended to be used to contravene a related provision, and  the authorised person believes on reasonable grounds that it is necessary to seize the thing in order to prevent its loss, concealment or destruction. These constraints on the exercise of the powers limit their susceptibility to arbitrary use or abuse and ensure that their use is reasonable and proportionate in the circumstances. Accordingly, the monitoring and investigation powers are necessary, proportionate and reasonable in the pursuance of the legitimate objectives of the Act. New subsections 22(13) and 23(10) of the Act modify the operation of Parts 2 and 3 of the Regulatory Powers Act, and provide an authorised person with the power to take samples of any thing at any premises entered under section 18 or 48 of the Regulatory Powers Act for the purposes of exercising monitoring or investigation powers. It is necessary to retain the existing power to take samples in the Act, as this power is an essential element of an inspector's monitoring and investigation powers under the current regulatory powers framework of that Act. Obtaining a sample of a product is necessary as samples (including food) may be required to obtain scientific evidence. During this process the sample, or part of, may be damaged or destroyed. The inability to keep a sample may limit the ability to perform necessary analysis. New subsections 22(13) and 23(10) of the Act preserve the effect of current arrangements under that Act (see the definition of monitoring powers in current subsection 21(1) of the Act and the offence powers provided for in current subsection 25(1) of the Act), which are repealed by item 25 of the Bill. 21

The power to sample any thing on any premises entered under section 18 or 48 of the Regulatory Powers Act for the purposes of exercising monitoring or investigation powers may not be exercised without a monitoring or investigation warrant, or the occupier's consent to enter the premises. Accordingly, the exercise of the power is constrained, and these constraints ensure its use is reasonable, necessary and proportionate to the objectives of the Act. Alignment with the Regulatory Powers Act will also apply additional provisions pertaining to monitoring and investigation powers that do not currently have equivalents in the Act, as in force immediately before the commencement of item 25 of the Bill. Those provisions are merely procedural matters and do not engage human rights. New section 34A of the Act, as inserted by item 26 of the Bill, seeks to enable the Secretary to, by written notice, require a person to produce information or documents within the period specified in the notice. The exercise of the power under new section 34A of the Act may incidentally require the provision of personal information. In certain situations, it may be vital that the Secretary can quickly obtain information from individuals in order to prevent unsafe or unsuitable food from entering the domestic supply chain. Wherever possible, the regulator will rely on voluntary disclosure of this information; however, in some circumstances, an individual may be unwilling to disclose required information. In such cases, the need to address public risk justifies the requirement for individuals to provide information documents under new section 34A of the Act. Finally, to ensure there is no arbitrary interference with an individual's privacy, the powers and functions in new section 34A of the Act must be exercised in compliance with the Privacy Act. The Privacy Act provides for protections on the collection, storage, use, disclosure or publication of personal information. Summary Items 25 and 26 of the Bill are compatible with human rights because, to the extent that those items may limit the right to privacy contained in Article 17 of the ICCPR, that limitation is reasonable, necessary and proportionate to the achievement of a legitimate objective. Right to security of person and right to life Item 25 of the Bill repeals current sections 21 to 32 of the Act and substitutes new sections 21 to 26 of the Act, which seek to trigger the standard provisions of Parts 2, 3, 4, 5 and 6 of the Regulatory Powers Act for the use of monitoring powers, investigation powers, civil penalty provisions, infringement notices and enforceable undertakings. Due to the amendments at item 25 of the Bill, the monitoring and investigation framework for the Act will be provided for by Parts 2 and 3 of the Regulatory Powers Act. New subsections 22(15) and 23(12) of the Act also modify the operation of Parts 2 and 3 of the Regulatory Powers Act, and permit an authorised person to use force against things when executing a monitoring or an investigation warrant. These modifications preserve current arrangements under the Act (see current paragraphs 24(4)(a) and 26(4)(a) of the Act), which are repealed by item 25 of the Bill. In executing a monitoring or an investigation warrant, an authorised person is permitted to use such force against things as is necessary and reasonable in the circumstances. It is necessary 22

to include this power, as an authorised person executing a monitoring warrant may need to open packaging or locked doors, cabinets, drawers and other similar objects that the authorised person reasonably suspects contain things or information that would provide evidence that provisions subject to monitoring have not been, or are not being, complied with, or that information subject to monitoring is incorrect. Similarly, an authorised person executing an investigation warrant may need to open packaging or locked doors, cabinets, drawers and other similar objects that the authorised person reasonably suspects contain evidential material that would demonstrate that a provisions of the Act has been contravened. Article 6(1) of the ICCPR includes a duty upon governments to take appropriate steps to protect the right to life of those within its jurisdiction, and an obligation to investigate arbitrary or unlawful killings or punish offenders. As this power does not extend to the use of force against persons, it does not engage the right to security of person in Article 9 of the ICCPR or the right to life in Article 6 of the ICCPR. The power can only be exercised under a monitoring or investigation warrant, which must be issued by a judicial officer. Further, the power may only be used as is necessary and reasonable in the circumstances. Accordingly, the power is compatible with human rights. Summary Item 25 of the Bill is compatible with human rights as it does not engage the right to security of person in Article 9 of the ICCPR or the right to life in Article 6 of the ICCPR. Enforceable undertakings and Article 14 Item 25 of the Bill repeals current sections 21 to 32 of the Act and substitutes new sections 21 to 26 of the Act, which seek to trigger the standard provisions of Parts 2, 3, 4, 5 and 6 of the Regulatory Powers Act for the use of monitoring powers, investigation powers, civil penalty provisions, infringement notices and enforceable undertakings. Due to the amendments at item 25 of the Bill, the framework for accepting enforceable undertakings in relation to the Act will be provided for by Parts 6 of the Regulatory Powers Act. Part 6 of the Regulatory Powers Act will enable the Secretary to accept and enforce undertakings relating to compliance with offence and civil penalty provisions of the Act. Further, if the Secretary is satisfied that the person has breached the undertaking, he or she may apply to a relevant court for an order relating to the undertaking. Triggering the enforceable undertakings provisions of the Regulatory Powers Act in relation to offences against the Act engages the right to a fair and public hearing and other criminal process rights and minimum guarantees in Article 14 of the ICCPR. Article 14(1) of the ICCPR ensures that everyone shall be entitled to a fair and public hearing by a competent, independent and impartial tribunal established by law. Under Part 6 of the Regulatory Powers Act, an order enforcing the undertaking can only be made by a court. Accordingly, the right to a fair and public hearing is not limited. Further, the amendments proposed in item 25 of the Bill do not limit the minimum guarantees and other criminal process rights in Article 14 of the ICCPR. The minimum guarantees and process rights will apply to criminal proceedings. 23

Summary Item 25 of the Bill is compatible with human rights because, to the extent that it engages the criminal process rights in Article 14 of the ICCPR, it does not limit those rights. Right to the presumption of innocence (reverse burden provisions) Article 14(2) of the ICCPR states that everyone charged with a criminal offence shall have the right to be presumed innocent until proven guilty according to law. The right to presumption of innocence is also a fundamental common law principle in Australia. Laws which shift the burden of proof to a defendant, commonly known as 'reverse burden provisions', can be considered a limitation of the presumption of innocence. This is because a defendant's failure to discharge a burden of proof or prove an absence of fault may permit their conviction despite reasonable doubt as to their guilt. This includes where an evidential or legal burden of proof is placed upon a defendant or where strict liability is applied to an offence (see the explanation of strict liability below). When a defendant bears an evidential burden in relation to an exception it means that the defendant bears the burden of adducing or pointing to evidence that suggests a reasonable possibility that the exception has been met. It is then up to the prosecution to establish that this exception does not apply. This can be justified in circumstances where the facts in question are peculiarly within the knowledge of the defendant. Reverse burden offences will not necessarily be inconsistent with the presumption of innocence provided that the reverse burden offence pursues a legitimate objective and is reasonable, necessary and proportionate to achieving that objective. Whether a reverse burden provision impermissibly limits the right to the presumption of innocence will depend on the circumstances of the case and the particular justification for the reverse burden. The Guide to Framing Commonwealth Offences notes that placing the burden of proof on the defendant should be limited to where the matter is peculiarly within the knowledge of the defendant and where it is significantly more difficult and costly for the prosecution to disprove than for the defendant to establish the matter. The Guide to Framing Commonwealth Offences also notes that a reverse burden provision is more readily justified if:  the matter in questions is not central to the question of culpability for the offence  the penalties are at the lower end of the scale, and  the conduct proscribed by the offence pose a grave danger to public health or safety. An additional factor to consider is whether the offences only impose an evidential burden-- that is, the prosecution must still disprove the matters beyond the reasonable doubt if the defendant discharges the evidential burden. Proposed provisions of the Bill may operate to limit the right to be presumed innocent through imposing an evidential burden on the defendant in relation to a range of matters. These matters are outlined below. Proposed reverse burden provisions have been developed in line with the Guide to Framing Commonwealth Offences. The Attorney-General's Department has reviewed the proposed reverse burden provisions in the Bill and does not have any concerns with their inclusion. 24

The following subsections include offences for which an exception applies if a person is authorised to engage in the conduct under the Act or under another Australian law:  new subsection 8A(3) of the Act (labelling offences), and  new subsection 9(5) of the Act (dealing with examinable food offences). It is necessary that the defendant bears the evidential burden in the proposed provisions identified above in order to achieve the legitimate objective of ensuring the objects of the Act are met in relation to the protection of public health and safety. The proposed provisions are reasonable and proportionate to this legitimate objective because the defendant will have the information or knowledge available to them, which would form evidence to support the application of the exception in those circumstances (that is, that they were authorised by law to undertake the conduct). The following proposed civil penalty provisions of the Bill seek to place an evidential burden on the defendant:  new subsection 9A(4) of the Act (labelling of food), and  new subsection 9A(7) of the Act (dealing with food). Section 96 of the Regulatory Powers Act (which is applied to the Act by item 25 of the Bill) provides that, in proceedings for a civil penalty order against a person for a contravention of a civil penalty provision, a person bears an evidential burden where that person wishes to rely on any exception, exemption, excuse, qualification or justification provided by the law creating the civil penalty provision. By virtue of the application of the standard provisions in Part 4 (civil penalty provisions) of the Regulatory Powers Act to the provisions of the Act, new subsections 9A(4) and (7) of the Act do not seek to reverse the burden of proof. Further, as section 96 of the Regulatory Powers Act only relates to proceedings for civil penalty orders, not offences, the right to be presumed innocent in Article 14(2) of the ICCPR is not engaged. Summary Items 23 and 24 of the Bill are compatible with human rights because, to the extent that those items may limit the right to be presumed innocent in Article 14(2) of the ICCPR, that limitation is reasonable, necessary and proportionate to the achievement of a legitimate objective. Right to the presumption of innocence (strict liability offences) Article 14(2) of the ICCPR states that everyone charged with a criminal offence shall have the right to be presumed innocent until proven guilty according to law. The right to presumption of innocence is also a fundamental common law principle in Australia. When 'strict liability' applies to an offence, the prosecution is only required to prove the physical elements of an offence. That is, they are not required to prove fault elements in order for the defendant to be found guilty. Strict liability is used in circumstances where there is a public interest in ensuring that regulatory schemes are observed and it can be reasonably expected that the person was aware of their duties and obligations. Strict liability offences can be considered a limitation of the presumption of innocence because the defendant can be found guilty without the prosecution being required to prove fault. It is important to note that the defence of honest and reasonable mistake of fact is available to the defendant (see section 9.2 of the Criminal Code). 25

Strict liability offences will not necessarily be inconsistent with the presumption of innocence, provided that the removal of the presumption of innocence pursues a legitimate objective and is reasonable, necessary and proportionate to achieving that objective. Whether a strict liability provision impermissibly limits the right to the presumption of innocence will depend on the circumstances of the case and the particular justification for an offence being a strict liability offence. The Bill contains a number of proposed strict liability offences. These offences have been proposed where there is a strong public interest in managing imported food safety risks appropriately and preventing serious damage to human health. The application of strict liability in the Bill, and the offences to which it relates, have been developed in line with the Guide to Framing Commonwealth Offences. The Attorney-General's Department has reviewed the strict liability offences in the Bill and does not have any concerns with their inclusion. The following subsections include strict liability offences:  new subsection 8(2) of the Act (importation offences)  new subsection 8(4) of the Act (importation offences)  new subsection 8A(2) of the Act (labelling offences)  new subsection 9(2) of the Act (dealing with examinable food offences)  new subsection 9(4) of the Act (dealing with examinable food offences)  new subsection 9(7) of the Act (dealing with examinable food offences), and  new subsection 34A(5) of the Act (offence relating to the Secretary's power to require information or documents). New section 8 of the Act seeks to establish two strict liability offences where a person imports food into Australia that either:  does not meet applicable standards (new subsection 8(2) of the Act), or  poses a risk to human health (new subsection 8(4) of the Act). The proposed strict liability offences under new subsections 8(2) and (4) of the Act, and the corresponding penalty of 60 penalty units for each offence, are necessary to achieve the legitimate objective of deterring conduct that involves importation of food that poses an unacceptable human health risk. The proposed offences are reasonable and proportionate to this legitimate objective, as the offences are not punishable by imprisonment and the proposed penalty is low (maximum penalty of 60 penalty units). New subsections 8(2) and (4) of the Act support various international agreements and obligations--such as the SPS Agreement, the TBT Agreement and the International Health Regulations--by protecting against the international spread of disease in a way that is commensurate with human health risks, while minimising any negative impacts on international traffic and trade. New subsection 8A(2) of the Act seeks to establish a strict liability offence where:  a person deals with food to which the Act applies  the food has been imported into Australia, and  at the time the person deals with the food, the food does not meet applicable standards relating to information on labels for packages containing food. Current section 3 of the Act provides that the term deal with food includes moving, altering or interfering with food in any physical manner whatsoever; and entering into a transaction 26

whereby the ownership of the food, or of any beneficial interest in the food, passes from one person to another. The proposed strict liability offence in new subsection 8A(2) of the Act, and the corresponding penalty of 60 penalty units, is necessary to achieve the legitimate objective of deterring the proscribed conduct, as consumers rely upon labelling for assurance of the contents of the food and incorrect labelling can result in serious health issues, and occasionally death, for undeclared allergens. In addition, it is a legal requirement to meet labelling requirements set out in the Food Standards Australia New Zealand Code. Failure to meet these requirements in relation to disclosure of the manufacturer, importer or supplier on labelling of food may result in the inability to effectively trace and identify food which may pose a serious risk to human health. New subsection 8A(2) of the Act supports various international agreements and obligations--such as the SPS Agreement, the TBT Agreement and the International Health Regulations--by protecting against the international spread of disease in a way that is commensurate with human health risks, while minimising any negative impacts on international traffic and trade. New subsection 8A(3) of the Act provides an exception that is additional to the defence of honest and reasonable mistake of fact, which is available under section 9.2 of the Criminal Code. The exception states that new subsection 8A(2) of the Act does not apply to a dealing with food for the purpose of altering or replacing the label on the package containing food in order to meet applicable standards relating to information on labels for packages containing food. New section 9 of the Act seeks to establish three strict liability offences where a person deals with an examinable food that has been imported into Australia where:  a food control certificate has not been issued and the person has not obtained appropriate approval to deal with the food in that particular manner (new subsection 9(2) of the Act)  a food control certificate has been issued, an imported food inspection advice has not been issued and the person has not obtained appropriate approval to deal with the food in that particular manner (new subsection 9(4) of the Act), and  a food control certificate has been issued, the food has been identified in a imported food inspection advice as failing food, and the person has not obtained appropriate approval to deal with the food in that particular manner (new subsection 9(7) of the Act). New subsection 9(5) of the Act provides an exception that is additional to the defence of honest and reasonable mistake of the fact, which is available under section 9.2 of the Criminal Code. The exception states that new subsection 9(4) of the Act does not apply to dealing with food for the purpose of altering or replacing the label on the package containing the food in order to meet applicable standards relating to information on labels for packages containing food. The proposed strict liability offences in new section 9 of the Act, and the corresponding penalty of 60 penalty units for each offence, are necessary to achieve the legitimate objective of deterring conduct that involves a person dealing with food that is required to be inspected, or inspected and analysed, and which may be been identified as failing food. The offences are reasonable and proportionate to this legitimate objective as they are not punishable by imprisonment, the penalty is low (maximum penalty of 60 penalty units) and additional exceptions are available in certain circumstances. In addition, the offences support various 27

international agreements and obligations--such as the SPS Agreement, the TBT Agreement and the International Health Regulations--by protecting against the international spread of disease in a way that is commensurate with human health risks, while minimising any negative impacts on international traffic and trade. Item 27 of the Bill inserts new section 34A of the Act, which seeks to provide the Secretary with the power to require a person to give information or provide documents if the Secretary believes on reasonable grounds the person has information or documents relevant to the operation of the Act. The Secretary, may by written notice, require the person to:  give an authorised officer the information required with a given time period, or  to produce to an authorised officer the documents required within a given time period. In certain circumstances, it may be vital that the Secretary can quickly obtain information from individuals in order to prevent unsafe or unsuitable food from entering the domestic supply chain. Wherever possible, the regulator will rely on voluntary disclosure of this information; however, in some circumstances an individual may be unwilling to disclose the required information. In such cases, the need to address public risk will justify the requirement for individuals to answer questions and provide documents under new section 34A of the Act. Under new subsection 34A(5) of the Act a person who contravenes a requirement to provide information or documents commits an offence of strict liability. The penalty for contravention is 60 penalty units. The proposed offence, and the corresponding penalty, is reasonable and proportionate to the legitimate objective of preventing unsafe or unsuitable food from entering the domestic supply chain, as the conduct is not punishable by imprisonment and the proposed penalty is low (maximum penalty of 60 penalty units). New section 34A of the Act also supports various international agreements and obligations-- such as the SPS Agreement, the TBT Agreement and the International Health Regulations-- by protecting against the international spread of disease in a way that is commensurate with human health risks, while minimising any negative impacts on international traffic and trade. Summary Items 23 and 27 of the Bill are compatible with human rights because, to the extent that those items may limit the right to be presumed innocent in Article 14(2) of the ICCPR, that limitation is reasonable, necessary and proportionate to the achievement of a legitimate objective. Right to health Article 12 of the ICESCR promotes the right of all individuals to enjoy the highest attainable standards of physical and mental health. In its General Comment No 14, the UNCESCR stated that health is a 'fundamental human right indispensable for the exercise of other human rights', and that the right to health is not the right to be healthy, but rather a right to a system of health protection that provides equal opportunity for people to enjoy the highest attainable level of health. That document further states that health is defined as an inclusive right, extending not only to timely and appropriate 28

health care, but also to the underlying determinants of health, which includes access to an adequate supply of safe food. Article 4 of the ICESCR provides that countries may subject economic, social and cultural rights--such as the right to health--only to such limitations 'as are determined by law in so far as this may be compatible with the nature of these rights and solely for the purpose of promoting general welfare in a democratic society'. The United Nations Committee has stated that such limitations must be proportionate, and must be the least restrictive alternative where several types of limitations are available. Further, where such limitations are permitted, they should be of limited duration and should be subject to review. As noted above, the Bill takes positive steps to promote the right to health through measures which include:  increasing importer accountability to source safe food  broadening emergency powers to improve incident response, and  improving monitoring and management of new and emerging food safety risks. Part 5 of Schedule 1 to the Bill promotes the protection of human health by ensuring the Australian Government has the power to control the spread of foodborne illness and communicable diseases (such as hepatitis or listeriosis). These measures will assist in ensuring Australia's obligations as a signatory to the International Health Regulations are met. The purpose of the International Health Regulations is to prevent, protect against, control and provide a public health response to the international spread of disease in ways that are commensurate with and restricted to, public health. Part 5 of Schedule 1 to the Bill seeks to improve monitoring and management of new and emerging food safety risks. This objective is achieved by modernising existing enforcement powers through alignment with the standard provisions of the Regulatory Powers Act. Summary Part 5 of Schedule 1 to the Bill is compatible with the right to health under Article 12 of the ICESCR. Part 6--Record-keeping Right to privacy Article 17 of the ICCPR prohibits arbitrary or unlawful interference with an individual's privacy, family, home or correspondence, and protects a person's honour and reputation from unlawful attacks. The right to privacy can be limited to achieve a legitimate objective where the limitations are lawful and not arbitrary. In order for an interference with the right to privacy to be permissible, the interference must be authorised by law, be for a reason consistent with the ICCPR and be reasonable in the circumstances. The United Nations Human Rights Committee has interpreted the requirement of 'reasonableness' as implying that any interference with privacy must be proportionate to a legitimate end and be necessary in the circumstances. New section 29 of the Act engages the protection against arbitrary or unlawful interference with privacy. To the extent that new section 29 of the Act may limit the right to privacy, this limitation is reasonable, necessary and proportionate to the achievement of a legitimate objective. The Act pursues the legitimate objective of strengthening the current risk based 29

management approach of imported food safety to better protect the health of consumers while reducing the regulatory burden for compliant food importers. New section 29 of the Act ensures that Australia can meet its ongoing domestic and international obligations in relation to the importation of food. Meeting domestic obligations is essential for the efficient and effective operation of the Australian food safety management system, including in its protection of human health. In addition, promoting the global protection of human health is essential in meeting Australia's international obligations and role as a good international citizen. New section 29 of the Act is necessary in order to assess the level of risk to human health that a food imported into Australia may pose. New section 29 of the Act seeks to enable the Secretary to, by written notice, require a person to produce records that must be kept under new section 28 of the Act. Such a person must produce the records to the Secretary within the period and in the manner specified in the notice. The exercise of the power under new section 29 of the Act may incidentally require the provision of personal information. In certain situations, it may be vital that the Secretary can quickly obtain information from individuals in order to prevent unsafe or unsuitable food from entering the domestic supply chain. Wherever possible, the regulator will rely on voluntary disclosure of this information; however, in some circumstances, an individual may be unwilling to disclose the required information. In such cases, the need to address public risk justifies the requirement for individuals to provide documents under new section 29 of the Act. Finally, to ensure there is no arbitrary interference with an individual's privacy, the powers and functions in new section 29 of the Act must be exercised in compliance with the Privacy Act. The Privacy Act provides for protections on the collection, storage, use, disclosure or publication of personal information. Summary New section 29 of the Act is compatible with human rights because, to the extent that it may limit the right to privacy contained in Article 17 of the ICCPR that limitation is reasonable, necessary and proportionate to the achievement of a legitimate objective. Criminal process rights (Article 14) Article 14 of the ICCPR requires that, in the determination of criminal charges, everyone shall be entitled to a fair and public hearing by a competent, independent and impartial tribunal established by law. Various other rights are provided for persons charged with criminal offences. Part 6 of Schedule 1 to the Bill engages the fair trial rights, minimum guarantees in the determination of a criminal charge, and other criminal process rights contained in Article 14 of the ICCPR. The amendments proposed by Part 6 of Schedule 1 to the Bill engage, but do not limit, the right to a fair and public hearing provided for by Article 14(1) of the ICCPR. The hearing must be by a competent, independent and impartial tribunal established by law. As the Bill is consistent with the Criminal Code and operates within the Australian criminal justice system, any conviction under a proposed provision of Part 6 of Schedule 1 to the Bill can be reviewed by a higher tribunal. New subsection 29(5) of the Act seeks to create an offence, subject to a penalty of imprisonment for six months, where a person fails to comply with a notice to produce records 30

given under new subsection 29(1) of the Act. The proposed offence, and the corresponding penalty of imprisonment for six months, is necessary to achieve the legitimate objective of maintaining the traceability of food that may pose a serious risk to human health. They are reasonable and proportionate to this legitimate objective of deterring the proscribed conduct, as the inability to efficiently and effectively trace food that may pose a serious risk to human health may result in serious health issues, and occasionally death. In certain situations, it may be vital that the Secretary can quickly obtain information from individuals in order to prevent unsafe or unsuitable food from entering the domestic supply chain. Wherever possible, the regulator will rely on voluntary disclosure of this information; however, in some circumstances, an individual may be unwilling to disclose the required information. In such cases, the need to address public risk justifies the requirement for individuals to keep, retain and provide documents under new section 28 and 29 of the Act. Article 14(7) of the ICCPR provides that 'no one shall be liable to be tried or punished again for an offence for which he has already been finally convicted or acquitted in accordance with the law and penal procedure of each country'. This prohibition on double jeopardy is a fundamental safeguard in the common law of Australia. It means that a person who has been convicted or acquitted of a criminal charge is not to be re-tried for the same or substantially the same offence. As the Bill is consistent with the Criminal Code and operates within the Australian criminal justice system, Part 6 of Schedule 1 to the Bill engages, but does not limit, the rights provided for in Article 14(7) of the ICCPR. New section 32 of the Act seeks to abrogate the privilege against self-incrimination, which will engage the right to be free from self-incrimination set out in Article 14(3) of the ICCPR. Article 14(3)(g) of the ICCPR protects the right of an individual to be free from self-incrimination in the determination of a criminal charge by providing that a person may not be compelled to testify against him or herself or confess guilt. The common law of Australia also recognises the privilege against self-incrimination which applies unless expressly or impliedly overridden by statute. The privilege against self-incrimination may be subject to permissible limits. Any limitations must be for a legitimate objective and be reasonable, necessary and proportionate to that objective. New subsection 32(1) of the Act provides that a person is not excused from producing a record under new Part 3A of the Act on the ground that the production of the record might tend to incriminate the person or expose the person to a penalty. New subsection 32(2) of the Act provides that, in the case of an individual, none of the following is admissible in evidence against the individual in criminal proceedings (other than proceedings for an offence against new subsections 28(4) and 29(5) of the Act or proceedings for an offence against section 137.1 or 137.2 of the Criminal Code that relates to new Part 3A of the Act):  the record, and  producing the record, and  any information, document or thing obtained as a direct or indirect consequence of producing the record. Removing the privilege in these circumstances is necessary to achieve the legitimate objective of effective assessment and management of imported food safety risks to human health. Upholding the privilege in relation to individuals who have information regarding a potential imported food safety risk could have significant consequences for human health including gastroenteritis, non-gastrointestinal illness (such as hepatitis), serious long-term health effects (such as reactive arthritis or irritable bowel syndrome) and, occasionally death. 31

While in some cases it may be feasible to obtain information by other means (for example, warrants), the additional time taken to obtain such information may significantly increase the risk of an unsafe or unsuitable food entering the domestic supply chain. Without these limitations, the Australian Government's ability to manage food safety risks through a responsive, evidence-led approach will be significantly reduced. Removal of the privilege ensures that the assessment of the food safety risk and the application of response measures can occur as urgently as necessary and reflects the magnitude of the potential impacts food safety risks pose to Australia. New section 32 of the Act restricts the abrogation of the privilege against self-incrimination, and protects an individual from incriminating himself or herself in a way that would allow evidence to be used against him or her in criminal proceedings (other than proceedings for an offence against new subsections 28(4) and 29(5) of the Act or proceedings for an offence against section 137.1 or 137.2 of the Criminal Code that relates to Part 3A of the Act). The abrogation of the privilege against self-incrimination is reasonable and proportionate to achieving the above stated objective, as new subsection 32(2) of the Act provides for appropriate limitations on the abrogation as the abrogation cannot be used against the person who made the disclosure either directly in court (use immunity) or indirectly to gather other evidence against the person (derivative use immunity). The only exceptions to the use and derivative use immunities relate to proceedings arising out of sections 137.1 and 137.2 of the Criminal Code (in relation to false and misleading information and documents) and new subsections 28(4) and 29(5) of the Act (in relation to retention and production of records). Finally, the usual criminal process rights and minimum guarantees that apply in criminal proceedings will apply to any criminal proceedings under the Act, including the right to a fair and public hearing and appeal rights to a higher court. Accordingly, the provisions are compatible with the criminal process rights in Article 14 of the ICCPR. Summary Part 6 of Schedule 1 to the Bill is compatible with human rights because, to the extent that it may limit the criminal process rights in Article 14 of the ICCPR those limitations are reasonable, necessary and proportionate to the achievement of a legitimate objective. Right to the presumption of innocence (strict liability offences) Article 14(2) of the ICCPR states that everyone charged with a criminal offence shall have the right to be presumed innocent until proven guilty according to law. The right to presumption of innocence is also a fundamental common law principle in Australia. When 'strict liability' applies to an offence, the prosecution is only required to prove the physical elements of an offence. That is, they are not required to prove fault elements in order for the defendant to be found guilty. Strict liability is used in circumstances where there is a public interest in ensuring that regulatory schemes are observed and it can be reasonably expected that the person was aware of their duties and obligations. Strict liability offences can be considered a limitation of the presumption of innocence because the defendant can be found guilty without the prosecution being required to prove fault. It is important to note that the defence of honest and reasonable mistake of fact is available to the defendant (see section 9.2 of the Criminal Code). 32

Strict liability offences will not necessarily be inconsistent with the presumption of innocence, provided that the removal of the presumption of innocence pursues a legitimate objective and is reasonable, necessary and proportionate to achieving that objective. Whether a strict liability provision impermissibly limits the right to the presumption of innocence will depend on the circumstances of the case and the particular justification for an offence being a strict liability offence. The Bill contains a number of strict liability offences. These offences have been used where there is a strong public interest in managing imported food safety risks appropriately and preventing serious damage to human health. The application of strict liability in the Bill, and the offences to which it relates, have been developed in line with the Guide to Framing Commonwealth Offences. The Attorney-General's Department has reviewed the strict liability offences in the Bill and does not have any concerns with their inclusion. New subsection 28(4) of the Act seeks to establish an offence of strict liability, subject to a penalty of 60 penalty units, against the owner of a food if new section 28 of the Act requires a particular record to be retained and that record is not retained in accordance with that section. The proposed penalty is reasonable and proportionate to the legitimate objective of protecting human health, as records may be required during a food safety incident to prevent the spread of food that may pose a serious risk to human health, and the consequences of not retaining the records may be severe. New section 28 of the Act supports various international agreements and obligations--such as the SPS Agreement, the TBT Agreement and the International Health Regulations--by protecting against the international spread of disease in a way that is commensurate with human health risks, while minimising any negative impacts on international traffic and trade. Summary New section 28 of the Act is compatible with human rights because, to the extent that it engages the right to the presumption of innocence in Article 14 of the ICCPR, it does not limit those rights. Right to health Article 12 of the ICESCR promotes the right of all individuals to enjoy the highest attainable standards of physical and mental health. In its General Comment No 14, the UNCESCR stated that health is a 'fundamental human right indispensable for the exercise of other human rights', and that the right to health is not the right to be healthy, but rather a right to a system of health protection that provides equal opportunity for people to enjoy the highest attainable level of health. That document further states that health is defined as an inclusive right, extending not only to timely and appropriate health care, but also to the underlying determinants of health, which includes access to an adequate supply of safe food. Article 4 of the ICESCR provides that countries may subject economic, social and cultural rights--such as the right to health--only to such limitations 'as are determined by law in so far as this may be compatible with the nature of these rights and solely for the purpose of promoting general welfare in a democratic society'. The United Nations Committee has stated that such limitations must be proportionate, and must be the least restrictive alternative where several types of limitations are available. Further, where such limitations are permitted, they should be of limited duration and should be subject to review. 33

As noted above, the Bill takes positive steps to promote the right to health through measures which include:  increasing importer accountability to source safe food  broadening emergency powers to improve incident response, and  improving monitoring and management of new and emerging food safety risks. Part 6 of Schedule 1 to the Bill promotes the protection of human health by ensuring the Australian Government has the power to control the spread of foodborne illness and communicable diseases (such as hepatitis or listeriosis). These measures will assist in ensuring Australia's obligations as a signatory to the International Health Regulations are met. The purpose of the International Health Regulations is to prevent, protect against, control and provide a public health response to the international spread of disease in ways that are commensurate with and restricted to, public health. Part 6 of Schedule 1 to the Bill promotes the right to health by enabling the Secretary to require a person to produce records that relate to food that the Secretary is satisfied may pose a serious risk to human health. Wherever possible, the regulator will rely on voluntary disclosure of this information; however, in some circumstances, an individual may be unwilling to disclose the required information. In such cases, the need to address public risk justifies the requirement for individuals to provide documents under new Part 3A of the Act. Summary Part 6 of Schedule 1 to the Bill is compatible with the right to health under Article 12 of the ICESCR. Part 7--Making of orders or determinations Part 7 of Schedule 1 of the Bill is compatible with the human rights and freedoms recognised or declared in the international instruments listed in section 3 of the Human Rights (Parliamentary Scrutiny) Act as it does not engage any human rights. Part 8--Use and disclosure of information Right to privacy Article 17 of the ICCPR prohibits arbitrary or unlawful interference with an individual's privacy, family, home or correspondence, and protects a person's honour and reputation from unlawful attacks. The right to privacy can be limited to achieve a legitimate objective where the limitations are lawful and not arbitrary. In order for an interference with the right to privacy to be permissible, the interference must be authorised by law, be for a reason consistent with the ICCPR and be reasonable in the circumstances. The United Nations Human Rights Committee has interpreted the requirement of 'reasonableness' as implying that any interference with privacy must be proportionate to a legitimate end and be necessary in the circumstances. New section 42A of the Act engages the protection against arbitrary or unlawful interference with privacy. To the extent that new section 42A of the Act may limit the right to privacy, this limitation is reasonable, necessary and proportionate to the achievement of a legitimate objective. The Act pursues the legitimate objective of strengthening the current risk based management approach of imported food safety to better protect the health of consumers while reducing the regulatory burden for compliant food importers. New section 42A of the Act ensures that Australia can meet its ongoing domestic and international obligations in relation 34

to the importation of food. Meeting domestic obligations is essential for the efficient and effective operation of the Australian food safety management system, including in its protection of human health. In addition, promoting the global protection of human health is essential in meeting Australia's international obligations and role as a good international citizen. New section 42A of the Act seeks to provide for the use and disclosure of information obtained under the Act, which may include personal information. The disclosure of information to certain parties is limited to situations where the Secretary is satisfied that the disclosure of information to the relevant party is necessary for that party to perform or exercise any of its functions, duties or powers. The disclosure of information is further limited by new subsection 42A of the Act, which provides that the Secretary must not disclose information to a department of the government of a foreign country or an agency, authority or instrumentality of the government of a foreign country unless the Secretary is satisfied that the disclosure is in connection with food imported into Australia that the Secretary is satisfied may pose a risk to human health. Further safeguards are provided for by new subsections 42A(5), (6) and (8) of the Act, which relate to the making of guidelines to which the Secretary must have regard to before disclosing information to a department of the government of a foreign country or an agency, authority or instrumentality of the government of a foreign country. The Secretary must consult the Australian Information Commissioner before making the guidelines, and the guidelines must be published on the Department's website. When developing the guidelines, consideration will be given to principles and guidelines established by Codex Alimentarius Commission. Finally, to ensure there is no arbitrary interference with an individual's privacy, the powers and functions in new section 42A of the Act must be exercised in compliance with the Privacy Act. The Privacy Act provides for protections on the collection, storage, use, disclosure or publication of personal information. Summary Part 8 of Schedule 1 to the Bill is compatible with human rights because, to the extent that it may limit the right to privacy contained in Article 17 of the ICCPR that limitation is reasonable, necessary and proportionate to the achievement of a legitimate objective. Part 9--Other amendments Part 9 of Schedule 1 of the Bill is compatible with the human rights and freedoms recognised or declared in the international instruments listed in section 3 of the Human Rights (Parliamentary Scrutiny) Act as it does not engage any human rights. Conclusion The Bill is compatible with human rights because, to the extent that it may limit human rights, those limitations are reasonable, necessary and proportionate. The Bill also seeks to promote the right to health contained in Article 12 of the ICESCR. (Circulated by authority of the Deputy Prime Minister and Minister for Agriculture and Water Resources, the Hon. Barnaby Joyce MP) 35

NOTES ON CLAUSES Preliminary Clause 1--Short title Clause 1 provides for the short title of the Act to be the Imported Food Control Amendment Act 2017. Clause 2--Commencement Clause 2 provides for the commencement of each provision in the Bill, as set out in the table. Subclause 2(1) provides that each provision of the Bill specified in column 1 of the table commences, or is taken to have commenced, in accordance with column 2 of the table. Any other statement in column 2 has effect according to its terms. Item 1 in the table provides that sections 1, 2 and 3, which concern the formal aspects of the Bill, as well as anything in the Bill not elsewhere covered by the table, will commence on the day on which the Bill receives the Royal Assent. Item 2 in the table provides that Part 1 of Schedule 1 to the Bill commences on a single day to be fixed by Proclamation. However, if any of the provisions do not commence within the period of 12 months beginning on the day the Bill receives the Royal Assent, they commence on the day after the end of that period. Deferring commencement for a 12 month period for Part 1 of Schedule 1 to the Bill will ensure affected persons will have sufficient time to implement any necessary changes to policies and procedures as a result of the amendments. Item 3 in the table provides that Parts 2, 3 and 4 of Schedule 1 to the Bill commence on the day after the Bill receives the Royal Assent. Item 4 in the table provides that Part 5 of Schedule 1 to the Bill commences on the 28th day after the Bill receives the Royal Assent. Deferring commencement for 28 days for Part 5 of Schedule 1 to the Bill is necessary to enable the Secretary to make any appropriate delegations of his or her powers and functions under the Act. Item 5 in the table provides that Part 6 of Schedule 1 to the Bill commences on a single day to be fixed by Proclamation. However, if any of the provisions do not commence within the period of 12 months beginning on the day the Bill receives the Royal Assent, they commence on the day after the end of that period. Deferring commencement for a 12 month period for Part 6 of Schedule 1 to the Bill will ensure affected persons will have sufficient time to implement any necessary changes to policies and procedures as a result of the amendments. Item 6 in the table provides that Parts 7, 8 and 9 of Schedule 1 to the Bill commence on the day after the Bill receives the Royal Assent. Subclause 2(2) provides that any information in column 3 of the table is not part of the Bill. Information may be inserted in column 3 of the table, or information in it may be edited, in any published version of the Bill. Clause 3--Schedules Clause 3 provides that legislation specified in a Schedule to the Bill is amended or repealed as set out in the applicable items in the Schedule concerned, and any other item in a Schedule to the Bill has effect according to its terms. 36

Schedule 1--Amendments PART 1--FOOD SAFETY MANAGEMENT CERTIFICATES Overview Part 1 of Schedule 1 to the Bill seeks to place increased accountability upon importers to ensure the food they bring into Australia is safe for human consumption. This Part makes amendments to require documentary evidence from importers to demonstrate that effective internationally recognised food safety controls are in place throughout the supply chain for particular types of food where at-border testing alone is insufficient to provide assurance of food safety. Importers will be required to demonstrate supply chain assurance through a recognised food safety management certificate. To provide persons affected by the proposed amendments with an adequate opportunity to prepare, item 2 of the commencement information table in clause 2 of the Bill provides that Part 1 of Schedule 1 to the Bill commences on a single day to be fixed by Proclamation or, if Proclamation does not occur within 12 months after the Bill receives the Royal Assent, then Part 1 of Schedule 1 to the Bill will commence on the day after the end of the 12-month period. Item 1 Subsection 3(1) Item 1 amends subsection 3(1) of the Act to insert a definition of recognised food safety management certificate to provide that such a certificate means a recognised foreign government certificate or a certificate covered by a determination in force under subsection 18A(1) of the Act. This definition is necessary to complement new section 18A of the Act, which is inserted by item 4 below. Item 2 After subparagraph 16(2)(a)(ii) Item 2 inserts new subparagraph 16(2)(a)(iia) of the Act after new subparagraph 16(2)(a)(ii) of the Act, as inserted by item 13 below. New subparagraph 16(2)(a)(iia) of the Act provides that the regulations that set out particulars of a food inspection scheme may empower the Minister, subject to section 17 of the Act, to make orders identifying food of particular kinds as food that must be covered by a recognised food safety management certificate. Paragraph 16(2)(a) of the Act is amended by item 13 below. That paragraph currently states that, without limiting subsection 16(1) of the Act, the regulations that set out particulars of a food inspection scheme may empower the Minister, subject to section 17 of the Act, to make orders identifying food of particular kinds as food of a kind that is required to be inspected, or inspected and analysed, under the food inspection scheme. Item 13 repeals current paragraph 16(2)(a) of the Act, and inserts new paragraphs 16(2)(a), 16(2)(aa) and 16(2)(ab), and new subparagraphs 16(2)(a)(i), 16(2)(a)(ii) and 16(2)(a)(iii) of the Act. Item 2 will enable the regulations to set out the circumstances in which the Minister may make an order identifying food of particular kinds that must be covered by a recognised food safety management certificate. Item 1 above and item 4 below are relevant to the definition of the phrase recognised food safety management certificate. New subparagraph 16(2)(a)(iia) of the Act will require importers of food to demonstrate supply chain assurance through documentary evidence of a recognised food safety 37

management certificate for particular food where at-border testing alone is insufficient to provide assurance of food safety. It is necessary to insert new subparagraph 16(2)(a)(iia) of the Act as border testing alone is no longer sufficient to provide assurance of a food's safety, particularly for foods intended to be eaten raw or after minimal processing. Assurance of food safety must be drawn from preventative controls throughout the supply chain. New subparagraph 16(2)(a)(iia) of the Act enables the Minister to identify foods which require supply chain assurance to be demonstrated through documentary evidence of a recognised food safety management certificate. In making an order as to which foods will require a recognised food safety management certificate, the Minister will consider whether at-border testing alone is sufficient to demonstrate safety of the food. Item 3 After paragraph 16(2)(f) Item 3 inserts new paragraph 16(2)(fa) of the Act after current paragraph 16(2)(f) of the Act. New paragraph 16(2)(fa) of the Act provides that the regulations that set out particulars of a food inspection scheme may specify circumstances in which food is taken to be a failing food. Item 3 will enable the regulations to set out the circumstances in which the food may be taken to be a failing food. New paragraph 16(2)(fa) of the Act will complement current paragraph 16(2)(g) of the Act, which provides that the regulations that set out particulars of a food inspection scheme may specify circumstances in which food is taken to be a failing food because of its relationship to food that is found to be a failing food. Item 4 After section 18 Item 4 inserts new section 18A of the Act, which provides for matters in relation to food safety management certificates. New subsection 18A(1) of the Act will enable the Secretary to determine, in writing, that, for food of a specified kind, a specified certificate issued by a specified person or specified body is a recognised food safety management certificate. It is necessary to insert new subsection 18A(1) of the Act as border testing alone is no longer sufficient to provide assurance of a food's safety, particularly for foods intended to be eaten raw or after minimal processing. Assurance of food safety must be drawn from preventative controls throughout the supply chain. Subsequent to new subparagraph 16(2)(a)(iia) of the Act, new subsection 18A(1) of the Act will enable the Secretary to determine, for a food identified under new subsection 16(2)(a)(iia) of the Act, what an appropriate recognised food safety management certificate is in order to provide adequate supply chain assurance. Item 4 also inserts notes at the end of new subsection 18A(1) of the Act. New Note 1 to new subsection 18A(1) of the Act provides that the regulations deal with when food of such a kind is taken to be failing food because the food is not covered by a recognised food safety management certificate. New Note 2 to new subsection 18A(1) of the Act directs the reader to new section 35B of the Act (which is inserted by item 40 below) for guidance on how a determination may refer to a kind of food. New Note 3 to new subsection 18A(1) of the Act directs the reader to subsection 33(3) of the Acts Interpretation Act for guidance on variation and revocation of the determination. New Note 4 to new subsection 18(1) of the Act directs the reader to subsection 33(3AB) of the Acts Interpretation Act for guidance on specification by class. 38

Safeguards are included to protect against arbitrary discretion of the power under 18A(1), including the making of guidelines under 18A(2), which the Secretary must consider in determining recognised food safety management certificates, and the requirement to publish on the department's website:  a determination under subsection 18A(1);  guidelines under subsection 18A(2). New subsection 18A(2) of the Act provides that the Secretary must, in writing, make guidelines that the Secretary must have regard to before making a determination under new subsection 18A(2) of the Act. It is intended that the guidelines will identify a range of schemes that can provide recognised food safety management certificates in line with new subsection 18A(1) of the Act. In exercising his or her power under new subsection 18A(2) of the Act, it is intended that the Secretary will initially draw upon schemes recognised by the Global Food Safety Initiative (GFSI). The GFSI is an industry-driven initiative that sets international benchmarks for food safety management systems. New subsection 18A(3) of the Act provides that a person commits an offence, subject to a penalty of imprisonment for 10 years, where that person knowingly forges, or utters, a food safety management certificate. The penalty prescribed by new subsection 18A(3) of the Act is proportionate to the offence, as it is necessary to deter the proscribed conduct of knowingly forging or uttering a food safety management certificate. Offending conduct may result in a reduced rate of inspection for a food which may pose a significant risk to human health. The penalty prescribed by new subsection 18A(3) of the Act is consistent with the existing penalty for a similar offence in current subsection 18(3) of the Act, which relates to recognised foreign government certificates. New subsection 18A(4) of the Act clarifies that a determination made under new subsection 18A(1) of the Act and guidelines made under new subsection 18(2) of the Act are not legislative instruments for the purposes of the definition of legislative instrument provided for by section 8 of the Legislation Act. New subsection 18A(4) of the Act is included to assist the reader, as that provision is merely declaratory of the law and does not represent a substantive exemption from the Legislation Act. Subsection 8(4) of the Legislation Act provides: (4) An instrument is a legislative instrument if: (a) the instrument is made under a power delegated by the Parliament; and (b) any provision of the instrument: (i). determines the law or alters the content of the law, rather than determining particular cases or particular circumstances in which the law, as set out in an Act or another legislative instrument or provision, is to apply, or is not to apply; and (ii). has the direct or indirect effect of affecting a privilege or interest, imposing an obligation, creating a right, or varying or removing an obligation or right. Determinations made under new subsection 18A(1) of the Act and guidelines made under new subsection 18(2) of the Act merely determine the particular cases or particular 39

circumstances in which the law, as set out by the Act and the regulations, is or is not to apply; those instruments do not determine or alter the content of the law itself. New subsection 18A(5) of the Act provides that the Secretary must publish, on the Department's website, a determination made under new subsection 18A(1) of the Act and guidelines made under new subsection 18(2) of the Act. It is necessary to insert new subsection 18A(5) of the Act because it will enable importers to check, prior to commencing shipment of food identified under new subparagraph 16(2)(a)(iia) of the Act to Australia's border, what documentary evidence in the form of a recognised food safety management is required to be demonstrated in order to imported these types of food. New subsection 18A(6) of the Act directs the reader to the definitions of forge and utter in current section 19A of the Act for the purposes of defining those terms in new section 18A of the Act. Item 5 Paragraph 42(2)(b) Item 5 omits "(other than food that is or may be the subject of an application for a further imported food advice)" from current paragraph 42(2)(b) of the Act. Current paragraph 42(2)(b) of the Act provides that, subject to subsection 42(3) of the Act, initial decision means a decision under subsection 14(1) of the Act to issue an imported food inspection advice identifying food (other than food that is or may be the subject of an application for a further imported food advice) as failing food and specifying the manner of dealing with that food. It is not necessary to substitute new text to replace the text to be omitted as that text is no longer necessary for the effective operation of the Act. PART 2--HOLDING ORDERS Overview Part 2 of Schedule 1 to the Bill improves responsiveness to food safety incidents by allowing earlier intervention where there are reasonable grounds to believe that food may pose a serious risk to human health, and that the food safety issue is unconfirmed and/or there is no reliable test that can be applied to detect the food safety hazard. This is achieved by enabling the Secretary to make a holding order for a limited period to gather sufficient information to determine ongoing risk management measures. To ensure a proportionate response, particular characteristics of a food can be targeted in order to avoid unnecessary or inappropriate holding of other foods. Item 6 Before subsection 15(1) Item 6 amends current section 15 of the Act to insert a new subheading before current subsection 15(1) of the Act. The new subheading, Failing food on inspection or inspection and analysis, will assist the reader to understand current subsection 15(1) of the Act and will also ensure current section 15 of the Act is structured consistently. Item 7 Paragraph 15(1)(c) Item 7 repeals current paragraph 15(1)(c) of the Act and substitutes new subsection 15(1)(c) of the Act, including new subparagraphs 15(1)(c)(i) and 15(1)(c)(ii) of the Act. 40

The effect of item 7 is that food of a kind that was being held by an order made under new subsection 15(3) of the Act can continued to be held by an order made under current subsection 15(1) of the Act, if the order is in connection with the order made under new subsection 15(3) of the Act. This ensures food that is held while additional scientific evidence is gathered is then subject, under the subsequent order, to an approach consistent with the evidence gathered, in line with Australia's obligations under the SPS Agreement. Item 8 At the end of subsection 15(1) Item 8 adds a note to the end of subsection 15(1) of the Act, as amended by item 7 above, to direct the reader to new section 35B of the Act (which is inserted by item 40 below) for guidance on how a determination may refer to a kind of food. This note is included to assist the reader to understand the scope and application of subsection 15(1) of the Act, as amended by item 7 above. Item 9 Subsection 15(2) Item 9 amends current subsection 15(2) of the Act to insert "made under subsection (1)" after "a holding order". This amendment clarifies that current subsection 15(2) of the Act only applies to a holding order made under current subsection 15(1) of the Act. Item 9 is consequential to the amendments made by item 10 below, which inserts new subsections 15(3), (4), (5), (6), (7), (8) and (9) of the Act. Item 10 At the end of section 15 Item 10 adds to current section 15 of the Act by inserting new subsections 15(3), (4), (5), (6), (7), (8) and (9) of the Act, which relate to the use of holding orders for foods posing a serious risk to human health. Current section 15 of the Act enables the Secretary to make a temporary order where, on inspection, or inspection and analysis, of a food, that food is identified as a failing food, or the Secretary believes on reasonable grounds that a food will be identified as a failing food once inspection, or inspection and analysis has been completed. The effect of current section 15 of the Act is that food of that kind imported into Australia is held at the border until inspection, or inspection and analysis can be completed. These temporary orders must specify the conditions in which the order will be revoked. Once the conditions specified in the order have been met, the Secretary must revoke the order. New subsection 15(3) of the Act provides that, where the Secretary is satisfied that there are reasonable grounds that a food may pose a serious risk to human health, the Secretary may, by writing, make a holding order stating that, until the order ends, food of that kind that is imported into Australia after the making of the order must be held in place to be approved by an authorised officer in writing. New subsection 15(3) of the Act also provides that the order must specify the circumstances in which the order will be revoked, and state that the order ends at the earlier of the following:  at the end of the period of 28 days beginning on the day the order is made, or if that period is extended, the end of the extended period;  the time when the order is revoked. New subsection 15(3) of the Act adds a note that directs the reader to new section 35B of the Act in relation to how an order may refer to a kind of food. New subsection 15(3) of the Act has been inserted to protect the community in circumstances where a particular food poses a serious risk to human health. A temporary holding order made 41

under new subsection 15(3) of the Act would enable an appropriate testing regime on the food for the particular hazard to be established. The intent of a holding order made under new subsection 15(3) of the Act is to merely preserve the status quo, and temporarily prevent a particular food from further distribution until sufficient scientific evidence can be gathered and the safety of that food can be determined. If the food is determined not to be a risk to human health, the order will be revoked; if the food is determined to be a risk to human health, a decision will then be made to deal with the food. Accordingly, a decision to make a holding order under new subsection 15(3) of the Act, or a decision to extend that order under new subsection 15(4) of the Act, leads to the making of a substantive decision. A decision that is preliminary or procedural in nature has been identified by the Administrative Review Council (ARC) in its publication What decisions should be subject to merits review as a factor lying in the nature of the decision that may justify the exclusion of merits review. The scientific tests and processes involved in determining whether a food held under new subsection 15(3) of the Act, or which continues to be held due to an extension under new subsection 15(4) of the Act, are extensive and time consuming, and would be costly to repeat on review. A decision that involves extensive inquiry processes has been identified by the ARC as a factor lying in the costs of review of the decision that may justify the exclusion of merits review. It is not possible to assess the merits of a decision made under new subsection 15(3) or (4) of the Act until the scientific approach to testing has been identified and conducted, at which time, the order made under new subsection 15(3) or (4) of the Act will no longer be required--that is, the effect of the decision under new subsection 15(3) or (4) of the Act will be spent. A decision where there is no appropriate remedy has been identified by the ARC as a factor lying in the effect of the decision that may justify the exclusion of merits review. New subsection 15(4) of the Act provides that the Secretary may, in writing, extend the 28-day period referred to in new subparagraph 15(3)(d)(i) of the Act by a further period of up to 28 days. New subsection 15(4) of the Act also provides that the Secretary may extend the order more than once. New subsection 15(4) of the Act has been inserted to enable continued protection of human health until the appropriate testing regime on the food for the particular hazard and/or adequate risk management strategies can be implemented in relation to the food. An extension to the temporary holding order made under new subsection 15(3) of the Act would be necessary where the most appropriate test has not yet been determined within the initial 28 day period prescribed by that new subsection of the Act. To provide a safeguard against arbitrary discretion, it is intended that the decision maker for an order under new subsection 15(3) of the Act will not be the same decision maker for, if applicable, a decision to extend the order under new subsection 15(4) of the Act. New subsection 15(5) of the Act provides that, before making an extension on an order, the Secretary must review the appropriateness of the order. This subsection has been inserted as a safeguard to ensure that there is no arbitrary discretion in the making of an extension of an order. New subsection 15(5) of the Act is also intended to satisfy Australia's obligations under the SPS Agreement that provisional measures be reviewed within a reasonable period of time. 42

New subsection 15(6) of the Act states that the Secretary must, by writing, immediately revoke a holding order made under new subsection 15(3) of the Act, if he or she is satisfied that the revocation circumstances specified in the order have been met. To ensure consistency with the SPS Agreement, circumstances in which the holding order must be revoked will include where additional information necessary for an objective assessment of the risk is no longer being sought. New subsection 15(7) of the Act provides that current subsection 15(1) and new subsection 15(3) of the Act do not prevent an authorised officer (defined by current subsection 3(1) of the Act) from giving a person an approval to deal with food of a kind covered by an order under current subsection 15(1) and new subsection 15(3) of the Act while the order is in force. This provision will, for example, enable importers to reduce risk through actions such as exporting or treating the food, or moving the food to lower cost warehousing where appropriate. New subsection 15(8) of the Act clarifies that an order made under current subsection 15(1) or new subsection 15(3) of the Act and an instrument made under current subsection 15(2) or new subsections 15(4) or (6) of the Act are not legislative instruments for the purposes of the definition of legislative instrument provided for by section 8 of the Legislation Act. New subsection 15(8) of the Act is included to assist the reader, as that provision is merely declaratory of the law and does not represent a substantive exemption from the Legislation Act. Subsection 8(4) of the Legislation Act provides: (4) An instrument is a legislative instrument if: (a) the instrument is made under a power delegated by the Parliament; and (b) any provision of the instrument: (i). determines the law or alters the content of the law, rather than determining particular cases or particular circumstances in which the law, as set out in an Act or another legislative instrument or provision, is to apply, or is not to apply; and (ii). has the direct or indirect effect of affecting a privilege or interest, imposing an obligation, creating a right, or varying or removing an obligation or right. Orders made under current subsection 15(1) or new subsection 15(3) of the Act and instruments made under current subsection 15(2) or new subsections 15(4) or (6) of the Act merely determine the particular cases or particular circumstances in which the law, as set out by the Act and the regulations, is or is not to apply; those instruments do not determine or alter the content of the law itself. New subsection 15(9) of the Act requires the Secretary to publish orders made under new subsection 15(3) of the Act, which will enable importers to check, prior to commencing shipment of food to Australia's border, if there is a current order made under new subsection 15(3) of the Act (or extended under new subsection 15(4) of the Act) in relation to the type of food they intend to import into Australia. Item 11 Saving provision Item 11 provides that the amendments made by Part 2 of Schedule 1 to the Bill do not affect the validity of a holding order made under section 15 of the Act prior to the commencement of this item. Item 11 preserves the effect of current section 15 of the Act, which provides for matters in relation to holding orders for certain food. 43

PART 3--CLASSIFICATION OF FOOD Overview Part 3 of Schedule 1 to the Bill makes technical amendments to enable an order made by the Minister to classify food by individual characteristics and introduces additional provisions to monitor and manage new and emerging risks. Additional provisions to monitor and manage new and emerging risks enable the Secretary to make a temporary order that increases the rate of inspection of food where there may be an emerging risk to human health and that the risk requires further investigation. This measure addresses the current limitation between the emerging risk first being identified and the food risk assessment being updated, as the current system is unable to increase the inspection rate. Requirements for an order made under Part 3 of Schedule 1 to the Bill have been set to ensure that evidence is gathered in a timely manner and inspection and analysis rates are appropriate to the risk of the food. Item 12 Subsection 3(1) Item 12 inserts a meaning of officer of Customs that is consistent with the Customs Act 1901 to improve clarity and consistency across those Acts. Item 13 Paragraph 16(2)(a) Item 13 repeals current paragraph 16(2)(a) of the Act and substitutes new paragraphs 16(2)(a), (2)(aa) and (2)(ab) of the Act. New paragraph 16(2)(a) of the Act will preserve the effect of current paragraph 16(2)(a) of the Act and will enable the Minister to make orders that specify particular kinds of food that are required to be inspected, or inspected and analysed, or those that require a recognised foreign government certificate, or that are classified into particular categories. New paragraph 16(2)(aa) of the Act will enable the regulations to set out the percentage of food in a particular category which must be referred by an officer of Customs for inspection, or inspection and analysis. New paragraph 16(2)(ab) of the Act will enable the Secretary to make an order that specifies the percentage of food of a particular kind, and classified into a particular category, that must be referred by an officer of Customs for inspection, or inspection or analysis. The amount of food to be referred is determined by the requirements to monitor or manage a new or emerging risk. The increase in the rate of referral of food is proportionate to the likelihood or seriousness of the risk to human health and the requirements to gather further scientific evidence in order to assess the risk. Item 14 After paragraph 16(2)(b) Item 14 inserts new paragraph 16(2)(ba) of the Act, which enables the Secretary to make an order for food that is classified into a particular category and is of a particular kind, including specifying the incidence of inspection, or inspection and analysis, and the rate at which samples must be taken. Similar to new paragraph 16(2)(ab) of the Act, the rates are determined by the requirements to monitor or manage a new or emerging risk. The increase in the rate of inspection or sampling of food is proportionate to the likelihood or seriousness of the risk to human health and the requirements to gather further scientific evidence. Scientific 44

evidence gathered in this context will include available pertinent information, consistent with Article 5.7 of the SPS Agreement. Item 15 At the end of section 16 Item 15 adds new subsections 16(6) and (7) of the Act. New subsection 16(6) of the Act clarifies that an order made by the Secretary for the purposes of new paragraphs 16(2)(ab) or (2)(ba) of the Act are not legislative instruments for the purposes of the definition of legislative instrument provided for by section 8 of the Legislation Act. New subsection 16(6) of the Act is included to assist the reader, as that provision is merely declaratory of the law and does not represent a substantive exemption from the Legislation Act. Subsection 8(4) of the Legislation Act provides: (4) An instrument is a legislative instrument if: (a) the instrument is made under a power delegated by the Parliament; and (b) any provision of the instrument: (i). determines the law or alters the content of the law, rather than determining particular cases or particular circumstances in which the law, as set out in an Act or another legislative instrument or provision, is to apply, or is not to apply; and (ii). has the direct or indirect effect of affecting a privilege or interest, imposing an obligation, creating a right, or varying or removing an obligation or right. Orders made by the Secretary for the purposes of new paragraphs 16(2)(ab) or (2)(ba) of the Act merely determine the particular cases or particular circumstances in which the law, as set out by the Act and the regulations, is or is not to apply; those instruments do not determine or alter the content of the law itself. Item 15 also inserts notes at the end of new subsection 16(6) of the Act. New Note 1 to new subsection 16(6) of the Act provides that, under the regulations, the order made by the Secretary is of a temporary nature. New Note 2 to new subsection 16(6) of the Act directs the reader to subsection 33(3) of the Acts Interpretation Act for guidance on variation and revocation of the order. New subsection 16(7) of the Act requires the Secretary to publish orders made by the Secretary for the purposes of new paragraphs 16(2)(ab) or (2)(ba) of the Act, which will enable importers to check, prior to commencing shipment of food to Australia's border, if there is a current order made by the Secretary for the purposes of new paragraphs 16(2)(ab) or (2)(ba) of the Act in relation to the type of food they intend to import into Australia. Item 16 Transitional provision--orders Item 16 provides that an order that was in force under regulation 7 or 8 of the Imported Food Control Regulations 1993 immediately before the commencement of this item, continues to be in force under that regulation as in force on or after that commencement. Part 3 of Schedule 1 to the Bill commences on the day after the Act receives the Royal Assent. Item 16 further provides that this transitional provision does not prevent the variation or revocation of the order on or after the commencement of this item. 45

PART 4--RECOGNITION OF FOREIGN COUNTRY'S FOOD SAFETY SYSTEM Overview Part 4 of Schedule 1 to the Bill provides for the recognition of a foreign country's food safety system where it has been deemed equivalent to Australia's food safety system. Food imported from a country that has been assessed as having an equivalent food safety regulatory system as Australia may be subject to reduced or minimal at-border food inspections, except where there is evidence of non-compliance or a food safety risk. This will reduce border intervention for food importers which will lead to a more streamlined process at-border whilst reducing importation costs. Item 17 Before paragraph 16(2)(b) Item 17 inserts new paragraph 16(2)(ac) of the Act, which enables the Minister to make an order specifying the percentage of a food classified into a particular category imported from a specified country that must be referred by an officer of Customs for inspection, or inspection and analysis. The amount of food to be referred is determined by an equivalence assessment of the foreign country's food safety regulatory system, or by evidence of non-compliance, or a food safety risk. Item 18 Before paragraph 16(2)(c) Item 18 inserts new paragraph 16(2)(bb) of the Act, which enables the Minister to make an order specifying the percentage of a food classified into a particular category imported from a specified country that is subject to inspection, or inspection and analysis. Consistent with new paragraph 16(2)(ac) of the Act, the rates are determined by an equivalence assessment of the foreign country's food safety regulatory system, or by evidence of non-compliance, or a food safety risk. Item 19 After subsection 16(2) Item 19 inserts new subsections 16(2A) and (2B) of the Act. New subsection 16(2A) of the Act provides that the percentage mentioned in new paragraph 16(2)(ac) or (2)(bb) of the Act that is specified in an order made by the Minister must be less than five per cent (including zero). It is necessary to include this new subsection as the risk posed by food under new paragraph 16(2)(ac) or (2)(bb) of the Act does not require a referral rate higher than five per cent and the referral rate within the range described is determined by an equivalence assessment. This new subsection is in line with existing provisions of the Act that currently restrict the inspection rate to between five per cent and 100 per cent. New subsection 16(2B) of the Act provides that the Minister may make an order for the purposes of new paragraphs 16(2)(ac) or (2)(bb) of the Act in relation to a particular country only if the Minister is satisfied that there is an agreement in force between Australia and that country, and that the agreement is based on an assessment of the food safety systems of Australia and that country which concluded that Australia and that country have equivalent food safety systems and Australia and that country conduct equivalent monitoring of the food they regulate. New subsection 16(2B) of the Act is necessary to ensure the recognition of a foreign country's food safety system occurs only where that foreign country's food safety system achieves food safety outcomes that ensures determined food from that country does not pose a risk to human health. 46

Item 20 Subsection 16(5) Item 20 inserts ", (ac) or (bb)" after "paragraph (2)(a)" in current subsection 16(5) of the Act, which has the effect of declaring that instruments made under new subsections 16(2)(ac) and (bb) of the Act are legislative instruments. PART 5--ENFORCEMENT Overview Part 5 of Schedule 1 to the Bill provides for a modern compliance framework with new and improved tools to enable more effective and efficient targeting of non-compliant behaviour or activities. These tools also provide greater flexibility and more opportunity to encourage non-compliant food importers to become compliant. Part 5 of Schedule 1 to the Bill contains a range of enforcement options including infringement notices, civil penalties, enforceable undertakings and criminal sanctions. This means the Australian Government may impose different penalties based on the relevant circumstances, ensuring that those penalties are proportionate to the offence committed, and are based on the level of risk posed. That Part also triggers the standard provisions in Parts 2, 3, 4, 5 and 6 of the Regulatory Powers Act to provide the framework for monitoring powers, investigation powers, civil penalty provisions, infringement notices and enforceable undertakings. Part 5 of Schedule 1 to the Bill will commence on the 28th day after the Bill receives the Royal Assent. Deferring commencement for 28 days for Part 5 of Schedule 1 to the Bill is necessary to enable the Secretary to make any appropriate delegations of his or her powers and functions under the Act. Item 21 Subsection 3(1) (paragraph (c) of the definition of authorised officer) Item 21 amends paragraph (c) of the current definition of authorised officer in subsection 3(1) of the Act to omit "when used in a provision of this Act other than section 24, 25, 26, 27, 28, 29, 30 or 32--". The definition of authorised officer currently provided for by subsection 3(1) of the Act states that the phrase means: (a) the Secretary; or (b) an Australian Public Service employee in the Department appointed by the Secretary under subsection 40(1) of the Act; or (c) when used in a provision of this Act other than section 24, 25 , 26, 27, 28, 29, 30 and 32--a person appointed by the Secretary under subsection 40(2) of the Act. It is not necessary to substitute new text to replace the text to be omitted because new subsection 22(6) of the Act provides exceptions to the powers granted to an authorised officer appointed under current subsection 40(2) of the Act to ensure powers remain consistent with the text omitted by item 21. Item 21 is consequential to the amendments made by item 25 below, which repeals current sections 21, 22, 23, 24, 25, 26, 27, 28, 29, 30, 31 and 32 of the Act, and substitutes new sections 21, 22, 23, 24, 25 and 26 of the Act. 47

Item 22 Subsection 3(1) Item 22 amends subsection 3(1) of the Act to insert a definition for the term civil penalty provision and for the term Regulatory Powers Act. The definition for the term civil penalty provision provides that that terms has the same meaning as in the Regulatory Powers Act. This definition directs the reader to the Regulatory Powers Act, which defines civil penalty provision in section 4 of that Act. The definition for the term Regulatory Powers Act provides that that term means the Regulatory Powers (Standard Provisions) Act 2014. It is necessary to insert these definitions into subsection 3(1) of the Act because the amendments made by item 25 below seek to trigger the standard provisions of the Regulatory Powers Act. Item 23 Sections 8 to 9 Item 23 repeals current sections 8, 8A and 9 of the Act and substitutes those sections with new sections 8, 8A and 9 of the Act. Current section 8 of the Act provides for matters in relation to importation offences. Current section 8A of the Act provides for matters in relation to labelling offences. Current section 9 of the Act provides for matters in relation to offences relating to dealing with examinable food. Consistent with the repealed provisions, new sections 8, 8A and 9 of the Act will provide for matters in relation to importation offences, labelling offences and offences relating to dealing with examinable food (respectively). This item modernises the language of repealed offences and provides differentiated enforcement provisions, which give greater flexibility and more opportunity to encourage non-compliant food importers to become compliant, are consistent with Australia's domestic and international obligations, and are necessary and proportionate to achieving the objective of protecting human health. New sections 8, 8A and 9 of the Act contain a number of proposed strict liability offences. These offences have been proposed where there is a strong public interest in managing imported food safety risks appropriately and preventing serious damage to human health. The application of strict liability in the Bill, and the offences to which it relates, have been developed in line with the Guide to Framing Commonwealth Offences. The Attorney-General's Department has reviewed the strict liability offences in the Bill and does not have any concerns with their inclusion. Proposed provisions in new section 8A and 9 may operate to limit the right to be presumed innocent through imposing an evidential burden on the defendant in relation to a range of matters. Proposed reverse burden provisions have been developed in line with the Guide to Framing Commonwealth Offences. The Attorney-General's Department has reviewed the proposed reverse burden provisions in the Bill and does not have any concerns with their inclusion. It is necessary that the defendant bears the evidential burden in the proposed provisions in order to achieve the legitimate objective of ensuring the objects of the Act are met in relation to the protection of public health and safety. The proposed provisions are reasonable and proportionate to this legitimate objective because the defendant will have the information or knowledge available to them, which would form evidence to support the application of the 48

exception in those circumstances (that is, that they were authorised by law to undertake the conduct). Delegated offence content in item 23 relates to the application of applicable standards. Applicable standards are legislative instruments made under the Food Standards Australia New Zealand Act. Delegated offence content is necessary and reasonable as the standards are technical in nature, can be subject to frequent change, are made publicly available, and are developed with formal public consultation. Importation offences (new section 8 of the Act) Consistent with offences repealed in current section 8 of the Act, substituted offences in new section 8 of the Act relate to importation of food. To improve clarity, the substituted offences in new section 8 of the Act been separated into two types, those relating to importation of food that does not meet applicable standards (excluding standards that relate to information on labels for packages containing food), and those relating to importation of food that poses a risk to human health. New subsection 8(1) of the Act establishes a fault-based offence for conduct in relation to a person who imports food that does not meet applicable standards (excluding standards that relate to information on labels for packages containing food). The penalty for the fault-based offence in new subsection 8(1) of the Act is 10 years imprisonment. The penalty remains consistent with the repealed fault-based offence in current subsection 8(1) of the Act relating to the importation of food that does not meet applicable standards. The offence and corresponding penalty are necessary, and intended to provide an effective deterrent to conduct involving the importation of food that does not meet applicable standards, and the penalty is reflective of the seriousness of the offence and the significant risk posed to human health. New subsection 8(2) of the Act establishes a strict liability offence for conduct in relation to a person who imports food that does not meet applicable standards (excluding standards that relate to information on labels for packages containing food). The strict liability offence, and its corresponding penalty of 60 penalty units, is necessary to achieve the legitimate objective of deterring conduct involving importation of food that does not meet applicable standards, and the penalty is reflective of the seriousness of the offence and the significant risk posed to human health. New subsection 8(3) of the Act establishes a fault-based offence for conduct in relation to a person who imports food that poses a risk to human health. The penalty for the fault-based offence in new subsection 8(3) of the Act is 10 years imprisonment. The penalty remains consistent with the repealed fault-based offence in current subsection 8(1) of the Act relating to the importation of food that poses a risk to human health. The offence and corresponding penalty are intended to provide an effective deterrent to conduct involving the importation of food that poses a risk to human health, and the penalty is reflective of the seriousness of the offence and the significant risk posed to human health. New subsection 8(4) of the Act establishes a strict liability offence for conduct in relation to a person who imports food that poses a risk to human health. The strict liability offence, and its corresponding penalty of 60 penalty units, is necessary to achieve the legitimate objective of deterring conduct involving importation of food that poses a risk to human health, and the penalty is reflective of the seriousness of the offence and the significant risk posed to human health. 49

New subsection 8(5) of the Act establishes imputed knowledge in relation to a contravention of new subsection 8(3) of the Act, which gives consideration to the abilities, experience, qualifications and other attributes of the contravening person, as well as the circumstances surrounding the alleged contravention. This means that a court must consider all relevant factors when determining the culpability of a person who imported food into Australia where that person ought to reasonably have known their conduct would contravene a provision of the Act. This provision seeks to set the expectations of a person importing food into Australia, and encourage persons to undertake due diligence in ensuring the food they import does not pose a risk to human health. Labelling offences (new section 8A of the Act) Consistent with offences repealed in current section 8A of the Act, substituted offences in new section 8A of the Act relate to labelling of food. New subsection 8A(1) of the Act preserves the effect of current subsection 9(1) of the Act, providing a fault-based offence in relation to a person dealing with imported food that does not meet applicable standards relating to information on labels for packages containing food. Item 23 aims to modernise drafting terminology to assist readers. The penalty for the fault-based offence in new subsection 8A(1) of the Act is 10 years imprisonment. This penalty remains consistent with the repealed fault-based offence in current subsection 8A(1) of the Act relating to labelling of food. The offence, and its corresponding penalty, is necessary and proportionate to achieve the legitimate objective of deterring conduct involving importation of food that does not meet applicable standards relating to information on labels for packages containing food. This is important as consumers rely upon labelling for assurance of the contents of the food. Incorrect labelling can result in serious health issues, and occasionally death for undeclared allergens. New subsection 8A(2) of the Act establishes a strict liability offence in relation to a person dealing with imported food that does not meet applicable standards relating to information on labels for packages containing food. The strict liability offence, and its corresponding penalty of 60 penalty units, is necessary to achieve the legitimate objective of deterring this conduct. As with the fault-based offence in new subsection 8A(1) of the Act, this is necessary as consumers rely upon labelling for assurance of the contents of the food and incorrect labelling can result in serious health issues, and occasionally death for undeclared allergens. New subsection 8A(3) of the Act provides an exception to new subsections 8A(1) and (2) of the Act that is additional to the defence of honest and reasonable mistake of fact, which is available under section 9.2 of the Criminal Code. The exception states that subsection 8A(1) or (2) of the Act does not apply to a dealing with food for the purpose of altering or replacing the label on the package containing food in order to meet applicable standards. Item 23 also inserts a note to new subsection 8A(3) of the Act , which provides that the evidential burden is placed upon the defendant in relation to matters in this subsection. It is necessary that the defendant bears the evidential burden in this subsection in order to achieve the legitimate objective of ensuring the objects of the Act are met. This reversal of burden has been introduced because the defendant will have the information or knowledge that is evidence of the exception (that is, that they were authorised by law to undertake the conduct). 50

Offences relating to dealing with examinable food (new section 9 of the Act) New section 9 of the Act will continue to relate to offences for dealing with examinable food, and will preserve the effect of the offences provided for by current subsections 9(1), (1A) and (2) of the Act. Those offences relate to dealing with food where a food control certificate has not been issued, an imported food inspection advice has not been issued, and for failing food. New subsection 9(1) of the Act preserves the effect of current subsection 9(1) of the Act, and relates to a person dealing with food where no food control certificate has been issued for an examinable food that has been imported into Australia. Item 23 aims to modernise drafting terminology to assist readers. The penalty prescribed by new subsection 9(1) of the Act is 10 years imprisonment, which is proportionate to the offence and is necessary to achieve the legitimate objective of deterring unauthorised dealing with food and the serious risk it may pose to human health. New subsection 9(2) of the Act establishes a strict liability offence for conduct in relation to a person dealing with food where no food control certificate has been issued for an examinable food that has been imported into Australia. The strict liability offence, and its corresponding penalty of 60 penalty units, is necessary to achieve the legitimate objective of deterring unauthorised dealing with food and the serious risk it may pose to human health. New subsection 9(3) of the Act preserves the effect of current subsection 9(1A) of the Act, and relates to a person dealing with food where a food control certificate has been issued and where no imported food inspection advice has been issue for an examinable food that has been imported into Australia. Item 23 aims to modernise drafting terminology to assist readers. The penalty prescribed by new subsection 9(3) of the Act is 10 years imprisonment, which is proportionate to the offence and is necessary to achieve the legitimate objective of deterring unauthorised dealing with food and the serious risk it may pose to human health. New subsection 9(4) of the Act establishes a strict liability offence for conduct in relation to a person dealing with food where a food control certificate has been issued and where no imported food inspection advice has been issue for an examinable food that has been imported into Australia. The strict liability offence, and its corresponding penalty of 60 penalty units, is necessary to achieve the legitimate objective of deterring unauthorised dealing with food and the serious risk it may pose to human health. New subsection 9(5) of the Act provides an exception for dealing with food where no food inspection advice has been issued, which is additional to the defence of honest and reasonable mistake of fact that is available under section 9.2 of the Criminal Code. The exception states that new subsections 9(3) and (4) of the Act do not apply to a dealing with food for the purpose of altering or replacing the label on the package containing food in order to meet applicable standards relating to information for packages containing food. 51

Item 23 also inserts a note to new subsection 9(5) of the Act, which provides that the evidential burden is placed upon the defendant in relation to matters in this subsection. It is necessary that the defendant bears the evidential burden in this subsection in order to achieve the legitimate objective of ensuring the objects of the Act are met. This reversal of burden has been introduced because the defendant will have the information or knowledge that is evidence of the exception (that they were authorised by law to undertake the conduct). New subsection 9(6) of the Act preserves the effect of current subsection 9(2) of the Act, and relates to a person dealing with examinable imported food that has been identified as failing food in an imported food inspection advice. Item 23 aims to modernise drafting terminology to assist readers. The penalty prescribed by new subsection 9(3) of the Act is 10 years imprisonment, and is proportionate to the offence and is necessary to achieve the legitimate objective of deterring unauthorised dealing with food and serious risk it may pose to human health. New subsection 9(7) of the Act establishes a strict liability offence in relation to a person dealing with examinable imported food that has been identified as failing food in an imported food inspection advice. The strict liability offence, and its corresponding penalty of 60 penalty units, is necessary to achieve the legitimate objective of deterring unauthorised dealing with food and the serious risk it may pose to human health. New subsection 9(8) of the Act establishes imputed knowledge in relation to a contravention of new subsections 9(1), (3) or (6) of the Act, which gives consideration to the abilities, experience, qualifications and other attributes of the contravening person, as well as the circumstances surrounding the alleged contravention. This means that a court must consider all relevant factors when determining the culpability of a person who imported food into Australia where that person ought to reasonably have known their conduct would contravene a provision of the Act. This provision seeks to set the expectations of a person importing food into Australia, and encourage persons to undertake due diligence in ensuring the food they import does not pose a risk to human health. Item 24 Before section 10 Item 24 inserts new section 9A of the Act, which establishes civil penalties provisions in relation to importing, labelling and dealing with food. Civil penalties provisions have been introduced as one component of differentiated enforcement provisions, which give greater flexibility and more opportunity to encourage non-compliant food importers to become compliant, are consistent with Australia's domestic and international obligations, and are necessary and proportionate to achieving the objective of protecting human health. Civil penalty orders are intended to be imposed in circumstances where a person has committed a significant or serious breach, or multiple breaches of compliance where the use of strict liability offences has been ineffective in encouraging a food importer to become compliant. In addition, the penalty of 120 penalty units has been applied to provide necessary and proportionate deterrence to this conduct. Each proposed civil penalty provision in new subsections 9A(1), (2), (3), (5), (6) and (8) of the Act will be subject to a pecuniary penalty of 120 penalty units. As item 25 of the Bill applies the standard provisions of Part 4 of the Regulatory Powers Act, the proposed 52

provisions will attract the corporate multiplier provision in subsection 82(5) of the Regulatory Powers Act. This means that an individual who contravenes new subsection 9A(1), (2), (3), (5), (6) or (8) of the Act will be subject to a pecuniary penalty of 120 penalty units, and bodies corporate that contravene new subsection 9A(1), (2), (3), (5), (6) or (8) of the Act will be subject to a pecuniary penalty of 600 penalty units. Subsection 82(5) of the Regulatory Powers Act provides that, where the person is not a body corporate, a pecuniary penalty must not be more than the penalty specified for the civil penalty provision. If the person is a body corporate, the pecuniary penalty must not be more than five times the pecuniary penalty specified for the civil penalty provision. The prescribed penalties for civil penalty provisions under new section 9A of the Act (that is, 120 penalty units for individuals and 600 penalty units for bodies corporate) are reflective of the seriousness of the conduct and the risk contravening behaviour may pose to human health. The proposed penalties are also consistent with other penalties for similar conduct provisions across the Commonwealth statute book. Delegated offence content in item 24 relates to the application of applicable standards. Applicable standards are legislative instruments made under the Food Standards Australia New Zealand Act. Delegated offence content is necessary and reasonable as the standards are technical in nature, can be subject to frequent change, are made publicly available, and are developed with formal public consultation. New subsection 9A(1) of the Act establishes a civil penalty provision for conduct in relation to a person who imports food that does not meet applicable standards (excluding standards that relate to information on labels for packages containing food). The civil penalty provision, and its corresponding penalty of 120 penalty units, is necessary to achieve the legitimate objective of deterring conduct involving importation of food that does not meet applicable standards, and the penalty is reflective of the seriousness of the offence and the significant risk posed to human health. New subsection 9A(2) of the Act establishes a civil penalty provision for conduct in relation to a person who imports food that poses a risk to human health. The civil penalty provision, and its corresponding penalty of 120 penalty units, is necessary to achieve the legitimate objective of deterring conduct involving importation of food that poses a risk to human health, and the penalty is reflective of the seriousness of the offences and the significant risk posed to human health. New subsection 9A(3) of the Act establishes a civil penalty provision for conduct in relation to a person dealing with imported food that does not meet applicable standards relating to information on labels for packages containing food. The civil penalty provision, and its corresponding penalty of 120 penalty units, is necessary to achieve the legitimate objective of deterring this conduct. This is necessary as consumers rely upon labelling for assurance of the contents of the food and incorrect labelling can result in serious health issues, and occasionally death for undeclared allergens. New subsection 9A(4) of the Act provides an exception to new subsection 9A(3) of the Act that is additional to the defence of honest and reasonable mistake of fact, which is available under section 9.2 of the Criminal Code. The exception states that the section does not apply to a dealing with food for the purpose of altering or replacing the label on the package containing food in order to meet applicable standards relating to information on labels for packages containing food. 53

Item 24 also inserts a note to new subsection 9A(4) of the Act, which provides that the evidential burden is placed upon the defendant in relation to matters in this subsection. It is necessary that the defendant bears the evidential burden in this subsection in order to achieve the legitimate objective of ensuring the objects of the Act are met. This reversal of burden has been introduced because the defendant will have the information or knowledge that is evidence of the exception (that they were authorised by law to undertake the conduct). New subsection 9A(5) of the Act establishes a civil penalty provision for conduct in relation to a person dealing with food where no food control certificate has been issued for an examinable food that has been imported into Australia. The civil penalty provision, and its corresponding penalty of 120 penalty units, is necessary to achieve the legitimate objective of deterring unauthorised dealing with food and the serious risk it may pose to human health. New subsection 9A(6) of the Act establishes a civil penalty provision for conduct in relation to a person dealing with food where a food control certificate has been issued and where no imported food inspection advice has been issue for an examinable food that has been imported into Australia. The civil penalty provision, and its corresponding penalty of 120 penalty units, is necessary to achieve the legitimate objective of deterring unauthorised dealing with food and the serious risk it may pose to human health. New subsection 9A(7) of the Act provides an exception to new subsection 9A(6) of the Act that is additional to the defence of honest and reasonable mistake of fact, which is available under section 9.2 of the Criminal Code. The exception states that the section does not apply to a dealing with food for the purpose of altering or replacing the label on the package containing food in order to meet applicable standards relating to information on labels for packages containing food. Item 24 also inserts a note to new subsection 9A(7) of the Act, which provides that the evidential burden is placed upon the defendant in relation to matters in this subsection. It is necessary that the defendant bears the evidential burden in this subsection in order to achieve the legitimate objective of ensuring the objects of the Act are met. This reversal of burden has been introduced because the defendant will have the information or knowledge that is evidence of the exception (that they were authorised by law to undertake the conduct). New subsection 9A(8) of the Act establishes a civil penalty provision for conduct in relation to a person dealing with examinable imported food that has been identified as failing food in an imported food inspection advice. The civil penalty provision, and its corresponding penalty of 120 penalty units, is necessary to achieve the legitimate objective of deterring unauthorised dealing with food and the serious risk it may pose to human health. Item 25 Sections 21 to 32 Item 25 repeals current sections 21, 22, 23, 24, 25, 26, 27, 28, 29, 30, 31 and 32 of the Act, and substitutes new sections 21, 22, 23, 24, 25 and 26 of the Act. This item applies the provisions of Parts 2, 3, 4, 5 and 6 of the Regulatory Powers Act for the use of monitoring powers, investigation powers, civil penalty provisions, infringement notices and enforceable undertakings. Current Part 3 of the Act provides for provisions in relation to enforcement powers, and includes current sections 21, 22, 23, 24, 25, 26, 27, 28, 29, 30, 31 and 32 of the Act. Those sections are no longer necessary, as item 25 amends the Act to apply the standard provisions of Parts 2, 3, 4, 5 and 6 of the Regulatory Powers Act. 54

Introduction Current section 21 of the Act provides for definitions and general powers relevant to the interpretation of current Part 3 of the Act. New Division 1 of Part 3 to the Act, which includes new section 21 of the Act, provides for a simplified outline of amended Part 3 of the Act. The new simplified outline summarises amended Part 3 of the Act and uses the same terminology as the Regulatory Powers Act. New section 21 of the Act is included to assist the reader. New section 21 of the Act is consequential to the amendments to current Part 3 of the Act made by item 25. Monitoring Current sections 23, 24, 30, 31 and 32 of the Act provides for provisions in relation to monitoring powers. Those sections are no longer necessary, as item 25 amends the Act to apply the standard provisions pertaining to monitoring powers in the Regulatory Powers Act. New Division 2 of Part 3 of the Act directs the reader to Part 2 of the Regulatory Powers Act, which creates a framework for monitoring whether provisions of an Act have been, or are being, complied with, and whether information given in compliance, or purported compliance, with a provision of an Act is correct (see the note to new subsection 22(1) of the Act). New section 22 of the Act outlines matters in relation to provisions subject to monitoring, related provisions, the authorised applicant, the authorised person, the issuing officer, the relevant chief executive, the relevant court, the power to take and keep samples, persons assisting, use of force in executing a warrant and the extension of matters to external Territories. New subsection 22(1) of the Act states that a provision is subject to monitoring under Part 2 of the Regulatory Powers Act if it is a provision of that Act. New subsection 22(1) of the Act ensures that Part 2 of the Regulatory Powers Act operates for the purposes of the provisions specified in that subsection. Item 25 also inserts a note at the end new subsection 22(1) of the Act, which directs the reader to Part 2 of the Regulatory Powers Act. New subsection 22(2) of the Act provides that despite section 8 of the Regulatory Powers Act, compliance agreements are subject to monitoring under Part 2 of the Regulatory Powers Act. This modification enables monitoring powers under the Regulatory Powers Act to be used in relation to compliance agreements, and replaces powers under current subsection 23(1) of the Act. New subsection 22(3) of the Act states that information given in compliance or purported compliance with a provision of the Act is subject to monitoring under Part 2 of the Regulatory Powers Act. New subsection 22(3) of the Act ensures that Part 2 of the Regulatory Powers Act operates for the purposes of all provisions of the Act and, where applicable, offences against the Crimes Act or the Criminal Code that relate to the Act. Item 25 also inserts a note at the end new subsection 22(3) of the Act, which directs the reader to Part 2 of the Regulatory Powers Act. 55

New subsection 22(4) of the Act states that there are no related provisions for the purposes of Part 2 of the Regulatory Powers Act, as that Part applies to the provisions identified in new subsections 22(1) and (2) of the Act and information mentioned in new subsection 22(3) of the Act. This new subsection reflects existing arrangements under the Act in relation to monitoring powers. New subsection 22(5) of the Act identifies an authorised officer as an authorised applicant and authorised person for the purposes of Part 2 of the Regulatory Powers Act, as that Part applies to the provisions identified in new subsections 22(1) and (2) of the Act and information mentioned in new subsection 22(3) of the Act. New subsection 22(6) of the Act provides exceptions to the powers granted to an authorised officer appointed under subsection 40(2) of the Act. New subsection 22(6) of the Act states that an authorised officer is not an authorised applicant or authorised person for the purposes of section 24 or 32 of the Regulatory Powers Act, as that section applies in relation to the provisions mentioned in new subsections 22(1) and (2) of the Act and information mentioned in new subsection 22(3) of the Act. This ensures powers remain consistent with the text omitted by item 21 above. New subsection 22(7) of the Act provides that a magistrate is an issuing officer for the purposes of Part 2 of the Regulatory Powers Act, as that Part applies to the provisions identified in new subsections 22(1) and (2) of the Act and information mentioned in new subsection 22(3) of the Act. New subsection 22(8) of the Act identifies the Secretary as the relevant chief executive for the purposes of Part 2 of the Regulatory Powers Act, as that Part applies to the provisions identified in new subsections 22(1) and (2) of the Act and information mentioned in new subsection 22(3) of the Act. New subsection 22(9) of the Act provides that the Secretary, as the relevant chief executive under Part 2 of the Regulatory Powers Act, as that Part applies to the provisions identified in new subsections 22(1) and (2) of the Act and information mentioned in new subsection 22(3) of the Act may, in writing, delegate his or her powers and functions to an SES employee, or acting SES employee, in the Department. New subsection 22(9) of the Act reflects existing arrangements under the Act (see current section 41 of the Act). New subsection 22(10) of the Act provides that a person exercising powers or performing functions under a delegation under new subsection 22(9) of the Act must comply with any directions of the Secretary. New subsection 22(11) of the Act identifies the following courts as a relevant court in relation to provisions mentioned in new subsections 22(1) and (2) of the Act and information mentioned in new subsection 22(3) of the Act: (a) the Federal Court of Australia (b) the Federal Circuit Court of Australia (c) a court of a State or Territory that has jurisdiction in relation to matters arising under the Act. It is appropriate to afford jurisdiction to the courts identified in new subsection 22(11) of the Act, as jurisdiction should be conferred as widely as possible to ensure that disputes can 56

be resolved in the lowest level of court appropriate, and that workload is distributed between courts to encourage efficiency in dealing with related matters. New subsections 22(12) and (13) of the Act provide for additional monitoring powers to apply, beyond those provided for under Part 2 of the Regulatory Powers Act, being the power to sample and keep any thing that relates to a provision mentioned in new subsections 22(1) or (2) of the Act and information mentioned in new subsection 22(3) of the Act that is found on premises entered under a monitoring warrant or with appropriate consent under Part 2 of the Regulatory Powers Act. The power to sample and keep any thing may include things such as food or things that may relate to the safety of food. This additional monitoring power is necessary to ensure that authorised officers have appropriate tools to monitor imported food safety risks and take into consideration the special requirements that may be needed by officers to effectively monitor imported food safety risks. New subsection 22(14) of the Act provides that an authorised officer may be assisted by other persons in exercising powers or performing functions or duties under Part 2 of the Regulatory Powers Act, as that Part applies to the provisions identified in new subsections 22(1) and (2) of the Act and information mentioned in new subsection 22(3) of the Act. New subsection 22(14) of the Act preserves the effect of current section 32 of the Act, which is repealed by item 25. New subsection 22(15) of the Act modifies the operation of Part 2 of the Regulatory Powers Act, and provides that, in executing a monitoring warrant under that Part, as that Part applies to the provisions identified in new subsections 22(1) and (2) of the Act and information mentioned in new subsection 22(3) of the Act, an authorised officer or person assisting an authorised officer may use such force against things as is necessary and reasonable in the circumstances. New subsection 22(15) of the Act ensures authorised persons have the capability to successfully monitor imported food safety risks and to help prevent imported food safety risks entering into Australia. This subsection does not authorise the use of force against a person. This is to ensure protection of individuals and to clarify that physical force cannot be used in the exercise of powers authorised by a warrant. Section 31 of the Regulatory Powers Act places an obligation on the occupier of premises, or another person who apparently represents the occupier, to provide reasonable facilities and assistance to the authorised person, and any person assisting, which is necessary for the authorised person to effectively exercise their powers under Part 2 of the Regulatory Powers Act, for the purposes of executing a monitoring warrant. Subsection 31(2) of the Regulatory Powers Act provides that failure to comply with section 31 of that Act is an offence, and carries a penalty of 30 penalty units. Despite this obligation, and its corresponding penalty for non-compliance, an occupier or other person may continue to refuse access to locked premises or objects. It is necessary to retain the power to use force against things to ensure that the execution of a monitoring warrant is not frustrated, and prevent concealment, loss, destruction, use or continuation of use of information or things in the course of non-compliance with the Act (see new subsections 22(1), (2) and (3) of the Act). New subsection 22(16) of the Act extends the application of Part 2 of the Regulatory Powers Act, as that Part applies to the provisions identified in new subsections 22(1) and (2) of the Act and information mentioned in new subsection 22(3) of the Act, to every external Territory to which the Act extends because of regulations made for the purpose of section 4 of the Act. Current section 4 of the Act provides that the Act does not extend to the Territories of 57

Christmas Island and Cocos (Keeling) Islands, or to Norfolk Island, unless regulations provide that the Act is to extend to that Territory. New subsection 22(16) of the Act reflects existing arrangements under the Act. Investigation Current sections 25, 26, 27, 28, 29, 30, 31 and 32 of the Act provide for provisions in relation to investigation powers. Those sections are no longer necessary, as item 25 amends the Act to apply the standard provisions pertaining to investigation powers in the Regulatory Powers Act. New Division 3 of Part 3 of the Act directs the reader to Part 3 of the Regulatory Powers Act, which creates a framework for gathering material that relates to the contravention of offence and civil penalty provisions (see the note to new subsection 23(1) of the Act). New section 23 of the Act outlines matters in relation to provisions subject to investigation, related provisions, the authorised applicant, the authorised person, the issuing officer, the relevant chief executive, the relevant court, the power to take and keep samples, persons assisting, use of force in executing a warrant and the extension of matters to external Territories. New subsection 23(1) of the Act states that a provision is subject to investigation under Part 3 of the Regulatory Powers Act if it is: (a) an offence against the Act; or (b) a civil penalty provision of the Act; or (c) an offence against the Crimes Act or the Criminal Code that relates to the Act. New subsection 23(1) of the Act ensures that Part 3 of the Regulatory Powers Act operates for the purposes of the provisions specified in that subsection. Item 25 also inserts a note at the end of new subsection 23(1) of the Act, which directs the reader to Part 3 of the Regulatory Powers Act. New subsection 23(2) of the Act states that there are no related provisions for the purposes of Part 3 of the Regulatory Powers Act, as that Part applies to the provisions identified in new subsection 23(1) of the Act. This new subsection reflects existing arrangements under the Act in relation to investigation powers. New subsection 23(3) of the Act states that the authorised officers identified in new paragraphs 23(3)(a) and (3)(b) of the Act as the authorised applicant and the authorised person for the purposes of Part 3 of the Regulatory Powers Act, as that Part applies to the provisions identified in new subsection 23(1) of the Act. New subsection 23(3) of the Act will enable authorised officers identified in new paragraphs 23(3)(a) and (3)(b) of the Act to apply to an issuing officer for an investigation warrant in relation to premises. Those provisions will also enable these officers to enter any premises and exercise investigation powers where the officer suspects on reasonable grounds that there may be material on the premises related to the contravention of a provision identified in new subsection 23(1) of the Act. However, an officer identified in new paragraphs 23(3)(a) and (3)(b) may not enter the premises unless the occupier has provided consent or the officer is in possession of an investigation warrant. New subsection 23(3) of the Act reflects existing arrangements under the Act (see current sections 25 and 26 of the Act). 58

New subsection 23(4) of the Act provides that a magistrate is an issuing officer for the purposes of Part 3 of the Regulatory Powers Act, as that Part applies to the provisions identified in new subsection 23(1) of the Act. New subsection 23(5) of the Act identifies the Secretary as the relevant chief executive for the purposes of Part 3 of the Regulatory Powers Act, as that Part applies to the provisions identified in new subsection 23(1) of the Act. New subsection 23(6) of the Act provides that the Secretary, as the relevant chief executive under Part 3 of the Regulatory Powers Act, as that Part applies to the provisions identified in new subsection 23(1) of the Act may, in writing, delegate his or her powers and functions to an SES employee, or acting SES employee, in the Department. New subsection 23(6) of the Act reflects existing arrangements under the Act (see current section 41 of the Act). New subsection 23(7) of the Act provides that a person exercising powers or performing functions under a delegation under new subsection 23(6) of the Act must comply with any directions of the Secretary. New subsection 23(8) of the Act identifies the following courts as a relevant court in relation to provisions mentioned in new subsection 23(1) of the Act: (a) the Federal Court of Australia (b) the Federal Circuit Court of Australia (c) a court of a State or Territory that has jurisdiction in relation to matters arising under the Act. It is appropriate to afford jurisdiction to the courts identified in new subsection 23(8) of the Act, as jurisdiction should be conferred as widely as possible to ensure that disputes can be resolved in the lowest level of court appropriate, and that workload is distributed between courts to encourage efficiency in dealing with related matters. New subsections 23(9) and (10) of the Act provide for additional investigation powers to apply, beyond those provided for under Part 3 of the Regulatory Powers Act, being the power to sample and keep any thing that relates to a provision mentioned in new subsection 23(1) of the Act that is found on premises entered under an investigation warrant or with appropriate consent under Part 3 of the Regulatory Powers Act. This additional investigation power is necessary to ensure that authorised officers have appropriate tools to investigate imported food safety risks, and takes into consideration the special requirements that may be needed by officers to effectively investigate imported food safety risks. New subsection 23(11) of the Act provides that an authorised officer may be assisted by other persons in exercising powers or performing functions or duties under Part 3 of the Regulatory Powers Act, as that Part applies to the provisions identified in new subsection 23(1) of the Act. New subsection 23(11) of the Act preserves the effect of current section 32 of the Act, which is repealed by item 25. New subsection 23(12) of the Act modifies the operation of Part 3 of the Regulatory Powers Act, and provides that, in executing a investigation warrant under that Part, as that Part applies to the provisions identified in new subsection 23(1) of the Act, an authorised officer or person assisting an authorised officer may use such force against things as is 59

necessary and reasonable in the circumstances. New subsection 23(12) of the Act ensures authorised persons have the capability to successfully investigate imported food safety risks. This subsection does not authorise the use of force against a person. This is to ensure protection of individuals and to clarify that physical force cannot be used in the exercise of powers authorised by a warrant. Section 63 of the Regulatory Powers Act places an obligation on the occupier of premises, or another person who apparently represents the occupier, to provide reasonable facilities and assistance to the authorised person, and any person assisting, which is necessary for the authorised person to effectively exercise their powers under Part 3 of the Regulatory Powers Act, for the purposes of executing a investigation warrant. Subsection 63(2) of the Regulatory Powers Act provides that failure to comply with section 63 of that Act is an offence, and carries a penalty of 30 penalty units. Despite this obligation, and its corresponding penalty for non-compliance, an occupier or other person may continue to refuse access to locked premises or objects. It is necessary to retain the power to use force against things to ensure that the execution of a investigation warrant is not frustrated, and prevent concealment, loss, destruction, use or continuation of use of information or things in the course of contravening a provision identified in new subsection 23(1) of the Act. New subsection 23(13) of the Act extends the application of Part 3 of the Regulatory Powers Act, as that Part applies to the provisions identified in new subsection 23(1) of the Act, to every external Territory to which the Act extends because of regulations made for the purpose of section 4 of the Act. Current section 4 of the Act provides that the Act does not extend to the Territories of Christmas Island and Cocos (Keeling) Islands, or to Norfolk Island, unless regulations provide that the Act is to extend to that Territory. New subsection 23(13) of the Act reflects existing arrangements under the Act. Civil penalties The Act does not currently provide for civil penalty provisions. Civil penalties provisions have been introduced as one component of differentiated enforcement provisions, which gives greater flexibility and more opportunity to encourage non-compliant food importers to become compliant, are consistent with Australia's domestic and international obligations, and are necessary and proportionate to achieving the objective of protecting human health. Civil penalty orders are intended to be imposed in circumstances where a person has committed a significant or serious breach, or multiple breaches of compliance where the use of strict liability offences has been ineffective in encouraging a food importer to become compliant. New Division 4 of Part 3 of the Act directs the reader to Part 4 of the Regulatory Powers Act, which provides for provisions in relation to civil penalty orders (see the note to new subsection 24(1) of the Act). New section 24 of the Act outlines matters in relation to enforceable provisions, the authorised applicant, the relevant court, the extension of matters to external Territories, and the liability of the Crown. New subsection 24(1) of the Act states that each civil penalty provision of the Act is enforceable under Part 4 of the Regulatory Powers Act, which ensures that Part 4 of the Regulatory Powers Act operates for the purposes of all civil penalty provisions in the Act. Item 25 also inserts a note at the end of new subsection 24(1) of the Act, which directs the reader to Part 4 of the Regulatory Powers Act. 60

New subsection 24(2) of the Act identifies the Secretary as the authorised applicant in relation to the civil penalty provisions of the Act. This will enable the Secretary to seek an order from a relevant court that a person, who is alleged to have contravened a civil penalty provision, must pay the Commonwealth a pecuniary penalty (that is, a 'civil penalty order'). New subsection 24(3) of the Act identifies the following courts as a relevant court in relation to civil penalty provisions in the Act: (a) the Federal Court of Australia (b) the Federal Circuit Court of Australia (c) a court of a State or Territory that has jurisdiction in relation to matters arising under the Act. It is appropriate to afford jurisdiction to the courts identified in new subsection 24(3) of the Act, as jurisdiction should be conferred as widely as possible to ensure that disputes can be resolved in the lowest level of court appropriate, and that workload is distributed between courts to encourage efficiency in dealing with related matters. New subsection 24(4) of the Act extends the application of Part 4 of the Regulatory Powers Act, as that Part applies in relation to the civil penalty provisions in the Act, to every external Territory to which the Act extends because of regulations made for the purpose of section 4 of the Act. Current section 4 of the Act provides that the Act does not extend to the Territories of Christmas Island and Cocos (Keeling) Islands, or to Norfolk Island, unless regulations provide that the Act is to extend to that Territory. New subsection 24(4) of the Act reflects existing arrangements under the Act. New subsection 24(5) of the Act states that Part 4 of the Regulatory Powers Act, as that Part applies in relation to the civil penalty provisions of the Act, does not make the Crown liable to be subject to civil proceedings for a contravention of a civil penalty provision. Infringement notices The Act does not currently provide for the use of infringement notices. New section 25 of the Act applies the standard provisions of Part 5 of the Regulatory Powers Act to certain provisions of the Act in order to create a framework for using infringement notices in relation to provisions of the Act. Infringement notices have been introduced as one component of differentiated enforcement provisions, which gives greater flexibility and more opportunity to encourage non-compliant food importers to become compliant, are consistent with Australia's domestic and international obligations, and are necessary and proportionate to achieving the objective of protecting human health. New section 25 of the Act directs the reader to Part 5 of the Regulatory Powers Act, which provides for provisions in relation to infringement notices (see the note to new subsection 25(1) of the Act), being a strict liability offence against the Act, or a civil penalty provision of the Act. Consistent with the Guide to Framing Commonwealth Offences, infringement notices will be used to deal with less serious and less factually complex contraventions of a provision, where initiating court proceedings would be disproportionately costly (see Chapter 6 of that Guide). New section 25 of the Act outlines matters in relation to enforceable provisions, the infringement officer, the relevant chief executive, the extension of matters to external Territories, and the liability of the Crown. 61

New subsection 25(1) of the Act states that a strict liability offence or civil penalty provision of the Act is subject to an infringement notice under Part 5 of the Regulatory Powers Act, which ensures that Part 5 of the Regulatory Powers Act operates for the purposes of the strict liability offences and civil penalty provisions of the Act. Item 25 also inserts a note at the end of new subsection 25(1) of the Act, which directs the reader to Part 5 of the Regulatory Powers Act. New subsection 25(2) of the Act provides that the authorised officers identified in new paragraphs 25(2)(a) and (2)(b) of the Act are infringement officers for the purposes of Part 5 of the Regulatory Powers Act, as that Part applies to the strict liability offences and civil penalty provisions of the Act. This new subsection will enable an authorised officer identified in new paragraphs 25(2)(a) and (2)(b) of the Act to issue an infringement notice to a person if they reasonably believe that person has contravened a strict liability offence or civil penalty provision of the Act. If the person pays the amount stated in the infringement notice within 28 days (or other period if extended by the relevant chief executive), any liability of the person for the alleged contravention is discharged. If the person chooses not to pay the amount that is payable under the infringement notice within 28 days (or other extended period), and the provision is a strict liability offence, the person may be prosecuted in a court for the alleged contravention. If the person chooses not to pay the amount that is payable under the infringement notice within 28 days (or other extended period), and the provisions is a civil penalty provision, proceedings seeking a civil penalty order under Part 4 of the Regulatory Powers Act may be brought against the person. New subsection 25(3) of the Act identifies the Secretary as the relevant chief executive for the purposes of Part 5 of the Regulatory Powers Act, as that Part applies to the provisions identified in new subsection 25(1) of the Act. New subsection 25(4) of the Act provides that the Secretary, as the relevant chief executive under Part 5 of the Regulatory Powers Act, as that Part applies to the provisions identified in new subsection 25(1) of the Act may, in writing, delegate his or her powers and functions to an SES employee, or acting SES employee, in the Department. New subsection 25(4) of the Act reflects existing arrangements under the Act (see current section 41 of the Act). New subsection 25(5) of the Act provides that a person exercising powers or performing functions under a delegation under new subsection 25(4) of the Act must comply with any directions of the Secretary. New subsection 25(6) of the Act extends the application of Part 5 of the Regulatory Powers Act, as that Part applies to the provisions identified in new subsection 25(1) of the Act, to every external Territory to which the Act extends because of regulations made for the purpose of section 4 of the Act. Current section 4 of the Act provides that the Act does not extend to the Territories of Christmas Island and Cocos (Keeling) Islands, or to Norfolk Island, unless regulations provide that the Act is to extend to that Territory. New subsection 25(6) of the Act reflects existing arrangements under the Act. New subsection 25(7) of the Act states that Part 5 of the Regulatory Powers Act, as that Part applies in relation to provisions mentioned in new subsection 25(1) of the Act, does not make the Crown liable to be given an infringement notice. 62

Enforceable Undertakings The Act does not currently provide a framework for enforceable undertakings. New section 26 of the Act applies the standard provisions of Part 6 of the Regulatory Powers Act to certain provisions of the Act in order to create a framework for accepting and enforcing undertakings relating to compliance with provisions of the Act. It is necessary to enable the regulator to accept and enforce undertakings relating to compliance with provisions of the Act in order to ensure a non-compliant party undertakes steps to correct non-compliant behaviour under a legally enforceable agreement, and without the need to bring the matter before the court in the first instance. New section 26 of the Act directs the reader to Part 6 of the Regulatory Powers Act, which provides for provisions in relation to enforceable undertakings (see the note to new section 26(1) of the Act). New section 26 of the Act outlines matters in relation to enforceable provisions, the authorised person, relevant courts and the extension of matters to external Territories. New subsection 26(1) of the Act provides that a provision is enforceable under Part 6 of the Regulatory Powers Act if it is an offence against the Act or a civil penalty provision of the Act. Subsection 3(1) of the Act defines the phrase this Act to include regulations and orders made under the Act. New subsection 26(1) of the Act ensures that Part 6 of the Regulatory Powers Act operates for the purposes of the provisions specified in that subsection. Item 25 also inserts a note at the end of new subsection 26(1) of the Act to direct the reader to Part 6 of the Regulatory Powers Act, which creates a framework for accepting and enforcing undertakings relating to compliance with provisions of an Act that applies Part 6 of the Regulatory Powers Act. New subsection 26(2) of the Act identifies the Secretary as an authorised person in relation to the offence and civil penalty provisions of the Act identified in new subsection 26(1) of the Act. This will enable the Secretary to accept and enforce undertakings relating to compliance with the offence and civil penalty provisions of the Act identified in new subsection 26(1) of the Act. Under current section 41 of the Act, the Secretary will be able to delegate his or her powers and functions as an authorised person under Part 6 of the Regulatory Powers Act, as that Part of that Act applies to the offence and civil penalty provisions of the Act identified in new subsection 26(1) of the Act, to:  a Senior Executive Service employee, or acting Senior Executive Service employee, in the Department, or  an Australian Public Service employee who holds or performs the duties of an Executive Level 1 or 2 position, or an equivalent position in the Department. New subsection 26(3) of the Act identifies the following courts as a relevant court in relation to the offence and civil penalty provisions of the Act identified in new subsection 26(1) of the Act: (a) the Federal Court of Australia 63

(b) the Federal Circuit Court of Australia (c) a court of a State or Territory that has jurisdiction in relation to matters arising under the Act. It is appropriate to afford jurisdiction to the courts identified in new subsection 26(3) of the Act, as jurisdiction should be conferred as widely as possible to ensure that disputes can be resolved in the lowest level of court appropriate, and that workload is distributed between courts to encourage efficiency in dealing with related matters. New subsection 26(4) of the Act extends the application of Part 6 of the Regulatory Powers Act, as that Part applies to the offence and civil penalty provisions of the Act identified in new subsection 26(1) of the Act, to any external Territory to which the Act extends due to regulations made for the purpose of current section 4 of the Act. Current section 4 of the Act provides that the Act does not extend to the Territories of Christmas Island and Cocos (Keeling) Islands, or to Norfolk Island, unless regulations provide that the Act is to extend to that Territory. New subsection 26(4) of the Act reflects existing arrangements under the Act. Item 26 Before section 33 Item 26 inserts a new heading for Part 4 of the Act as well as a new section, section 32A of the Act. The original heading for Part 4 of the Act, Part 4--Miscellaneous, is repealed by item 29 below. The new heading, Part 4--Other matters, assists the reader to understand the content of Part 4 of the Act. The insertion of the simplified outline by new section 32A of the Act provides an overview of each section of Part 4 of the Act. Currently, Part 4 of the Act deals with various matters, including evidence of analysts of food, the making of compliance agreements and the use, disclosure and publication of information obtained under the Act. The simplified outline is intended to assist the reader to understand the Part, and is consistent with the insertion of simplified outlines by items 26 (in relation to current Part 4 of the Act), 37 (in relation to new Part 3A of the Act) and 49 (in relation to current Part 2 of the Act) below. Item 27 After section 34 Item 27 inserts new section 34A of the Act, which provides the Secretary with the power to require a person to give information or provide documents if the Secretary believes on reasonable grounds the person has information or documents relevant to the operation of the Act. The Secretary, may by written notice, require the person to:  give an authorised officer the information required with a given time period, or  to produce to an authorised officer the documents required within a given time period. The period specified in the notice must be a minimum of 14 days after the notice is given, which provides the person with adequate time to give information or provide documents. This is the default period, unless the Secretary considers a shorter period is necessary as the information or documents relate to food which may pose a serious risk to human health. An authorised officer may inspect documents, and may make and retain copies of a part or the whole document. In addition, an authorised officer may take and retain possession of a document for as long as is reasonably necessary. In the event the person is otherwise entitled to possession of a document which they have produced, they are entitled to be provided with a copy of the document certified by the Secretary as soon as practicable. The certified copy of 64

the document must be received in all courts and tribunals as evidence as if it were the original. As the Secretary deems appropriate, and until the certified copy is provided, the person who provided the document, or a person authorised by that person, may be permitted to inspect and make copies of the document. In certain circumstances, it may be vital that the Secretary can quickly obtain information from individuals in order to prevent unsafe or unsuitable food from entering the domestic supply chain. Wherever possible, the regulator will rely on voluntary disclosure of this information; however, in some circumstances an individual may be unwilling to disclose the required information. In such cases, the need to address public risk will justify the requirement for individuals to answer questions and provide documents under new section 34A of the Act. A person who contravenes a requirement to provide information or documents commits an offence of strict liability. The penalty for contravention is 60 penalty units. In addition, sections 137.1 and 137.2 of the Criminal Code contain offences for providing false or misleading information or documents. Item 28 Section 35 (heading) Item 28 repeals and substitutes the heading for current section 35 of the Act, which provides a more explicit heading to the intent of the section. Item 29 Part 4 (heading) Item 29 repeals the heading to current Part 4 of the Act. The heading is substituted by item 26 above. Item 30 Subsection 40(2) Item 30 amends the requirements to appoint an authorised officer under current subsection 40(2) of the Act to omit "all the provisions of this Act other than sections 24, 25, 26, 27, 28, 29, 30 and 32". It is not necessary to substitute new text to replace the text to be omitted because new subsection 22(6) of the Act provides exceptions to the powers granted to an authorised officer appointed under current subsection 40(2) of the Act to ensure powers remain consistent with the text omitted by item 30. Item 30 is consequential to the amendments made by item 25 above, which repeals current sections 21, 22, 23, 24, 25, 26, 27, 28, 29, 30, 31 and 32 of the Act, and substitutes new sections 21, 22, 23, 24, 25 and 26 of the Act. Item 31 Application provisions--offences and civil penalties Item 31 provides that the repeal of current sections 8, 8A and 9 of the Act, and insertion of new sections 8, 8A and 9 of the Act by Part 5 of Schedule 1 to the Bill, apply in relation to food imported into Australia on or after the commencement of Part 5 of Schedule 1 to the Bill. Item 31 also provides that new section 9A of the Act applies in relation to food imported into Australia on or after the commencement of Part 5 of Schedule 1 to the Bill. Part 5 of Schedule 1 to the Bill commences on the 28th day after the Bill receives the Royal Assent. Item 31 preserves existing arrangements under the Act and ensures continuity in the enforcement of offences and civil penalty provisions. 65

Item 32 Saving provision--identity cards Item 32 provides that, despite the repeal of current section 22 of the Act by Part 5 of Schedule 1 to the Bill, that section, as in force immediately before the commencement of Part 5 of Schedule 1 to the Bill, continues to apply on and after that commencement in relation to a person who ceased to be an authorised officer before that commencement. Part 5 of Schedule 1 to the Bill commences on the 28th day after the Bill receives the Royal Assent. Item 32 preserves the effect of current section 22 of the Act, which provides that a person commits an offence punishable, on conviction, of a fine not exceeding 1 penalty unit, if that person ceases to be an authorised officer but does not return his or her identity card to the Secretary as soon as practicable after that cessation. Where a person ceases to be an authorised officer after the commencement of Part 5 of Schedule 1 to the Bill, sections 35 and 76 of the Regulatory Powers Act will apply to that person. Item 32 also ensures that valid identity cards in existence as at the commencement of Part 5 of Schedule 1 to the Bill will not automatically become invalid on the basis of form due to that commencement. Item 33 Application and saving provisions--monitoring and investigation Item 33 provides for the application of the amendments in Part 5 of Schedule 1 to the Bill in relation to monitoring and investigation powers, and makes it clear that the amendments apply in relation to:  determining compliance with a provision identified by new subsection 22(1) or (2) of the Act and the correctness of information mentioned in new subsection 22(3) of the Act before, on or after the commencement of Part 5 of Schedule 1 to the Bill, and  evidential material that relates to a provision identified by new subsection 23(1) of the Act, if the suspected contravention of the provision occurred before, on or after the commencement of Part 5 of Schedule 1 to the Bill. Item 33 provides clarity for an authorised officer exercising:  monitoring powers under Part 2 of the Regulatory Powers Act, as that Part applies to a provision identified by new subsection 22(1) or (2) of the Act and information mentioned in new subsection 22(3) of the Act, and  investigation powers under Part 3 of the Regulatory Powers Act, as that Part applies to the provisions identified in new subsection 23(1) of the Act. Item 33 will ensure that an authorised officer may exercise powers and functions under Parts 2 and 3 of the Regulatory Powers Act from the time of the commencement of Part 5 of Schedule 1 to the Bill, regardless of whether or not the non-compliance or the suspected contravention occurred before, on or after that commencement. Part 5 of Schedule 1 to the Bill commences on the 28th day after the Bill receives the Royal Assent. 66

With the exception of new subsection 22(3) of the Act, which provides for the ability to monitor information, Part 5 of Schedule 1 to the Bill does not expand the existing regulatory framework of the Act in relation to monitoring and investigation powers. Accordingly, the retrospective application provided for by item 33 does not impact upon the rights of, or impose liabilities on, a person who will be subject to the:  monitoring powers under Part 2 of the Regulatory Powers Act, as that Part applies to a provision identified by new subsection 22(1) or (2) of the Act, and  investigation powers under Part 3 of the Regulatory Powers Act, as that Part applies to the provisions identified in new subsection 23(1) of the Act. The application of monitoring powers to information given in compliance or purported compliance with a provision of the Act identified in new subsection 22(3) of the Act is important for the purposes of an effective monitoring scheme. It is necessary to extend current monitoring powers of the Act to information, as information is necessary for various provisions of the Act, and monitoring the correctness of that information upholds the objects of the Act. The ability to monitor the correctness of information given in compliance, or purported compliance, with a provision of the Act or the regulations made under the Act complements the existing monitoring powers framework of the Act. There is currently no equivalent to this provision in the Act. This item also provides that Part 3 of the Act, as in force immediately before the commencement of Part 5 of Schedule 1 to the Bill, continues to apply on and after that commencement in relation to: (a) an application for a warrant made, but not decided, under Part 3 of the Act before the commencement of Part 5 of Schedule 1 to the Bill; (b) a warrant issued, or completed and signed, under current Part 3 of the Act before, on or after the commencement of Part 5 of Schedule 1 to the Bill as a result of an application made before that commencement; (c) powers exercised, rights created and duties imposed, under Part 3 of the Act before, on or after the commencement of Part 5 of Schedule 1 to the Bill in relation to: (i) an entry onto premises before that commencement with the consent of the occupier of the premises; or (ii) an entry onto premises before, on or after that commencement as a result of a warrant issued, or completed and signed, under current Part 3 of the Act before, on or after the commencement of Part 5 of Schedule 1 to the Bill as a result of an application made before that commencement; (d) things secured or seized under current Part 3 of the Act before, on or after the commencement of Part 5 of Schedule 1 to the Bill; (e) a requirement made under current section 30 of the Act before, on or after the commencement of Part 5 of Schedule 1 to the Bill; (f) a request made under current section 32 of the Act before, on or after the commencement of Part 5 of Schedule 1 to the Bill. Item 34 Application provision--civil penalties Item 34 provides that Part 4 of the Regulatory Powers Act, as that Part applies under new Division 4 of Part 3 to the Act, applies in relation to contraventions of civil penalty provisions occurring on or after the contraventions of civil penalty provisions which occur on or after the commencement of Part 5 to the Bill. Part 5 of Schedule 1 to the Bill commences on the 28th day after the Bill receives the Royal Assent. 67

Item 35 Application provision--infringement notices Item 35 provides that Part 5 of the Regulatory Powers Act, as that Part applies under new Division 5 of Part 3 of the Act, applies in relation to alleged contraventions of provisions identified in new subsection 25(1) of the Act occurring on or after the commencement of Part 5 of Schedule 1 to the Bill. Part 5 of Schedule 1 to the Bill commences on the 28th day after the Bill receives the Royal Assent. Item 36 Application provision--enforceable undertakings Item 36 provides that Part 6 of the Regulatory Powers Act, as that Part applies under new Division 6 of Part 3 of the Act, applies in relation to undertakings given on or after the commencement of Part 5 of Schedule 1 to the Bill. Part 5 of Schedule 1 to the Bill commences on the 28th day after the Bill receives the Royal Assent. PART 6--RECORD-KEEPING Overview Part 6 of Schedule 1 to the Bill imposes preventative control measures to ensure that food is traceable and can be efficiently and effectively recalled. In addition, Part 6 of Schedule 1 to the Bill will improve consistency with domestic food safety legislation. The Bill will require that the owner of the imported food at the time of importation keep records containing information determined by the Secretary in order to maintain traceability of the food. New measures will enable the Secretary to request the production of records, as well as inspecting, copying and retaining records. To provide persons affected by the proposed amendments with an adequate opportunity to prepare, item 5 of the commencement information table in clause 2 of the Bill provides that Part 1 of Schedule 1 to the Bill commences on a single day to be fixed by Proclamation or, if Proclamation does not occur within 12 months after the Bill receives the Royal Assent, then Part 1 of Schedule 1 to the Bill will commence on the day after the end of the 12-month period. Item 37 After Part 3 Item 37 inserts new 'Part 3A--Record-keeping' of the Act, which introduces measures that will require that preventative controls are in place to ensure that food is traceable and can be recalled efficiently and effectively, by maintaining traceability of food to one step forward and one step backwards. In addition, consistency with domestic food safety legislation will be improved. New section 27 of the Act provides a simplified outline of new Part 3A of the Act. The simplified outline notes that new Part 3A of the Act provides requirements for retaining records in relation to the importation of food into Australia, including who must retain these records, how long they must be retained, and that they may be required to be produced to the Secretary. The insertion of a simplified outline is consistent with the insertion of simplified outlines by items 25 (in relation to current Part 3 of the Act) and 26 (in relation to current Part 4 of the Act) above, and item 49 (in relation to current Part 2 of the Act) below. New section 28 of the Act provides that records in relation to food imported into Australia must be retained for five years by the owner of the food at the time of the importation. 68

Requirements for which records must be retained are determined by the Secretary, by means of a legislative instrument. New section 28 of the Act creates an offence of strict liability, subject to a penalty of 60 penalty units, if that section requires a record to be retained and the owner of the food does not retain the record in accordance with that section. The proposed penalty is necessary and proportionate to the proscribed conduct, as records may be required during a food safety incident, and the consequences of not retaining the records may be severe. New section 29 of the Act provides that the Secretary may require a person to produce records required to be retained under new section 28 of the Act within 14 days of such a notice to produce. This allows an assessment of risk to be efficiently and effectively undertaken in circumstances where the Secretary is satisfied the records relate to food that may pose a serious risk to human health. New section 29 of the Act creates an offence, subject to imprisonment of six months, if that section requires a record to be produced and it is not produced in accordance with that section. The offence is intended to deter conduct where a person may fail to produce a required record which may prevent a serious risk to human health. In certain situations, such as those which apply to new section 29 of the Act, it may be vital that the Secretary can quickly obtain information from individuals in order to prevent unsafe or unsuitable food from entering the domestic supply chain. Wherever possible, the regulator will rely on voluntary disclosure of this information; however, in some circumstances an individual may be unwilling to disclose the required information. In such cases, the need to address public risk will justify the requirement for individuals to provide records under new section 29 of the Act. To ensure there is no arbitrary interference with an individual's privacy the power contained in new section 29 of the Act is required to be exercised in compliance with the Privacy Act, which provides protections on the collection, storage, use, disclosure or publication of personal information. New section 30 of the Act provides that the Secretary may inspect and retain copies of records produced under new Part 3A of the Act. This enables the Secretary to perform their duties under the Act. Subsequent to new section 30 of the Act, new section 31 of the Act provides that the Secretary may retain records for as long as reasonable. In addition, new section 31 of the Act outlines how a person, who would otherwise be entitled to the possession of the record, must be provided with a certified copy of the record (which must be received in all courts and tribunals as if it were an original), and may be permitted access to the record for the purpose of inspection and making copies. New section 32 of the Act provides that the privilege against self-incrimination is abrogated under new Part 3A of the Act, in relation to producing a record which may incriminate the person or expose the person to a penalty. New subsection 32(2) of the Act provides for appropriate limitations on the abrogation as the abrogation cannot be used against the person who made the disclosure either directly in court (use immunity) or indirectly to gather other evidence against the person (derivative use immunity). The only exceptions to the use and derivative use immunities relate to proceedings arising out of sections 137.1 and 137.2 of the Criminal Code (in relation to false and misleading information and documents) and new subsections 28(4) and 29(5) of the Act (in relation to retention and production of records). 69

Removing the privilege against self-incrimination for the purposes of new Part 3A of the Act is necessary to achieve the legitimate objective of effective assessment and management of imported food safety risks to human health. Upholding the privilege in relation to individuals who have information regarding a potential imported food safety risk could have significant consequences for human health including gastroenteritis, non-gastrointestinal illness (such as hepatitis), serious long-term health effects (such as reactive arthritis or irritable bowel syndrome), and occasionally death. While in some cases it may be feasible to obtain information by other means (for example, warrants), the additional time taken to obtain such information may significantly increase the risk of an unsafe or unsuitable food entering the domestic supply chain. Without these limitations, the Australian Government's ability to manage food safety risks through a responsive, evidence-led approach will be significantly reduced. Removal of the privilege ensures that the assessment of the food safety risk and the application of response measures can occur as urgently as necessary and reflects the magnitude of the potential impacts food safety risks pose to Australia. Item 38 Application provision Item 38 provides that new section 28 of the Act applies in relation to food imported into Australia on or after the commencement of this item, being the day after the Act receives the Royal Assent. PART 7--MAKING OF ORDERS OR DETERMINATIONS Overview Part 7 of Schedule 1 to the Bill outlines how an order or determination made under the Act may refer to a kind of food by reference to particular characteristics. By enabling an order made under the Act to identify food by a range of characteristics, the order will be more specific and, therefore, enable targeted at-border intervention consistent with the risks posed by the particular food. Item 39 At the end of subsection 18(1) Item 39 adds a note to current subsection 18(1) of the Act, which directs the reader to new section 35B of the Act for how a determination may refer to a kind of food. This note is included to assist the reader to understand the inter-relatedness of the provisions in the Act. Item 40 After section 35A Item 40 inserts new section 35B of the Act, which sets out how an order or determination may refer to a kind of food by particular characteristics. Consistent with holding orders made under proposed provisions in Part 2 of Schedule 1 to the Bill, this item will enable the Secretary to make holding orders that ensure a proportionate response by allowing particular characteristics of a food to be targeted in order to avoid unnecessary or inappropriate inspection and analysis of other foods. Item 41 Application provision Item 41 provides that new section 35B of the Act applies only in relation to an order or determination that was made on or after the commencement of this item, being the day after the Act receives the Royal Assent. 70

PART 8--USE AND DISCLOSURE OF INFORMATION Overview Part 8 of Schedule 1 to the Bill seeks to modernise the ability of the Department to use and disclose information (including personal information) in order to meet Australia's domestic and international obligations. Meeting domestic obligations is essential to the effective and efficient operation of the Australian food safety management system, including in its protection of human health. Australia is committed to promoting the protection of human health. Australia, as a good international citizen, and as a signatory to international treaties, is obliged to share information to our international partners where there is a risk to human health posed by a food. To ensure appropriate discretion is used, the disclosure of information to a party must be in connection with food imported into Australia that may pose a risk to human health, and must be necessary for the party to perform or exercise any of its functions, duties or powers. Item 42 Section 41 Item 42 inserts an exception to the Secretary's power of delegation in current section 41 of the Act to exclude the power under new subsection 42A(5) of the Act. The effect of the exception is that the guidelines must be made by the Secretary and cannot be delegated, providing a safeguard to appropriate disclosure of information. Item 43 After section 42 Item 43 inserts new section 42A of the Act to provide for a provision for use and disclosure of information obtained under the Act. The provision enables the Secretary to disclose information obtained under the Act to domestic and international parties where specific requirements for disclosure have been satisfied. The inclusion of this item ensures Australia can meet ongoing domestic and international obligations. Safeguards are included to protect arbitrary discretion of the power by requiring that the use and disclosure of information is in connection with food imported into Australia that may pose a risk to human health, and where the use and disclosure of information is necessary for the party, to which the information has been disclosed, to perform or exercise any of its functions, duties or powers. The type of information to be shared may include personal information, excluding protected information. The sharing of information under new section 42A of the Act is both necessary and proportionate to the legitimate objective of achieving better health outcomes internationally. The use and disclosure of information must be consistent with guidelines made by the Secretary in consultation with the Australian Information Commissioner. Those guidelines must be published on the Department's website. When developing the guidelines, consideration will be given to principles and guidelines established by Codex Alimentarius Commission. To ensure there is no arbitrary interference with an individual's privacy the powers contained in new section 42A of the Act are required to be exercised in compliance with the Privacy Act, which provides protections on the collection, storage, use, disclosure or publication of personal information. 71

Item 44 Application provision Item 44 provides that new section 42A of the Act applies to information obtained before, on or after the commencement of this item, being the day after the Act receives the Royal Assent. PART 9--OTHER AMENDMENTS Overview Part 9 of Schedule 1 to the Bill contains technical amendments that will enhance the operation of the Act. In particular, it will improve its harmonisation with existing Commonwealth legislation. This includes alignment of the definition of food with the definition in the Food Standards Australia New Zealand Act. Item 45 Subsection 3(1) (definition of food) Item 45 repeals the definition of food and substitutes a reference to the definition provided in the new section 3A of the Act, which is inserted by item 47 below. This amendment aligns the definition of food in the Act with existing domestic legislation, including the Food Standards Australia New Zealand Act. Item 46 Paragraph 3(2)(b) Item 46 amends current paragraph 3(2)(b) of the Act by substituting the reference to "manufactured or transported" with a reference that elaborates on manufacturing processes consistent with processes detailed in new section 35B of the Act. Item 47 After section 3 Item 47 inserts new section 3A of the Act, which provides a definition of food that is aligned to existing domestic legislation, including the Food Standards Australia New Zealand Act. This alignment ensures there is uniformity across the law. The original definition is repealed by item 45 above. Item 48 Paragraph 7(3)(b) Item 48 amends current paragraph 7(3)(b) of the Act by providing an exception that enables food imported as a trade sample to be consumed by a person if it is for the purpose of carrying out scientific or commercial evaluation. Previously, trade samples could not be consumed by a person, which inhibited the commercial evaluation process, as taste is an important element in food. Item 49 Before Division 1 of Part 2 Item 49 inserts new Division 1A of the Act before Division 1 of Part 2 of the Act. The purpose of this item is to insert new section 7A of the Act, which provides a simplified outline of the measures in current Part 2 of the Act. Current Part 2 of the Act relates to controls on the importation and movement of food. The insertion of a simplified outline is consistent with the insertion of simplified outlines by items 25 (in relation to current Part 3 of the Act), 26 (in relation to current Part 4 of the Act), and 37 (in relation to new Part 3A of the Act) above. Item 50 Before subsection 18(3) Item 50 amends current section 18 of the Act to insert a new subheading before current subsection 18(3) of the Act. The new subheading, Offence, will the reader to understand 72

current subsection 18(3) of the Act and will also ensure current section 18 of the Act is structured consistently. Item 51 At the end of section 18 Item 51 amends current section 18 of the Act to insert new subsections 18(4) and (5) of the Act. New subsection 18(4) of the Act clarifies that a determination made under current subsection 18(1) of the Act or a revocation made under current subsection 18(2) of the Act are not legislative instruments for the purposes of the definition of legislative instrument provided for by section 8 of the Legislation Act. New subsection 18(4) of the Act is included to assist the reader, as that provision is merely declaratory of the law and does not represent a substantive exemption from the Legislation Act. Subsection 8(4) of the Legislation Act provides: (4) An instrument is a legislative instrument if: (a) the instrument is made under a power delegated by the Parliament; and (b) any provision of the instrument: (i). determines the law or alters the content of the law, rather than determining particular cases or particular circumstances in which the law, as set out in an Act or another legislative instrument or provision, is to apply, or is not to apply; and (ii). has the direct or indirect effect of affecting a privilege or interest, imposing an obligation, creating a right, or varying or removing an obligation or right. A determination made under current subsection 18(1) of the Act or a revocation made under current subsection 18(2) of the Act merely determine the particular cases or particular circumstances in which the law, as set out by the Act and the regulations, is or is not to apply; those instruments do not determine or alter the content of the law itself. New subsection 19(5) of the Act provides that, for the purposes of current section 18 of the Act, the terms forge and utter have the meanings given by current section 19A of the Act. Item 52 Before subsection 19(4) Item 52 amends current section 19 of the Act to insert a new subheading before current subsection 19(4) of the Act. The new subheading, Offence, will assist the reader to understand current subsection 19(4) of the Act and will also ensure current section 19 of the Act is structured consistently. Item 53 At the end of section 19 Item 53 amends current section 19 of the Act to insert new subsections 19(5) and (6) of the Act. New subsection 19(5) of the Act clarifies that an arrangement under current subsection 19(1) of the Act, an approval or a revocation under current subsection 19(1A) of the Act, a determination under current subsection 19(2) of the Act, or a revocation under current subsection 19(3) of the Act, are not legislative instruments for the purposes of the definition of legislative instrument provided for by section 8 of the Legislation Act. New subsection 19(5) of the Act is included to assist the reader, as that provision is merely declaratory of the law and does not represent a substantive exemption from the Legislation Act. 73

Subsection 8(4) of the Legislation Act provides: (4) An instrument is a legislative instrument if: (c) the instrument is made under a power delegated by the Parliament; and (d) any provision of the instrument: (i). determines the law or alters the content of the law, rather than determining particular cases or particular circumstances in which the law, as set out in an Act or another legislative instrument or provision, is to apply, or is not to apply; and (ii). has the direct or indirect effect of affecting a privilege or interest, imposing an obligation, creating a right, or varying or removing an obligation or right. An arrangement under current subsection 19(1) of the Act, an approval or a revocation under current subsection 19(1A) of the Act, a determination under current subsection 19(2) of the Act, and a revocation under current subsection 19(3) of the Act merely determine the particular cases or particular circumstances in which the law, as set out by the Act and the regulations, is or is not to apply; those instruments do not determine or alter the content of the law itself. New subsection 19(6) of the Act provides that, for the purposes of current section 19 of the Act, the terms forge and utter have the meanings given by current section 19A of the Act. Item 54 Application provision Item 54 of the Act provides that the amendments to current paragraph 7(3)(b) of the Act by item 48 of the Bill apply to food imported into Australia on or after the commencement of this item, being the day after the Act receives the Royal Assent. 74

REGULATION IMPACT STATEMENT This Regulation Impact Statement (Reference 19384) has been approved by the Office of Best Practice Regulation. 75

Imported food reforms Decision regulation impact statement Compliance Arrangements Branch OBPR ID: 19384

© Commonwealth of Australia 2016 Ownership of intellectual property rights Unless otherwise noted, copyright (and any other intellectual property rights, if any) in this publication is owned by the Commonwealth of Australia (referred to as the Commonwealth). Creative Commons licence All material in this publication is licensed under a Creative Commons Attribution 3.0 Australia Licence, save for content supplied by third parties, logos and the Commonwealth Coat of Arms. Creative Commons Attribution 3.0 Australia Licence is a standard form licence agreement that allows you to copy, distribute, transmit and adapt this publication provided you attribute the work. A summary of the licence terms is available from creativecommons.org/licenses/by/3.0/au/deed.en. The full licence terms are available from creativecommons.org/licenses/by/3.0/au/legalcode. Inquiries about the licence and any use of this document should be sent to copyright@agriculture.gov.au. Cataloguing data This publication (and any material sourced from it) should be attributed as: Department of Agriculture and Water Resources 2016, Imported food reforms-decision regulation impact statement, Canberra. ISBN 978-1-76003-120-6 (online) This publication is available at agriculture.gov.au/import/goods/food/reform Department of Agriculture and Water Resources Postal address GPO Box 858 Canberra ACT 2601 Telephone 1800 900 090 Web agriculture.gov.au The Australian Government acting through the Department of Agriculture and Water Resources has exercised due care and skill in preparing and compiling the information and data in this publication. Notwithstanding, the Department of Agriculture and Water Resources, its employees and advisers disclaim all liability, including liability for negligence and for any loss, damage, injury, expense or cost incurred by any person as a result of accessing, using or relying upon any of the information or data in this publication to the maximum extent permitted by law. Acknowledgements The department thanks those importers that participated in the Food Importer Research to inform the regulatory analysis and those that kindly responded to our additional requests for further information. The department also thanks the stakeholders who provided comments on the Imported food reforms-consultation regulation impact statement. ii

Contents About the decision regulation impact statement ...............................................................................vii Summary ......................................................................................................................................................... viii Background ........................................................................................................................................................ 1 1.1 Imported food statistics ..........................................................................................................................1 1.2 Food regulatory system in Australia..................................................................................................5 1.3 Current regulation of imported food .................................................................................................7 1.4 Previous imported food reviews .........................................................................................................9 1.5 International approaches to imported food control ................................................................ 11 2 Statement of the problem .................................................................................................................. 15 2.1 Importer accountability ....................................................................................................................... 18 2.2 Ability to detect food safety issues at the border ...................................................................... 18 2.3 Emergency response ............................................................................................................................. 19 2.4 Monitoring new and emerging risks ............................................................................................... 21 2.5 Removing compliant food from border intervention .............................................................. 21 2.6 Consistency of domestic and imported food legislation ......................................................... 22 2.7 Summary of the problem ..................................................................................................................... 22 3 Need for government action ............................................................................................................. 24 4 Policy objective ..................................................................................................................................... 25 5 Consultation ........................................................................................................................................... 26 5.1 Summary of feedback by stakeholder group ............................................................................... 26 5.2 Promoting consultation........................................................................................................................ 31 5.3 Previous consultation ........................................................................................................................... 31 6 Proposed options for reform............................................................................................................ 35 6.1 Option 1-non-legislative improvements ...................................................................................... 36 6.2 Option 2-option 1 plus further non-legislative improvements........................................... 41 6.3 Option 3-option 1 and 2 plus changes to primary and consequential subordinate legislation 47 6.4 Regulatory Burden Measure Table .................................................................................................. 66 7 Trade implications ............................................................................................................................... 67 7.1 Supply chain assurance ........................................................................................................................ 67 7.2 Broaden emergency powers............................................................................................................... 68 7.3 Powers to monitor for new and emerging risks ........................................................................ 69 7.4 Recognise a foreign country's food safety regulatory system .............................................. 70 7.5 Align the IFC Act 1992 with domestic food legislation ............................................................ 70 iii

7.6 International approaches .................................................................................................................... 70 7.7 Implications for Australian exporters ............................................................................................ 72 8 Implementation .................................................................................................................................... 73 8.1 Legislation.................................................................................................................................................. 73 8.2 Transition ................................................................................................................................................... 73 8.3 Stakeholder education and guidance.............................................................................................. 73 8.4 Evaluation .................................................................................................................................................. 73 Appendix A: Submissions received, summary of feedback and response to issues raised 74 Appendix B: Prescribed foods overview............................................................................................... 82 Appendix C: Costing methodology and assumptions ....................................................................... 84 Appendix D: Comparison of Imported Food Control Act 1992 to the Model Food Provisions86 Appendix E: Prescribed foods analysis of trade implications....................................................... 95 Methodology and limitations ............................................................................................................................ 95 Outcome of analysis .............................................................................................................................................. 95 Glossary .......................................................................................................................................................... 102 References ..................................................................................................................................................... 104 Tables Table 1 Lines referred as risk by commodity type and country of origin, excluding New Zealand, 2015 ...................................................................................................................................................................................... 45 Table A1 Feedback and response on option 1 .................................................................................................... 76 Table A2 Feedback and response on option 2 .................................................................................................... 77 Table A3 Feedback and response on option 3 .................................................................................................... 77 Table A4 Feedback and response to concerns raised on imported food reform generally ............. 80 Table B1 Indicative list of 'prescribed foods' ...................................................................................................... 82 Table B2 Top five prescribed food groups imported over a three year period, by tonnes .............. 83 Table D1 Comparison of core definitions in Imported Food Control Act 1992 and the Model Food Provisions........................................................................................................................................................................... 86 Table D2 Comparison of core offences in Imported Food Control Act 1992 and the Model Food Provisions........................................................................................................................................................................... 90 Table D3 Comparison of emergency powers in Imported Food Control Act 1992 and the Model Food Provisions ............................................................................................................................................................... 92 13 to 29 February 2016................................................................................................................................................ 96 Table E2 Top five importers of ready-to-eat or minimally processed nuts, by tonnes, 1 March 2013 to 29 February 2016 ......................................................................................................................................... 97 Table E3 Top five importers of beef and beef products, by tonnes, 1 March 2013 to 29 February 2016 ..................................................................................................................................................................................... 98 Table E4 Top five importers of raw meat and meat products, by tonnes, 1 March 2013 to 29 February 2016 .......................................................................................................................................................... 98 iv

Table E5 Top five importers of raw milk cheese (Roquefort), by tonnes, 1 March 2013 to 29 February 2016 .......................................................................................................................................................... 99 Table E6 Top five importers of ready-to-eat raw or minimally processed bivalve molluscs, by tonnes, 1 March 2013 to 29 February 2016 .................................................................................................... 100 Table E7 Top five importers of ready-to-eat minimally processed finfish, by tonnes, 1 March 2013 to 29 February 2016 ...................................................................................................................................... 101 Table E8 Prescribed foods imported by Fiji, by tonnes, 1 March 2013 to 29 February 2016 .... 101 Figures Figure 1 Value of food imports from 2013-2016 ..................................................................................................2 Figure 2 Top 10 countries for food imports ...........................................................................................................3 Figure 3 Number of consignments being imported by businesses in 2015 per year ............................3 Figure 4 Size of businesses importing food from 2013-2014 by FTE ..........................................................4 Figure 5 Top ten number of ANZSIC Divisions for businesses importing food from 2013-15 ..........4 Figure 6 The food regulatory system .........................................................................................................................6 Figure 7 Overview of rate of referral of risk and surveillance food for inspection under the Imported Food Inspection Scheme, depending on compliance ......................................................................8 Figure 8 Sample profile ................................................................................................................................................ 33 Figure 9 Proposed options and objectives to improve the safety of imported food ........................... 35 Figure 10 Regulatory burden measurement and cost offset estimate table .......................................... 66 Figure B1 Top five prescribed food groups imported over a three year period, by tonnes and percentage ......................................................................................................................................................................... 84 Figure E1 Top five importers of ready-to-eat or minimally processed produce, by tonnes and percentage, 1 March 2013 to 29 February 2016 .............................................................................................. 96 Figure E2 Top five importers of ready-to-eat or minimally processed nuts, by tonnes and percentage, 1 March 2013 to 29 February 2016 ............................................................................................. 97 Figure E3 Top five importers of raw meat and meat products, by tonnes and percentage, 1 March 2013 to 29 February 2016 ......................................................................................................................................... 99 Figure E4 Top five importers of ready-to-eat raw or minimally processed bivalve molluscs, by tonnes and percentage, 1 March 2013 to 29 February 2016..................................................................... 100 Figure E5 Top five importers of ready-to-eat minimally processed finfish, by tonnes and percentage, 1 March 2013 to 29 February 2016 ............................................................................................ 101 Boxes Box 1 Recalls and food safety incidents associated with imported food ................................................. 17 Box 2 Cost of hepatitis A cases associated with frozen berries ................................................................... 17 Box 3 Delay costs............................................................................................................................................................. 39 Box 4 Increased number of Food Import Compliance Agreements ........................................................... 40 Box 5 Increased foreign government certification............................................................................................ 46 Box 6 Supply chain assurance.................................................................................................................................... 51 v

Box 7 Emergency powers case study...................................................................................................................... 54 Box 8 Monitoring for new or emerging issue case study ............................................................................... 57 Box 9 Recognition of foreign government systems .......................................................................................... 59 Box 10 Traceability ........................................................................................................................................................ 64 vi

About the decision regulation impact statement The purpose of this Decision Regulation Impact Statement (RIS) is to recommend a preferred policy option to strengthen the safety of imported food and improve the ability to respond to food safety risks with imported food. This Decision RIS follows stakeholder comment on the Consultation RIS. This Decision RIS identifies the nature of the problem to be solved and outlines the alternative policy options considered. It assesses the costs and benefits of each option and presents rationale for a preferred option. The Decision RIS will be used by the Australian Government to inform its decision making on reforms to imported food control. This Decision RIS follows the Australian Government Guide to Regulation (Department of the Prime Minister and Cabinet, 2014). vii

Summary The Department of Agriculture and Water Resources is responsible for administering the Imported Food Control Act 1992, and in doing so, monitoring imported food for compliance to the Australia New Zealand Food Standards Code. Under the Act, importers are also legally responsible for complying with the standards that apply to their products to ensure they are safe for their intended use. As food businesses in Australia, food importers are also obligated under state and territory food law to only sell safe and suitable foods. The value of food being imported is increasing with a 5 year trend growth rate of 10.3 per cent for processed food and 7.9 per cent for unprocessed food. From 2013-2015 there were, on average, 16 000 businesses that imported food into Australia each year. In 2015, approximately 5 per cent were frequent importers of food, importing food (on average) at least once per week. The majority (76%) of businesses importing food are within the micro to small business category with only 6% in the large business category. Most businesses importing food are in wholesale trade (47%), followed by manufacturing (16%) and retail (14%). Foodborne illness is a serious public health and safety issue in Australia. In 2010, it was estimated there were 4.1 million episodes of gastrointestinal foodborne illness in Australia and 86 deaths (Kirk et al. 2014). Recent food safety issues with imported food such as the outbreak of hepatitis A associated with imported frozen berries in 2015, have exposed limitations with the current food safety management of imported food, particularly the ability of the system to:  make importers responsible and accountable for the safety of food being imported  detect food safety issues in imported food at the border  monitor new and emerging food safety risks from imported food  respond quickly and effectively when food safety issues are identified. As such, the department is proposing a package of legislative and non-legislative reforms to better align the imported food inspection program with contemporary and preventative risk management approaches. The policy objective is to strengthen the current system to provide more flexible and targeted ways to prevent and respond to food safety risks, to better protect the health of consumers while reducing the regulatory burden for compliant food importers and upholding our international obligations. Three policy options are presented to address the policy objectives. The proposed reforms do not represent a complete overhaul of the current system, rather they are a set of practical options for reform that aim to strengthen the existing system. Option 1 is non-legislative, option 2 involves minimal legislative change and option 3 includes more comprehensive legislative changes. Each option builds on the previous option with option 3 providing the most comprehensive improvement to the overall imported food regulatory system to address the current limitations and the policy objective. viii

Option 1 includes non-legislative initiatives already commenced to address the limitations identified following the hepatitis A outbreak associated with imported frozen berries. These are:  improving government communication during a food incident  increasing the number of importers on a Food Import Compliance Agreement (FICA). Under option 1 there would be no legislative changes to the current system and no additional costs to businesses or consumers. Assuming an additional fifty food importing businesses take up a tiered FICA over the next ten years, the regulatory savings are estimated to be $667 000 per year, across these businesses (that is, $13 340 per year to each business). However, the system will still largely rely on existing border inspection and testing to monitor compliance with food safety requirements and lacks flexibility to rapidly respond to food safety issues. Option 2 includes the initiatives already commenced under option 1 plus more improvements including:  proactive compliance and enforcement activities  food surveys  increased use of foreign government certification. Foreign government certification offers an alternative to inspection and testing at the border to manage the safety for specific foods, providing savings to importers. Soft or surface ripened cheese are some of the most frequently tested foods under the Imported Food Inspection Scheme. If imports of these products from France and Italy were accompanied by foreign government certificates, the regulatory savings to the 82 food importing businesses currently importing these cheeses, is estimated to be an overall average of $168 000 per year over a ten year period. This equates to a savings of $2 048 per year to each business. Taking into account the measures proposed under option 1, the net benefit of option 2 is calculated to be an annual saving of $835 000 over ten years to the food importing businesses benefited by these measures. This option does not address all policy objectives, particularly the ability to respond effectively to new and emerging food safety issues and increasing importer accountability for food safety more broadly, not just for those with access to government certification. Option 3 includes the initiatives outlined in options 1 and 2 plus the following changes to primary (and consequential subordinate) legislation to:  mandate evidence of supply chain assurance for certain foods  broaden emergency powers  increase powers to monitor for new and emerging risks  recognise a foreign country's food safety regulatory system  harmonise the Imported Food Control Act 1992 with domestic food legislation where applicable-including requiring traceability. ix

The estimated annual net cost to businesses to implement option 3-the most comprehensive reform package-is $216 000 per year across the approximately 16 000 businesses importing food, averaged over ten years. This equates to a cost of approximately $14 per food importing business per year. This option includes legislative measures to effectively respond to potential food safety issues with imported food, requirements for supply chain assurance for certain foods, and recognition of foreign country food safety systems in addition to the measures proposed under options 1 and 2. Option 3 is the preferred option, as it is the only option to fully address the policy objective and does not impose significant costs on industry. It provides the greatest benefits to consumers by placing more responsibility on importers to source safe food and enabling effective emergency response to be taken on potentially unsafe imported food. This reduces the likelihood of consumers becoming ill from exposure to unsafe imported food. The cost of the thirty three cases of hepatitis A from the frozen berries outbreak has been estimated to be $710, 259 (Section 2). Option 3 also provides indirect benefits to importers, as it decreases the likelihood of an imported food safety incident occurring and consequently the costs to industry from such an incident. These costs can be considerable. The profits of the company that imported the frozen berries implicated in the hepatitis A outbreak dropped $14m, in the year following the outbreak (Patties Foods, 2015). As the costs of incidents associated with unsafe imported food are considerable to consumers, industry and government, if this option reduces the frequency of an incident like hepatitis A associated with frozen berries by only one less every ten years, the benefits will still greatly outweigh the costs. The Consultation RIS for imported food reform was released on 22 August 2016 for public consultation with comments being accepted until 30 September 2016. The Consultation RIS sought comment on three options to address the policy objective. It included estimated costs and benefits of the proposed reform options and sought feedback on the nature and extent of the impacts from affected stakeholders and interested parties. Nine submissions were received on the RIS, seven from industry, one from a state government and one from a registered health promotion charity. Submitters generally supported the reform measures with no major concerns raised. Additionally, trading partner consultation was initiated by informing the World Trade Organisation (WTO) members through a Sanitary and Phytosanitary Agreement (SPS) notification. The trade implications of the preferred option have been assessed to be minimal on the basis that many importers are already seeking assurance on the safety of the food being imported and have traceability systems in place to enable food to be effectively and efficiently recalled from the supply chain if a food safety issue arises. The proposed reforms also align with those of some of our major trading partners. x

Background 1.1 Imported food statistics Australia is a net exporter of food. In 2015, Australia exported food to the value of $42.0 billion. By comparison, in the same year, imported food products were worth $17.5 billion (DFAT 2016). Imported food was comprised mainly of processed food ($15.2 billion) and the remainder unprocessed food ($2.3 billion). The value of food being imported is increasing with a 5 year trend growth rate of 10.3 per cent for processed food and 7.9 per cent for unprocessed food (Figure 1). For unprocessed food, Australia mainly imports food within the Trade Import and Export Classification (TRIEC) of 'vegetables, fruit & nuts, fresh, chilled or provisionally preserved' and for processed food, 'preparations of food, beverages & tobacco not elsewhere specified'. This includes highly processed dairy products, beverages and sauces and condiments. New Zealand is the major source of Australia's food imports, followed by United States and China (Figure 2). From 2013-2015 there were approximately 16, 000 businesses importing food each year (data sourced from the Integrated Cargo System (ICS)-the electronic recording system for recording movement of goods across Australia's borders). A food importer was considered to be any business that imported food from 2013-2015. This includes businesses where the importation of food only formed part of their business. In 2015, approximately 5 per cent of importers were frequent importers (importing more than 50 consignments of food per year), 10 per cent imported between 11-50 consignments and the majority (85 per cent) imported ten or less consignments (Figure 3). This indicates that only 5 per cent of importers are importing food, on average, at least once per week. While the majority of businesses import food infrequently, this is not an indication of the size of businesses importing food as, for example, a large food manufacturing business in Australia may import food infrequently to address supply gaps. The Australian Bureau of Statistics (ABS) defines business size according to the number of employees as follows:  micro businesses, 0-4 employees  small businesses, 0-19 employees  medium businesses, 20-199 employees  large businesses, 200 or more employees (Department of Industry, Innovation, Research and Tertiary Education, 2012). By matching the Australian Business Numbers (ABNs) of businesses importing food in 2013-14, with available data on the number of employees of these businesses (calculated as Full Time Equivalents), an indication of the size of businesses importing food can be determined. From this data, 76% of businesses importing food are within the micro to small business category, 18% are in the medium category and 6% are in the large business category (Figure 4). This data matching was conducted by the ABS at the request of the department. Department of Agriculture and Water Resources 1

Using the ABNs of the businesses importing food from 2013-15, the ABS also provided data on the Australian and New Zealand Standard Industrial Classification (ANZSIC) division these businesses have been assigned. The ANZSIC classifies businesses to an industry based on its predominant activity (ABS, 2006). This indicates that the majority of businesses importing food are in wholesale trade (47%), followed by manufacturing (16%), retail (14%) and accommodation and food services (6%). Figure 5 shows the top ten number of ANZSIC divisions for businesses importing food 2013-15 (numbers averaged over these years). This data provided by the ABS is indicative only as the ABNs of all businesses importing food is not available. Additionally information on the numbers of employees is not available for all businesses with ABNs nor their ANZSIC division. Figure 1 Value of food imports from 2013-2016 $A billions 16 14 12 10 8 6 4 2 - 2013 2014 2015 Processed food Unprocessed food Source: DFAT 2016 Department of Agriculture and Water Resources 2

Figure 2 Top 10 countries for food imports Vietnam United Kingdom France Malaysia Italy 2015 Singapore 2014 Thailand 2013 China United States New Zealand - 500 1,000 1,500 2,000 2,500 3,000 3,500 $A millions Source: DFAT 2016 Figure 3 Number of consignments being imported by businesses in 2015 per year Source: Integrated Cargo System (ICS) 2016 Department of Agriculture and Water Resources 3

Figure 4 Size of businesses importing food from 2013-2014 by FTE 6% 18% 56% 20% Micro Small Medium Large Zero - 4 employees 5 - 19 employees 20 - 199 employees 200+ employees Source: ABS 2016 Figure 5 Top ten number of ANZSIC Divisions for businesses importing food from 2013-15 F Wholesale Trade 3,342 1,111 C Manufacturing 986 G Retail Trade ANZSIC Division 435 H Accommodation And Food Services 315 M Professional, Scientific And Technical Services 239 A Agriculture, Forestry And Fishing 191 I Transport, Postal And Warehousing 131 K Financial And Insurance Services 100 S Other Services 93 N Administrative And Support Services - 1,000 2,000 3,000 4,000 Number of businesses from 2013-15 (averaged) Source: DFAT 2016 Department of Agriculture and Water Resources 4

1.2 Food regulatory system in Australia The food regulation system is a cooperative bi-national arrangement involving the Australian Government, states and territories and New Zealand (Department of Health 2016). Figure 6 provides a pictorial representation of the food regulatory system. The food regulatory system in Australia is established through an intergovernmental agreement with the States and Territories and a treaty between Australia and New Zealand (Department of Health 2016). Additionally, Food Standards Australia New Zealand (FSANZ), the joint Australia and New Zealand standards setting body, is established under Commonwealth legislation, the Food Standards Australia New Zealand Act 1991. Each state and territory in Australia has its own laws to implement and enforce the food standards developed by FSANZ. Food policy is set by the Australia and New Zealand Ministerial Forum on Food Regulation which consists of health and agriculture ministers from the states and territories, and the Australian and New Zealand governments. Food standards are developed to reflect this policy framework (FSANZ 2015a). The Code includes standards for:  the use of ingredients, processing aids, colourings, additives, vitamins and minerals  the composition of some foods, such as dairy, meat and beverages as well as new technologies such as novel foods  labelling requirements for both packaged and unpackaged food, including specific mandatory warnings or advisory labels  safe food handling practices for food businesses  primary production and processing. Food imported into Australia must comply with the Imported Food Control Act 1992 (IFC Act 1992) which also requires imported food to comply with the Code. Department of Agriculture and Water Resources 5

Figure 6 The food regulatory system Source: FSANZ 2015a Department of Agriculture and Water Resources 6

1.3 Current regulation of imported food Foods imported into Australia are subject to requirements under the Biosecurity Act 2015 to address biosecurity concerns and the IFC Act 1992 for compliance with Australian food standards and the requirements of public health and safety. Under the IFC Act 1992, importers are legally responsible for complying with the standards that apply to their products to ensure they are safe and suitable for their intended use. To monitor compliance with Australia's imported food requirements, the department operates a risk based border inspection scheme, the Imported Food Inspection Scheme (IFIS), under the IFC Act 1992. Food is referred for inspection under the IFIS by the Department of Immigration and Border Protection based on internationally agreed tariff codes. The rate at which food is referred for inspection depends on its risk. Under the IFIS, food is classified as:  risk food  surveillance food or  compliance agreement food. Risk food is the type of food that has the potential to pose a high or medium risk to public health. FSANZ provides advice to the Minister for Agriculture and Water Resources on the foods that pose such a risk. Risk food is initially referred for inspection and testing at a rate of 100 per cent against a published list of potential hazards (specific to the food), but is decreased if a history of compliance is established. However, any fail will return the inspection rate to 100 per cent. Surveillance food is considered to pose a low risk to human health and safety. Each consignment of surveillance food has a 5 per cent chance of being referred for inspection. All surveillance foods referred are visually inspected for obvious signs of contamination or deterioration and the labels of the food are also assessed for compliance against labelling standards. Samples of surveillance food may also be analysed for pesticides and antibiotics, microbiological and chemical contaminants and food additives. If a surveillance food fails an inspection, the inspection rate is increased to 100 per cent until a history of compliance is established. The inspection rate for a surveillance food can also be increased by placing a 'holding order' on the food, if there are reasonable grounds for believing the food may fail an inspection or analysis. This effectively increases the inspection rate for the food to 100 per cent until compliance is established (section 15 of the IFC Act 1992). Figure 7 provides a summary of the rate at which risk and surveillance food is referred for inspection under the IFIS and how this rate varies, depending on compliance. The arrows indicate a reduction in the rate of referral or an increase in the rate of referral based on compliance. Department of Agriculture and Water Resources 7

Figure 7 Overview of rate of referral of risk and surveillance food for inspection under the Imported Food Inspection Scheme, depending on compliance Note: Compliance is based on the combination of specific food, from a specific producer in a specific country. Compliance agreement food, is food that is imported by a business under a Food Import Compliance Agreement (FICA). FICAs offer food importers an alternative regulatory arrangement to inspection and testing of their products under the IFIS by recognising an importer's existing documented food safety management system. This provides these businesses with a streamlined process for importing food, which represents a substantial cost saving. It is optional for food importers to enter into a FICA. Currently, fifteen importers operate under a FICA. Food may also be imported under a foreign government certification arrangement. The department can enter into a government-to-government certification arrangement with the national competent authority of a country exporting food to Australia, providing confidence that the food has been produced safely. While this certification can be developed for any imported food, this is only currently used for risk food because the Imported Food Control Regulations 1993 only provide for a reduction in inspection rates for risk foods. Consignments of imported food accompanied by a recognised foreign government certificate may be inspected and tested at a reduced rate (5 per cent). Such arrangements are in place for certain risk classified seafood from Thailand and Canada and a risk classified cheese from France. Use of a recognised foreign government certificate in the clearance of food imported to Australia is normally voluntary but an Order made by the Minister may mandate a foreign government certificate for a food. Recognised government certification is currently mandatory for beef and beef products and raw milk cheese. Under the IFC Act 1992, food may also be imported under a recognised quality assurance certificate, if approved by the Secretary of the department. However, importers and overseas food processing operations have never sought to obtain such an approval and therefore no food is currently imported under this kind of certification. Special arrangements apply to food imported from New Zealand. Under the Trans-Tasman Mutual Recognition Act 1997, any good that may be legally sold in New Zealand may be sold in Australia. However, with respect to food, restrictions may apply under the Biosecurity Act 2015 and/or the IFC Act 1992. Department of Agriculture and Water Resources 8

The IFC Act 1992 provides for all food that is either produced in, or imported into and cleared for sale in New Zealand, to be imported without being inspected and/or analysed, with the exception of some foods where Australia and New Zealand do not have agreed food safety controls. Currently the only foods that Australia and New Zealand do not have agreed food safety controls for are beef and beef products (for Bovine spongiform encephalopathy (BSE) certification), cassava chips and seaweed. When food subject to the IFC Act 1992 is found to be a failing food, on the basis that it does not meet the applicable standards, or it poses a risk to human health through the operation of the IFIS, it may be required to be treated, destroyed or exported. When imported food has cleared the border, it is subject to state and territory food legislation. All food sold in Australia must comply with the state and territory food legislation. The state and territory food legislation include offences for the sale of food that is unsafe or unsuitable, including non-compliance with the requirements of the Code. State and territory and local government food regulatory agencies are responsible for ensuring that all food available for sale within their jurisdiction, both imported and domestically produced food, meets the requirements of the Code. 1.3.1 Responding to food incidents Food safety incidents associated with food, including imported food are managed by multiple Australian Government agencies and state and territory food safety regulators using a range of generic and sector-specific agreements, protocols, networks and committees. When a food incident occurs the regulatory response is coordinated through the Bi-National Food Safety Network (BFSN) which is made up of Australian Government agencies (including a representative from the department), FSANZ, state and territory and New Zealand food regulators. FSANZ's role is to coordinate information sharing between the regulators. Where there are cases of illness associated with a contaminated food, OzFoodNet -the Australian Government's enhanced foodborne disease surveillance network comprising of members from all states and territories and coordinated by the Commonwealth Department of Health, conducts the epidemiological investigation and shares findings with the BFSN. Incidents being managed under the BFSN, may trigger activation of the National Food Incident Response Protocol (NFIRP). The NFIRP provides a formal mechanism for managing national food incidents with FSANZ being responsible for the key coordination roles of National Food Incident Coordinator, Risk Assessment Coordinator and Communications Controller. 1.4 Previous imported food reviews 1.4.1 National Competition Policy Review of the Imported Food Control Act 1992 The Imported Food Control Act Review (the review) was completed in 1998 as part of the comprehensive examination of legislation by the Commonwealth Government to ensure compliance with the National Competition Policy (Tanner et al. 1998). The review identified that food safety regulation and food safety practices in Australia and overseas were undergoing major change. At the same time, there was rapid growth in world food trade, Australian food consumption patterns were changing and there was increasing consumer concern about food safety. Department of Agriculture and Water Resources 9

The review noted that much of the food being consumed by Australians is relatively underprepared or 'fresh' compared to the traditional thoroughly cooked or salted foods. Such foods come with higher inherent risk if not prepared under adequate safety systems. In that regard, the development and application of preventive safety programs, such as those based on a Hazard Analysis Critical Control Point (HACCP) approach, have been found to be more effective in producing safe food than traditional end-product inspection and testing. The review examined the costs and benefits of the IFC Act 1992 and, where possible, attempted to quantify them. The costs of the scheme were estimated to be in the order of $9 million annually, representing 0.25 per cent of the value of food imported into Australia. These costs are largely borne by the importing industry and consumers. Where imported foods are used as ingredients for further processing, export competitiveness may be affected. Benefits related mainly to the reduction in costs of illness. The estimate of the benefits was considered conservative because it did not take into account all failures detected by the program or the educative and deterrent effects of the scheme. In the absence of such a scheme, it was considered likely that the incidence of sub-standard or unsafe food entering the Australian market would increase. The review was cognisant of the need for the IFC Act 1992 to be consistent with Australia's international obligations and trade objectives, and for it to be compatible with advances in food processing and food safety. The review's recommendations reinforced the conformity of Australia's controls on imported foods with the principles of the World Trade Organization's (WTO) Agreement on the Application of Sanitary and Phytosanitary Measures and the Agreement on Technical Barriers to Trade. The review recommended that in order to maintain the relevance and effectiveness of the IFC Act 1992, it is important that the IFC Act 1992 allows the delivery of a program that adheres to scientific risk-management principles, and is performance-based, transparent and flexible, consultative, efficient and effective. The review concluded that the best way to ensure that imported food complies with Australian public health and safety standards is to develop a partnership (or co-regulatory) approach between industry and government. The partnership approach will encourage industry to take greater responsibility for ensuring food safety while, at the same time, retaining government control over the food importing system through regular government-controlled audits. This was achieved by providing food importers with the opportunity to enter into FICAs. Under option 1 in section 5.1.3, it is recommended that more be done to increase the number of importers on a FICA, as current uptake is low. 1.4.2 Australian National Audit Office Report-Administration of the Imported Food Inspection Scheme, 2015 In 2015, the Australian National Audit Office (ANAO) published its findings into an independent performance audit on the effectiveness of the department's administration of the IFIS (ANAO 2015). The ANAO Report noted that the importation of food from countries with varying production and processing practices has the potential to expose Australian consumers to a broad range of food-borne illnesses if food safety risks are not effectively managed. Department of Agriculture and Water Resources 10

The ANAO Report found that in the context of the legislative framework established for the regulation of imported food, the department's administration of its responsibilities under the IFIS has been generally effective. In particular: planning for compliance monitoring is informed by food risk assessments prepared by FSANZ; regulatory activity takes into account the compliance history of producers; and actions taken are proportionate to the level of risk presented. Further, inspections are underpinned by a staff capability program, a broad range of procedural guidance material, regular management verification of activities, and food testing is conducted by independently accredited laboratories. The department has also recently commenced initiatives to make its regulatory activities more client-focused and consistent through the re-organisation of business processes and deployment of new technologies. The ANAO Report noted that in light of recent imported food incidents, the department has given preliminary consideration to legislative reforms that would better assist in the management of food incidents and also provide for systemic improvements in the regulation of imported food. The reforms under consideration would, if adopted, allow the department to: hold food at the border pending the preparation of a risk assessment by FSANZ; conduct compliance campaigns and intelligence gathering activities beyond risk and surveillance food inspections; and apply holding orders to allow for the establishment of new testing requirements, among other things. 1.5 International approaches to imported food control In light of international guidance and best practice, many overseas countries have, or are moving towards, preventative approaches to managing food safety risks associated with imported food. Following is a summary of the regulatory approaches by some of Australia's key trading partners to manage risks associated with imported food. 1.5.1 United States In 2011, the United States (US) Food and Drug Administration (FDA) Food Safety Modernization Act (FSMA) was signed into law, representing the most sweeping reform of food safety laws in the US in more than 70 years (FDA 2016). It aims to take a more preventative approach to food safety, by shifting the focus from responding to contamination to preventing it (FDA 2016). The law includes new tools to hold imported foods to the same standards as domestic foods. New powers include:  Importer accountability: Importers will have an explicit responsibility to verify that their foreign suppliers have adequate preventive controls in place to ensure that the food they produce is safe.  Third Party Certification: The FSMA establishes a program through which qualified third parties can certify that foreign food facilities comply with US food safety standards. This certification may be used to facilitate the entry of imports.  Certification for high risk foods: FDA has the authority to require that high-risk imported foods be accompanied by a credible third party certification or other assurance of compliance as a condition of entry into the US. Department of Agriculture and Water Resources 11

 Voluntary qualified importer program: FDA must establish a voluntary program for importers that provides for expedited review and entry of foods from participating importers. Eligibility is limited to, among other things, importers offering food from certified facilities.  Authority to deny entry: FDA can refuse entry into the US of food from a foreign facility if the FDA is denied access by the facility, or the country in which the facility is located (FDA 2015). The rule on Foreign Supplier Verification Programs (FSVP) for Importers of Food for Humans and Animals has been finalised, and compliance dates for some businesses begin in May 2017. It places obligations on importers to verify that imported food is compliant with US food safety laws across the supply chain. For most foods, FSVP includes activities for the identification of hazards and documentation of assurances (for example, testing and audits to verify that their foreign suppliers have adequate preventive controls in place to ensure safety and corrective actions). The FDA can also accredit qualified third party auditors to certify that foreign food facilities are complying with US food safety standards, although the policy/guidance for this is still in development. The FSVP is to be re-evaluated every 3 years, or when a new risk emerges, and applies to each supplier and food. For high risk food, third party certification by a private company or government authority, and inspection of the overseas facility by US officers may be required. Exemptions to the FSVP include food imported for research or personal consumption, food imported for further processing, low acid canned foods, juice and fish products covered by more extensive FDA HACCP regulations and meat, poultry and egg products which are regulated by US Department of Agriculture (USDA). Exemptions to the rule are also provided for small businesses such as farms averaging less than $500 000 sales during the previous three years, although these businesses must still meet reduced requirements. 1.5.2 Canada In 2012, Canada passed the Safe Food for Canadians Act 2012. This Act:  makes food as safe as possible for Canadian families  protects consumers by targeting unsafe practices  implements tougher penalties for activities that put health and safety at risk  provides better control over imports  institutes a more consistent inspection regime across all food commodities  strengthens food traceability. The Act includes powers to register or license importers, and prohibits the importation of unsafe food commodities. It also holds importers accountable for the safety of imported products - that is, that they meet domestic requirements for food safety. Department of Agriculture and Water Resources 12

Importers in Canada must verify the suitability and safety of their suppliers. Guidance on how importers can meet this is provided in the Canadian Food Inspection Agency (CFIA) Good Importing Practices (GIP) for Food (CFIA 2014). The GIP informs the decision of CFIA as to whether the food complies with Canadian food safety legislation. The GIP requires importers to have the ability to produce, on request, information about the critical steps of production and the food safety controls put in place to manage the risks, an evaluation of the supplier and have accurate records of distribution for traceability and recall. For some higher risk products an import licence is required which assures food safety along the supply chain (for example, cheese), or it is produced in an approved country and establishment (for example, meat and meat products). 1.5.3 European Union Article 3 to 6 of Regulation (EC) No 852/2004 of the European Parliament and of the Council of 29 April 2004 on the hygiene of foodstuffs defines specific hygiene requirements for food imported into the European Union, which includes:  a general obligation to monitor the food safety and processes under their own responsibility  general hygiene provisions for primary production  a HACCP based procedure for post primary production  microbiological requirements for certain products  registration or approval of establishments along the supply chain. EU importers must ensure that the food businesses they are supplied by adhere to these requirements. In addition, Annex I to Regulation (EC) No 669/2009 lists food and feed of non- animal origin that are subject to an increased level of official control for imports. The enhanced control mechanism means that competent authorities will:  carry out systematic checks on documents accompanying the consignments  conduct physical checks, including laboratory analysis, at a frequency related to the risk identified. This list is regularly updated by the EC Standing Committee on the Food Chain and Animal Health based on information from various sources such as the Rapid Alert System for Food and Feed, reports from the EU Food and Veterinary Office, and EU Member States and non-EU countries. 1.5.4 New Zealand New Zealand passed a new food Act in 2014, the Food Act 2014 to make fundamental changes to New Zealand's domestic food regulatory system. It also incorporated changes to improve the control of imported food, including the compulsory registration of importers and a border system responsive to the risk of the food being imported (NZFSA 2009). All importers of food in New Zealand must now register with NZ Ministry of Primary Industries (NZ MPI) as a food importer (or use a registered importer), safely source and handle food before export, and meet specific requirements for foods identified as presenting a higher risk to consumers. Department of Agriculture and Water Resources 13

Importers must have accurate records to show how food has been produced, stored and transported, have records of product purchased for traceability and maintain a list of suppliers with accurate contact information. Foods that pose a greater risk to consumers and public health are classified as 'foods of high regulatory interest' or 'foods of increased regulatory interest'. A food safety clearance is required to import any foods of regulatory interest into New Zealand. These foods include a range of dairy, seafood, meat, nuts and processed foods including frozen berry fruit. A food safety clearance is required to import any foods of regulatory interest and importers of foods of regulatory interest are required to demonstrate the food's safety in one of four ways in order to obtain a food safety clearance. 1) A registered food importer that's is verified by the NZ MPI can be issued with a NZ Importer Assurance. This is a certificate issued by the Chief Executive based on an audit of the registered importers business. 2) Bovine meat and products containing bovine meat that are imported from Australia must be accompanied by a manufacturer's declaration that the meat is of Australian or New Zealand origin. 3) For some countries, NZ MPI will accept official certificates (from the appropriate government agency) as assurance the food is safe. The certificate must be from the country of origin for New Zealand. 4) In some cases, food will have to be sampled and tested by an approved laboratory. Department of Agriculture and Water Resources 14

2 Statement of the problem The aim of this RIS is to explore options to address regulatory gaps that increase the risk of foodborne illness associated with imported food. Foodborne illness is a serious public health and safety issue in Australia. In 2010, it was estimated there were 4.1 million episodes of gastrointestinal foodborne illness in Australia and 86 deaths (Kirk et al. 2014). While it is not known what percentage of these illnesses and deaths are caused by imported food, imported food has been associated with illness and death in Australia (Box 1). Increased imports of food raises the risk of foodborne disease from these foods and potentially increase the frequency and costs of these outbreaks. While Australia is a net exporter of food, the amount of food Australia imports is increasing, with a 5 year trend growth rate of 10.3 per cent for processed food and 7.9 per cent for unprocessed food per cent. Much of the growth in food imports has been in processed foods. A large number of food processors in Australia use a mix of locally sourced and imported products in their product formulations, leading to increasing complexity of these products (Spencer, Kneebone 2012). This globalisation of the supply chain, increases the opportunity for food safety issues to arise and presents challenges for trace-back investigations. For example, in 2011 six people in Australia with an allergy to peanuts, had reactions to a range of imported crumbed fish and seafood products (Allergen Bureau, 2011). Investigations found that soy flour containing peanut had been used in the crumbing mix and the products did not declare the presence of peanuts. Australia is also increasingly importing raw and minimally processed foods as exporting countries are able to address biosecurity risks. For example, the department is currently reviewing the importation of beef and beef products from certain countries. The primary processing of raw beef is strictly controlled by many countries, including Australia, to minimise contamination of the meat during the slaughtering process with foodborne pathogens, particularly pathogenic strains of Escherichia coli, which can cause serious illness and death. If Australia is to receive more imported raw and minimally processed foods, it is important that importers are obliged to provide assurance that these foods have been produced and processed to control likely hazards. Consumer expectations about food safety has also increased pressure on government to improve its systems. The department's imported food safety incident management experience indicates that there is increased awareness of both domestic and international food safety incidents. This has driven a shift in the expectations of consumers that government is able to respond quickly to new and emerging food safety risks by controlling potentially unsafe food from entering the domestic market place. Recalls and food safety incidents are likely occurrences in a risk-based food safety system. The role of government is to reduce the probability of illness occurring from imported food to the extent that the costs of doing so are less than the net benefits accrued. This is considered the acceptable level of risk. Department of Agriculture and Water Resources 15

While food safety issues from imported food are not common in Australia, the costs of these issues can be high to consumers, industry and government. For example, the outbreak of hepatitis A associated with imported frozen berries in 2015 directly impacted the consumers who became ill with hepatitis A and also the company that imported the berries. In this outbreak, there were thirty three confirmed hepatitis A illnesses, costing an estimated $710 000 (Box 2). After the implicated product was recalled, the profits of the company that had imported the berries went from $16.7 million to $2.1 million per year (Patties, 2015). There are also much broader implications, with consumer confidence in the safety of frozen berries plummeting, resulting in a temporary reduction in sales for all brands of imported berry products. Trade was also affected with some importers in Australia choosing to no longer source frozen berries from the country of origin of the implicated product (Smith, 2016). To minimise the likelihood of food safety issues occurring with imported food, Australia operates a risk-based at-border inspection system. However, recent food safety issues with imported food, have exposed limitations with the current regulatory system, particularly the ability of the system to:  make importers responsible and accountable for the safety of food being imported  detect food safety issues in imported food at the border  monitor new and emerging food safety risks from imported food  respond quickly and effectively when food safety issues are identified. These shifts have resulted in a regulatory system, under the IFC Act 1992, that has not kept pace with the increased food safety risks emerging from the globalisation of supply chains and subsequent complexity of food production systems. At-border assessment of imported food needs to rely less on testing of the food and more on assurance that preventative controls are in place through the supply chain and that food is traceable and can be recalled efficiently and effectively. It is also essential that the system can readily monitor new and emerging risks and provide flexible and targeted ways to prevent and respond to food safety risks. The current regulatory system focuses on known issues and lacks the ability to identify and respond to potential food safety threats. There are also some differences in approach to the regulation of food at-border and post-border as a result of the IFC Act 1992 not being harmonised with state and territory government updates to domestic food legislation in 2000. Department of Agriculture and Water Resources 16

Box 1 Recalls and food safety incidents associated with imported food In 2013-14 the IFIS referred 29 102 lines of imported food for inspection resulting in 95 058 tests being undertaken, including label and visual checks as well as laboratory testing for microbiological and chemical contamination. Overall compliance rate was 98.5 per cent based on tests completed. This high compliance suggests there are minimal food safety concerns with imported food that is referred through the system. Data on recalls and food safety incidents provides another perspective. For food safety incidents requiring management under national frameworks and recalls, imported food is over represented compared to domestically produced food, given that imported food comprises approximately 20 per cent of the total household expenditure on food. From data compiled by FSANZ on food recalls and the department on incidents, in the last five years, 34 per cent of recalls involved imported foods (mainly because of undeclared allergens-48 per cent) and since 2006, 63 per cent of the food safety incidents requiring management under a national framework were associated with imported food. These incidents were associated with 244 illnesses and two deaths (including allergic reactions). It is important to note that this data about food safety incidents does not include those that concern domestically produced food and do not require a national response. The national responses to imported food safety incidents deal with the additional complexity of both the on and off-shore supply chains. In February 2015, there was a highly publicised outbreak of hepatitis A associated with imported frozen mixed berries. Thirty three cases of hepatitis A resulted from this outbreak. In December 2013, a ten year old boy died following an allergic reaction from consuming an imported coconut drink that contain undeclared milk content. In 2015 another child was reported to have had an anaphylactic reaction to another brand of imported coconut drink with undeclared milk content. A recently published report (2014) by the Australian National University on foodborne illness in Australia has estimated that the annual incidence in 2010 was 4.1 million (90 per cent credible interval (CrI): 2.3- 6.4 million) cases of foodborne gastroenteritis occurring each year, along with 5 140 (90 per cent CrI: 3 530-7 980) cases of non-gastrointestinal foodborne illness and 35 840 (90 per cent CrI: 25 000-54 000) cases of sequelae (Kirk et al. 2014). The cost of foodborne illness in Australia has been calculated to be approximately $1.2 billion/annum using estimates of foodborne illness in 2000 (Abelson et al. 2006). The estimates of foodborne illness in the report above do not include allergic reactions to foods. However, allergic reactions to food are an increasing issue in Australia-the rate of admission to hospital with food anaphylaxis increased significantly in the years between 1995 and 2006, most dramatically in the 0-4 year age group (University of Sydney 2014). It is estimated that one in ten babies born in Australia today will develop a food allergy (ascia 2014). Box 2 Cost of hepatitis A cases associated with frozen berries In the 2015 outbreak of hepatitis A associated with frozen berries, thirty three people were confirmed as having contracted the illness. In the report, The annual cost of foodborne illness in Australia, (Abelson et al, 2006), the cost of hepatitis A cases has been estimated to individuals and businesses. In this 2006 report, it was estimated that 150 cases of hepatitis A occur in Australia per year resulting in one death, costing a total of $3.25m or $21 523/case. These costs include loss of work time and loss and disruption of other household activities and the cost of one death. The estimates do not include costs to government to treat the hepatitis A illness. Without re-estimating the cost per case in 2016 figures, the cost to individuals and businesses of the thirty three cases associated with the frozen berry outbreak can be conservatively estimated at $710 259. Department of Agriculture and Water Resources 17

2.1 Importer accountability The IFC Act 1992 primarily regulates the food being imported and not the business that is importing the food. While the IFC Act 1992 includes an offence for a person who knowingly imports food that does not meet applicable standards or poses a risk to human health, it places no direct obligations on the food importing business, at the border, to take reasonable measures to ensure food being imported is safe and suitable. By contrast, state and territory food legislation includes many more offences for selling unsafe and unsuitable food and handling food in a way that would render food unsafe or unsuitable. This is supported by measures in the Code that require food businesses to notify their business to the relevant authority, handle food safely and have information available to assist with traceback and recall activities. Food businesses in Australia that import food may be registered or licensed by state and territory food regulators and therefore subject to the food business requirements in the Code through the state and territory food legislation. However, not all businesses that import food are regulated by states and territories and state and territory enforcement agencies can only enforce legislation post border. There is therefore inconsistency in the obligations placed on food businesses at-border and post border, with more obligations applying post border. If greater consistency could be achieved, all businesses importing food would be required to take reasonable measures to ensure the safety and suitability of food being imported. 2.2 Ability to detect food safety issues at the border For some food risks, preventative controls through the supply chain are essential for producing safe food. Australia's current at-border inspection and testing approach that underpins the risk- based IFIS, while providing some level of protection, does not always provide an adequate level of assurance about the safety of imported food. This is particularly the case when food is tested for the presence of foodborne pathogens and certain kinds of chemical hazards that may not be evenly distributed throughout a food lot or consignment, as this testing has the following limitations:  only a small portion of food in a lot can be tested and a negative result will not guarantee that the entire lot is safe  for some foodborne pathogens and hazards, there are no reliable effective tests that can be applied at the border (for example, it is difficult to test for viruses in foods such as norovirus and hepatitis A virus or some biotoxins)  foodborne pathogens and some chemical hazards are challenging to isolate when the prevalence and/or concentration of the pathogen is low in a food (for example, pathogenic strains of Escherichia coli such as E. coli O157 can cause serious illness in low numbers, below the level that can be reliably detected in food). While, statistically based sampling can be an effective tool to verify compliance with food standards, it is impractical to test all imported food for hazards of concern at the border to assess safety. Department of Agriculture and Water Resources 18

The safety of foods is best ensured through the effective implementation of validated control measures throughout the food chain to minimise contamination and assure food safety. As food importers have no direct control over the production of the food they are importing and because testing for safety is limited, assurance of the food's safety should be demonstrated by proof that the food has been produced under an effective food safety management system. This is particularly important for foods where food safety controls throughout the supply chain are essential for producing this food safely. For example, the safety of ready-to-eat produce is dependent on it being grown, harvested, processed and packaged in accordance with good agricultural and good hygiene practices. This is because if the produce is contaminated with a foodborne pathogen, there may be no further step, such as cooking, to destroy the pathogen before the produce is eaten. As this food cannot be reliably tested at the border for possible microbial contamination, importers of such foods should ensure the supply chains they use have effective food safety management systems in place. 2.3 Emergency response Current emergency powers are limited to food safety issues and/or hazards that have already been, or can be, identified. These powers do not adequately address the management of food safety risks that are reasonably suspected of being present but cannot be analysed (for example, viruses). This is particularly challenging at the beginning of an incident where regulatory action to prevent potentially unsafe food from entering the domestic market is delayed whilst the food safety hazard and risk is identified and confirmed and the appropriate response is established. If there is a known or suspected food safety issue with an imported food, it is critical that the department can:  temporarily suspend the importation of the implicated food  identify importers of the unsafe food and where in the supply chain unsafe food has been distributed  work cooperatively and effectively with other relevant government agencies and industry to manage the food safety risk and communicate the risk to the public. Temporarily suspend the importation of the implicated food If there are reasonable grounds for believing that an imported food would, on inspection, or inspection and analysis, pose a risk to human health, the Secretary of the department can issue a holding order for the food (section 15 of the IFC Act 1992). This means the food can be held at the border and not released, until the conditions of the holding order have been met. A holding order must also only be placed on a food if there are reasonable grounds to believe that a food, on inspection, or inspection and analysis would fail. The holding order must also specify the circumstances in which the order will be revoked. This is effective if the food safety issue is known and can be detected in the food, thereby allowing the food to be inspected and/or analysed and passed or failed. However, this is problematic where there is an unconfirmed food safety issue or the issue cannot be easily detected in the food. Department of Agriculture and Water Resources 19

The department is therefore currently constrained from taking urgent action when there is a known or suspected food safety issue due to the limitations of a holding order when there is an unconfirmed food safety issue or the issue cannot be easily detected in the food. Identify importers of the unsafe food Until recently the department had difficulty accessing and analysing import data to identify producers of foods and therefore importers of potentially unsafe food during an incident. These issues have now been rectified by improving access to import data contained within the ICS and requiring producer information to be lodged for all imported food (discussed under option 1). However, there are still challenges with confirming with these importers if they have sourced implicated batches of the food and if they have, where this food has been distributed, as not all importers have effective traceability systems. Traceability systems enable the importer to trace food one step backwards and one step forwards. While state and territory food legislation includes traceability requirements not all importers are regulated by state and territory food legislation. For example, in Western Australia food importers are exempted from being registered, if they handle packaged foods only. Any delay in confirming importers of a potentially unsafe food and its distribution in the supply chain, means there will be a delay in taking appropriate risk management action, such as a food recall. This increases the likelihood that more consumers could become ill. Work cooperatively and effectively with other relevant government agencies Food safety issues that require coordination by more than one food regulatory agency or between Australia and New Zealand are currently managed under the BFSN which is coordinated by FSANZ. The Department of Agriculture and Waters Resources and the Department of Health are both active participants of the BFSN, sharing information about imported food safety issues, providing epidemiological updates, participating in teleconferences and providing advice on action items. Any food regulatory agency with legislative responsibility for food safety can activate the NFIRP, which provides a formal framework for the coordination of Australian, and where appropriate New Zealand, government agencies responsible for food safety and food issues in the event of a national food incident. The department can therefore activate the NFIRP when an imported food is associated with illness, injury or death and national coordination is needed under a formal framework between the state and territory food regulators and/or with New Zealand. While there are existing networks and protocols for the coordination of food safety issues between agencies, the hepatitis A outbreak associated with imported frozen berries, highlighted issues with coordination between Australian Government agencies. Following this outbreak, an Australian Government inter-departmental committee considered areas for improvement when responding to a food safety incident. The key area for improvement was about better quality communication from the Australian Government, especially in the early stages of an incident. Work to improve Australian Government communication has already been progressed and is discussed under option 1. Department of Agriculture and Water Resources 20

2.4 Monitoring new and emerging risks The imported food regulations currently require the restrictive classification of food into 'risk' and 'surveillance' food with prescribed rates of inspection for each classification. This lack of flexibility makes investigation of new and emerging risks challenging. The department receives a range of information about new and emerging food safety risks from domestic and international sources. To respond the department needs to identify whether the risk is present in imported food, assess the risk and then, if needed, take appropriate risk management action. To obtain data on a new or emerging risk, the department can currently apply a new test to the food at the border or undertake a survey. When data is available, FSANZ can be approached to provide risk advice. However, these options have limitations. While the department can already subject an imported food to a new test, the Regulation currently authorises 5 per cent of the consignments of a surveillance food to be referred for this new test. This low referral rate is unlikely to provide sufficient data quickly enough to make an assessment of a food's safety. The department could also obtain the data needed by submitting a new survey proposal to domestic food regulators. However, there can be long delays in obtaining the funding and commitment from food regulators for a new survey, particularly when there are competing proposals that are considered higher priority. 2.5 Removing compliant food from border intervention The IFC Act 1992 currently has some mechanisms to recognise imported food certified by foreign governments and food importers that operate under food safety management systems that manage the risks with the food they are importing. These mechanisms have the effect of removing food from the IFIS where there is confidence about its safety. However, more needs to be done to increase the amount of food and food importers that are recognised so there can be less compliance intervention at the border. The Act enables the department to enter into a government-to-government certification arrangement with the national competent authority of a country exporting food to Australia, providing confidence that the food has been produced safely. Currently consignments of imported food accompanied by a recognised foreign government certificate may be inspected and tested at a reduced rate (5 per cent). Foreign government certification arrangements are currently in place for certain risk categorised foods but this could be increased by promoting the advantages of these arrangements to countries exporting a high volume of a risk food to Australia. Importers choosing to source foods from suppliers with this certification would then benefit from reduced border intervention as they would incur less compliance costs. Food importing businesses that have documented food safety management systems in place can apply for a FICA to recognise this system. Food imported by a business with a FICA is not subject to the IFIS, thereby streamlining the importation process and providing considerable savings to these businesses from costs associated with inventory control, delays and service fees. If more importers enter into a FICA, it would focus inspection activity on potentially non-compliant imported food. Department of Agriculture and Water Resources 21

However, while importers have been able to operate under a FICA since 2010, there has been a low uptake. The likely reasons for the low uptake and options to make this arrangement more attractive to food importers are discussed in section 5.1.3. Currently the only country with reduced border inspection for exports from that country is New Zealand, as the IFC Act 1992 only provides for food from New Zealand to be exempted from the application of the Act. New Zealand is exempted under the Trans-Tasman Mutual Recognition Arrangement (TTMRA). Section 5.3.4 discusses allowing foreign government equivalence for other countries. 2.6 Consistency of domestic and imported food legislation State and territory governments updated domestic food legislation in 2000 to align with food provisions contained in the Food Regulation Agreement: an inter-governmental commitment between Commonwealth, state and territory governments to a national approach to food regulation. The IFC Act 1992 was not aligned and as a result has inconsistencies with key components of the domestic legislation such as offences, definitions, emergency powers and the ability to enforce traceability of food and ensure effective and efficient recall of food. Consequently, food at the border is not regulated in a consistent way to food post border. 2.7 Summary of the problem Food safety issues with imported food have highlighted limitations with the existing regulatory system's ability to make importers accountable for the safety of the food being imported and to identify and respond to food safety risks with imported food. The IFC Act 1992 regulates the food being imported and does not place specific obligations on the importing food business. This makes enforcement challenging at the border, particularly when no test can be applied to assess an imported food's safety. Instead, the focus needs to be on importing businesses seeking food safety assurance from suppliers on the safety of the food. The restrictive classification of food into 'risk' and 'surveillance' does not enable new and emerging risks to be easily investigated, as there is no flexibility to vary referral rates for inspection unless the risk has already been established. The emergency powers are also too restrictive as they are limited to food safety issues that have already been, or can be, identified leaving a gap for those that are reasonably suspected of being present. The IFC Act 1992 has also not kept pace with domestic food regulation in Australia or international approaches to the control of imported food. Work has commenced on addressing some of these issues and this is discussed under option 1. However, more action needs to be considered to fully address the problem outlined. Australia experiences relatively few food safety incidents related to imported food. However, recent incidents have exposed some limitations with the current risk-based system for the management of imported food safety risks. The key areas of concern are that the system has:  limited ability to hold importers accountable for the safety of imported food  narrow powers to address and respond to unknown and emerging risks  limited options for compliant importers to reduce their regulatory burden Department of Agriculture and Water Resources 22

 inconsistencies with the state and territory food legislation in the areas of offences, definitions, emergency response and the ability to trace food  limited ability to utilise importer details for compliance analysis, consultation and education purposes. It is important that our food safety system continues to take a risk-based approach that enables intervention where the risks are highest whilst recognising existing industry food safety systems that manage the risks effectively and that are consistent with our international obligations. Department of Agriculture and Water Resources 23

3 Need for government action Foodborne illness is a serious public health and safety issue in Australia. In 2010, it was estimated there were 4.1 million episodes of gastrointestinal foodborne illness in Australia and 86 deaths (Kirk et al. 2014). The economic costs of foodborne illness in Australia are substantial from medical practitioner visits, treatments and days of work lost each year, costing $1.2 billion/annum (Abelson et al. 2006). This, largely preventable, burden of foodborne illness to the Australian community highlights the need to continue to improve food safety in Australia (Kirk et al. 2014). Importers of food in Australia are currently subject to regulatory control under the IFC Act 1992 and state and territory food legislation. Market forces are also likely to motivate food importers to take steps to ensure food being imported is safe and suitable as there are negative consequences if an importer is found to be supplying unsafe or unsuitable food. For example, businesses and consumers will not buy a product associated with illness. A business also runs the risk of having to pay compensation if found liable for supplying a consumer good that has caused harm and/or being prosecuted under existing food legislation. Consumers of imported food are generally unable to assess, when purchasing this food, if it is safe and suitable for consumption. For example, purchasers of the imported frozen berries associated with the hepatitis A outbreak in 2015, were unaware the product was contaminated as foodborne pathogens do not alter the appearance or taste of food. The exception to this is persons who suffer allergic reactions to foods, who rely on compulsory declarations on food labelling to assess whether it can be safely consumed. However, this does not work when labelling information is incorrect or missing. The imported coconut drink associated with the death of a child in 2013 did not have a declaration on the label that the product contained milk products. Consumers are therefore reliant on existing food regulation and market forces to compel importers of food to ensure food is safe and suitable. However, there is evidence that this is not working effectively to minimise foodborne illness and death from imported food. While it is unknown what percentage of foodborne illness in Australia each year is attributable to imported food, since 2006, 63 per cent of food safety incidents requiring management under a national framework were associated with imported food (data compiled by the department in consultation with FSANZ and OzFoodNet). These incidents were linked to 244 cases of illness (including allergic reactions to food) and two deaths. If government takes no action to address the identified problem, food safety issues with imported food will continue at their current rate and are likely to increase as food imports increase. Department of Agriculture and Water Resources 24

4 Policy objective This Decision RIS raises a range of concerns in relation to the management of imported food safety risks. These include that the current system has limited ability to provide flexible and targeted ways to prevent and respond to food safety risks. The policy objective is to strengthen the current system to provide more flexible and targeted ways to prevent and respond to food safety risks, to better protect the health of consumers while reducing the regulatory burden for compliant food importers and upholding our international obligations. This includes:  increasing importer accountability  increasing importers sourcing safe food  improved monitoring and managing of new and emerging risks  improved incident response. The proposed reform measures also seek to align with state and territory food legislation where relevant and consistent with the policy objective. Department of Agriculture and Water Resources 25

5 Consultation The Consultation RIS for imported food reforms was released for public comment on 22 August 2016 and made available via the Department of Agriculture and Water Resource's website at www.agriculture.gov.au/import/goods/food/reform/consultation. Consultation closed on 30 September 2016. Additionally, trading partner consultation was initiated by informing the World Trade Organisation (WTO) members through a Sanitary and Phytosanitary Agreement (SPS) notification on 24 August 2016, with comments due by 23 October 2016. During the consultation period:  nine submissions were received - seven from industry associations or businesses, one from government and one from a registered health promotion charity (promoting food safety)  no comments were received from trading partners in response to the Consultation RIS, however, a meeting was held with members of the Delegation of the European Union at their request in Canberra and comments are expected on the formal WTO notification before it closes on 23 October  three meetings were held with industry associations and industry representatives. Appendix A provides a list of the submissions received that will be publicly available. It also includes a summary of feedback received by key issues and responses to the issues raised. Industry was generally supportive of the proposed reform measures and did not raise any major concerns. Their main recommendations were:  to ensure there is close consultation with impacted importers on the reform measures as they are progressed  any new powers (for emergency response and new/emerging food safety risk) are limited to where necessary to address risks to public health and safety and backed by sound scientific evidence  there be a transition period for new requirements and education and guidance on these requirements. The submissions from government and the registered health promotion charity also supported the reform measures. 5.1 Summary of feedback by stakeholder group 5.1.1 Consumers No submissions were received from consumer groups or individuals. 5.1.2 Business Seven submissions were received from industry, five from industry associations and two businesses that import food. Consultation sessions were also held with businesses that import food. Department of Agriculture and Water Resources 26

Industry generally supported the proposed reform measures. The peak industry association, the Food and Beverage Importers Association (FBIA) supports in principle the direction of the proposed reforms as providing more efficient management tools at the border, in particular for emergencies, while at the same time rewarding importers of compliant food by fewer costly inspections. AUSVEG supports option 3 as better protects the health of consumers. The Ai Group supports option 3 in principle as it moves towards a preventative food safety approach, in line with developing international best practices but remains cognisant of need to ensure the regulatory burden and cost impact on businesses and therefore consumers, is minimised. Australian Pork supports option 3 as places increased responsibility on importers to source safe food. The Australian Food and Grocery Council supports the intent of option 3 subject to the following caveats:  reform needs to address food safety in its wider context, not just microbiological risk  the costs and regulatory burden must be rigorously managed to ensure food importation does not become sole domain of large enterprises  non-government certification of imported food should be recognised  better use of industry intelligence should be made to identify imported foods posing a safety risk  higher levels of inspection/sampling may not of itself provide greater food safety assurance given limitations of inspection/sampling in detecting food safety issues  non-compliance of imported food for issues not food safety related should be addressed through national system of surveillance rather than border inspection/analysis  reforms are defensible as minimum effective regulation to address identified risk - Australia should not impose on its importers any regulatory burden that it would not accept as reasonable for a foreign country to impose on Australia's exporters. Industry supports a partnership or co-regulatory method in managing the imported food safety system and therefore strongly supports the trialling of 'tiered FICAs'. Industry also strongly supported the broader acceptance of a country's food safety regulatory system that has been recognised as equivalent under Codex principles and supported high risk foods imported under foreign government certification arrangements Industry generally supported:  requiring supply chain assurance for prescribed foods but recommends close consultation with affected importers to ensure the measures do not become unnecessarily burdensome.  broader emergency powers provided that these powers are only exercised in cases where there is sound scientific evidence that a food poses a serious risk to public health and safety, importers be consulted and there is an avenue for review of the decision  additional powers to monitor for new and emerging risks provided it is restricted to where there is clear evidence of a such a risk Department of Agriculture and Water Resources 27

 harmonising of the IFC Act 1992 with domestic food legislation provided it is limited to the actions of importers at the border, prior to the sale of the food in the domestic market  a transition period to minimise impacts on businesses. There were no major concerns raised by industry, generally. However, several submitters recommended that government improve its communication with industry during food incidents. Several submitters also raised concerns and issues not directly related to the proposed reform measures. All issues raised have been summarised and addressed in Appendix A. A presentation outlining the proposed reforms was made to a meeting of the Seafood Importers Association Australasia (SIAA) in Sydney. Whilst the discussion raised a number of questions about biosecurity related matters, the key points raised about the imported food reforms were:  appears that the risk-based approach to food safety regulation can result in some non- compliant behaviour amongst seafood importers and that this can place compliant businesses at a competitive disadvantage  general view was that seafood importers would be able to meet the proposed traceability requirements without additional costs  importers will need improve current knowledge about their suppliers to comply with proposed supply chain assurance requirements and that this will require additional work for those supplying the domestic ready-to-eat market  importers present expressed keen interest in the proposed changes to the FICA arrangement and agreed that it would be useful to bring down laboratory costs  proposed transition timeframe of 12 months appeared about right There was also some discussion about establishing a 'standard' as a way to determine who can import and who cannot such as a license or registration requirement. A meeting was held in Melbourne with a range of food importing businesses who are members of the Food and Beverage Importers Association (FBIA) to discuss the proposed reforms and test the assumptions that underpin the cost benefit analysis in the RIS. The key points raised about the imported food reforms were:  concerns that current legislation is not sufficient to address non-compliant behaviour of some importers  difficulties faced with European Union (EU) food labelling and different allergen declaration requirements  the proposed traceability requirements could be met without any additional costs  the import of proposed prescribed foods and the supply chain assurance requirements could be met through importers current food safety and quality management systems noting that going back to farm will require additional work with suppliers  the proposed 12 months transition period appears to be reasonable  proposed changes to the FICA arrangement is positive and good way to bring down costs for compliant importers Department of Agriculture and Water Resources 28

 delay costs incurred also include costs of storage when an incident requires additional storage space and can result in penalties from retailers. A meeting was held in Sydney with three importers from New South Wales to discuss the proposed reforms and test some of the assumptions made in the Consultation RIS. The main concerns raised were:  public perception that higher standards apply to food being produced by domestic businesses than imported food. Businesses importing food need to apply due diligence to assure themselves that food being imported is safe  concerned that foods are being imported that do not comply with the Food Standards Code, for example, non-permitted food dyes being used in foods and foods incorrectly labelled  obtaining supply chain assurance back to the farm is possible but challenging  proposed changes to the FICA arrangement is positive and a good way to bring down costs for compliant importers. All importers present at this meeting indicated that they would be able to meet the traceability requirement. One importer imports food likely to fit within the 'prescribed food' category. This importer currently seeks supply chain assurance from the suppliers of this food but may need to obtain more detailed assurance from the supplier to ensure food safety controls are in place and effective on the supplying farms. The main recommendations proposed were:  guidance materials and education is needed to improve importers knowledge of existing obligations and proposed new requirements, consider providing advice in multiple languages  importers be permitted to obtain documented evidence of on-farm assurance for 'prescribed foods' from overseas producer (that is, documented evidence not required for each farm supplying the producer)  a transition period of eighteen months would be required to account for the timing of seasonal crops. 5.1.3 Trading partners A presentation about the proposed imported food reforms was made to members of the Delegation of the European Union on their request in Canberra. The meeting included some discussion about how the proposed measures would likely work. The following points were made:  the costs of providing supply chain assurance can be quite high for small-medium size businesses  suggestion that Australia consider including recognition of other foreign government certification/accreditation arrangements in the range of recognised certifications for the proposed supply chain assurance measure--that is, if a facility or supplier in a foreign country had been certified/accredited to the US requirements Department of Agriculture and Water Resources 29

 noted that country specific schemes can have long auditing processes  importance of any new requirements and obligations being clearly articulated to provide clarity to overseas suppliers  trading partners expectations of national treatment being equitable and consistent. The members were pleased to have the opportunity to gain a better understanding of the proposed reforms and will be interested to receive further briefings as the details are available. 5.1.4 Government One submission was received from state government - the Victorian Departments of Health and Human Services and Economic Development, Jobs, Transport and Resources and PrimeSafe. This submission from Victorian government supported Option 3 recognising the proposed changes will:  have a greater focus on quality assurance than on end point testing  provide greater consistency between food legislation in states and territories to food being imported at the border  future-proof the system noting the growth in the import of processed and unprocessed foods over the past five years  provide for greater protection of consumers. Other main comments were:  the proposed changes present a more cohesive monitoring and enforcement system across regulating bodies to identify potential risks and enact an emergency response  a range of activities would be helpful in communicating emerging food safety issues to importers, which should include clarification of the requirements under the Imported Food Control Act 1992 and the Biosecurity Act 2015  it is reasonable to assume that importers, registered as food businesses within their local authority, have the ability to trace food one step forward and one step backward. However, those not registered may have more difficulty  the proposed inclusion of general offences in the Model Food Provisions in the Imported Food Control Act 1992 will prevent, or at least deter, market entry of food substitutes and provides consistency between imported and domestically produced foods. These provisions also provide greater protection of consumers. 5.1.5 Other One submission was received from a registered health promotion charity, the Food Safety Information Council. The Council supported Option 3 as an effective method of ensuring that imported food is as safe as possible for Australian consumers. Department of Agriculture and Water Resources 30

The Council is supported by state and territory health and food safety agencies, local government, and professional, industry and community organisations. It promotes food safety with its major activity being Australia Food Safety Week, held annually in the second week of November. In its submission, the Council emphasised the role it plays during food incidents by providing science based, practical information to the media and consumers and is seeking government funding to assist with the continuation of its work. 5.2 Promoting consultation The release of the consultation package was promoted via a number of avenues including:  a media release from the relevant Commonwealth Minister (the Hon Barnaby Joyce MP, Minister for Agriculture and Water Resources)  the department's website and social media networks  subscribers to the Department of Immigration and Border Protection's ICS updates  online advertising on Facebook and Google by AdWords  departmental publications, alerts and notices  industry and government networks such as the department's Imported Food Consultative Committee and Cargo Consultative Committee and state and territory food regulators  other government agencies such as the Department of Immigration and Border Protection, FSANZ and the Department of Industry, Innovation and Science through business.gov.au and the Food and Agribusiness Growth Centre.  a printed postcard distributed through biosecurity officers and imported food officers to businesses importing food, brokers and agents  an email to parties who expressed interest in receiving updates  formally notifying international trading partners through a World Trade Organization (WTO) Sanitary and Phytosanitary Agreement (SPS) notification  targeted consultation through Australia's diplomatic posts  supplementary consultation through face to face meetings with a range of food importing businesses aimed at testing the assumptions that underpin the cost benefit analysis in the RIS. 5.3 Previous consultation Since May 2015, the department has undertaken a range of consultation activities to help inform the development of the proposed options for reform. These activities included targeted discussions with representatives of relevant Australian Government agencies, state and territory food safety regulators, food importers, industry associations and trading partners. In addition, the department undertook information gathering activities including imported food consignment data analysis, comparative analysis of international food safety regulation and a survey of food importers to assess current practices. Department of Agriculture and Water Resources 31

Specific meetings held with industry on the proposed reform options and the RIS included:  meetings with food importers in Sydney and Melbourne in June 2015, 14 industry representatives attended  discussions with the department's Imported Food Consultative Committee at the May 2015, November 2015, and May 2016 meetings as well as out of session updates. States, territories and New Zealand were consulted through existing bi-national food regulatory forums. Targeted consultation occurred with trading partners more likely to be impacted by the proposed reforms. This included Turkey, China, Brazil, the European Union, Canada, Chile, Fiji, United States, New Zealand, Papua New Guinea and Viet Nam. 5.3.1 Food importer research The department engaged Colmar Brunton Social Research to conduct research into food importer compliance, awareness and importer behaviour. The key component of this research was a food importer survey which was undertaken from 18 April to 3 May 2016. A total of 41 surveys were completed in this period. Given the very small number of completed surveys achieved, these findings should be viewed as representative of the experiences of this small number of respondents only. Objectives The objectives of the research project were to:  establish a database of food importer information that enables segmentation by specific criteria such as demographics, size/turnover, food types, source countries, use of food safety systems or other systems for compliance, costs of compliance, and state or territory food business registration/licence  provide a summary report of the research analysis including food importer segmentation, national footprint, costs of compliance, extent of food safety systems, and key statistical conclusions and relevance  obtain sufficient information regarding the type and level of involvement of importers in the food recall process, their ability to trace imported food back one step to the supplier and one step forward to the customer, and how food importers understand and meet their food recall obligations  understand importer consideration of, and interest in, entering into a FICA with the department, the perceived barriers and benefits of doing so. Methodology The department circulated the draft questionnaire within the department's Imported Food Consultative Committee (comprising a range of members, including food importers, nationally) for feedback. Department of Agriculture and Water Resources 32

To further test the planned food importer survey, a series of nine cognitive interviews were conducted from 6-9 April 2016 with food importers ranging from small importers through to very large food importers. Feedback obtained through these interviews was used in further refining the questionnaire. The online food importer survey was conducted on a self-select basis and was promoted via a number of channels including government websites, the department's Import Clearance Industry Advice Notice and Imported Food Industry Advice Notices, and ICS Notices. The survey was also promoted in partnership with key industry consultation and stakeholder groups and via the department's social media channels. Sample profile of respondents to the food importer survey Figure 8 provides an overview of the 41 respondents to the survey. Figure 8 Sample profile Key findings The research concluded the following findings. Accuracy of estimated hours The ability to accurately estimate hours spent was a challenge for many. The high proportion of 'don't know' responses to hours spent undertaking specific food import tasks makes modelling of hours and the associated cost impact on a business importing food quite challenging. Compliance effort Broadly speaking, the compliance effort required by food operators reflects the size of the business and the volume of food importing activity. Hours reported for undertaking key compliance activities were generally higher for both medium and larger businesses and those where food importing makes up a major part of their overall business activities. Department of Agriculture and Water Resources 33

State and territory licensing and registration Four in five respondents were licenced and/or registered as a food business at the state and territory level. One of the objectives of the study was to build a database of food importers that could be used as a future channel to engage the sector on potential reforms. While the low response rate did not allow for this to be realised, it was recommended to explore engagement through state and territory governments through food business licensing and regulation. Knowledge of regulations Self-rated knowledge of food safety regulation governing food importing and confidence in ability to comply was both high. Among at least the respondents of the survey, there was little evidence that food importers are lacking knowledge of the regulations governing their activities or have difficulty in complying with these. Given the self-select nature of the survey and the channels through which it was promoted, it is likely more reflective of more frequent food importers than those doing importing on a smaller or less frequent scale. Food Import Compliance Agreements (FICAs) Awareness of FICAs was reasonably low. More than half of respondents indicated they had not heard of a FICA, and among these one of the main barriers to not considering establishing one is a lack of knowledge about what they are. It is proposed that better promotion of FICAs may serve to stimulate growth in those entering into such arrangements. The proposed reform to FICAs not covering all import activities is likely to stimulate greater take-up of these arrangements. The findings showed that at least a quarter of those not currently on a FICA would be more likely to apply for one if an importer could apply for only part of its importing activities. Food safety management accreditation The majority of importers source foods from suppliers that have food safety management system accreditation. The overall proportion of suppliers with food safety management systems in place was high, and only a small proportion of suppliers of higher risk foods were identified not to have such systems in place. Together, these findings provide a reasonable level of assurance that food safety risk is being managed appropriately by food importer survey respondents. Traceability Traceability appears strong for those with documented food recall system. Those that have invested in developing a documented food recall system have the ability to readily trace one step forward or back in their supply chain, with the majority confident they could provide such information within one hour if needed. Examine barriers to ensuring all importers meet their traceability obligations. The key challenges identified by those who had established a food recall system were the challenges of dealing with multiple stakeholders at the federal and state level and the lack of a template companies could access and use for this purpose. Department of Agriculture and Water Resources 34

6 Proposed options for reform Three policy options for reform are proposed (Figure 9). Option 1 is non-legislative, option 2 involves minimal legislative change and option three includes more comprehensive legislative changes. Each option builds on the previous option. Therefore option 3 provides the most comprehensive improvement to the overall imported food regulatory system to address the current limitations and the policy objective. The costs and benefits of each option have been assessed against the status quo and with each other. The status quo represents the current regulatory system for managing imported food safety risks, as outlined in section 1.3. Figure 9 Proposed options and objectives to improve the safety of imported food Department of Agriculture and Water Resources 35

6.1 Option 1-non-legislative improvements Option 1 includes two initiatives that have already commenced to address the limitations identified following the hepatitis A outbreak associated with imported frozen berries. These initiatives commenced in 2015 as they did not require any legislative change. These initiatives are discussed below. 6.1.1 Improved Australian Government communications during a food incident Following the hepatitis A outbreak associated with imported frozen berries, a cross government department working group was established to identify areas for improvement. The working group concluded that the food safety response to the outbreak was prompt and effective but improvements could be made to how the outbreak was communicated to the public, as there was a fragmented approach in Australian Government communications activity. For example, there were three separate media statements about the issue and improved coordination between government agencies may have provided a coordinated, single message to the public during the incident. The nature of the media cycle in Australia can also lead to speculative reporting about the handling of an incident and raise concerns amongst consumers. Earlier and better quality communication, especially in the early stages of an incident, can assist with managing this. The improvements identified were to:  identify a lead Minister to manage food safety incidents quickly but recognising that as the incident progresses, the lead Minister may change  develop a better and more coordinated approach to whole of government communications  review the Memorandum of Understanding between the Department of Health, the Department of Agriculture and Water Resource and FSANZ  test these new arrangements through a multi-jurisdictional (and industry) imported food incident exercise. The above recommendations have been progressed through an inter-departmental working group, led by the Department of Agriculture and Water Resources with representatives from the Departments of Health, Prime Minister and Cabinet, the Attorney General's Department and FSANZ. This group has developed new Commonwealth communication arrangements that identify:  a lead minister responsible for communicating to the general public during a national food incident (and how roles may change as the incident progresses)  roles and responsibilities of agencies when managing a national food incident. These new communication arrangements were tested successfully during a food safety incident exercise on 27 May 2016 with relevant government agencies participating. Representatives from the food industry and state and territory food regulators were also present to observe and provide feedback. All participants provided positive feedback on the new arrangements and work is now progressing to finalise the reference materials. Department of Agriculture and Water Resources 36

In the submissions on the Consultation RIS, industry supported this initiative but also recommended that government improve its communication with industry during food incidents. Industry requested that government contact any affected industry early, before any media alerts or public communications, to avoid confusion and ensure the correct message is communicated. Government has already recognised this need and since February this year, a Food Incident Forum has been established. This government/industry group is coordinated by FSANZ and enables early and timely sharing of information during food incidents. 6.1.2 Increase number of importers with food safety management systems Food importers that have documented food safety management systems in place can apply for a FICA to recognise this system. Food products imported under a FICA are not subject to potential delay and costs associated with inspection and testing under the IFIS. Instead, food products imported under a FICA are handled by the importer's food safety management system which is audited by the department. If more importers enter into a FICA, inspection activity at the border can be focussed on imported food more likely to pose a risk to consumers, as food more likely to be compliant will be removed from the IFIS. However, while importers have been able to operate under a FICA since 2010, there has been a low uptake. Currently only fifteen importers are operating under a FICA. In the food importer survey, respondents were asked if they had heard of a FICA prior to the survey and what the main barriers were to applying for FICA. Of the 41 respondents to the survey, 54 per cent had not heard of a FICA. The most common barrier identified was 'not knowing enough about what a FICA is and how they work' (24 per cent), followed by the agreement being 'too expensive/not worth the implementation and/or maintenance cost' (12 per cent). The department has also received feedback from importers that they would be more likely to enter into a FICA if the arrangement could be for a particular imported food, food type or brand- currently it must be for the entire business. In the food importer survey, respondents were asked if this change to FICA arrangements would influence interest in applying for a FICA. Some 28 per cent of those without a FICA said they would be more likely to apply for one if this change was made. The department is currently considering options to make this possible and has commenced development of a pilot of the proposed 'tiered' FICA with a key food retailer. If this pilot is successful, the department will need to actively communicate the new FICA arrangements and advantages to importers to encourage increased participation. It is important to note that regardless of the outcome of this pilot, importers will continue to be able to apply for a FICA to recognise their documented food safety management system. Department of Agriculture and Water Resources 37

6.1.3 Costs of option 1 While this option improves government communication during imported food incidents and seeks to increase the number of importers operating under a FICA, it does not include any changes to the current regulatory system for managing imported food safety. This means imported foods would be subjected to the risk based IFIS, relying on food safety issues being detected at the border via inspection and analysis of the food. Foods with hazards that are difficult to detect at the border may therefore be imported. Importers would be encouraged to have food safety management systems as a way to meet their regulatory obligations to import safe food, but having such a systems approach would not be mandatory. There would be no flexibility to vary referral rates to assess new and emerging food safety risks with imported food. There would be no new emergency powers, potentially delaying urgent action needed at the border to stop further importation of potentially unsafe food during a food safety incident. As this option only partially meets the policy objective, consumers will continue to be exposed to food safety issues with imported food as potential food safety issues will not be effectively identified or managed. This unmanaged risk will potentially increase with time, as more food is imported and supply chains become more complex. There is also the potential for importers entering into FICAs to pass on the costs incurred to establish and maintain these FICAs, to consumers. However, given FICAs provide a net benefit to importers (section 6.1.5), this is unlikely. As part of costing the regulatory burden of options 1 and 2, the cost of businesses complying with IFIS has been calculated in the Regulatory Burden Measure (RBM). The RBM is a tool developed by the Australian Government to calculate the compliance costs of regulatory proposals. Importers would continue to incur costs when risk and surveillance food is referred under the IFIS for inspection/analysis. Three substantive compliance costs have been identified: the cost to a businesses to attend the inspection of food referred to the IFIS, to have this food analysed (when required) and the cost of having food delayed at the border (see Box 3). The department charges fees to process imported food referred for inspection/analysis under IFIS, however these direct costs are excluded from the RBM framework. The impacts, of requiring the overseas producer to be declared when an imported food is lodged within the ICS, have already been separately considered by the department in consultation with import brokers, and are therefore not considered in this RIS. Department of Agriculture and Water Resources 38

Box 3 Delay costs It is assumed that businesses importing food into Australia have financed the purchase of those goods using a business overdraft loan, and that the loan is paid back once the goods have been cleared at the border and are sold in Australia. The lost income associated with border clearance of imported food is calculated as interest paid on the value of the goods during the time between goods arriving at the border and being released into the country. An interest rate of 8 per cent is used in the calculations based on the average of business overdraft interest rates for the four major banks as at 5 July 2016. The delay for surveillance food is calculated as the difference in days between the arrival date of the goods and the inspection date recorded in the Agriculture Import Management System (AIMS) (test and release). The average delay for surveillance foods is calculated to be 14 days. The average value of goods per line of surveillance food is $14 800, resulting in a delay cost of $40.70 per line of surveillance food referred for inspection. The delay for risk food is calculated as the difference in days between the arrival of the goods and the final imported food inspection advice in AIMS (test and hold). This is calculated as an average of 18 days. The average values of goods per line of risk food is $18 600, resulting in a delay cost of $41.35 per line of risk food referred for inspection. An importer entering into a FICA will incur administrative and compliance costs, including initial set up and maintenance of the agreement, and yearly audit costs. Based on the results from the food importer research it is estimated, over a ten year period, that 50 importers will enter into a FICA (representing five new FICAs per year). Based on the profile of businesses already on a FICA, it is assumed that they will be large scale importers as the more the business imports, the greater the benefits. Based on an increase of five new FICAs every year, the average cost to businesses over a ten year period is estimated to be $238 000 per year, assuming:  a total of 80 hours for an importer to set up an agreement  an average of 110 hours per year for ongoing maintenance of the agreement, including annual audit  a default RBM labour cost of $65.45 per hour. 6.1.4 Benefits of option 1 The main benefit of option 1 is it does not introduce any new costs for importers currently operating under IFIS and no new costs will be passed on to consumers. It also partly addresses the policy objectives, as it includes non-legislative initiatives to improve imported food safety. These are:  improved government communication during a food safety incident due to the development of new arrangements  providing greater incentives to business to operate under a documented food safety system by enabling more food importers to enter into a FICA for a particular imported food, food type or brand. Consultation with importers on a FICA indicates there are many benefits to participating in this arrangement including:  not relying on the department's booking inspections and related activity Department of Agriculture and Water Resources 39

 not having goods waiting under test and hold directions  not waiting for consignments to be released  better negotiation and planning for laboratory testing, resulting in significant cost savings  improved planning of stock holdings  providing prestige to their reputation as an importer and customer of large international suppliers and retail customers. 'Tiered FICAs' were strongly support by industry in the submissions on the Consultation RIS. Based on the scenario outlined in Box 4, the regulatory savings of 50 additional FICAs over a 10 year period (at a rate of five additional FICAs each year) is estimated to be an average of $905 000 per year. This comprises savings from reduced delay costs of $203 000 and reduced inspection and laboratory costs of $702 000 per year. Box 4 Increased number of Food Import Compliance Agreements Modelled scenario For the modelled scenario, it is assumed an additional 50 importers operating will operate under a tiered FICA over a 10 year period. It is also assumed that large scale importers are more likely to enter into a FICA. Results of the food importers survey showed the median number of consignments imported by FICA holders was 700 per year. Based on data from ICS, there is an average of nine lines of food per consignment, equating to 6 300 individual lines of food per FICA importer per year. If it is assumed that a tiered FICA would cover 25 per cent of an importer's goods, the average number of lines per FICA importer per year would be 1 575. Based on data from ICS, it is assumed that 66.7 per cent of lines are surveillance foods and 33.3 per cent risk foods. Under the existing IFIS, there is a 5 per cent chance of surveillance foods being referred for inspection and testing. This equates to 52 lines. For risk food, it was estimated that on average, 25 per cent of lines would be referred for inspection (based on the assumption that the remaining lines are on a reduced inspection rate due to a previous compliance history), equating to 131 lines. Under a FICA, these goods would not be referred for inspection and testing. Regulatory savings Based on the scenario above, importers operating on a FICA would avoid 183 lines of food being delayed at the border for inspection and testing per year. Using the delay costs calculated for surveillance and risk foods (see Box 3) the total savings due to reduced delay costs were estimated to be $203 000 per year on average over a 10 year period. Importers would also not be required to attend inspections for referred goods, resulting in a saving of $162 000 per year (an average of 30 minutes per line inspected at a base labour cost of $65.45). As part of the FICA, importers are required to undertake their own sampling and testing of foods at an equivalent rate as the IFIS. The random nature of referrals under IFIS means that a business will not be able to predict when their food will be referred and cannot budget for the additional costs. Under a FICA, importers are able to plan analytical testing and negotiate competitive laboratory fees. Feedback from FICA holders estimate the cost savings from reduced laboratory fees is $20 000 per year per FICA holder. On average, modelling on five additional importers operating on a tiered FICA each year over a 10 year period, this would result in a saving of $540 000 per year across all new FICA holders. Department of Agriculture and Water Resources 40

6.1.5 Net impact of option 1 This option only partially meets the objectives of government action. It improves whole of government communications during a food safety incident and has the potential to increase the number of importers recognised for operating under effective food safety management systems. An additional uptake of 50 importers operating under a tiered FICA over 10 years would result in an average net savings of $667 000 per year, across the fifty businesses. This equates to a savings of $13 340 per year to each business on a FICA. However, the main cost of this option is it still relies on the existing regulatory system (that is, inspection and analysis of food at the border). Due to the limitations of border inspection, unsafe imported food may not be detected, with potential adverse consequences for consumers. This unmanaged risk may increase with time, as more food is imported and supply chains become more complex. 6.2 Option 2-option 1 plus further non-legislative improvements This option includes the initiatives already commenced in option 1 plus the following mainly non-legislative improvements:  proactive compliance and enforcement activities (may require minimal legislative change)  non-regulatory surveys of new and emerging food safety risks (no legislative change)  increasing high risk food imported under foreign government certification arrangements (no legislative change). 6.2.1 Proactive compliance and enforcement activities This initiative proposes to improve the use of imported food data to enable proactive compliance and enforcement activities to:  identify first time importers to inform them of legal obligations when importing food  communicate with importers �- on compliance issues �- on new or emerging food safety risks �- during a food safety incident  provide importer details to state and territory government food regulators to support their regulatory activities. To achieve this, some legislative changes may need to be made to the IFC Act 1992. Importers of all goods into Australia are required to lodge details about the imported goods into an electronic management system - the ICS, which is managed by the Department of Immigration and Border Protection. Information about food lodgements are profiled, and depending on the outcome of this profiling, referred to the IFIS for inspection/analysis. For example, in 2013-14, 820 000 lines of food within the scope of IFIS were lodged in the ICS. Of these, 101 000 lines were referred to IFIS--that is, 12 per cent of all lines of food in the scope of the IFIS were referred to IFIS for inspection/analysis. Department of Agriculture and Water Resources 41

The information on food lines referred to the department is transferred into the AIMS. This electronic system is used to manage foods referred for inspection and analysis under IFIS but does not provide a complete database of food importers to enable proactive compliance and enforcement activities. While the department can access information on importers directly from the ICS, the IFC Act 1992 appears to limit the use of this data to the operation of the IFIS as it does not expressly provide for powers to communicate directly with importers. To address this concern, the department is seeking legal advice on what, if any, legislative changes are needed to enable the department to more proactively use data on food importers contained within the ICS. If the department was able to more proactively use this data, it would assist with addressing three of the reform objectives:  increasing importer accountability  improving emergency response  monitoring of new and emerging food safety risks. Identifying first time importers would enable the department to proactively communicate imported food obligations--that is, that the importer is responsible for ensuring imported food is safe and compliant with the IFC Act 1992 and the Code. Having the ability to communicate with all food importers would enable the department to communicate food safety issues concerning imported food. For example, the importance of declaring all allergens on labels. In an emergency, it is also critical that the department can easily and quickly communicate with importers who may have imported potentially unsafe food to confirm if this food is in the supply chain and if so, the need for the importer to consider recalling it. This information could then be shared with relevant state and territory regulators to enable appropriate risk management activities to be undertaken. 6.2.2 Non-regulatory surveys of new and emerging food safety risks The department currently receives intelligence via national and international food safety networks on potential food safety issues with imported food. To assess whether a new or emerging food safety risk exists with imported food, it may need to be tested for the hazard of concern. Samples of imported food can be taken for testing at the border prior and/or post border once it is in the supply chain. Imported food can already be sampled at the border but as discussed under section 2.4, for surveillance foods, the current legislated referral rate of 5 per cent does not provide sufficient data to enable an assessment of a new or emerging food safety risk, and is an ineffective means of sampling products from a representative range of importers. Non-regulatory options for surveying imported food for new and emerging food safety risks post border are:  submitting a proposal to the Implementation Sub-committee for Food Regulation (ISFR) for inclusion in its Coordinated Food Survey Plan  liaising directly with FSANZ for a survey to be undertaken. Department of Agriculture and Water Resources 42

ISFR coordinates survey activities of national and bi-national (Australia and New Zealand) significance. Proposals for surveys are submitted to ISFR for consideration and if they are consistent with ISFR's priorities, supported by ISFR members and funding is available, will be included on ISFR's Coordinated Food Survey Plan. This plan, over a three year time frame, prioritises, plans and implements the agreed survey activities. One of the priorities of the survey plan is to contribute to knowledge, in support of scientific assessments and the management, of microbiological and chemical emerging issues, including outbreaks and food incidents. ISFR surveys have been conducted in the past to obtain data to inform risk assessment activities on potential food safety issues with imported food. However, they have mainly been used to obtain data in response to an imported food safety incident rather than obtaining data on a food safety risk that may occur in the future. For example, in 2011 a national coordinated survey of iodine levels and seaweed and seaweed containing products was conducted in response to a national food incident due to an increased number of reported human thyroid dysfunction cases linked to high iodine intake. (FSANZ 2013a). The high iodine intake was linked to the consumption of an Australian produced soy milk that contained imported seaweed. The results of this survey were used to inform risk management activities with imported seaweed. Surveys conducted under the ISFR framework can successfully provide data on new or emerging food safety risks but may not be accepted if there are higher priorities and/or if funding is not available. Additionally, unless the data is needed urgently in response to a food safety incident, it is unlikely that results will be available quickly. It can take many months for a survey proposal to be accepted and as the survey plan spans a three year period, depending on priorities, results may not be available for some time. Another option is to liaise with FSANZ on conducting a survey. While FSANZ may coordinate or participate in surveys under ISFR, it also independently undertakes surveys as part of its work on the Code or in response to emerging risks and national food incidents. For example, in 2015, FSANZ tested canned and bottled fruit products (both domestic and imported product) following reports that found arsenic was present in some imported canned peaches as well as levels of lead and tin above allowable limits in the Code (FSANZ 2015c). However, the ability of FSANZ to undertake surveys, like those coordinated under ISFR, will be subject to the availability of funding and priorities. While recognising the limitations of conducting surveys under the ISFR framework or directly with FSANZ, the department will continue to actively seek opportunities to use these mechanisms, particularly where a regulatory approach is not appropriate. 6.2.3 Increasing high risk foods imported under foreign government certification arrangements Under the existing IFC Act 1992, food can be imported under a foreign government certification arrangement. The Act enables the department to enter into a government-to-government certification arrangement with the national competent authority of a country exporting a high risk food to Australia, providing confidence that the food has been produced safely. Consignments of imported food accompanied by a recognised foreign government certificate may be inspected and tested at a reduced rate (five per cent). Department of Agriculture and Water Resources 43

Foreign government certification arrangements are currently in place for certain risk classified seafood from Thailand (fish, crustaceans and bivalve molluscs) and Canada (fish and crustaceans) and Roquefort cheese from France. Use of a foreign government certificate in the clearance of food imported to Australia is normally voluntary but under an order may be mandated. Recognised government certification is currently mandatory for raw milk cheese and beef and beef products for Bovine Spongiform Encephalopathy (BSE) food safety requirements. Foreign government certification arrangements benefit the exporting country, the importer and also potentially the consumers of these foods. The exporting country benefits as it is exposed to less trade and reputational risk from non-compliant food being exported. The importer of risk foods benefits as consignments of these foods are inspected and tested at a reduced rate (five per cent) representing financial savings to the importer. The consumer benefits from potentially safer food, as the exporting country's competent authority has provided assurance that the food complies with Australia's food safety standards. In comparison, no such government assurance is provided for other risk foods imported into Australia. However, importers may request non- government assurances from suppliers under commercial arrangements. To increase the amount of risk food that is imported under a foreign government certification arrangement and therefore certified as being compliant with Australia's food safety standards, the department could actively seek to increase the number of arrangements in place. This could be achieved by promoting the advantages of these arrangements to countries exporting a high volume of a risk food to Australia. Importers choosing to source foods from suppliers with this certification will benefit from reduced border intervention. Table 1 summarises the countries that had the most 'risk food' lines referred to the department for inspection and analysis under IFIS from 2013-2015 by commodity type (excluding New Zealand). Department of Agriculture and Water Resources 44

Table 1 Lines referred as risk by commodity type and country of origin, excluding New Zealand, 2015 Commodity types Thailand France Korea Japan China Italy Grand total Beverages 139 - 18 - 4 2 163 Cereals - - - - 1 - 1 Dairy - 6 394 - - - 1 935 8 329 Horticulture 337 66 1 298 1 479 1 530 66 4 776 Meat 244 212 133 1 52 319 961 Other 431 18 1 400 412 648 84 2 993 Seafood 12 807 29 434 1 347 784 99 15 500 Grand total 13 958 6 719 3 283 3 239 3 019 2 505 32 723 Source: Integrated Cargo System The most number of lines referred as 'risk food' is seafood from Thailand, followed by dairy from France. Foreign government certification arrangements are already in place for risk foods within the seafood commodity from Thailand and Roquefort cheese from France. However, based on the quantity of imports and referrals for inspection, foreign government certification arrangements could be explored for other 'risk' cheeses from France and Italy. The 'risk food' being exported from these countries within this commodity is soft or surface ripened cheese, due to the risk associated with foodborne pathogen Listeria monocytogenes. 6.2.4 Benefits of option 2 This option, which includes the initiatives already underway (as outlined in option 1), further addresses the reform objectives by:  improving importer accountability by communicating to importers about their legal obligations  improving incident response by communicating with importers when there are food safety issues with imported food and having the ability to share information with state and territory food regulators  monitoring new and emerging risks by working with ISFR and FSANZ to conduct non- regulatory surveys  increasing importers sourcing safe food by increasing the amount of food that can be imported under a foreign government certificate. This benefits consumers by increasing imported food safety to a greater extent than option 1. This main benefit of this option to importers is from increased foreign government certification. Food imported under a foreign government certificate has reduced intervention at the border, including inspection and analysis. In submissions from industry on the Consultation RIS, this initiative was supported. An example of these savings are outlined in Box 5. Department of Agriculture and Water Resources 45

Box 5 Increased foreign government certification Scenario As presented in Table 1, dairy from France and Italy was the second most frequently imported risk food in 2015. Of these, there were a total of 930 lines of soft or surface ripened cheese inspected at the border. There were 82 unique importers of soft or surface ripened cheese from France and Italy in 2015, with an average of two suppliers per importer (range one to ten). Costs Based on feedback from food importers, it is estimated that the time for an importer to source from suppliers with foreign government certificate and obtain evidence of certification is two hours per supplier. Using data from AIMS, there is an average of two suppliers per importer. Using a base labour cost of $65.45 per hour, the one-off cost to importers is estimated to be $2 100 per year averaged over 10 years. Regulatory savings Food imported with a government certificate would have a 5 per cent chance of being inspected and tested. The reduced delay costs to businesses is estimated to be an average of $37 000 per year. Other savings for business include reduced inspections costs of $29 000 and laboratory testing costs of $104 000, resulting in a total regulatory savings of $170 000 per year averaged over 10 years. Net savings The net savings to importers for this scenario is estimated to be $167 900 per year averaged over 10 years. This equates to a savings of $2 048 per year to each business importing these products, based on the assumption that 82 importers of soft or surface ripened cheese from France and Italy source from suppliers with foreign government certification (when this option becomes available). 6.2.5 Costs of option 2 The main disadvantage of this option is that it does not fully address the reform objectives. It does not address the issue of the department being unable to take immediate action when a potential food safety issue is identified with imported food. It also does not increase the traceability capability of importers. This may result in a delay with responding to a food safety issue, resulting in more people being exposed to a food safety hazard. The ability to monitor new and emerging food safety risks through non-regulatory surveys is dependent on both ISFR and FSANZ supporting such a survey and finances being available. Non- regulatory surveys are also more appropriate for where data does not need to be collected quickly due to the time it takes to obtain agreement to proceed. The department may therefore be restrained in its ability to respond to evidence of a new of emerging risk with imported food, potentially exposing consumers to unsafe food. While this option potentially increases the number of importers sourcing safe food through foreign government certificates, the increase will only be small as these arrangements are only suitable for certain country/risk food combinations. The majority of food will continue to be imported under IFIS with the focus being on testing a percentage of this food at the border, which has a limited ability to detect hazards in food. The safety of foods is best ensured through the effective implementation of validated control measures throughout the food chain to minimise contamination and assure food safety, particularly for foods where food safety controls throughout the supply chain are essential for producing this food safely. Department of Agriculture and Water Resources 46

This option has resource implications for the department to:  identify and proactively communicate imported food obligations to first time importers  communicate with importers on food safety issues concerning imported food  work with ISFR and FSANZ to conduct surveys on new and emerging food safety risks, which could include a financial contribution either 'in kind' or directly  promote foreign government certification arrangements with countries that are exporting a significant amount of 'risk food' to Australia such as China, Japan and Korea. However, the above resource implications for the department can be absorbed within existing budget processes. 6.2.6 Net impact of option 2 This option provides a net regulatory saving to importers of $835 000 per year over a ten year period. It includes the $667 000 savings from option 1. It has resource implications for the department but these can be absorbed within existing budgets. It increases imported food safety to a greater extent than option 1 by:  improving communication with importers and state and territory regulators to assist with incident response  addressing new and emerging risks through ISFR/FSANZ coordinated surveys  increasing the amount of risk food imported under foreign government certification arrangements. However, it does not improve the ability of the department to take a precautionary approach when food safety issues are identified with imported food or to ensure importers have the ability to trace food. New and emerging risks may not be assessed in a timely and responsive way. It also largely relies on at-border testing to detect food safety hazards at the border. This limits the department's ability to reduce the risk of foodborne illness from imported food from occurring and this risk is potentially increasing as more food is imported. 6.3 Option 3-option 1 and 2 plus changes to primary and consequential subordinate legislation Option 3 includes the initiatives outlined in options 1 and 2 plus the following changes to primary (and consequential subordinate) legislation to:  mandate evidence of supply chain assurance for certain foods  broaden emergency powers  increase powers to monitor for new and emerging risks  recognise a foreign country's food safety regulatory system  align the IFC Act 1992 with domestic food legislation where applicable-including requiring traceability. Department of Agriculture and Water Resources 47

6.3.1 Mandate evidence of supply chain assurance for prescribed foods The existing IFIS relies on inspecting and, where relevant, testing food at the border to assess the safety of imported food. Foods that pose a medium or high risk to public health ('risk food') are inspected and tested at a higher rate than lower risk food ('surveillance food'). Testing food to assess safety has its limitations as only a sample of food can be tested and a negative result does not mean the entire batch of food or other batches not subject to testing are also negative. In recognition of the limitations of testing, international food standards recommend that food businesses produce and process food under documented food safety management systems. These systems identify the food safety hazards likely to be associated with the primary production and processing of the food and the controls that need to be followed to manage these hazards. Under these systems, testing is used to verify that the controls are working and is not used on its own to assess food safety. In Australia, domestic food laws require businesses that produce or manufacture high risk food or prepare food for vulnerable people to have food safety management systems. This includes businesses that: prepare food for vulnerable people (such as for patients in hospitals); grow bivalve molluscs (such as oysters); or produce manufactured and fermented meats (such as salamis). Food safety management systems are also required for primary producers of produce such as poultry, meat, dairy, eggs and seed sprouts. Comparable countries to Australia commonly require food safety supply chain assurance for imports, particularly high risk foods. The US places the responsibility on importers to verify that their foreign suppliers have adequate food safety controls in place. High-risk foods can be required to be accompanied by credible third party certification as a condition of entry. In New Zealand all importers must take all reasonable steps to document how the food has been produced and managed in a manner that ensures the food is safe for human consumption. Foods of high regulatory interest may require a higher level of evidence of supply chain assurance, as a condition of import. Canadian importers must be able to supply traceability and food safety assurance documentation on request. However, some high risk products have to prove supply chain assurance, for example meat and meat products have to be from an approved country and establishment with safety controls in place. To address the limitations of testing food at the border, and in line with domestic and international approaches, importers of prescribed foods should be required to provide evidence that food safety hazards have been controlled throughout the primary production and processing of these foods. These foods would be prescribed in the imported food legislation. The department, in consultation with FSANZ, would determine what foods should be prescribed foods based on:  evidence of their association with causing foodborne illness  the necessity for evidence of through-chain controls to demonstrate identified food safety hazards have been effectively managed  border testing alone being insufficient to provide assurance of the food's safety. Department of Agriculture and Water Resources 48

While the foods to be prescribed would be formalised following policy agreement to this approach, the department has prepared an indicative list of these foods to enable trade and costing impacts to be estimated. These foods are:  ready-to-eat raw or minimally processed produce associated with foodborne disease  ready-to-eat raw or minimally processed nuts (shelled and unroasted)  beef and beef products  ready-to-eat uncooked meats associated with foodborne disease  raw meat and meat products (other than beef and poultry)  raw poultry  eggs (whole eggs, unprocessed egg products)  raw milk cheese  ready-to-eat raw or minimally processed bivalve molluscs  ready-to-eat minimally processed finfish. Due to biosecurity restrictions, Australia does not currently import many foods that are likely to be in the 'prescribed food' category. In the above list, Australia does not import raw poultry, eggs or raw meat, with the exception of pork for further processing. Australia imports some ready-to- eat raw or minimally processed produce, of which, some have been associated with foodborne disease such as frozen berries, semi-dried tomatoes, snow peas and sugar snap peas. It is important that the IFC Act 1992 has the ability to manage the food safety risks associated with the broader range of 'prescribed' foods, as biosecurity restrictions may change in the future. For example, the department is currently reviewing the importation of beef and beef products from certain countries. Appendix B provides more detail on foods that may be 'prescribed', the main food safety hazards of concern with these foods and the foods Australia currently imports under the above groupings. Importers would be able to demonstrate that the food safety hazards associated with a 'prescribed foods' have been controlled by:  providing a recognised government certificate or  providing a recognised non-government certificate, such as certification against internationally recognised food safety schemes--for example, GLOBALGAP or BRC Global Standards or  importing the food under a FICA. Whichever type of evidence is provided, it will be verified on a document assessment, or a system verification or audit basis. This could be done either on a consignment by consignment basis (transactional) or on a pre-import basis (pre-requisite requirement). Government certification is supported by an equivalence determination and agreement between Australia and the exporting country competent authority. Department of Agriculture and Water Resources 49

Non-government certification will be supported by recognition of food safety management systems that have been certified as meeting globally accepted food safety standards. Some 'prescribed foods' may only be able to be imported with a government certificate. This is likely to occur where the safety of the food is dependent on competent authority controls in the exporting country, such as for animal health (for example, brucellosis), or environmental health (for example, human viruses in waterways growing bivalve molluscs) and will be based on risk assessment advice from FSANZ. This currently occurs with beef and beef products that can only be imported with a government certificate to provide assurance that these products are free from BSE. Costs This option is likely to impose new costs on a small proportion of importers as well as government and may also have impacts on consumers. This option impacts on importers of foods within the 'prescribed food' category, who do not already request evidence of supply chain assurance from their suppliers. It does not impact on importers that already obtain such evidence or importers of non 'prescribed food'. An analysis of import data from 1 March 2013 to 29 February 2016, indicates that an average of 365 importers out of a total of approximately 16 000 (2 per cent) import foods within the 'prescribed food category' in any given year, with the main food imported being raw pork (Appendix B). In the food importers survey, between 2 per cent and 12 per cent of respondents indicated they had imported food types within the 'prescribed food' category in the past three years. Twelve percent had imported ready-to-eat minimally processed finfish and only 2 per cent had imported semi-dried tomatoes. Of the respondents that indicated they had imported 'prescribed foods', the only products being sourced from suppliers without food safety management certification were raw or frozen bivalve molluscs (5 suppliers out of 25) and raw ready-to-eat nuts (5 suppliers out of 83). While the number of respondents to the survey was too low to draw conclusions more broadly, it indicates that some importers of 'prescribed foods' are already obtaining food safety management system certification from suppliers of these foods. Respondents to the food importer survey with at least one supplier providing food safety management certification, were asked to estimate how many hours it takes annually to maintain food safety management system records for all certified suppliers. Estimates varied widely, from one hour to 2080 hours (for a business with 200+ employees) and 25 per cent of respondents were unable to provide an estimate. The costs to importers of 'prescribed food' to obtain evidence of supply chain assurance are estimated in Box 6. From consultation with industry, it is reasonable to assume that large businesses already meet this requirement but this may not be the case for all small to medium size businesses. As importers mainly fall within the SME category, the department will work closely with this group, throughout the implementation period, to facilitate compliance. Department of Agriculture and Water Resources 50

Box 6 Supply chain assurance Data from ICS shows there were on average 365 unique importers of foods per year that would fit the scope of 'prescribed foods', as detailed in Appendix B. Over the 2013-15 period, the number of importers of prescribed goods increased by an average of three per cent per year. This increase was factored into the RBM calculations over the ten year period so that by the tenth year there would be 476 importers of prescribed food, with an average of 418 per year over this period. More than 95 per cent of respondents in the food importers survey indicated they had supply chain assurances with their suppliers, although given the limited number of respondents, this may be over representative for all importers. Submissions received on the Consultation RIS also indicated that large organisations already meet this requirement but this may not be the case for all smaller businesses. For the purposes of the RBM, it was conservatively assumed that 50 per cent of importers of 'prescribed foods' would need to gain supply chain assurance for an average of two suppliers each (based on data from ICS). Additional information was sought from food importers on the time required to source suppliers with these assurances, with an average time of two hours per supplier. Based on an average labour rate of $65.45 per hour, the total one off cost for importers of prescribed food to establish supply chain assurance (where such assurance is not already obtained) would be an average of $6 200 per year over ten years. The median annual time required by importers to maintain and verify supply chain assurance was 50 hours, resulting in an average total cost of $687 000 per year over ten years. The net average cost for supply chain assurance for importers of prescribed foods was therefore estimated to be $693 000 per year over 10 years, or approximately $1 700 per importer per year (assuming an average of 418 importers of prescribed food/year). The department will bear the initial costs associated with establishing the foods requiring supply chain assurance and the certification that will be accepted for these foods. Departmental staff will also be required to undertake document assessment of the foods at the border to ensure they are being imported with adequate certification. However, these costs are expected to be absorbed within existing financial allocations. This option may also have a cost for consumers from an increase in the price of 'prescribed food' or less availability of this food. Prescribed foods may increase in cost, if importers of these foods pass on any increases in the cost to import these foods from suppliers who can provide certification. However, additional feedback from importers that participated in the food importer research, indicated that this is likely to be minimal as these costs are largely absorbed by importers due to market competition. Importers of 'prescribed food', to avoid new costs, may also decide to no longer import these foods, reducing the availability of these foods to consumers. While this is a possible impact, those importers that are able to absorb the costs, are likely to fill any gap. Department of Agriculture and Water Resources 51

Benefits The main benefit of this reform is that it addresses the limitations of at border-inspection to a greater extent than options 1 and 2, by making importers of 'prescribed foods' more accountable for the safety of food being imported. These foods could not be imported without the importers obtaining documented assurance that these foods have been produced safely--that is, under good agriculture and manufacturing practices, as applicable to the food. This forces importers to take a more proactive approach to food safety. There is evidence from the food importer survey, that importers of these foods are already obtaining such assurance voluntarily, recognising the importance of taking a preventative approach to food safety. There may also be indirect benefits to importers from being required to seek this assurance. This is on the basis that food that has been produced and processed under documented food safety management systems is less likely to be the cause of a food safety incident. Subsequently, importers would have less costs associated with recalls and paying compensation to consumers affected by unsafe food. Consumers will benefit from this approach, as foods within the 'prescribed food' category should be safer, due to importers having to go to greater efforts to obtain assurance from suppliers that these foods have been produced safely. 6.3.2 Broaden emergency powers Under the IFC Act 1992 a holding order may only be placed on a food if there are reasonable grounds to believe that a food, on inspection, or inspection and analysis would fail. The holding order must specify the circumstances in which the order will be revoked. This is problematic when the food safety issue is unconfirmed and/or there is no reliable test that can be applied to detect the food safety hazard. For example, while the food safety hazard with the frozen berries associated with illness was known (that is, hepatitis A), there was no reliable test that could be applied at the border to detect it in the food. To enable the department to be more responsive when there is a potential food safety issue with imported food, it is recommended the IFC Act 1992 be amended to enable the department to place a holding order on a food reasonably suspected of posing a serious danger to public health (based on the scientific evidence available at the time). For example, there may be strong epidemiological evidence that an imported food is causing illness, but the causative agent may not be known. While the food is subject to this initial holding order, risk assessment advice could be sought from FSANZ and pass/fail criteria established. The main advantage of this approach is that action can be taken immediately to hold food at the border. The main disadvantage of this approach is that a wider range of foods may be caught in the initial holding order until the risk can be properly assessed and then narrowed if supported by the risk advice. This approach is consistent with emergency powers under state and territory food acts. Under these acts, the relevant authority has emergency powers to take action if the authority has reasonable grounds to believe these actions are necessary to prevent or reduce the possibility of a serious danger to public health or to mitigate the adverse consequences of a serious danger to public health (that is, the states/territories can act on a 'reasonable belief'). Department of Agriculture and Water Resources 52

This approach appears to be consistent with international approaches and aligns with Codex Alimentarius' Guidelines for Food Import Control Systems (CAC/GL 47-2003) which recommends that the responsible authority have procedures to respond appropriately to emergency situations, including holding suspect product upon arrival. The following is what is understood about how the US, Canada, New Zealand and the EU can all respond to food safety emergencies and emerging incidents based on reasonable beliefs.  The US can issue an import alert, without inspection, on suspicion that the food would be non-compliant. The onus is then on the importer to prove the food is safe and compliant.  Canada can also enact import alerts to prevent the importation of food if there are reasonable grounds it is unsafe or non-compliant.  In New Zealand, if there is reasonable belief a product is unsafe or non-compliant, actions can be taken by the officers to prevent distribution in New Zealand and an importer's registration can be suspended if there is reasonable belief that the imported food will pose a high risk to public health or there is a serious failure in food safety operations.  The EU food safety laws include the requirement to take into account the 'Precautionary Principle' in risk management--that is, where there is a possibility of harmful effects but scientific uncertainty persists, risk management measures may be adopted, pending further scientific information for a more comprehensive risk assessment. Costs Increasing emergency response powers in the IFC Act 1992, to take a more precautionary approach, will impact on importers of foods deemed potentially unsafe. This approach is likely to impact more importers initially until FSANZ can complete a risk assessment to confirm or allay the suspected risk. Following receipt of this advice, the department may be able to narrow the scope of food subject to a holding order. Australia manages between three and four serious imported food safety issues per year. Therefore, the likelihood of imported food being restricted at the border in response to a food safety incident is small. However, if it is, the cost to these importers will be primarily associated with having food held at the border. This delay could be days or weeks. When the hepatitis A outbreak was identified, the department issued a holding order nine days after a link was made between the cases and a particular brand of frozen berries. If the department had issued a holding order, prior to the receipt of risk assessment advice from FSANZ, the order may have included a wider range of berry products resulting in delay costs to more importers. Taking a more precautionary approach also increases the impact on consumers, as more foods are likely to be subject to the initial holding order, until the risk can be properly assessed. For example, if this approach had been taken with the hepatitis A outbreak associated with imported berries, more (but not all) imported frozen berries could have been initially held at the border. This temporarily restricts the range of imported food available to consumers. To minimise the impact of increasing the emergency powers in the IFC Act 1992, it is recommended that:  a holding order only be issued for a food for which there is sound scientific evidence that it poses a serious risk to public health and safety Department of Agriculture and Water Resources 53

 the holding orders be reconsidered on receipt of risk advice from FSANZ and/or if the importer or overseas producer of the food provides sound scientific evidence that the food does not pose a serious risk to public health and safety. While industry is generally supportive of this initiative, submissions from industry on the Consultation RIS requested additional safeguards to minimise the impact including:  not applying the powers beyond the scope of imports likely to be affected  applying for the minimum time necessary  confidentiality safeguards to prevent naming of brands or exporters  industry being consulted  the decision being reviewable. The Department agrees that the impact of broadening emergency powers be minimised by ensuring it only applies to foods for which there is sound scientific evidence, for the minimum time necessary. The Department also agrees that industry should be consulted and the decision be reviewable. Holding orders are already subject to confidentiality safeguards. Based on the case study presented in Box 7, the delay costs for four food safety incidents requiring use of the proposed emergency powers is estimated to be an average of $8 000 per year. Box 7 Emergency powers case study Scenario Raw cashews imported from a single country are suspected as the cause of salmonellosis cases in Australia. Product is withheld at the border for two weeks as further evidence is gathered and appropriate safety assurances can be gained. Data In 2015 there were a total of 1 100 lines of cashews imported from a single country (approximately 42 lines every two weeks). Based on the average delay costs calculated for surveillance food ($40.70 per line for a delay of 14 days) the total delay cost for such a scenario would be $2 000. Benefits The main benefit of this option is that it is the only option that can legally restrict the importation of potentially unsafe food at the border. It therefore provides the greatest benefit to consumers, as it minimises the exposure to potentially unsafe food. It also potentially benefits industry, by minimising the impact of a food safety issue with imported food. Any delay in taking action can result in more illness occurring and reputational damage to the food commodity implicated. Under option 2, with improved communication with importers, importers can be contacted about potentially unsafe food and advised not to import it or if they have, not to distribute it in the supply chain until further information about the risk is known. While many importers may be willing to voluntarily comply with this advice, there is a risk that some will not and unsafe food could be sold to consumers. Department of Agriculture and Water Resources 54

6.3.3 Increase powers to monitor for new and emerging risks When the department becomes aware of evidence related to a new or emerging food safety risks it can apply a new test to the food at the border or approach ISFR or FSANZ with a proposal for a survey. The option to conduct a survey with ISFR or FSANZ is discussed under option 2, where it is concluded that this option is more appropriate for surveys where data does not need to be collected quickly due to the time it takes to obtain agreement to proceed. These surveys are also dependent on ISFR and FSANZ priorities and funding. The ability to apply a new test to a food also has its limitations, as under the current Regulations only 5 per cent of the consignments of a surveillance food will be referred for this new test, which is unlikely to provide sufficient data quickly enough to determine the extent of the presence of the risk and make an assessment of a food's safety. In addition, this rate of inspection means that the higher volume imports are inspected and analysed the most and the data does not provide sufficient detail of all the different individual sources of an imported food. While these issues do not exist for 'risk food' as it is referred at 100 per cent, new and emerging risks with imported food have been associated with surveillance foods and not risk foods. To address these concerns, it is proposed that foods suspected of posing a new food safety risk be temporarily referred for border inspection at a higher rate. This would require the introduction of a new inspection category into the Imported Food Control Regulations 1993 with the authority to apply a higher variable referral rate. The rate at which the food would be referred would be dependent on a number of variables such as current volumes of the food imported and likely prevalence of the hazard in the food - food imported in low volumes with an emerging hazard of likely low prevalence would need referring at a higher rate. An 'active surveillance category' was included in the Regulations but removed following the 'Tanner review' of the Act in 1998 (see Background). Under this category, 10 percent of shipments of active surveillance foods were tested to enable the, then Australian New Zealand Food Authority (now FSANZ), to provide advice on the risk to human health of a food. During the review, the Food and Beverage Importers Association raised concerns with this category stating: ... the active surveillance classification, as currently operating, is inflexible, leads to over testing and not in line with risk analysis principles. There might be need for a classification for emergency or special testing, but the current scheme is an unnecessary cost for importers, which is passed on to consumers. To overcome concerns with the previous 'active surveillance category', it is recommended that:  an evidence based approach be used to determine foods requiring more active surveillance including consideration of the regulatory impact  consultation with industry take place on any proposed increased surveillance and potential impacts  the time the food is referred at a higher rate be specified and reflect the minimum time needed to obtain the data needed to assess the potential risk  following an assessment of the potential risk, the increased rate of inspection be either ceased or appropriate risk management measures taken. Department of Agriculture and Water Resources 55

The US, New Zealand and Canada all operate risk based border inspection systems that incorporate emerging knowledge on risks. The US allocates a risk score to imports that takes into account compliance history and other factors. New Zealand food imports that pose a greater risk to consumers and public health are considered 'foods of regulatory interest' and require food safety clearances to be imported. Canada's inspection program adjusts the inspection rate according to a history of compliance and intelligence about emerging risks. Costs This option will have cost implications for importers of foods subject to 'active surveillance' and these costs may be passed on to consumers. These importers will incur costs associated with having a higher percentage of the food referred for inspection and analysis. This will include increased costs associated with managing the imports, inspection and analytical fees and delay costs. It is recommended delay costs be minimised by allowing foods under 'active surveillance' to be on a 'test and release' system, as currently applies to 'surveillance foods'. The cost, generally, should also be minimised by applying strict criteria to determining what foods are subjected to 'active surveillance', at what increased rate and for how long - as discussed above. To estimate the costs, the department has assumed that, on average, no more than four types of foods per year would be placed under this 'enhanced surveillance', based on an analysis of the frequency of new and emerging risks that have arisen with imported foods in recent years. Based on the case study provided in Box 8, the average delay costs to businesses associated with an increased rate of inspection of 25 per cent for six months is estimated to be $2 500 and laboratory costs of $6 900 for each incident. If this was to occur four times a year, the total cost is estimated to be an average of $38 000 per year across those businesses importing food subject to 'enhanced surveillance'. Industry is generally supportive on this initiative provided it is restricted to where there is clear evidence of a new or emerging food safety risk. However, there was a concern from a submitter that the impacts estimated will be much greater if the additional testing is used for regulatory purposes. If it is, industry cannot ensure compliance prior to export, where the risk is unknown. If a food is 'failed' based on testing requirements imposed after the time of export, this would have enormous impact for importers, exports and trade relations. The Department agrees that any additional testing of food at the border for new and emerging risks is primarily to inform risk assessment and management actions. However, if the food being is found food to be non-compliant with existing legislation, action will need to be taken. The Department will also consult with industry before applying any additional testing of product for new and emerging risks. Department of Agriculture and Water Resources 56

Box 8 Monitoring for new or emerging issue case study Scenario There have been reports internationally of elevated E. coli levels in coriander powder, including suspicion of causing illness. Coriander powder is placed on an elevated inspection rate of 25 per cent for six months to gather data on E. coli levels to inform an assessment of process hygiene. Costs On average there are 250 lines of coriander powder imported into Australia over a three month period. If 25 per cent of these were inspected, tested and released, there would be an associated delay cost (based on surveillance food) to businesses of $2 500 in total across those businesses importing the coriander powder. Total costs for laboratory testing would be $6 900 across these businesses. Benefits The main benefit of this option is that it enables evidence of new or emerging risks in food to be investigated promptly. Under option 2, surveys may be able to be conducted under ISFR or FSANZ but it takes time to get agreement to a survey and agreement is dependent on priorities and availability of funding. Under option 2, improved communication with importers will also enable more information to be provided on new and emerging risks but unless importers have undertaken their own testing which can be shared with the department, data will not be available for assessment of the risk. The quicker the department can act on evidence of a new or emerging risk by placing food of concern under 'active surveillance', the quicker this risk can be assessed and appropriate risk management action taken. Any delay potentially exposes consumers to unsafe imported food. 6.3.4 Recognise a foreign country's food safety regulatory system Currently the only country with reduced border inspection for exports from that country is New Zealand, as the IFC Act 1992 only provides for food from New Zealand to be exempted from the application of the Act. New Zealand is exempted under the TTMRA, which aims to remove regulatory barriers to the movement of goods and services providers between Australia and New Zealand. The IFC Act 1992 therefore does not generally apply to food imported from New Zealand unless a 'risk food' is deemed to require border inspection/analysis. Currently this means the Act only applies to beef and beef products (for BSE certification), seaweed and cassava chips from New Zealand. The IFC Act 1992 does allow for foreign government certification of risk foods, which under the Regulations means the referral rate of these foods is 5 per cent instead of the normal 100 per cent. However, it is currently only applied on a risk food/country basis. A foreign country is therefore currently unable to have all its foods recognised as being produced under an equivalent food safety regulatory system to Australia's, to reduce border inspection/testing. The Codex Alimentarius Commission's Principles and Guidelines for National Food Control Systems (CAC/GL 82-2013) and its Guidelines for Food Import Control Systems (CAC/GL 47-2003) (internationally agreed guidelines), recommend that these systems include provisions for recognition, as appropriate, of the food control system applied by an exporting country's competent authority (Codex Alimentarius 2003, 2013). Department of Agriculture and Water Resources 57

In 2015, Australia completed an assessment of comparability between the Australian and US FDA food regulatory systems based on the Codex Alimentarius Commission's principles for food control systems. The comparability assessment consisted of a thorough desk audit of materials submitted by the US FDA, the trade history recorded under the IFIS and an in-country review to verify implementation of the food regulatory system. Australia is in the late stages of assessment and development of a mutual recognition arrangement with the US. While the US system has been deemed equivalent, the IFC Act 1992 limits the ability to reduce border intervention from an entire country. It is therefore recommended that the Act be amended to give the authority to recognise foreign country equivalence, exempting all imports from border intervention except where there is evidence of non-compliance or a food safety risk. Costs This option does not impose any significant new costs to importers or consumers. Importers can benefit by sourcing food from countries that have foreign country equivalence. This may result in importers changing suppliers and there may be some costs associated with making this change. The main costs associated with this proposed change will be to the department to assess whether a foreign country's food regulatory system is comparable to that of Australia. It is expected that the countries sought for equivalence would be identified based on imported food data, compliance behaviour, trade priorities and consultation with key stakeholders including trading partners and industry representatives. The number of potential opportunities for these types of arrangements is therefore likely to be small but achievable. It is estimated that an additional two countries would be considered for such an assessment over the next ten years. Benefits Importers of foods from countries that have been assessed as having a food regulatory system comparable to Australia's will benefit from having no border intervention for these foods. There may be some risk foods where equivalence is not determined, such as currently occurs with some foods from New Zealand. The cost savings to an individual importer will depend on the volume of food being imported from the recognised country. Such recognition may also benefit our exporters as it is usual for these arrangements to be reciprocal. Industry has strongly supported recognition of foreign government food safety systems because of potential benefits. Recognising three foreign government food safety systems over a ten year period is estimated to produce annual savings over the ten year period of $807 500 to businesses. This is based on data for foods imported from the US, as outlined in Box 9. The actual savings would depend on the volume of imports from the countries for which equivalence has been determined. Consumers may benefit from reduced prices, if importers of food from a recognised country pass on some or all of the savings from importing these foods. Department of Agriculture and Water Resources 58

Box 9 Recognition of foreign government systems Data Over the last 3 years, the number of lines of food imported from the US have increased from approximately 63 000 imports in 2013, to 73 000 in 2015. Of these lines, approximately 10 per cent of risk and surveillance foods are referred to AIMS for possible inspection. There were 2 183 lines of food inspected from the US in 2015, with 562 analytical tests applied to risk foods, and 918 tests applied to surveillance foods. Costs If all food imported from the US was exempted from border intervention on the basis of being produced under an equivalent food safety system, an average savings of $425 000 per year, over ten years, is estimated due to reduce delay costs and laboratory testing. This was calculated using the baseline costs outlined in Appendix C. For the RBM, it was proposed that food safety equivalence determinations could be carried out for three countries over the ten year costing period - the US in Year 1, a second country in Year 4 and a third country in Year 7. Based on this scenario, and using the savings calculated for the US as a baseline, the annual savings over the ten year period is estimated to be $807 500 per year. 6.3.5 Align the IFC Act 1992 with domestic food legislation The Council of Australian Governments signed an Inter-Governmental Food Regulation Agreement in 2000 to give effect to a nationally consistent food regulatory system. One of the objectives of this agreement was providing a consistent regulatory approach across Australia through nationally agreed policies, standards and enforcement procedures. It included agreement to the adoption of Model Food Provisions (often referred to as the 'Model Food Act') to provide for the effective and consistent administration of the Code, including new food safety standards. The Model Food Provisions have now been adopted into state and territory food legislation. This means every jurisdiction in Australia has the same definitions for key components of food legislation such as:  definitions for 'food', 'unsafe food', 'unsuitable food'  offences relating to food  emergency powers. As the Inter-Governmental Food Regulation Agreement provided for consistency between the states and territories on food regulation, it did not include aligning Commonwealth food legislation such as the IFC Act 1992. There are therefore inconsistencies between the IFC Act 1992 and state and territory food legislation. A comparison of the definitions, offences and emergency powers between the Model Food Provisions and the IFC Act 1992 is provided at Appendix D and a summary follows. Department of Agriculture and Water Resources 59

Another key difference is food businesses are regulated under state and territory food legislation and must meet specific obligations placed on them in Chapter 3 of the Code, relating to:  notification (notifying details about the business to the appropriate enforcement agency before commencing operation such as contact details, the nature of the food business and the location)  traceability (having the ability to provide information about what food it has on the premises and where it came from (trace-back)  for certain businesses (including importers) having a fully documented food recall system in place (trace-forward)  food handling controls  health and hygiene requirements  cleaning, sanitising and maintenance  food premises and equipment. The above obligations can currently be enforced on businesses that import food, post border, by the state and territory and local government food enforcement agencies. However, they are not enforceable at the border on food importers. While many of the requirements have limited relevance on food importers at the border due to the minimal handling of the food, it is critical that importers are able to trace food for effective food incident response. It is therefore recommended this obligation be placed on all importers in the IFC Act 1992. This is discussed further below under 'Traceability'. Definitions State and territory food legislation includes definitions for 'unsafe food' and 'unsuitable food', whereas the IFC Act 1992 includes elements within these definitions under 'failing food' but there are inconsistencies. For example, the definition of 'unsafe food' excludes food being considered unsafe because it may cause allergic reactions or other reactions in persons due to sensitivities. Such foods are not specifically excluded under the definition of 'failing food' under the IFC Act 1992. This means, for example, an imported food containing an allergen could be failed at the border as it may be dangerous to human health. The definition of 'food' within the state and territory food legislation provides greater clarity around what can be considered food. For example, the state and territory food legislation definition includes any substance or thing declared to be a food under the FSANZ Act 1991. This is not included in the IFC Act 1992. Offences State and territory food legislation, as detailed in the Model Food Provisions, include many more offences than the IFC Act 1992 including for selling unsafe and unsuitable food, handling food in a way that would render food unsafe or unsuitable, selling falsely prescribed food and engaging in misleading conduct relating to the sale of food. By comparison the IFC Act 1992, only has offences in relation to knowingly importing food that poses a risk to human health, labelling and dealing offences. Department of Agriculture and Water Resources 60

As per the IFC Act 1992, the state and territory food legislation provide that it is an offence to knowingly sell food that is unsafe. However, the state and territory food legislation also includes an offence (albeit a lesser offence) for a person to sell food that is unsafe. For this lesser offence, proof that the person knew the food was unsafe is not required. The state and territory food legislation also includes additional offences related to handling food in a manner that will render, or is likely to render, the food unsafe. There is a more serious offence if a person knowingly does this. Similar offences apply in the state and territory food legislation in relation to 'unsuitable food'. If these offences were included in the IFC Act 1992, this would have the effect of, indirectly, placing responsibility on the business to take reasonable steps to ensure the food being imported is safe and suitable and once the importing business takes responsibility for this food, handling it responsibly so it does not become unsafe or unsuitable. It would also create a more seamless food regulatory system by aligning Commonwealth and state and territory food laws. Since the IFC Act 1992 was written, many provisions in the Code that relate to false and misleading descriptions and sale of food have been deleted and 'replaced' with general offences in the state and territory food legislation (as included in the Model Food Provisions). As the IFC Act 1992 does not contain these offences, it limits the ability of the department to take enforcement action at the border where food may be falsely described or adulterated but not necessarily unsafe or unsuitable. Australia, like other countries, is vulnerable to the emerging and growing threat of food fraud and substitution, with economic gain being a significant motivating factor. Examples include beef substituted with horse meat, substitution of olive oil with unknown oils and honey adulterated with water and sugars. The department, under the IFIS, can test food for authenticity at the border if the composition of the food is specified in the Code. For example, honey is currently tested for sugars and moisture content as there is a standard for honey specifying that it must be honey and contain not less than 60 per cent reducing sugars and no more than 21 per cent moisture (FSANZ 2015b). However, the composition of many foods are no longer specified in the Code, as the general provisions in state and territory food legislation and fair trading legislation provide a more efficient means of dealing with misleading conduct. Post border regulatory action may be able to be taken under state and territory food legislation and the Australian Consumer Law (Schedule 2 of the Competition and Consumer Act 2010) to address misleading and deceptive conduct in relation to food. However, these regulatory activities would be more effective if they were supported by the ability to also take action at the border. This could be achieved by including the general offences in the Model Food Provisions related to false and misleading descriptions and sale of adulterated food in the IFC Act 1992. Without this ability, action can only be taken against imported fraudulent and adulterated food post border, when it is already in the supply chain. Emergency powers As discussed in section 5.3.2, it is recommended that the emergency powers under the IFC Act 1992 be expanded to enable a precautionary approach if there are reasonable grounds for believing imported food is unsafe. Department of Agriculture and Water Resources 61

This approach is consistent with state and territory food legislation, where food can be prevented from being advertised, sold, cultivated or harvested if there are reasonable grounds to believe such restrictions are necessary to prevent or reduce the possibility of a serious danger to public health. The emergency powers in the IFC Act 1992 restrict the placing of a holding order to food that fails an inspection or analysis or where there are reasonable grounds to believe a food would fail an inspection or analysis. This does not enable a precautionary approach to be taken if an imported food is associated with illness and the hazard is not known and/or cannot be easily detected in the food. To improve consistency between the regulation of imported and domestically produced food, it is proposed that the IFC Act 1992 be aligned with the core definitions, offences and emergency powers in state and territory food legislation to:  align the definition of 'food'  separate the definition of 'failing food' into food that has failed because it is unsafe and food that has failed because it is unsuitable and include the definitions of 'unsafe food' and 'unsuitable food'  include offences to sell food that is 'unsafe' or 'unsuitable' and to handle food in a way that renders, or is likely to render, the food 'unsafe' or 'unsuitable'  include offences related to the false description of food and misleading conduct relating to sale of food  have the ability to restrict the importation of food if there are reasonable grounds to believe the food needs to be restricted to protect public health and safety. Traceability and food recall Under state and territory food legislation, food businesses must be able to provide information about what food it has on the premises and where it came from (trace-back) and certain businesses (including certain importers) must have a fully documented food recall system in place. While a food recall is focused on retrieving potentially unsafe food from the supply chain, as part of business preparedness, it should also include the ability to trace food along the chain from suppliers through to customers (that is, tracing both forward and backwards). This is outlined in FSANZ's Food Recall Plan Template, which food businesses can use to develop their own food recall systems (FSANZ 2016). As food traceability requirements only apply to food businesses post border, there is a gap for those food importers that only operate at the border. To close this gap, it is recommended, that importers be required to have the ability to trace food imported one step forwards and step backwards under the IFC Act 1992. This means that for every consignment of food imported, the importer must have the ability to identify the immediate supplier and the immediate customer. This might be achieved through providing in the IFC Act 1992 that the regulations may prescribe requirements for the traceability of food and for the recall of food. A similar approach is used in New Zealand legislation. Department of Agriculture and Water Resources 62

Costs The recommended changes to the IFC Act 1992 to align it to state and territory food legislation, where applicable, are not expected to impose new costs to industry, government or consumers. Aligning definitions should not have any impact and including the offences will only impact non- compliant importers, as these offences already apply post border. In the submissions on the Consultation RIS, industry was generally supportive of the harmonising the IFC Act 1992 to state and territory food legislation provided any harmonisation recognises the difference in applying obligations to an importing company purchasing food from outside Australia and a vendor or distributor selling food in Australia. The Department agrees the approach to harmonisation needs to be limited to the actions of importers at the border, prior to the sale of the food in the domestic market. The recommended change most likely to have an impact on food importers, is introducing a requirement to trace food imported one step backwards and one step forward. This will mainly impact those importers not already actively regulated by state/territory food enforcement agencies to have effective tracing systems in place. In the food importer survey, 80 per cent of respondents indicated they were licensed or registered as a food business and 73 per cent indicated that they had a food recall system in place. Twelve per cent of respondents did not know if they had a documented food recall system. Of those respondents that had a food recall system, nearly all said their system enables them to identify suppliers (100 per cent) and customers (97 per cent). Encouragingly, most also indicated that this information could be identified within one hour (77 per cent to identify the supplier and 67 per cent to identify the customer). See Box 9 for an estimation of the costs. Respondents were also asked what the main barriers or challenges were to establishing a documented food recall system. Two common themes were the challenge of dealing with multiple government stakeholders at the federal and state level and a perceived lack of guidance on the process of establishing such a system. As mentioned earlier, FSANZ has a food recall plan template available on its website. While this has only recently become available it should now be providing a valuable tool for businesses to develop their own food recall system. The NSW Food Authority also developed a simple Food Recall Action Plan earlier this year to assist food businesses develop a plan for removing unsafe product from the market (NSW Food Authority 2016). Consumers may be impacted by paying higher prices for imported food if businesses importing food pass on the costs associated with setting up and maintaining a traceability system. It is estimated that approximately 1 600 (or 10%) of businesses that import food will incur such costs and these costs are estimated to be $700 per businesses per year averaged over 10 years (Box 10). Therefore, any price increases to imported food are likely to be minimal. Department of Agriculture and Water Resources 63

Box 10 Traceability Data There were insufficient respondents to the food importer survey to have confidence that the responses were indicative of importers more broadly, however, the department has estimated that 50 per cent of importers that are not licensed or registered as a food business would need to improve their record keeping systems to ensure they have the ability to identify suppliers and customers of food being imported. Results of the survey indicated 20 per cent of importers were not registered with their state or territory. Of those businesses with food recall systems, respondents indicated that the length of time to establish the system was between two hours and 180 hours, with a median of ten hours. Half were unable to provide an estimate of the time required. Respondents were also asked to indicate how long it takes to maintain a food recall system. Responses ranged from one to 60 hours, with a median of 15 hours. Due to the availability of new tools to assist businesses establish traceability systems, the department reduced the time for set up and maintenance to seven and ten hours respectively. Costs The total cost of increased traceability was estimated to be $1.12 million per year, averaged over ten years. This included:  1 600 importers required to improve traceability systems  7 hours per importer to set up a traceability system (one-off cost)  10 hours per annum to maintain the traceability system  labour cost of $65.45 per hour. This equates to $700 per business per year, averaged over ten years. Benefits Providing greater consistency between state and territory food legislation and the IFC Act 1992 not only makes good sense but also addresses two of the reform objectives, increasing importer accountability and improved incident response. Greater importer accountability is achieved by amending the IFC Act 1992 to mirror the offences in the state and territory food legislation for a person to import food that is unsafe or unsuitable and also to handle food in a way that would render it unsafe or unsuitable. These offences, indirectly, have the effect of placing responsibility on the business to take reasonable steps to ensure the food being imported is safe and suitable and once the importing business takes responsibility for this food, handling it responsibly so it does not become unsafe or unsuitable. Improved incident response is achieved by broadening the emergency powers and also requiring importers to have the ability to trace food. These initiatives benefit consumers by improving the safety of imported food and in the event of unsafe food being imported, enabling it to be quickly and effectively retrieved from the supply chain. Department of Agriculture and Water Resources 64

6.3.6 Net benefits of Option 3 Option 3 is the only option that fully addresses the policy objective. It includes the benefits of options 1 and 2 but additionally:  provides greater certainty on the safety of food where evidence of through-chain controls is needed to demonstrate management of food safety hazards  enables immediate action to be taken at the border to respond to a potential food safety issue with imported food  enables evidence of a new or emerging risk with imported food to be investigated immediately by including the ability to temporarily refer this food at a higher rate for border inspection to assess the risk  includes the ability to recognise foreign country equivalence, exempting all imports from border intervention except where there is evidence of non-compliance or a food safety risk  provides greater consistency between domestic and imported food legislation. Option 3 provides the greatest benefits to consumers. It increases the safety of imported food by placing greater responsibility on importers to source safe food. It also enables more effective emergency response to potentially unsafe imported food, thereby minimising exposure to consumers. The cost of foodborne disease is significant. The cost of the thirty three cases of hepatitis A from the frozen berries outbreak has been estimated to be $710, 259 (Section 2). Option 3 also provides indirect benefits to importers, as it decreases the likelihood of an imported food safety incident occurring and consequently the costs to industry from such an incident. The costs of a food safety incident to a company can be considerable and the incident can also have wider impacts on an industry sector. As discussed in section 2, the company that imported the frozen berries implicated in the 2015 hepatitis A outbreak lost $14m in profits in the year following the outbreak. The net annual cost of option 3 is estimated to be $216 000 per year averaged over ten years across the approximately 16 000 businesses importing food, equating to approximately $14 per business per year. This is mainly driven by the costs to businesses to implement and maintain traceability systems as well as supply chain assurance for 'prescribed foods', at $1.022 million and $693 000 per year respectively. These costs are offset by the estimated savings of $835 000 per year from option 2. There is the potential for consumers to be impacted if any increased costs incurred by importers are passed on to consumers. To avoid new costs, some importers may also choose to no longer import food or narrow the type of food imported. This could decrease the range of imported food available to consumers. However, these impacts are considered to be minimal due to the small number of importers expected to be impacted by the main proposed changes (2% of importers, import prescribed food and 10% needing traceability systems). As the costs of incidents associated with unsafe imported food are considerable to consumers and industry, if this option reduces the frequency of an incident like hepatitis A associated with frozen berries by only one less every ten years, the benefits will still greatly outweigh the costs. Department of Agriculture and Water Resources 65

Regulatory Burden Measure Table Figure 10 presents the regulatory burden and cost offset estimates that have been calculated using thetitle Document Commonwealth here RBM, as required under the Australian Government Guide to Regulation. Figure 10 Regulatory burden measurement and cost offset estimate table Average annual regulatory costs Change in costs ($ million) Business Status quo Nil Policy Option 1--Non legislative change - 0.667 Increased FICA participation (improvement underway) - 0.667 Administrative costs � � Delay costs - 0.203 Inspection and laboratory costs - 0.702 Policy Option 2--Further non legislative change - 0.835 Costs from Policy Option 1 - 0.667 Increased foreign government certification - 0.168 Administrative costs + 0.002 Delay costs - 0.037 Inspection and laboratory costs - 0.133 Policy Option 3--Legislative change + 0.216 Costs from Policy Option 2 - 0.835 Supply chain assurance + 0.693 Broader emergency powers + 0.008 Monitoring new and emerging risk + 0.038 Traceability requirements + 1.120 Country system equivalence - 0.808 Are all new costs offset?  Yes, costs are offset  No, costs are not offset  Deregulatory--no offsets required Total (Change in costs - Cost offset) ($ million) = $0 Department of Agriculture and Water Resources 66

7 Trade implications The proposed reforms that will require legislative change as outlined in option 3 will likely have implications for Australia's trading partners. Whilst the proposed reforms aim to ensure that food imported into Australia meets Australian food standards and public health and safety requirements they must also be consistent with Australia's international obligations such as under the WTO agreements including the Agreement on the Application of Sanitary and Phytosanitary Measures (SPS Agreement). In addition, the proposed reforms must be consistent with the international standards for food safety as set by Codex Alimentarius. 7.1 Supply chain assurance An analysis of imports of prescribed foods over the past three years indicates which of Australia's key trading partners will be most likely affected by the proposed reforms. These countries have been approached directly to seek information about how food producers and manufacturers operate in their country. Under option 3, importers will be required to make a declaration that they have records that provide supply chain assurance for 'prescribed' foods, where border inspection alone would be insufficient to assure the safety of the food. These foods require preventative controls to be in place during their production to ensure safety as border testing alone is insufficient to provide this assurance. Australian importers will be able to demonstrate that the food safety hazards associated with 'prescribed foods' have been subjected to preventative controls in a food safety management system by providing a:  recognised government certificate or  recognised non-government certificate, such as certification of a HACCP based food safety management scheme. Government certification will be supported by a food safety management system equivalence determination, and agreement between Australia and the exporting country competent authority. Non-government certification must be supported by food safety management systems that have been certified as meeting globally accepted food safety standards consistent with Codex Alimentarius. This appears to be in line with the EU and Canada's supply chain assurance requirements for what is determined to be higher risk foods. Australia's proposal is less stringent than the US that requires supply chain assurance for a wider range of foods. It is also in line with New Zealand, which requires all importers to keep records on how products have been produced, transported and stored with more stringent requirements applied to foods of high regulatory interest. Department of Agriculture and Water Resources 67

In the US, it appears that importers are required to provide supply chain assurance for all foods, either to the Food and Drug Authority or the USDA. For meat, meat products, eggs, egg products and poultry the USDA manages the imports and only allows importations from registered countries and establishments that have been certified by the competent authority of that country. In the EU, it is understood that importers are required to ensure that their suppliers comply with HACCP as a systematic approach to food safety and good hygiene practices (GHP) through the supply chain. In addition, EU importers are required at the point of import to ensure food that is higher risk such as sprouts and products of animal origin is from registered establishments. In Canada, it appears that importers are required to have the ability to demonstrate supply chain assurance on request, but some high risk products (prescribed) have to prove supply chain assurance. For example, meat and meat products have to be from an approved country and establishment with safety controls in place. In New Zealand, it is understood that all importers must take all reasonable steps to document how the food has been produced and managed in a manner that ensures the food is safe for human consumption. Foods of high regulatory interest may require a higher level of evidence of supply chain assurance, as a condition of import. 7.1.1 Prescribed foods-Case studies 'Prescribed foods' are those foods that require a higher level of food safety assurance to be demonstrated at the border due to their potential public health and safety risk and border testing alone is insufficient to provide this assurance. To assist with assessing the potential impacts, analysis has been undertaken of the main countries that Australia currently imports 'prescribed foods' from. This analysis also identifies the Pacific Island Countries (PICs) Australia currently imports 'prescribed foods' from due to the economic importance of trade with Australia for these countries. The findings overall found that:  prescribed foods were imported from 73 countries over a three year period from 1 March 2013 to 29 February 2016  the top five countries from which the greatest volume of prescribed food (tonnes) was imported during the review period was the United States (191 790), Denmark (157 410), Canada (80 810), Vietnam (52 550) and the Netherlands (41 266)  Fiji was the only PIC country from which prescribed foods were imported  on each prescribed food category only one or two countries imported the majority of the product, by volume. Further information about the analysis of trade data is provided at Appendix E, based on the 'prescribed food' type. 7.2 Broaden emergency powers On average, Australia manages between three and four serious imported food safety issues per year. Therefore, the likelihood of imported food being restricted at the border in response to a food safety incident is low. Department of Agriculture and Water Resources 68

It is understood that the US, Canada and New Zealand all can impose import controls on food on a reasonable belief or reasonable grounds that the food could pose a risk to public health. This can include a detainment of the consignment, exportation back to the country of origin, suspension of trade, or release subject to special controls. It appears that the EU food safety laws include the requirement to take into account the 'Precautionary Principle' in risk management--that is, where there is a possibility of harmful effects but scientific uncertainty persists, risk management measures may be adopted, pending further scientific information for a more comprehensive risk assessment. The proposed imported food reforms will extend the use of holding orders to restrict imported food to enable application on reasonable grounds that the food poses a serious danger to public health, while the full extent of the actual risk is established. This appears to be consistent with what is understood about the EU, US, Canada and New Zealand's emergency powers. 7.3 Powers to monitor for new and emerging risks It appears that some of Australia's trading partners conduct risk-based inspection systems for managing food safety risks in imported foods, and are able to be more flexible with the settings of the risk and inspection frequency. In Canada and the US, inspection frequency looks like it is based on food safety risk, and takes into account compliance history. New Zealand appears to have flexibility in the use of the high regulatory interest food category as well as the use of information from the Imported Food Monitoring Program used to determine at border inspections. In the EU, the European Food Safety Authority provides scientific risk advice on foods and import requirements. However, it appears that the Member States can also consider societal, traditional, economic, ethical, environmental issues and the feasibility of border controls in categorising foods in a higher risk category for enhanced surveillance. In addition, Annex I to Regulation (EC) No 669/2009 lists food and feed of non-animal origin that are subject to an increased level of official control for imports. This list is regularly updated by the EC Standing Committee on the Food Chain and Animal Health based on information from various sources such as the Rapid Alert System for Food and Feed (RASFF), reports from the EU Food and Veterinary Office, and EU Member States and non-EU countries. Department of Agriculture and Water Resources 69

7.4 Recognise a foreign country's food safety regulatory system It is expected that the countries sought for equivalence would be determined based on imported food data, compliance behaviour, trade priorities and consultation with key stakeholders including trading partners and industry representatives. It is important to note that the number of potential opportunities for these types of arrangements are likely to be relatively small and therefore achievable. Canada, New Zealand and the EU imported food regulations also appear to enable the recognition of other countries' food safety management regulations with exemptions for particular goods that require more stringent controls due to the risk. Equivalence would be assessed on the basis that the foreign country's food safety regulatory system achieves the same level of protection as that of Australia's food safety regulatory system. Recognition of a foreign country's food safety regulatory system would likely result in Australia's exporters receiving reduced regulatory intervention associated with food safety clearance of their food exports in the foreign country. 7.5 Align the IFC Act 1992 with domestic food legislation It is proposed that for each consignment of food imported, importers in Australia will need to have accessible records that show who they bought it from and who they sold it to. This facilitates effective traceability of food during a food safety incident. Each consignment of food will be required to have documentation to identify the food, batch, supplier name and supplier location. This appears to be consistent with the US, NZ, Canada and the EU who all make importers legally responsible for the safety and compliance of the food they are importing to be safe and compliant. 7.6 International approaches 7.6.1 Countries with similar imported food safety systems It is understood that trading partners such as the US, the EU, Canada and New Zealand have or are soon to implement similar imported food safety measures that are being proposed by Australia. The majority of the proposed reform measures for Australia are equivalent or less stringent than these overseas systems, particularly when compared with the US. In the time since the introduction of the IFC Act 1992, a number of key trading partners have undertaken reviews and reforms in response to emerging food safety issues and risk management systems. Based on the following examples, the global shift in food safety regulation appears to demonstrate that our proposed reforms are well aligned to some of our key trading partners:  United States (US): Food Safety Modernisation Act introduced in November 2015 was sweeping reform that sought to ensure food safety by shifting the focus from responding to contamination to preventing it. Department of Agriculture and Water Resources 70

 China: October 2015 update of its Food Safety Law and associated regulations aimed at strengthening regulation of food companies and encouraging confidence in the China food industry.  New Zealand: 2014 reform of the Food Act 1981 took effect in March 2016. This provides greater flexibility to apply food safety requirements on a sliding scale depending on the level of risk with a focus on food production processes rather than premises.  Canada: following the report into the 2008 listeriosis outbreak (the Weatherill Report), the Safe Food for Canadians Act was introduced in late 2012. This legislation consolidates the authorities of four related food Acts aimed at strengthening Canada's food safety system based on key features of international food safety systems - identification of food businesses, ability to trace food one step forward and one step back, and establish preventative food safety controls.  European Union (EU): following a series of food incidents in late 1990 and the outcomes of its White Paper on Food Safety in 2000, established general food law regulations in 2002 that established the general principles and requirements of food law organised into functions of risk assessment, risk management and risk communication. 7.6.2 International standards Codex Alimentarius has produced principles and guidelines for food import and export inspection and certification systems. The guiding principles are set out in Principles for Food Import and Export Inspection and Certification (CAC/GL 20-1995). The guideline document of most relevant to the measures being proposed for imported food reform is Guidelines for Food Import Control Systems (CAC/GL 47-2003). In the guiding principles document, it states that 'in both design and use, food inspection and certification systems should be governed by a number of principles which will ensure an optimal outcome consistent with consumer protection and facilitation of trade.' These principles include ensuring these systems are:  risk based  non-discriminatory  cost effective and no more restrictive of trade than is necessary to achieve the level of protection needed  harmonised with international standards  recognise equivalence  transparent  able to take into account the capabilities of developing countries to provide the necessary safeguards. The proposed reforms in option 3 have been developed and will be implemented in a manner that is consistent with Australia's international obligations. To ensure consistency, advice will be sought from the Attorney-General's Department, Office of International Law, the Department of Foreign Affairs and Trade as well as from relevant Commonwealth agencies. In addition, Australia will continue to consult informally with key trading partners and formally with WTO members. Department of Agriculture and Water Resources 71

7.7 Implications for Australian exporters Australian exporters are not expected to be materially affected, if at all, by the introduction of the proposed imported food reforms. Currently export certification of a range of prescribed food products from Australia is underpinned by a regulatory framework that requires registration of food preparation establishments and participation in a commodity-specific approved arrangement scheme. Department of Agriculture and Water Resources 72

8 Implementation The key activity necessary to implement the proposed imported food reforms is the amendment of the IFC Act 1992 and subordinate legislation. Administrative procedures and requirements will also be updated to reflect the proposed changes. 8.1 Legislation The proposed reforms will require some legislative changes. The department is responsible for preparing drafting instructions, with the Office of Parliamentary Counsel responsible for drafting the changes to the legislation. 8.2 Transition It is proposed that transitional arrangements apply to the proposed reform measures that will impact on businesses importing food such as for supply chain assurance and traceability. In submissions on the Consultation RIS and meetings with importers, industry strongly supported a transition period to minimise impacts on businesses, particularly smaller businesses. However, industry had differing views on the time period, ranging from twelve months two years. The Department recommends a transition period of twelve months to give businesses time to comply with new obligations, but no longer due to the need for these reforms to be implemented to protect consumer health. 8.3 Stakeholder education and guidance An educational program will be implemented to ensure that food importers are aware of the new requirements and how to ensure that they comply. Guidance materials will also be developed to facilitate compliance. Consideration will be given to providing these materials in other languages. 8.4 Evaluation The evaluation of the effectiveness and efficiency of the implementation of the proposed options for reform to the management of imported food safety risks will occur as part of the department's business as usual management of the imported food program. This involves regular monitoring of and reporting on the effectiveness of the Imported Food Inspect Scheme to stakeholders through the Imported Food Consultative Committee (IFCC). The department also undertakes regular engagement with FSANZ to ensure the communication, coordination, development and effectiveness of risk assessment and risk management activities. Further the department contributes and participates in food safety incident management activities through the BFSN and the ISFR. These arrangements include ongoing monitoring and evaluation of the effectiveness of food safety regulation domestically. Department of Agriculture and Water Resources 73

Appendix A: Submissions received, summary of feedback and response to issues raised Feedback on the reform measures was received from formal submissions on the Consultation RIS and through meetings with importers. The department received nine submissions in response to the Consultation RIS on imported food reforms. Of these, one was confidential and eight were non-confidential. The stakeholders that submitted non-confidential submissions are listed below and the submissions will be made available on the department's website. In addition, four informal comments were received via email that contained feedback not applicable to the reforms measures. Non-confidential submissions were received from the:  Australian Food & Grocery Council (AFGC) - leading national organisation representing Australia's food, drink and grocery manufacturing sector  Food & Beverage Importers Association (FBIA) - industry association representing importers into Australia of food and beverages. Members range from large, multi-national companies to small, specialist importers  Food Safety Information Council - a registered health promotion charity, promoting food safety  Victorian Departments of Health and Human Services and Economic Development, Jobs, Transport and Resources, and PrimeSafe  AUSVEG - national peak industry body representing the interests of Australian vegetable and potato growers  Berry Ltd - a Chinese/British joint venture involved in organic and conventional berry farming and factory operations producing frozen fruit and other fruit based products  Australian Industry Group (Ai Group) - peak industry association in Australia representing the interests of more than 60 000 businesses in a range of sectors. This submission was made on behalf of the Ai Group's Confectionery Sector  Australian Pork - national representative body for Australian pig producers The department also undertook three meetings with industry associations and industry representatives to discuss the reform measures. These were:  a meeting with the Seafood Importers Association Australasia  a range of food importing businesses that are members of the Food and Beverage Importers Association (FBIA)  three importers from New South Wales. Department of Agriculture and Water Resources 74

All stakeholders that were consulted or provided a submission, generally supported the proposed reforms. Industry all generally supported Option 3 but some stressed the need for the reforms to adhere to the principles of minimum effective regulation to minimise impact on businesses and therefore consumers and also functioning of Australia's Free Trade Agreements. Industry also supported a partnership or co-regulatory method in managing the imported food safety system. A summary of the feedback received and a response to the issues raised is provided in the tables below. Tables A1, A2 and A3 summarise feedback on each option and provide responses to concerns raised. Table A4 summarises feedback on other issues and concerns raised about imported food reform more generally and provides responses to this feedback. Department of Agriculture and Water Resources 75

Table A1 Feedback and response on option 1 Proposed reform initiatives in Support Concerns Response option 1 Importer declaration of producer Industry supported this initiative. - - information One submitter from industry also supported sharing information with industry on importers of failing food to educate importers and identify importers history and competence. Improved Australian Government Industry supported this initiative. Some submitters from industry requested Government has already recognised the communication during an that government improve communication need to improve communication with incident with industry during incidents by industry during food incidents and since contacting relevant industry parties early, February this year, a Food Incident Forum before any media alerts or public has been established. This communications, to avoid confusion and government/industry group is coordinated ensure the correct message is by FSANZ and enables early and timely communicated. sharing of information during food incidents. Tiered FICAs Fully supported by industry. One submitter One submitter from industry believes the Agree that the benefits of FICAs need to be stated that the alternative of an importer setting Australian Government should consider communicated to industry, particularly the up a separate company to import food under a increasing its requirements for risk foods benefits of tiered FICAs. FICA is inefficient and costly. under FICAs - countries such as the EU and Food businesses operating under a FICA Industry also recommended a communication US undertake food safety audits of have their food safety management campaign to expand industry's understanding of establishments in Australia but Australia systems audited by the Department to the benefits of FICAs. imposes no reciprocal requirements and ensure risks associated with imported food relies solely on the provision of audit are being managed. outcomes from government or third party Where a risk food requires mandatory audits. This should be considered in future government certification, the Australian negotiations with export partners. Government undertakes a competent authority assessment of the exporting country. Department of Agriculture and Water Resources 76

Table A2 Feedback and response on option 2 Proposed reform initiatives in Support Concerns Response option 2 Proactive compliance and Supported by industry. - - enforcement activities Non-regulatory surveys on new Supported by industry, particularly the use of - - and emerging food safety risks non-regulatory surveys of domestic and imported food to establish whether there are new food safety risks. Imported foods should not be targeted unless a risk is clearly linked exclusively to imports. Increase amount of high risk food Supported by industry. - - imported under foreign One submitter from industry supported but government certification suggested that certifications of well-established arrangements and reputable non-government agencies be equally recognised as not all foreign governments will certify foods. Table A3 Feedback and response on option 3 Proposed reform initiatives in Support Concerns Response option 3 Department of Agriculture and Water Resources 77

Proposed reform initiatives in Support Concerns Response option 3 Mandatory supply chain Generally supported by industry but it was One submitter from industry noted that the The Department recognises that SMEs may assurance for 'prescribed foods' recommended that there be close consultation focus on controlling microbiological risk by require more time and assistance to meet with affected importers to ensure the measure mandating supply chain assurance for this requirements of this measure. This will does not become unnecessarily burdensome. 'prescribed foods' is necessary but does not be achieved by allowing a 12 month Industry also noted that large organisations consider it sufficient. Importers should be transition period and providing education already meet this requirement but SMEs should required to bear the onus of food safety and guidance. not be excluded through prohibitive costs or assurance in its wider context--that is, Harmonising the IFC Act 1992 with complexity. allergen management and food integrity. domestic legislation will increase importer One submitter from industry also stated that accountability more broadly by including implementing for small-scale/infrequent general offences for importing unsafe and importers (with assistance) may help the overall unsuitable food and food that is safety of the food chain. adulterated or falsely described. Broader emergency powers Industry generally supported provided: One submitter from industry highlighted The Department agrees that the impact of it is only exercised in cases where there is sound the need for the right balance to be struck broadening emergency powers be scientific evidence that a food poses a serious risk to minimise adverse impacts on industry. minimised by ensuring it only applies to to public health and safety Another submitter from industry, while foods for which there is sound scientific agreeing to emergency powers where there evidence, for the minimum time necessary. not applied beyond the scope of imports likely to is a genuine need, cautioned that the The Department also agrees that industry be affected broader powers could lead to greater should be consulted and the decision be applied for the minimum time necessary reviewable. public/media/political pressure for the there are confidentiality safeguards to prevent powers to be over-utilised as a first Holding orders are already subject to naming of brands or exporters response rather than a last-resort option. confidentiality safeguards. industry is consulted the decision is reviewable. One submitter from industry also suggested these powers capture notifications about an imported food that has caused illness or failed in the domestic market. Department of Agriculture and Water Resources 78

Proposed reform initiatives in Support Concerns Response option 3 Additional powers to monitor for Industry generally supported provided it is One submitter from industry stated that the The Department agrees that any additional new and emerging risks restricted to where there is clear evidence of a impact will be as stated in the RIS if the testing of food at the border for new and new or emerging food safety risk. additional testing is used for information emerging risks is primarily to inform risk purposes only. If it is used for regulatory assessment and management actions. purposes, industry cannot ensure However, if the food being is found to be compliance prior to export, where the risk non-compliant with existing legislation, is unknown. If a food is 'failed' based on action will need to be taken. testing requirements imposed after the The Department will also consult with time of export, this would have enormous industry before applying any additional impact for importers, exports and trade testing of product for new and emerging relations. risks. Recognition of foreign country's Strongly supported by industry. One submitter from industry recommended Australia will only recognise a foreign food safety regulatory system stringency and cautiousness when country's system following a thorough considering food safety systems from comparability assessment in accordance foreign countries to ensure only those with international standards for countries with world-renowned food safety equivalency assessment, including an in- schemes are recognised. country review to verify implementation of the food regulatory system. Harmonisation of Imported Food Industry generally supported. One submitter from industry, while not While a complete review of the IFC Act Control Act 1992 with state and Industry also agreed that it was reasonable to opposed to the initiative, considered that a 1992 may bring additional benefits, due to territory food legislation - expect that businesses importing food that are complete review of the IFC Act 1992, be time and resource constraints, these including traceability already registered or licensed with considered given its age. reforms seek to address the identified state/territory regulators, can trace food one step Two submitters from industry also limitations. forward and one step backwards. requested that any harmonisation The Department agrees the approach to recognises the difference in applying harmonisation needs to be limited to the obligations to an importing company actions of importers at the border, prior to purchasing food from outside Australia and the sale of the food in the domestic market. a vendor or distributor selling food in Australia. Department of Agriculture and Water Resources 79

Table A4 Feedback and response to concerns raised on imported food reform generally Area of concern Concerns Response Implementation Industry supported a transition period to minimise impacts on The Department recommends a transition period of twelve businesses, particularly smaller businesses. Industry also supported months to give businesses time to comply with new obligations, education and guidance be provided including developing materials in but no longer due to the need for these reforms to be multiple languages. implemented to protect consumer health. Industry had differing views on the time period, ranging from twelve Education and guidance will be provided to industry. months two years. Operation of the IFIS FBIA recommends extending the range of importers that are This issue is expected to be partly addressed by inspected - a high volume importer of foods under a particular encouraging more businesses to operate under FICAs, as tariff is more likely to have its imports scrutinised under the 5 these businesses are typically the frequent importers of percent random testing scheme than a small volume importer. food. Ai Group recommends that when a 'surveillance food' fails Once a 'surveillance food' fails, all future imports of this there should be an increased responsibility on the importer to food by the importer are referred for inspection/analysis ensure that future imports will be compliant and an importer until there are five consecutive passes. The failure of a food failure needs to link with the producer of the failed food. is also linked to the overseas producer so that other importers of this food can be targeted for inspection/analysis. AFGC supports the IFIS focussing on food safety matters only Disagree. All domestically produced and imported food and enforcement of non-food safety matters to domestic must comply with the Food Standards Code. Importers, as surveillance activity. For example, food should not be 'failed' at per domestic businesses, are responsible for ensuring the border for non-compliant labelling if this non-compliance compliance with this Code, with enforcement occurring at does not impact on the safety of the food. the border under IFIS and post border by state and territory food regulators. AFGC and the Ai Group recommended that the IFIS have the The Department consults regulatory with industry and ability to take action based on regulator and market intelligence state/territory regulators on areas of non-compliance and of non-compliance. takes action based on this intelligence. Two reform measures also specifically focus on taking action based on intelligence, either from government or industry. Impact of the hepatitis A Berry Ltd raised concerns about the detrimental affects the These concerns will by the departments of Health and outbreak on businesses hepatitis A outbreak associated with berries had on its Agriculture and Water Resources separately with Berry business, particularly the perceived food safety threat of frozen Ltd. berries from China, which it considers unfounded. Department of Agriculture and Water Resources 80

Area of concern Concerns Response Application of the TTMRA on Australian Pork raised concerns that the reference to the As noted in the Consultation RIS, foods imported into food imported from New arrangements applied to food imported from New Zealand Australia are subject to requirements under the Biosecurity Zealand for biosecurity risks under the TTMRA are unclear and imply that fresh pork Act 2015 and the IFC Act 1992. The restrictions applying to products imported into New Zealand could then be sold in imported pork are related to biosecurity and not food Australia. safety. The RIS will be amended to note that biosecurity restrictions may apply to food imported from New Zealand. Unification of biosecurity and AFGC considers the relationship between Australia's The Department is committed to regulating in an efficient imported food controls biosecurity regime and imported food controls need to be and effective manner and continues to seek opportunities unified and clarified to avoid duplication, multiple fees, to reduce duplication and costs to businesses. inspections and to minimise paperwork. Department of Agriculture and Water Resources 81

Appendix B: Prescribed foods overview Within option 3, it is recommended that importers of certain foods be required to provide evidence that food safety hazards have been controlled throughout the primary production and processing of these foods and that these foods would be prescribed in the imported food legislation. An indicative list of food that may be prescribed is outlined in Table B1 including the main food safety hazards of concern with these foods and the foods currently imported. From 2013-2015, prescribed foods were imported by a total of 623 importers (based on Australian Business Number) at an average of 365 importers per year. A total of 636 672 tonnes of prescribed foods were imported during the three year period of 1 March 2013 to 29 February 2016 (Table B2). Over this period the top prescribed food group imported (by tonnes) was 'Raw meat and meat products (pork only) of which 461 759 tonnes were imported. This was followed by 'Ready-to-eat raw or minimally processed nuts' (87 497 tonnes), 'Ready-to-eat raw or minimally processed produce associated with foodborne disease' (63 413 tonnes), 'Ready-to-eat raw or minimally processed bivalve molluscs' (16 132 tonnes) and 'Ready-to-eat minimally processed finfish' (7 871 tonnes) (Error! Reference source not found.). Table B1 Indicative list of 'prescribed foods' Indicative list of 'prescribed foods' Main food safety hazards of concern Foods currently imported with these foods Ready-to-eata raw or minimally Listeria monocytogenes, Shiga toxin- Fresh and frozen berries processed produce associated producing Escherichia coli (STEC), Frozen mango with foodborne disease such as foodborne viruses (such as hepatitis Fresh sugar snap peas and fresh and frozen berries, bagged A virus and norovirus), protozoan snow peas leafy greens, cut packaged fruit, parasites, Shigella spp. sprouted seeds, fresh herbs Semi-dried tomatoes Ready-to-eata raw or minimally Salmonella spp. Pistachios, almonds, processed nuts (shelled and cashew nuts unroasted) Beef and beef products Bovine spongiform encephalopathy No products can be (BSE) imported without a recognised foreign government certificate. Review currently underway to consider importation of fresh (chilled or frozen) beef and beef products from US, Japan, the Netherlands and Vanuatu. Ready-to-eata uncooked meats Shiga toxin-producing Escherichia Jerky, biltong, mettwurst associated with foodborne coli (STEC) disease (salami, mettwurst, jerky, biltong) Raw meat and meat products Shiga toxin-producing Escherichia Pork only for further (other than beef and poultry) coli (STEC), Salmonella processing under quarantine approved premises. Department of Agriculture and Water Resources 82

Indicative list of 'prescribed foods' Main food safety hazards of concern Foods currently imported with these foods Raw poultry Campylobacter spp., Salmonella spp. None imported due to biosecurity restrictions. Eggs (whole eggs, unprocessed Salmonella spp. None imported due to egg products) biosecurity restrictions. Raw milk cheese Shiga toxin-producing Escherichia No products can be coli (STEC), Listeria monocytogenes imported without a recognised foreign government certificate, with the exception of raw milk cheese from New Zealand. Roquefort is currently the only raw milk cheese being imported from France. Ready-to-eata raw or minimally Biotoxins, foodborne viruses, Vibrio Fresh or frozen clams, processed bivalve molluscs cholerae, Vibrio parahaemolyticus cockles, mussels, oysters, pipi and scallops Ready-to-eata minimally Listeria monocytogenes Cold smoked salmon processed finfish a Is expected to be eaten without being cooked. Table B2 Top five prescribed food groups imported over a three year period, by tonnes Total Position Prescribed Food Group (tonnes) 1 Raw meat and meat products (pork only) 461,759 2 Ready-to-eata raw or minimally processed nuts 87,497 3 Ready-to-eata raw or minimally processed produce associated with foodborne disease 63,413 4 Ready-to-eata raw or minimally processed bivalve molluscs 16,132 5 Ready-to-eata minimally processed finfish 7,871 Total 636,672 a Is expected to be eaten without being cooked. Source: ICS data Department of Agriculture and Water Resources 83

Figure B1 Top five prescribed food groups imported over a three year period, by tonnes and percentage Figure B1 Top five prescribed food groups imported over a three year period, by tonnes and percentage Department of Agriculture and Water Resources 84

Appendix C: Costing methodology and assumptions The Commonwealth RBM was used for this analysis. Consistent with the Regulatory Burden Measurement Guidance Note published by the Office of Best Practice Regulation (OBPR), the analysis included consideration of the following regulatory costs to businesses from the proposed options:  Compliance costs �- administrative costs costs incurred by regulated entities primarily to demonstrate compliance with the regulation (usually record keeping an reporting costs) �- substantive compliance costs costs incurred to deliver the regulated outcomes being sought (usually purchase and maintenance costs)  Delay costs �- expenses and loss of income incurred by a regulated entity through: an application delay an approval delay. Direct financial costs attached to a regulation that are payable to government, such as administrative charges and fees were excluded from the RBM calculation. The regulatory cost of the current IFIS was calculated to determine the baseline costs to businesses. The main costs to businesses under the existing scheme included:  the cost to business for a staff member or appointed delegate attend the inspection of the food referred to the IFIS. �- estimated time for inspection of 30 minutes per line  the cost to business for analytical tests applied to referred food �- an average cost of $220 per test for surveillance foods �- an average cost of $140 per test for risk foods  the costs associated with having food delayed at the border while it is inspected (delay cost) �- average of 14 day delay for surveillance foods inspected and released at the border, resulting in an average delay cost of $40.70 per line inspected �- average delay of 18 days for risk food inspected and held at the border, resulting in an average delay costs of $41.35 per line inspected  The base labour rate of $65.45 per hour was used for all relevant calculations. These data were used when costing the proposed options, including determining regulatory savings from reduced inspection, testing and delay costs, where relevant. Department of Agriculture and Water Resources 85

Appendix D: Comparison of Imported Food Control Act 1992 to the Model Food Provisions Following is a comparison of the IFC Act 1992 with the Model Food Provisions. In 2000, the Council of Australian Governments signed an Inter- Governmental Agreement to give effect to a nationally consistent food regulatory system. This included agreement to the adoption of Model Food Provisions (often referred to as the 'Model Food Act') to provide for the effective and consistent administration of the Australia New Zealand Food Standards Code, including new food safety standards. The Model Food Provisions have now been adopted into state and territory food legislation. The Model Food Provisions are contained within two Annex's-Annex A and Annex B. This comparison is with the provisions within Annex A only, as this Annex contain the core definitions, offences and emergency powers. The comparison is presented in three tables, one on core definitions, one on core offences and one on emergency powers. Table D1 Comparison of core definitions in Imported Food Control Act 1992 and the Model Food Provisions Core definitions Imported Food Control Act 1992 Model Food Provisions (Annex A) Differences Food food includes: In this Act, food includes: The Model Food Provisions expand on the  any substance or thing of a kind used or  any substance or thing of a kind used, or definition of 'food' to include: capable of being used as food or drink by represented as being for use, for human  substances or things that are live, raw, prepared human beings; or consumption (whether it is live, raw, or partly prepared (which may include live  any substance or thing of a kind used or prepared or partly prepared), or animals and plants) capable of being used as an ingredient or  any substance or thing of a kind used, or  substances used in preparing substances or additive in, or substance used in the represented as being for use, as an things used, or represented as being for use, for preparation of, a substance or thing referred ingredient or additive in a substance or human consumption, such as a processing aid to in paragraph (a); or thing referred to in paragraph (a)  chewing gum and any ingredients and additives  any other substance or thing that is or in chewing gum and substances used in prescribed; whether or not it is in a  any substance used in preparing a preparing chewing gum condition fit for human consumption, but substance or thing referred to in paragraph  any substances or thing declared to be a food does not include a therapeutic good within (a) (other than a substance used in under the ANZFA Act 1991 (now the FSANZ Act the meaning of the Therapeutic Goods Act preparing a living thing) if it comes into 1991) 1989. direct contact with the substance or thing Section 3 Interpretation referred to in that paragraph, such as a processing aid, or Department of Agriculture and Water Resources 86

Core definitions Imported Food Control Act 1992 Model Food Provisions (Annex A) Differences  chewing gum or an ingredient or additive in chewing gum, or any substance used in preparing chewing gum or  any substance or thing declared to be a food under a declaration in force under section 3B of the Australia New Zealand Food Authority Act 1991 of the Commonwealth [and prescribed by the regulations for the purposes of this paragraph], whether or not the substance, thing or chewing gum is in a condition fit for human consumption. (2) However, food does not include a therapeutic good within the meaning of the Therapeutic Goods Act 1989 of the Commonwealth. (3) To avoid doubt, food may include live animals and plants. Section 3 Unsafe food Not defined. However, IFC Act 1992 For the purposes of this Act, food is unsafe The main differences are: includes a definition for 'failing food'. at a particular time if it would be likely to  imported food is only considered unsafe if it has failing food means examinable food, that: cause physical harm to a person who might been examined and meets the definition of a later consume it, assuming: 'failing food' - under the Model Food Provisions,  as a result of an inspection, or inspection  it was, after that particular time and before it is an offence to sell unsafe food at any time and analysis, under the Food Inspection Scheme, is found to be: being consumed by the person, properly  definition of 'failing food' includes food safety subjected to all processes (if any) that are and suitability issues  food that does not meet the applicable standards for that food; or  relevant to its reasonable intended use, and  the Model Food Provisions make assumptions nothing happened to it after that particular that the food has been processed and consumed  food that poses a risk to human health; or time and before being consumed by the according to its reasonable intended use and  is taken, under the provisions of the person that would prevent it being used for nothing happened to it to prevent the food being Scheme, to be such food. its reasonable intended use, and used for its reasonable intended use - for Section 3 Interpretation  it was consumed by the person according to example, raw poultry is cooked before it is its reasonable intended use. eaten, according to the instructions on the label. It also expands on the circumstances where food poses a risk to human health (2) However, food is not unsafe for the  the Model Food Provisions exclude foods being considered unsafe because they may cause under subsection 3(2), as below. purposes of this Act merely because its Department of Agriculture and Water Resources 87

Core definitions Imported Food Control Act 1992 Model Food Provisions (Annex A) Differences For the purposes of this Act, food poses a inherent nutritional or chemical properties allergic reactions or other reactions in persons risk to human health if: cause, or its inherent nature causes, due to sensitivities. (a) it contains: adverse reactions only in persons with allergies or sensitivities that are not  pathogenic micro-organisms or their toxins; or common to the majority of persons.  micro-organisms indicating poor handling; (3) In subsection (1), processes include or processes involving storage and  non-approved chemicals or chemical preparation. residues; or Section 6  approved chemicals, or chemical residues, at greater levels than permitted; or  non-approved additives; or  approved additives at greater levels than permitted; or  any other contaminant or constituent that may be dangerous to human health; or (b) it has been manufactured or transported under conditions which render it dangerous or unfit for human consumption. Subsection 3(3) clarifies that the references to approved chemicals, chemical residues or additives is a reference to these substances being permitted in the Australia New Zealand Food Standards Code (the Code) and that the reference to non-approved chemicals, residues and additives are those not permitted in the Code. Unsuitable food Not defined but elements of unsuitability (1) For the purposes of this Act, food is The Model Food Provisions clarify what can be are included under definition of 'failing unsuitable if it is food that: considered to be 'unfit for human food'. These elements are: (a) is damaged, deteriorated or perished to consumption' and does not restrict it to the  micro-organisms indicating poor handling; an extent that affects its reasonable manufacturing or transporting conditions rendering it unfit. The parts of the definition Department of Agriculture and Water Resources 88

Core definitions Imported Food Control Act 1992 Model Food Provisions (Annex A) Differences or intended use, or that relate to food being unfit are food that:  non-approved chemicals or chemical (b) contains any damaged, deteriorated or  is damaged, deteriorated or perished or residues; or perished substance that affects its contains any damaged, deteriorated or  approved chemicals, or chemical residues, reasonable intended use, or perished substances and limits this to at greater levels than permitted; or circumstances where this affects the (c) is the product of a diseased animal, or  non-approved additives; or an animal that has died otherwise than by reasonable intended use of the food. For  approved additives at greater levels than slaughter, and has not been declared by or example, it may be acceptable to sell permitted; or under another Act to be safe for human broken biscuits for manufacturing  it has been manufactured or transported consumption, or purposes under conditions which render it dangerous (d) contains a biological or chemical agent,  contains a biological or chemical agent, or or unfit for human consumption. or other matter or substance, that is other matter or substance, that is foreign foreign to the nature of the food. to the nature of the food (for example (2) However, food is not unsuitable for the metal shavings in a meat pie) purposes of this Act merely  is the product of a diseased animal, or an because: animal that has died otherwise than by slaughter. (a) at any particular time before it is sold for human consumption it contains an  The Model Food Provisions do not agricultural or veterinary chemical, or automatically consider food that contains microorganisms indicating poor handling (b) when it is sold for human consumption as 'unsuitable food'. To be considered it contains an agricultural or veterinary 'unsuitable', the food would need to be chemical, so long as it does not contain the deteriorated or perished or exceed chemical in an amount that contravenes microbiological limits specified in the the Food Standards Code, or Code for that food. (c) it contains a metal or non-metal contaminant (within the meaning of the Food Standards Code) in an amount that does not contravene the permitted level for the contaminant as specified in the Food Standards Code, or (d) it contains any matter or substance that is permitted by the Food Standards Code. (3) In this section, slaughter of an animal includes the killing of an animal in the Department of Agriculture and Water Resources 89

Core definitions Imported Food Control Act 1992 Model Food Provisions (Annex A) Differences process of capturing, taking or harvesting it for the purposes of preparing it for use as food. Section 7. Food business A business that imports food is not defined In this Act, food business means a business, In the Model Food Provisions a person must under the IFC Act 1992. enterprise or activity (other than a comply with any requirement imposed on the business, enterprise or activity that is person by a provision of the code in relation to primary food production) that involves: the conduct of a food business or to food (a) the handling of food intended for sale, intended for sale or food for sale. In the Code, or the sale of food, there are specific obligations placed on food businesses in Chapter 3, relating to notifying (b) regardless of whether the business, particulars about the business to the relevant enterprise or activity concerned is of a enforcement agency, food safety practices and commercial, charitable or community food premises and equipment. nature or whether it involves the handling or sale of food on one occasion only. The IFIS, set out in the regulations to the IFC Act 1992, regulates the food that is imported. Section 4 Persons who import food regulated under the handling of food includes the making, Scheme must comply with the requirements manufacturing, producing, collecting, on the food. extracting, processing, storing, transporting, delivering, preparing, treating, preserving, packing, cooking, thawing, serving or displaying of food (Section 2 Definitions) Table D2 Comparison of core offences in Imported Food Control Act 1992 and the Model Food Provisions Core offences Imported Food Control Act 1992 Model Food Provisions (Annex A) Differences Offence to sell food Section 8 Importation offence Division 1 Serious offences relating to food In the IFC Act 1992, it is an offence for a person that is unsafe 9 Handling of food in unsafe manner to knowingly import food that poses a risk to A person must not import into Australia food to which this Act applies that the A person must not handle food intended human health. Similarly in the Model Food person knows: for sale in a manner that the person knows Provisions, it is an offence to knowingly sell food that is unsafe. However, the Model Food  does not meet applicable standards; or will render, or is likely to render, the food unsafe. Provisions also includes an offence (albeit a  poses a risk to human health. Department of Agriculture and Water Resources 90

Core offences Imported Food Control Act 1992 Model Food Provisions (Annex A) Differences Penalty: Imprisonment for 10 years. Maximum penalty: $100 000 or lesser offence) for a person to sell food that is (1A) Paragraph (1)(a) does not apply to imprisonment for 2 years, or both, in the unsafe. For this lesser offence, proof that the applicable standards relating to case of an individual and $500 000 in the person knew the food was unsafe is not information on labels for packages case of a corporation. required. containing food. 10 Sale of unsafe food The Model Food Provisions also includes (2) For the purposes of establishing a A person must not sell food that the person additional offences related to handling food in contravention of subsection (1), if, having knows is unsafe. a manner that will render, or is likely to regard to: render, the food unsafe. There is a more Maximum penalty: $100 000 or serious offence if a person knowingly does  a person's abilities, experience, imprisonment for 2 years, or both, in the this. qualifications and other attributes; and case of an individual and $500 000 in the  all the circumstances surrounding the case of a corporation. alleged contravention of that subsection; Division 2 Other offences relating to food  the person ought reasonably to have 12 Handling and sale of unsafe food known that the food did not meet (1) A person must not handle food applicable standards or posed a risk to intended for sale in a manner that will human health, the person is taken to render, or is likely to render, the food have known that the food did not meet unsafe. those standards or posed that risk. Maximum penalty: $50 000 in the case of an individual and $250 000 in the case of a corporation. (2) A person must not sell food that is unsafe. Maximum penalty: $50 000 in the case of an individual and $250 000 in the case of a corporation. Offence to sell food There is no offence for a person to import Section 13 Handling and sale of unsuitable Under the IFC Act 1992, it is an offence for a that is unsuitable food that is unsuitable but some elements food person to knowingly import food that is non- are included under the offence above to A person must not handle food intended compliant with the Code. However, there is no knowingly import food that does not meet for sale in a manner that will render, or is offence to knowingly import food for other applicable standards. likely to render, the food unsuitable. elements of unsuitability such as food that is Food referred for inspection under the damaged, deteriorated or perished. However, Maximum penalty: $40 000 in the case of IFIS, is considered 'failing food' if it does such food could be failed at the border, if Department of Agriculture and Water Resources 91

Core offences Imported Food Control Act 1992 Model Food Provisions (Annex A) Differences not comply with the Code or is considered an individual and $200 000 in the case of a referred for inspection. unfit for human consumption (see corporation. In the Model Food Provisions, the offence to definition of 'failing food' above). A person must not sell food that is sell unsuitable food does not require proof unsuitable. that the person knows that the food is Maximum penalty: $40 000 in the case of unsuitable. There is also an offence to handle an individual and $200 000 in the case of a food in a manner that will render, or is likely to corporation. render, the food unsuitable. For example, storing perishable foods at incorrect For the purposes of this section, it is temperatures. immaterial whether the food concerned is safe. Other offences The IFC Act 1992 has a separate offence The Model Food Provisions has additional The Model Food Provisions have more related to food labelling, as it is exempted offences for: offences than the IFC Act 1992. It may be from the importation offence discussed  False descriptions of food appropriate to include some of these in the IFC above. The labelling offence is dealt with Act 1992, particularly those that relate to false separately to allow a person to import food  Misleading conduct relating to sale of and misleading descriptions and sale of food. that does not meet the labelling food requirements in the Code, provided the  Sale of food not complying with the food is correctly labelled when it arrives in purchaser's demand the country.  Sale of unfit equipment or packaging or labelling material  Compliance with the Code. Table D3 Comparison of emergency powers in Imported Food Control Act 1992 and the Model Food Provisions Emergency Imported Food Control Act 1992 Model Food Provisions (Annex A) Differences powers Powers to restrict Section 15 Holding orders for certain food Section 26 Making of order Under the IFC Act 1992 a holding order, the importation or preventing the importation of a food, can be If: An order may be made under this Part by sale of food made if the food fails an inspection or analysis  an inspection, or inspection and analysis, of the relevant authority if the relevant examinable food of a particular kind authority has reasonable grounds to or there are reasonable grounds to believe a indicates the food, or a part of the food, to believe that the making of the order is food would fail an inspection or analysis. This Department of Agriculture and Water Resources 92

Emergency Imported Food Control Act 1992 Model Food Provisions (Annex A) Differences powers be failing food; or necessary to prevent or reduce the restricts a holding order to a hazard in a food  the Secretary is satisfied that there are possibility of a serious danger to public that can be detected via inspection or analysis. reasonable grounds for believing that food health or to mitigate the adverse However, an imported food may be associated of a particular kind would, on inspection, or consequences of a serious danger to public with illness and the hazard is not known inspection and analysis, be so identified; health. and/or cannot be easily detected in the food.  the Secretary may, by writing, make a Section 27 Nature of order In response to intelligence that imported food holding order: may pose a potential medium to high risk, the (1) An order under this Part may do any  stating that, until the revocation of the department could, on the advice of FSANZ, one or more of the following: order, food of that kind that is imported into classify the food as a 'risk food', which means it Australia after the making of the order must  require the publication of warnings, in a form approved by the relevant authority, would be referred under the IFIS at a 100 per be held in a place to be approved by an that a particular food or type of food is cent rate until compliance is established. authorised officer, until an inspection, or inspection and analysis, required under the unsafe, Under the Model Food Provisions, food can be Food Inspection Scheme, has been  prohibit the cultivation, taking, harvesting prevented from being advertised, sold, completed; and or obtaining, from a cultivated or harvested if there are reasonable  specifying the circumstances in which the  specified area, of a particular food or type of grounds to believe such restrictions are order will be revoked. food or other primary produce intended to necessary to prevent or reduce the possibility If the Secretary is satisfied, in respect of a be used for human consumption, of a serious danger to public health. While the holding order, that the circumstances  prohibit a particular food or type of food powers under the Model Food Provisions are specified for its revocation have occurred, from being advertised or sold, not restricted to a food that has failed, or the Secretary must, by writing,  direct that a particular food or type of food would fail, an inspection or analysis, they are immediately revoke the holding order. consigned or distributed for sale or sold be limited to food safety. The IFC Act 1992 can recalled and specify the manner in which, restrict the importation of food for non-safety Making an order and the period within which, there call is to reasons under the definition of a 'failing food'. Section 16 of the IFC Act 1992 allows be conducted, For example, a non-safety related breach of the regulations to set out particulars of a food  direct that a particular food or type of food Code. inspection scheme for imported food. The or other primary produce intended to be Act also specifies what regulations can be used for human consumption be set out under the Scheme. This includes the impounded, isolated, destroyed or power for the Minister to make orders otherwise disposed of and specify the identifying the food that is required to be manner in which the impounding, isolation, inspected and analysed under the scheme destruction or disposal is to be conducted, and the rate of such inspection. However,  prohibit absolutely the carrying on of an the Minister must not make or vary an activity in relation to a particular food or order under section 16 unless the Minister type of food, or permit the carrying on of the activity in accordance with conditions Department of Agriculture and Water Resources 93

Emergency Imported Food Control Act 1992 Model Food Provisions (Annex A) Differences powers has first consulted with FSANZ. Under the specified in the order, without limiting the regulations, food may be considered 'risk generality of paragraph (f), impose food', if FSANZ advises the Minister that conditions relating to the taking and the food has the potential to pose a high or analysis of samples of the food or of water or soil or any other thing that is part of the medium risk to public health. environment in which that activity is carried This means foods of potential food safety on in relation to the food, specify methods of concerns can, on the advice of FSANZ, be analysis (not inconsistent with any methods classified by the Minister as risk foods and prescribed by the Food Standards Code) of thereby referred for inspection at a rate of any samples required to be taken in 100 per cent until compliance is accordance with the order. established. Department of Agriculture and Water Resources 94

Appendix E: Prescribed foods analysis of trade implications Methodology and limitations The analysis within the document reviews import data of prescribed foods and the country and associated volume of the imports. The following analysis is based upon information recorded in the ICS managed by the Department of Immigration and Border Protection. The ICS is a software system into which all goods imported to or exported from Australia must be reported. Imported food data was collected from the ICS for a three year period from 1 March 2013 to 29 February 2016. This three year period was used to reduce data anomalies which may appear due to seasonal demands or fluctuations (for example, poor yields due to environmental factors). Tariff codes were used to search the ICS to identify countries from which Australia is importing 'prescribed foods'. This worked well when a tariff code matched a food within a 'prescribed food category'. For example, frozen strawberries has its own tariff code and only certain types of frozen strawberry products were out of scope such as pulped, pureed and candied. However, it did not work well when the tariff code contained multiple types of foods and only a subset of these were 'prescribed foods'. For example, fresh snow and sugar snap peas are in a tariff code which includes all fresh peas. In these circumstances, the 'Goods Description' field was used to isolate the relevant food. The 'Goods Description' field is a free text field which is entered by a customs broker. Keywords were included or excluded as necessary to locate relevant foods and improve the quality of the results. However, as it is a free text field, the description entered can be of poor quality (that is, grammatical errors, imprecise or incorrect entries). Information regarding specific keyword selection criteria used can be found in each section of this document. While the tariff codes and 'Goods Description' fields assisted with identifying the foods likely to be considered a 'prescribed food', there is no information in the ICS that specifies the intended use of the food. This is important when a food is only considered a 'prescribed food' if it is raw or minimally processed and 'ready-to-eat'. For example, many of the raw nuts being imported are likely to be going for further processing. However, as these nuts could not be separated from those being imported ready-to-eat the results will overestimate the imports of these foods. Countries which had imported under a total of 10kg of a food category were excluded from the summary as the importation of such small amounts is more likely to be for personal use rather than for commercial sale. Outcome of analysis Below, for each category of 'prescribed foods', is summary of the outcome of the analysis conducted to identify the main countries Australia imports 'prescribed food' from. A summary has also been included for the Pacific Island Countries (PICS) due to the economic importance of trade with Australia for these countries. Department of Agriculture and Water Resources 95

Ready-to-eat raw or minimally processed produce associated with foodborne disease A list of imported ready-to-eat raw or minimally processed produce associated with foodborne disease was identified. This list included fresh and frozen berries, mango, semi-dried tomatoes and snow and sugar snap peas. All countries these foods had been imported from were identified and volumes per tariff and total volume were calculated. The top five countries for total import volume (tonnes) were China (23 931), Chile (19 663), Vietnam (4 542), New Zealand (4 117) and Serbia (2 007) (see Table E1). Keywords excluded were 'pulp', 'puree', 'smoothie' and 'candied' as such imports are likely to have been subjected to some form of heat treatment. Table E1 Top five importers of ready-to-eat or minimally processed produce, by tonnes, 1 March 2013 to 29 February 2016 Position Country Total (tonnes) Primary item imported 1 China 23 931 Frozen strawberries 2 Chile 19 663 Frozen berries (excluding strawberries) 3 Vietnam 4 542 Frozen mango 4 New Zealand 4 117 Fresh berries 5 Serbia 2 007 Frozen berries (excluding strawberries) Source: ICS data Figure E1 Top five importers of ready-to-eat or minimally processed produce, by tonnes and percentage, 1 March 2013 to 29 February 2016 Source: ICS data Department of Agriculture and Water Resources 96

Ready-to-eat raw or minimally processed nuts A list of relevant ready-to-eat raw or minimally processed nuts (shelled and unroasted) was identified, which included cashew nuts, Brazil nuts, walnuts, hazelnuts (including filberts), almonds and pistachios. All countries which these foods had been imported from were identified and volumes per tariff and total volume were calculated. The top five countries for total import volume (tonnes) were Vietnam (4 338), the US (21 165), Turkey (7 911), Bolivia (2 331) and Brazil (1 922) (see Table E2). The country of origin for the majority (59 per cent) of the product was imported from Vietnam (see Source: ICS data, Table E2). Keywords excluded were 'roast', 'blanch', 'sugar', 'dried' and 'cooked', as these processes are likely to reduce associated risk with this category of foods. Table E2 Top five importers of ready-to-eat or minimally processed nuts, by tonnes, 1 March 2013 to 29 February 2016 Position Country Total (tonnes) Primary item imported 1 Vietnam 47 338 Cashew nuts 2 United States 21 165 Walnuts 3 Turkey 7 911 Hazelnuts (including filberts) 4 Bolivia 2 331 Brazil nuts 5 Brazil 1 922 Brazil nuts Source: ICS data Figure E2 Top five importers of ready-to-eat or minimally processed nuts, by tonnes and percentage, 1 March 2013 to 29 February 2016 Source: ICS data Beef and beef products Due to biosecurity restrictions to beef and beef products, New Zealand is the only country Australia imports these products within the prescribed foods criteria. Over the three year period 6 078 tonnes of beef and beef products were imported from New Zealand (see Table E3). The primary item imported under this category was frozen meat of bovine animals. A keyword Department of Agriculture and Water Resources 97

included was 'beef', to isolate all relevant foods, and a word excluded was 'return', to exclude all product being returned to Australia. Table E3 Top five importers of beef and beef products, by tonnes, 1 March 2013 to 29 February 2016 Position Country Total (tonnes) Primary item imported 1 New Zealand 6 078 Frozen bovine animal meat Source: ICS data Ready-to-eat uncooked meats associated with foodborne disease Salami, mettwurst, jerky and biltong were identified as relevant ready-to-eat uncooked meats associated with foodborne disease. Of these, Australia is currently only importing biltong from New Zealand (17 tonnes). Cooked jerky is being imported from the US and Denmark but due to the cooking process, is out of scope. No other country imported more than a total of 10kg of the category over the three year period. Keywords included were, 'salami', 'mettwurst', 'jerky' and 'biltong'. Raw meat and meat products Pork is the only meat currently imported under the prescribed foods 'Raw meat and meat products' category (excluding beef as identified in a separate category above). All countries which these foods had been imported from were identified and volumes per tariff and total volume were calculated. The top 5 countries for total import volume (tonnes) were the US (169 837), Denmark (152 837), Canada (80 300), the Netherlands (39 413) and Ireland (11 457) (see Table E4). Keywords excluded were 'cured', 'salted' and 'terrine', in order to remove foods which had undergone a level of processing which reduced the risk to foods of this category. Table E4 Top five importers of raw meat and meat products, by tonnes, 1 March 2013 to 29 February 2016 Position Country Total (tonnes) Primary item imported 1 United States 169 837 Fresh, chilled or frozen swine meat 2 Denmark 152 481 Fresh, chilled or frozen swine meat 3 Canada 80 300 Fresh, chilled or frozen swine meat 4 Netherlands (the) 39 413 Fresh, chilled or frozen swine meat 5 Ireland 11 457 Fresh, chilled or frozen swine meat Source: ICS data Department of Agriculture and Water Resources 98

Figure E3 Top five importers of raw meat and meat products, by tonnes and percentage, 1 March 2013 to 29 February 2016 Source: ICS data Raw milk cheese Raw milk cheese can only currently be imported from France under a foreign government certificate, specifically for the Roquefort cheese type. Over the three year period 111 tonnes was imported (see Table E5). The only keyword included was 'Roquefort'. Table E5 Top five importers of raw milk cheese (Roquefort), by tonnes, 1 March 2013 to 29 February 2016 Position Country Total (tonnes) 1 France 111 Source: ICS data Ready-to-eat raw or minimally processed bivalve molluscs A list of ready-to-eat raw or minimally processed bivalve molluscs was created using the prescribed foods criteria, which included oysters, clams, cockles, mussels, pipi and scallops. All countries which these foods had been imported from were identified and volumes per tariff and total volume were calculated. The top 5 countries for total import volume (tonnes) were New Zealand (7 135), China (4 404), Japan (970), Chile (775) and Peru (688) (see Table E6). Keywords included, 'oyster', 'clam', 'cockle', 'mussel', 'pipi' and 'scallop', to isolate relevant food types, and excluded 'dried', 'dry', 'cooked', 'boiled' and 'blanch', to remove foods which have undergone processing. The keyword 'off' was also excluded to remove scallops with the roe removed as it is the part of a scallop most associated with foodborne illness. Department of Agriculture and Water Resources 99

Table E6 Top five importers of ready-to-eat raw or minimally processed bivalve molluscs, by tonnes, 1 March 2013 to 29 February 2016 Position Country Total (tonnes) Primary item imported 1 New Zealand 7 135 Mussels 2 China 4 404 Scallops 3 Japan 970 Scallops 4 Chile 775 Mussels 5 Peru 688 Scallops Source: ICS data Figure E4 Top five importers of ready-to-eat raw or minimally processed bivalve molluscs, by tonnes and percentage, 1 March 2013 to 29 February 2016 Source: ICS data Ready-to-eat minimally processed finfish Cold smoked salmon is the only currently imported food under the prescribed food category of ready-to-eat minimally processed finfish. All countries these foods had been imported from were identified and volumes per tariff and total volume were calculated. The top 5 countries for total import volume (tonnes) were Denmark (4 926), Norway (2 230), Poland (318), the United Kingdom of Great Britain and Northern Ireland (157) and New Zealand (137) (see Table E7). Keywords included were 'smoked', 'salmon', to isolate relevant foods, and the only excluded keyword was 'hot', in order to exclude hot smoked salmon which undergoes heat treatment. Department of Agriculture and Water Resources 100

Table E7 Top five importers of ready-to-eat minimally processed finfish, by tonnes, 1 March 2013 to 29 February 2016 Position Country Total (tonnes) 1 Denmark 4 926 2 Norway 2 230 3 Poland 318 4 United Kingdom of Great Britain and Northern Ireland (the) 157 5 New Zealand 137 Source: ICS data Figure E5 Top five importers of ready-to-eat minimally processed finfish, by tonnes and percentage, 1 March 2013 to 29 February 2016 Source: ICS data Pacific Island countries Fiji was identified as the only country within PICS to import foods within the prescribed food categories. Fiji imported a total of 1.4 tonnes in only one of the categories with mussels being the only food imported (see Table E8). Table E8 Prescribed foods imported by Fiji, by tonnes, 1 March 2013 to 29 February 2016 English short name Total (tonnes) Primary item imported Fiji 1.4 Mussels Source: ICS data Department of Agriculture and Water Resources 101

Glossary AIMS Agriculture Import Management System ANAO Australian National Audit Office Approved Arrangement Voluntary arrangements (previously Quarantine Approved Premises and Compliance Agreements) entered into with the department BFSN/the network Bi-National Food Safety Network BSE Bovine spongiform encephalopathy - a transmissible and fatal neurodegenerative disease that affects cattle. Variant Creutzfeldt - Jakob disease (vCJD), a rare and fatal human neurodegenerative condition, results from exposure to BSE through eating contaminated beef or beef products. CFIA Canadian Food Inspection Agency Codex Alimentarius the International Food Standards CrI Credible interval - represents a range of values where the most likely estimate might lie using a posterior probability distribution. It may be interpreted similar to confidence intervals (Kirk et al. 2014) FDA The Food Drug Administration (United States) FICA Food Import Compliance Agreement Foreign government certification arrangement A government-to government certification arrangement that the department can enter into with the national competent authority of a country exporting food to Australia. These arrangements provide further assurance that certain food imported into Australia complies with Australia's food safety standards FSANZ Food Standards Australia New Zealand FSMA Food Safety Modernisation Act (United States) FSVP Foreign Supplier Verification Programs (United States) HACCP Hazard Analysis Critical Control Point-a management system in which food safety is addressed through the analysis and control of biological, chemical and physical hazards Holding order A legal mechanism under the Imported Food Control Act 1992 which ensures that future comparable consignments of a failed food are referred to the department to ensure the reason that the food failed has been rectified IFC Act 1992 The Imported Food Control Act 1992 IFCC Imported Food Consultative Committee Department of Agriculture and Water Resources 102

IFIS Imported Food Inspection Scheme ICS Integrated Cargo System-electronic system for recording movement of goods across Australia's borders ISFR Implementation Sub-committee for Food Regulation NFIRP National Food Incident Response Protocol NZ MPI New Zealand Ministry for Primary Industries OzFoodNet Located within the Australian Department of Health, OzFoodNet undertakes surveillance and investigations of foodborne disease in Australia in conjunction with the states and territories. PICS Pacific Island Countries Prescribed Foods Foods that require a higher level of food safety assurance to be demonstrated at the border due to their potential public health and safety risk. Border testing alone is insufficient to provide this assurance. RBM Regulatory Burden Measure-a tool developed by the Australian government to calculate the compliance costs of regulatory proposals. RIS Regulation Impact Statement Risk Food Initially referred for inspection and testing at a rate of 100 per cent against a published list of potential hazards (specific to the food), but is decreased if a history of compliance is established. Supply chain assurance Assurance that the food safety hazards of a food have been controlled throughout its production. Surveillance food Surveillance food is considered to pose a low risk to human health and safety. Each consignment of surveillance food has a 5 per cent chance of being referred for inspection. Traceability The ability to trace food along the supply chain from suppliers through to customers (tracing both forward and backwards) TTMRA Trans-Tasman Mutual Recognition Arrangement - is a non-treaty agreement between the Australian Government, state and territory governments and the government of New Zealand to remove regulatory barriers to the movement of goods and services providers between Australia and New Zealand USDA United States Department of Agriculture WTO World Trade Organization Department of Agriculture and Water Resources 103

References Abelson, P, Potter Forbes, M & Hall, G, 2006, The annual cost of foodborne illness in Australia, isbn. 0642829063, report prepared for the Department of Health and Ageing by Applied Economics, Canberra. Australian Bureau of Statistics 2006 (Revision 1.0), 1292.0 - Australian and New Zealand Standard Industrial Classification (ANZSIC), Commonwealth of Australia. Allergen Bureau 2011, March 2011 News Round Up. Australian National Audit Office 2015, Administration of the Imported Food Inspection Scheme, ANAO report No. 49 2014-2015, Commonwealth of Australia, available at anao.gov.au/sites/g/files/net616/f/ANAO_Report_2015-2015_49.pdf (2.98MB). ascia 2014, Food allergy and anaphylaxis update, Australasian society of clinical immunology and allergy, available at allergy.org.au/health-professionals/papers/anaphylaxis/32- hp/infobulletins-hp/573-food-allergy-and-anaphylaxis-update-2014. CFIA 2014, Good Importing Practices for Food, Canadian Food Inspection Agency, available at inspection.gc.ca/food/imports/commercial-importers/good-importing- practices/eng/1376630080078/1377849177191. Codex Alimentarius, 1995, Principles for Food Import and Export Inspection and Certification, CAC/GL 20-1995, Codex Alimentarius Commission. ---- 2003, Guidelines for Food Import Control Systems, CAC/GL 47-2003, Codex Alimentarius Commission. ---- 2013, Principles and Guidelines for National Food Control Systems, CAC/GL 82-2013, Codex Alimentarius Commission. Department of Health 2016, The Food Regulation System, Department of Health, Canberra, health.gov.au/internet/main/publishing.nsf/Content/foodsecretariat-system1.htm. Department of Industry, Innovation, Science, Research and Tertiary Education 2012, Australian Small Business Key Statistics and Analysis, Commonwealth of Australia, treasury.gov.au/PublicationsAndMedia/Publications/2012/sml-bus DFAT 2016, Composition of Trade Australia 2015, Department of Foreign Affairs and Trade, Canberra, available at dfat.gov.au/about-us/publications/Pages/composition-of-trade.aspx. FDA 2015, Background on the FDA Food Safety Modernization Act (FSMA), US Food & Drug Administration, available at fda.gov/Food/GuidanceRegulation/FSMA/ucm239907.htm. FDA 2016, FDA Food Safety Modernization Act (FSMA), US Food & Drug Administration, available at fda.gov/Food/GuidanceRegulation/FSMA/. FSANZ 2013, 'Completed ISFR food surveys', Food Standards Australia New Zealand, Canberra, available at foodstandards.gov.au/science/surveillance/pages/isccomponent1.aspx. Department of Agriculture and Water Resources 104

---- 2015a, 'The safe food system', Food Standards Australia New Zealand, Canberra, available at foodstandards.gov.au/about/safefoodsystem/Pages/default.aspx. ---- 2015b, Australia New Zealand Food Standards Code-standard 2.8.2-Honey, Food Standards Australia New Zealand, Canberra. ---- 2015c, 'Survey of tinned fruits for tin, lead and arsenic', Food Standards Australia New Zealand, available at foodstandards.gov.au/publications/Pages/Survey-of-tinned-fruits-for-tin- lead-and-arsenic.aspx. FSANZ 2016, 'Food recall plan template', Food Standards Australia New Zealand, Canberra, available at foodstandards.gov.au/industry/foodrecalls/recalltemplates/Pages/default.aspx. Kirk, M, Glass, K, Ford, L, Brown, K & Hall, G 2014, Foodborne illness in Australia: Annual incidence circa 2010, National Centre for Epidemiology and Population Health, Canberra, available at health.gov.au/internet/main/publishing.nsf/Content/ohp-foodborne-illness-aust. NSW Food Authority 2016, Food recall action plan, New South Wales Department of Primary Industries -Food Authority, available at foodauthority.nsw.gov.au/ip/recalls. NZFSA (2009), Regulatory Impact Statement 2009 - A reformed food regulatory regime, New Zealand Food Safety Authority, available at foodsafety.govt.nz/elibrary/industry/Regulatory_Impact-Specifically_Covers.pdf (pdf 263.86kb). Patties Foods 2015, How we're making a good company great, Annual Report 2015, annualreport2015.patties.com.au/wp-content/themes/patties/pdf/Patties_AR15_full.pdf Smith J 2016, 'Frozen berries still on the shelf as a choice', Sydney Morning Herald, 30 January 2016, available at smh.com.au/national/frozen-berries-still-on-the--shelf-as-a-choice- 20160124-gmd6qd.html Spencer, S & Kneebone, M 2012, FOODmap: An analysis of the Australian food supply chain, Department of Agriculture, Fisheries and Forestry, Canberra, available at agriculture.gov.au/ag- farm-food/food/publications/foodmap-a-comparative-analysis Tanner, C, Beaver, A, Carroll, A and Flynn, E 1998, Imported Food National Competition Policy Review of the Imported Food Control Act 1992, Imported Food Control Act review Committee, Commonwealth of Australia, available at agriculture.gov.au/biosecurity/legislation/imp-food- control. University of Sydney 2014, 'Has food allergy incidence risen in Australia?', University of Canberra, available at sydney.edu.au/news/84.html?newsstoryid=13471. Department of Agriculture and Water Resources 105

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