1998

THE PARLIAMENT OF THE COMMONWEALTH OF AUSTRALIA

SENATE

WILDLIFE PROTECTION (REGULATION OF EXPORTS AND IMPORTS) AMENDMENT BILL 1998

EXPLANATORY MEMORANDUM

(Circulated by Authority of the 
Minister for the Environment and Heritage,
Senator the Hon Robert Hill)

ISBN:  0642 387400
WILDLIFE PROTECTION (REGULATION OF EXPORTS AND IMPORTS) AMENDMENT BILL 1998

OUTLINE

One of the greatest threats to the survival of some of the world’s critically endangered species is the use of products derived from them, for example traditional medicines.  The amendments to the Wildlife Protection (Regulation of Exports and Imports) Act 1982  (the Wildlife Protection Act) will assist in saving critically endangered species from extinction by strengthening controls on the illegal import, export and possession of products that contain endangered species in their ingredients. 

The amendment will implement Australia’s obligations under the Convention on International Trade in Endangered Species of Wild Fauna and Flora (CITES), specifically as set out in resolutions 9.6, 9.13 and 10.19, which were unanimously passed by the 144 Parties to CITES at Conferences of the Parties in 1994 and 1997.   

This bill targets evidentiary problems which arise under the current legislation, to facilitate successful prosecution for the import or export without a valid permit of products that contain material from endangered species on the basis of representations with respect to those products. 

For a prosecution to be successful under the current legislation, it must be proved beyond reasonable doubt that the product does contain an endangered species.  In some products, such as traditional medicines, endangered species have been mixed with other ingredients and heated at high temperatures.  In such circumstances, it is not possible with current technology to prove conclusively that any particular species is contained in the product.  The proposed amendments will enable a prosecution to be successful on the basis that a product is represented to contain material from an endangered species, and as such will overcome these forensic problems.  The amendments will achieve this result by deeming that things which are deliberately represented (for example by their packaging) to be or to contain endangered species, are covered by the Wildlife Protection Act.

It is not the aim of the amendment to cover products that are obvious imitations of an endangered species.  The amendment is, however, intended to cover imitations which claim to be authentic.  Such products encourage market demand for endangered species products, which in turn drives illegal poaching and threatens the survival of these species. 

FINANCIAL IMPACT STATEMENT

Implementation costs will be funded from within existing departmental budgets.  

Department of the Environment
Regulation Impact Statement (RIS)
for the 
Wildlife Protection (Regulation of Exports and Imports) Amendment Bill 1998

1.	Problem or issue identification

Identify its nature
Poaching of endangered species for use in traditional medicine is internationally recognised as one of the greatest threats contributing to extinction of certain species. 

One hundred and forty four countries, including Australia and countries that have practised in traditional medicine for thousands of years, such as China and Japan, are Parties to the Convention on International Trade in Endangered Species of Wild Fauna and Flora (CITES).  Under CITES, Parties are required to control international trade in species that are threatened with extinction, or that may become threatened with extinction if trade is not regulated.  The Wildlife Protection (Regulation of Exports and Imports) Act 1982, which is administered by Environment Australia, enables Australia to fulfil its international obligations under CITES.

Products containing endangered species listed in the appendices to CITES are subject to seizure under the Wildlife Protection Act.  The Act makes it illegal to trade commercially in these products, which include many traditional medicines.  A successful rate of prosecution is vital in protecting endangered species from poaching, and in deterring the use of traditional medicines that contain material from endangered species.  Two species commonly used in traditional medicines, tiger and rhinoceros, have numbers of less than 5000 and 14000 respectively left in wild populations.  In the case of tigers, this represents a decline rate of 95% since the turn of the century when the world population was recorded at around 100,000.  Out of the five species of rhinoceros, four have numbers of less than 3000 in the wild, with the Javan rhinoceros having numbers of less than 100.

To date there have been no prosecutions for breaches of the Wildlife Protection Act that involve illegally imported traditional medicine products containing material from endangered species.  The major impediment has been that current forensic technology is unable to prove beyond reasonable doubt (the required standard for criminal prosecution) that the traditional medicines contain material from endangered species as claimed on their packaging.  This is because existing DNA testing technologies can not identify a particular species within a product, once material from that species is co-mingled with other elements, and heated at high temperatures.  

At the last two Conferences of the Parties to CITES, member countries have unanimously passed a number of resolutions aimed at reducing illegal trade in traditional medicine products containing endangered species, and facilitating prosecution of offenders. These resolutions recommend that all member States of CITES ensure that their national legislation effectively controls trade in all parts and derivatives of endangered species used for healing purposes and trade in medicinal products containing or purporting to contain these species.  Implementation of the resolutions will specifically address the evidentiary problems in proving that a product contains an endangered species in its ingredients

Australia is due to report at the next CITES Conference of the Parties in early 2000 on the implementation of these resolutions.  As such, there is significant international determination and pressure for member States of CITES to implement stronger legislative controls.  

How has the market failed?
Normal market dealings do not address the problem of traditional medicines containing material from endangered species.  This is because the market provides rewards for those who provide these medicines, and provides nothing to those that refrain from poaching endangered species for medicinal use.  As a species becomes scarcer through use in traditional medicines, the demand for that species, and the prices paid to poachers on the provision of that species, rise in reflection of this scarcity.  While certain individuals respond to this scarcity by not buying products that contain material from endangered species, for others it is an added reason to pursue these products and obtain their purported benefits before they disappear completely.  Without regulatory intervention to ensure all parties refrain from trade in and use of traditional medicines that contain or claim to contain material from endangered species, the market demand will continue with rewards going to those that provide these products.

How has the legislation failed?
The current legislation does not take into consideration the limitations of current DNA testing technologies.  A successful prosecution would require proof beyond reasonable doubt that the product contained a particular protected species.  As this is not possible using current forensic technologies, the current legislation is ineffective in its application to products, such as traditional medicine, in which material from endangered species is co-mingled with other ingredients.

2.	Specification of the desired objective

The key objective is to address the evidentiary problems that have been identified above, and enable successful prosecution for the import, export, or (in limited circumstances) possession of products that contain, or are represented to contain, material from endangered species.  

The broader goal is to assist in saving critically endangered species from extinction resulting from their use in products such as traditional medicines.

Other nations, including the United States and the European Union, have already implemented similar legislation to the proposed amendment and have since recorded a greater prosecution success rate. 

The relevant CITES resolutions recommend that legislation is implemented in conjunction with education programs.  The Commonwealth Government administers an education program that includes the holding of Traditional Medicine Symposiums.  These Symposiums, which involve traditional medicine traders, practitioners and students as well as conservation groups, educate individuals on the threat posed to endangered species, and encourage the development and use of alternative ingredients.

3.	Identification of options (regulatory and non-regulatory)

Regulatory.

a)	No specific action:
Legislation will remain the same, and the Commonwealth will continue its current education campaign.  This option is not viable as the evidentiary problems identified will not be addressed.  As a result, the current legislation will remain ineffective and there will continue to be no prosecutions for the import of products that contravene the legislation.  Australia will also have failed to meet its international obligations under CITES.

b)        Legislative amendment as proposed:
The proposed amendment to the Wildlife Protection Act will enable the Government to prosecute successfully importers of traditional medicines that contain material from endangered species, in line with CITES resolutions. The forensic problems will be overcome by prohibiting import or export without a permit for products which are represented to contain or be derived from endangered species.  The proposed amendment will also make it possible to successfully prosecute individuals who, without reasonable excuse possess a product that they know or have reasonable grounds for suspecting was imported illegally.  

c)	Legislative amendment as proposed but with a regulatory scheme for licensing 	or exempting certain products:
This would necessitate a large administrative process on the part of the Government, and would require businesses to go through lengthy paperwork requirements.  

Non-regulatory.

d)	Providing information and education:
In conjunction with the traditional medicine community and wildlife conservation groups, develop information and education programs for individuals and groups involved in the trade of traditional medicines, as well as students, community groups, and other interested parties, to reduce consumer demand for traditional medicine products that are represented to contain material from endangered species. This option in itself will not address the evidentiary problems raised, but is an essential part of the Government’s existing wildlife protection strategy.

e)	Protection of endangered species in the wild:
	Develop campaigns and programs to protect existing wild populations of 	endangered species used in traditional medicines. Again, this option would not address the evidentiary problems in prosecuting for the import of products that contain, or are represented to contain, material from endangered species.

The above options are not mutually exclusive, indeed the Government is committed to combining appropriate non-regulatory options with the proposed regulatory scheme.  In this way, the broader objective of saving endangered species from extinction is more likely to be achieved.

4.	Assessment of impacts (costs and benefits) of each option

Depending on which option(s) are employed, there will be an impact on several stakeholders.  The stakeholders likely to be directly affected are:
•	conservation groups and individuals concerned with the survival of endangered species that are utilised in traditional medicines;
•	industry groups that currently produce products that contain, or are represented to contain, material from endangered species (all these groups are currently based overseas);
•	individuals or groups who import or export products that contain, or are represented to contain, material from endangered species; 
•	retailers who sell these products;.
•	consumers who value products that contain, or are represented to contain, material from endangered species;
•	individuals or interest groups that concern themselves with Australia’s international reputation;
•	officers responsible for the enforcement of any legislative changes; and
•	taxpayers (for certain options).

Regulatory.

option a)	No specific action:

Costs - enforcement agencies will be required to work under impotent legislation that fails to adequately address the illegal trade in traditional medicines that contain material from endangered species.  This is because the current legislation does not allow for the inability of current DNA technologies to conclusively prove the presence of an endangered species in a traditional medicine once it is co-mingled with other elements.  Traders in these medicines will continue importing due to an awareness that existing legislation is unable to support prosecution.  Enforcement costs will rise as the demand for these medicines will continue to rise as a result of their availability.

If the legislative amendment does not proceed, it may be perceived that Australia is not committed to stopping the illegal international trade in endangered species.  Australia would likely be subject to international criticism for failing to address the problem, and therefore failing to fulfil its obligations under CITES.

Inadequate legislation will arguably contribute to a continual decrease in numbers of endangered species.  In some cases, such as the tiger and rhinoceros, this will almost certainly lead to extinction.  This will contribute to rising costs in combating poaching of endangered species, and other problems associated with criminal activity.  Countries that are home to critically endangered species could experience an adverse impact upon tourism and other cultural programs if these species become extinct.

Benefits - there are no foreseeable benefits in maintaining a stance of no action.	

option b)	Legislative amendment as proposed:

Costs - the cost of developing and implementing the legislative amendment and the cost of ensuing enforcement action will be funded from within existing departmental budgets.

Individuals who inadvertently import traditional medicines containing material from endangered species into Australia are unlikely to be prosecuted, however the prohibited import will be seized by the Australian Customs Service (ACS).  Seized items are destroyed unless the importer can prove that the item was not covered by the Act. 

Strengthening legislation may lead to the establishment of an underground illegal trade industry.

Benefits - the proposed amendment will enable the Government successfully to prosecute importers of products that are represented to contain material from endangered species, and is the only option that specifically addresses the identified evidentiary problems. It will also enable Australia to fulfil its international obligations under CITES.

Successful prosecutions as a result of the proposed amendment will act as an effective deterrent to the trade in traditional medicines that contain material from endangered species.  A resultant shortage of the endangered species materials for sale will also encourage the use of alternative ingredients.  This will in turn lead to a decrease in the cost of enforcement.

Note: Existing Commonwealth legislation, the Therapeutic Goods Act 1989, administered by the Therapeutic Goods Authority (TGA), defines ‘therapeutic goods’ as goods which are represented to be for therapeutic use (see full definition at Attachment A).  Prosecutions can therefore proceed on the basis of such representations without the prosecution having to prove that the representation is true.  Since 1993, the TGA has laid 577 charges based on this definition with a 100% conviction rate.  This is worth noting as a successful precedent for the use of a provision of the same type as the proposed amendment.  

option c)	Legislative amendment as proposed but with a regulatory scheme for licensing or exempting certain products:

Costs - There would be significant costs to the Commonwealth in administrative and enforcement requirements if businesses are required to obtain licences for all traditional medicine products that identify with an endangered species.  Businesses would also face compliance costs and delays.  

Benefits - Through tight regulation of the industry, it would prove difficult for importers to continue trading in traditional medicines not covered under Regulations.  Demand in these products would arguably decrease as they become harder to obtain, and legal alternatives become available.

Non-regulatory.

option d)	Providing information and education:

Costs -The Government is currently promoting use of alternatives to material from endangered species in traditional medicines through Traditional Medicine Symposia in various cities.  These Symposia are held jointly with TRAFFIC Oceania (a programme of the World Wide Fund for Nature and IUCN-The World Conservation Union), and educational institutions such as the University of Western Sydney Macarthur, and the Royal Melbourne Institute of Technology.  The Government’s contribution to the symposium held in Sydney last year was $10,000, and the symposium to be held in Melbourne in March 1999 will be allocated approximately $15,000. 

In addition, the Government provides information on the legislation, including, for example, which products are not permitted to be imported without a permit.  Therefore, costs associated with this option will be in relation to the continuance of programs that are already in place.  

Benefits - the promotion of an ability to successfully prosecute importers of traditional medicines represented to contain material from endangered species will be an effective deterrent to illegal trade. 

Education campaigns will encourage the development and use of alternatives to medicines that contain material from endangered species.  Increased public awareness of the critical situation of many endangered species, and of availability of approved substitutes, will lead to a decrease in consumer demand.  A market decline for products represented to contain material from endangered species should contribute to a decrease in the poaching of these animals.  The Government is committed to conducting these programs in close consultation with the traditional medicine community and wildlife conservation groups.

option e)	Protection of endangered species in the wild:

Costs - This would be a costly option as Australia is not a native home to any of the endangered species that are utilised in traditional medicines, and as a result any efforts to protect endangered species in the wild by the Commonwealth would need to be directed overseas.  As protection of species in the wild is ultimately dependant on enforcement of wildlife protection legislation in the relevant countries, Australia’s involvement would be limited to the provision of funding or technical expertise.

This option would not address the difficulties in prosecuting importers of traditional medicines that contain material from endangered species.  The evidentiary issues would still exist, and there would be no deterrent to trade in these products.   

Benefits - Effective protection of endangered species in the wild from poachers would lead to an increase in numbers of wild populations and would decrease the availability of these species for use in traditional medicines.

5.	Consultation

The proposed amendments will implement CITES resolutions were unanimously agreed by all other CITES Parties including Australia.  Australia’s support for the resolutions was agreed in consultation with relevant government departments.

The World Wide Fund for Nature, TRAFFIC Oceania, and other conservation groups have urged the Government to amend the Wildlife Protection Act to make prosecution easier, and to conduct education campaigns aimed at traditional medicine consumers.

The proposed amendment was raised at the Traditional Medicine Symposium held in Sydney in 1997, which was attended by traditional medicine practitioners, retailers, and traders and students, conservation groups and other interested parties.  

Representatives from these groups have been invited to attend the next Symposium to be held in Melbourne during March 1999, at which further information will be provided.  

The Government’s public announcement of the amendment on 22 August 1998 was attended by key representatives of the traditional medicine community, who gave strong support to the amendment.

Industry groups that manufacture traditional medicines are all located in nations other than Australia, and as such it was not possible to consult with them.  

As it is already illegal to import traditional medicines that contain material from endangered species, the proposed amendment will not impact on industry groups that are already clearly in compliance with Australia’s import restrictions under the Wildlife Protection Act.  The proposed amendment will impact on those industry groups that are not in compliance will the import restrictions under the Act in relation to traditional medicines, as it will be possible to successfully prosecute them.   

The amendment will also enable successful prosecution for export products that contain material from endangered species.  However, there is no indication that any such products are currently exported from Australia.

6.	Conclusion and recommended option

Taking into consideration the benefits and costs of the options discussed above, the preferred option is (b), amendment of existing legislation to enable effective controls and enforcement capabilities.  The proposed legislative amendment will facilitate prosecutions under the Wildlife Protection Act for breach of the provisions governing trade in products containing endangered species.  The proposed amendment will best address the evidentiary problems that currently exist for successful prosecution, and will fulfil the intention of the Act in effectively contributing to the protection of endangered species from extinction. 

In addition, the Government will continue to implement option (d), working closely with the traditional medicine community and related consumer groups to develop public awareness programs aimed at reducing consumer demand for traditional medicines purporting to contain materials from endangered species.  This option is an integral component of the Government’s efforts to halt the trade in traditional medicines which contain materials from species that are threatened with extinction.

If options (b) and (d) are adopted in concert, they will play an essential role in minimising the use of endangered species in traditional medicine, and each option will have no impact on small business compliance costs.

The proposed amendment to the Wildlife Protection Act is required to implement CITES resolutions.  There is currently a high level of international concern and multilateral support to halt the illegal trade in endangered species, and the 144 nations that are Parties to CITES have agreed to report on implementation of the resolutions during the 11th CITES COP, to be held in early 2000.

7.	Implementation and Review

The proposed amendment will not require any changes to the current administration and enforcement of the Wildlife Protection Act.  Environment Australia will continue to administer the Act and to coordinate enforcement responsibilities with other agencies, including the Australian Customs Service.

The Government has committed to undertake a broad review of the Wildlife Protection Act, taking into account recommendations of the recent Senate Inquiry into commercial use of native wildlife.  This review will take place after the amendment has been introduced. The Government will provide ongoing support to review of the Act and to operation of the amendment.

Attachment A

Therapeutic Goods Act definition

The Therapeutic Goods Act 1989 regulates the quality, safety and efficacy of medical treatments available in Australia.  The Act contains controls in relation to the import, export, manufacture and supply of medicines, and is administered by the Therapeutic Goods Administration.

Definitions:

“3.(1)	“therapeutic goods” means goods:
	(a) that are represented in any way to be, or that are, whether because of the 	way in which the goods are presented or for any other reason, likely to be 	taken to be:
		(i) for therapeutic use; or
		(ii) for use as in ingredient or component in manufacture of 				therapeutic goods; or
		(iii) for use as a container or part of a container for goods of the kind 			referred to in subparagraph (i) or (ii);”

NOTES ON CLAUSES

1.	Clause 1 - Short Title
This Clause provides for this Act to be cited as the Wildlife Protection (Regulation of Exports and Imports) Amendment Act 1998.

2.	Clause 2 - Commencement
This clause provides that the Act shall commence 28 days after the day of Royal Assent.

3.	Clause 3 - Schedules

Schedule 1 - Amendment of the Wildlife Protection (Regulation of Exports and Imports) Act 1982

4.	Item 1 - Subsection 4(1)
This Item inserts two new definitions : ‘Convention listed animal’ and ‘Convention listed plant’.  ‘Convention’ refers to the Convention on International Trade in Endangered Species of Wild Fauna and Flora (CITES), as defined in existing section 4(1).  All wildlife species protected under CITES are listed in a number of Appendices to the Convention, and included in Schedules to the Wildlife Protection Act.  These are referred to as ‘CITES listed’ species.  The existing offence provisions of the Wildlife Protection Act do not only cover CITES listed species; under the existing definition of ‘specimen’ they also cover native Australian animals and plants, many of which are not CITES listed.  These new definitions take into account the more limited definition of CITES listed species required in relation to the amendment. 

5.	Item 2 - After subsection 4(2A)
Proposed subsection 4(2B) extends the Act’s current controls on the import and export without a permit of protected wildlife species (as defined by the existing definition of ‘specimen’), or a product containing a protected wildlife species, to also apply to things which are represented to be, or to be derived from, a CITES listed protected wildlife species.  

6.	This provision extends the scope of the existing offences under sections 21, 22 and 53.  These offences currently relate to the import, export and possession of a specimen.  By deeming a thing which is represented to be a specimen of a CITES listed species to be a specimen from a CITES listed species, proposed 4(2B) extends the coverage of the Act’s existing offence provisions to cover such things.  

7.	The mere fact that a thing appears to look like a ‘Convention listed’ specimen or to be part of a ‘Convention listed’ specimen does not mean that this provision will apply.  The provision requires that the thing is represented to be the Convention listed specimen or part of the Convention listed specimen.  Thus a thing that is clearly an imitation would not be covered if there is no representation that the thing is the actual Convention listed specimen or part of the Convention listed specimen concerned.

8.	It is not the intent of the provision to limit the general use of images of wildlife as a marketing tool.  Use of such images will not be affected, provided that they do not represent that an endangered species is actually a constituent element of the product.  

9.	Item 3 - After subsection 4(2B)
Proposed subsection 4(2C) provides that if a thing is represented as being (in one of the ways described under proposed subsection 4(2B)), a specimen for which the importer holds a permit, this representation is not evidence that the thing is in fact in accordance with a permit.  This prevents Subsection 4 (2B) from deeming an importer or exporter to be in compliance with a permit where they have mis-labelled a product which contains a species not covered by the permit, and the label claims it contains the species covered by the permit.

10.	Item 4 - At the end of section 21 (after the penalty)
This Note is inserted to make it clear that the effect of Subsection 4 (2B) is to extend the scope of the export offence under section 21. 

11.	Item 5 - At the end of section 22 (after the penalty)
This Note is inserted to make it clear that the effect of Subsection 4 (2B) is to extend the scope of the import offence under section 22. 

12.	Item 6- At the end of section 53(1)
Inserted at the end of Subsection 53(1).  This Note is inserted to make it clear that the effect of Subsection 4 (2B) is to extend the scope of the possession offence under section 53.