A REVIEW OF THE PORTS AND MARITIME ADMINISTRATION REGULATION 2012 AND THE PORT BOTANY LANDSIDE IMPROVEMENT STRATEGY 29 JANUARY 2021
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A REVIEW OF THE PORTS AND MARITIME ADMINISTRATION REGULATION 2012 AND THE PORT BOTANY LANDSIDE IMPROVEMENT STRATEGY 29 JANUARY 2021 Joint Response Submission from the International Forwarders and Customs Brokers Association of Australia Limited (“IFCBAA” and Road Freight NSW (“RFNSW”) developed with assistance from Eighty8 Consultants (lodged 19 February 2021 with TFNSW) (26 pages) Table of Contents 1. Executive Summary …………………………………………………………………………………………………………………..……..……………..1 1.1 Project Purpose……………………………………………………………………………………………………………………..……………………3 1.2 Scope of Work..………………………………………………………………………………………………………………………..…………………4 1.3 Summary of Approach………………………………………………………………………………………………………………..……………… 4 2. Proposed draft documents summary of changes………………………………………………………………………………..……………. 4 2.1 Port Botany Landside Improvement Strategy..………………………………………………………………………………..………….5 2.1.1 History Independent Pricing and Regulatory Tribunal …..………………………………………………………….……5 2.1.2 Framework .……………………………………………………………………………………………………………………………………5 2.1.3 Proposed Changes and Amendments .…………………………………………………………………………………….….....5 2.2 Ports and Maritime Administration Regulation 2012 .…………………………………………………………………………………8 2.2.1 History of Ports and Maritime Administration Regulation 2012………………………………………………………9 2.2.2 Framework……………………………………………………………………………………………………………………………………..8 2.2.3 Ports and Maritime Administration Regulation 2012 remake (changes and amendments)……………..9 3. The International Forwarders & Customs Brokers Association of Australia and Road Freight NSW Commentary and Position on Regulation Changes and Amendments..………..…....……………………………………………14 3.1.1 Containment and Control of Stevedore Charges……………………………………………………………………………14 3.1.2 Stevedore Terminal Access Agreements and Conditions……………………………………………………………….17 3.1.3 Expansion of the Regulation and PBLIS………………………………………………………………………………………….18 3.1.4 Establishment of a Port Community System (incorporating full and empty containers)….…………….19 3.1.5 The International Forwarders & Customs Brokers Association of Australia and Road Freight NSW need for additional data……………………………………………………………………………………………….19 4. Recommendations……………………………………………………………………………………………...….……………………………………….20 Appendices......................................................................................................................................................................22 References…………………………………………………………………………………………………………………………………………………………………25
1. Executive Summary Movement of cargo in sea freight containers is an important aspect of port operations. The transportation system helps move freight from the terminals or stevedores to the points of consumption. Communities and businesses in New South Wales (NSW) gain economic benefit from the ability to buy and sell their goods in overseas markets. The movement of goods through ports often directly impacts communities next to these facilities, including container transportation companies, freight forwarders, customs brokers, and warehouses. Regulations have proven to improve the safety and efficiency of goods movement. These benefit all stakeholders, including those entities involved in the supply chain and those communities impacted by it. Regulation is an important tool available for the NSW Government. Well designed and properly targeted regulation helps deliver the community’s economic, social, and environmental goals. However, regulation can also impose administrative, compliance burdens and costs on business and consumers. These burdens must be weighed against the benefits that the regulation generates. The NSW Government has expressed that the key characteristic of good regulation is to minimise red tape. This is achieved through the seven principles of better regulation. These principles are designed to improve the quality of regulation by ensuring that the decision maker is aware of potential issues when undertaking regulatory reviews. The Better Regulation principles (Commission, 2016) are: Principle 1: The need for government action should be established. Government action should only occur where it is in the public interest, that is, where the benefits outweigh the costs. Principle 2: The objective of government action should be clear. Principle 3: The impact of government action should be properly understood by considering the costs and benefits (using all available data) of a range of options, including non-regulatory options. Principle 4: Government action should be effective and proportional. Principle 5: Consultation with business and the community should inform regulatory development. Principle 6: The simplification, repeal, reform, modernisation or consolidation of existing regulation should be considered. Principle 7: Regulation should be periodically reviewed, and if necessary reformed, to ensure its continued efficiency and effectiveness. This report was commissioned by the International Forwarders & Customs Brokers Association of Australia (IFCBAA) and Road Freight NSW (RfNSW) in December 2020, in response to communication via email and website from Transport for NSW (TfNSW), regarding their review of the Ports and Maritime Administration Regulation 2012. This is required under the staged repeal program of the Subordinate Legislation Act 1989. TfNSW also advised IFCBAA and RfNSW that they are proposing to make some minor amendments to the Port Botany Landside Improvement Strategy (PBLIS) Mandatory Standards and have requested feedback. PBLIS was introduced in 2010, after the Independent Pricing and Regulatory Tribunal (IPART) found inefficiencies with container movements at Port Botany. The feedback provided to TfNSW by IFCBAA and RfNSW will inform potential future amendments to this legislation. The following documents were provided by TfNSW for this review: • Consultation Draft Ports and Maritime Administration Regulation 2020 • Regulatory Impact Statement • Comparison Guide to the Regulation and the Draft Regulation – shows the revised structure and proposed changes • PBLIS Mandatory Standards with proposed changes • Summary of proposed changes to PBLIS Mandatory Standards pg. 1
This project undertaken by Eighty8 Consultants is divided into three parts: (i) Complete a review and draft responses to the above-mentioned documents and provide draft responses to IFCBAA and RfNSW by / on 08 January 2021 for review and comment. (ii) Complete subsequent commentary to support the review and suggested responses, to supplementary information supplied by IFCBAA on 22 December 2020. Draft commentary for, and supply to IFCBAA and RfNSW by / on 15 January 2021 for review and comment. (iii) Complete a Final Report incorporating comments received by IFCBAA and RfNSW and deliver this by / on 29 January 2021, for submission by IFCBAA and RfNSW to TfNSW before the due date of 19 February 2020. The major findings in this report are threefold. Firstly, the current minor review of the Ports and Maritime Regulation 2012 and the PBLIS Mandatory Standards is a positive step forward by TfNSW to address current port related issues. The most significant points are: 1. The use, accuracy, and applicability of the newly introduced Automated Number Plate Recognition (ANPR) system is to be expanded to port approach roads and empty container parks in Botany or servicing Port Botany. 2. Further consultation on stevedore cancellation of bookings “agreed timeframes for requirements” to allow further flexibility of the current 4-hour timeframes. 3. TfNSW to invest in and implement push messages to container truck drivers via mobile telephones using SMS technology on changes or delays at the port. 4. Further consultation on the definition of “Detailed Particulars”, especially when relating to “Unforeseen Events”. 5. Better understanding of the definition of “Terminal” and its expansion to include empty container parks under PBLIS. 6. A more thorough explanation for the definition of “Container” ensuring container content loading guidelines, misleading maximum gross weights and restricted container stacking capacity are included. 7. Redefining the definition of “Working Day” to ensure inclusion of weekends and 24 x 7 operations. 8. The passing down the supply chain to IFCBAA and RfNSW members all savings relating to 50% reduction in navigation service charges. 9. IFCBAA and RfNSW should be supplied additional data of manifests and trends for analysis and future planning. 10. Further consultation required regarding traffic control at ports and wharves, with specific coloration between this proposed change and the significant delays that occurred in 2019-20, where terminals and stevedores were unable to meet the demand of container trucks collecting containers in Time Zones resulting in excessive congestion on port and public roads. 11. Changes to definitions and procedures of Dangerous Goods for better consistency cannot result in additional operational processes or compliance costs for IFCBAA and RfNSW members. 12. IFCBAA and RfNSW must be included in the membership of the Maritime Advisory Council. Next, there is a requirement by IFCBAA and RfNSW for further consultation regarding: 1. An annual review of the PBLIS Mandatory Standards. 2. Inclusion of empty container storage, handling, data, evacuation and the full life cycle of containers under PBLIS. 3. Emerging charges and costs introduced by stevedores, shipping lines and governments require better processes for approval, justification before implementation and inclusion under PBLIS. 4. The process for writing, agreement, and amendment of the Stevedore Terminal Access Agreements and Conditions requires PBLIS Mandatory Standard guidelines. 5. Technological improvements in the port supply chain requires addressing challenges with two software providers for full and empty containers, the development of a Port Community System and better data for IFCBAA and RfNSW members. 6. Time Slots per hour need to be increased from the current 54 to 85. 7. Availability: There is a requirement for directions under PBLIS regarding how and when stevedores advertise to industry vessel / container availability dates. Current practices result in futile trips, unproductive Time Slots causing additional costs and inefficient use of container trucks. pg. 2
8. Stevedores to have continuous improvement Key Performance Indicators (KPIs) introduced under PBLIS. 9. Waterside space, congestion of port and port approach roads and the scoping of new futuristic ports requires further consultation with IFCBAA and RfNSW. 10. An Economic Model needs to be developed and included as an annual review of costs and loss time productivity. IFCBAA and RfNSW, believe it is now timely that a deep dive thorough analysis and review is completed to address these items. IFCBAA and RfNSW received notice from TfNSW that this will occur at the start of the next Financial Year (FY) being July 2021. Lastly, this report is timely, significant, and essential for TfNSW and the NSW Government to include the feedback supplied by IFCBAA and RfNSW and that it is taken into consideration in the current minor review and the more comprehensive review. This is to ensure that historical inefficient practices (prior to the introduction of PBLIS) that appear to be resurfacing, do not continue to escalte resulting in such matters as: (i) Extensive truck queues at Port Botany (ii) Manual processes (iii) Excessive Truck Turnaround Times (TTT) at terminals resulting in minimal productivity per truck (iv) “Mates structure” between certain members of the supply chain and stevedores (v) Increasing costs in Terminal Infrastructure Surcharges (vi) Emerging Costs such as the newly introduced Safety Surcharge. 1.1 Project Purpose The purpose of this project is to review and draft responses to the five documents that IFCBAA and RfNSW received from TfNSW in December 2020 being (NSW, Consultation on the Ports and Maritime Administration Regulation 2012, 2020): • Consultation Draft Ports and Maritime Administration Regulation 2020 • Regulatory Impact Statement • Comparison Guide to the Regulation and the Draft Regulation – shows the revised structure and proposed changes • PBLIS Mandatory Standards with proposed changes • Summary of proposed changes to PBLIS Mandatory Standards To make it easier for IFCBAA and RfNSW these responses have been formulated into tables 1.0 and 2.0 later in this report. Discussions with IFCBAA, RfNSW and TfNSW regarding remaking the Ports and Maritime Administration Regulation 2012 and amending the PBLIS Mandatory Standards have occurred on numerous occasions, in particular since 2017. These have occurred in either private meetings or more publicly in TfNSW and NSW Ports led forums such as the Cargo Facilitation Committee (CFC), The Port Road Taskforce (PRT) and more recently, in the newly formed Port, Transport & Logistics Taskforce (PTLT). References to these discussions are clearly identified in the minutes of these forums. Although the received documents with proposed changes and amendments are a starting point, IFCBAA and RfNSW petition inclusion in a more comprehensive review of the two instruments of government in 2021, as committed to by TfNSW. This will commence at the start of the next Financial Year (FY) being July 2021. Further commentary that needs to be included in this comprehensive review is supplied later in this report. For relevance, the TfNSW NSW Freight and Ports Plan 2018-2023 makes reference to stronger coordination between port owners, stevedores, road and rail managers and service operators, as well as managing congestion, and ensuring there is sufficient “landside” capacity for freight (NSW, NSW Freight and Ports Plan 2018-2023, 2018, p. 28) and support reforms to transport laws and regulatory bodies particularly -conducting ongoing reviews of NSW legislation and policies pg. 3
governing the freight industry to ensure that it does not impose unnecessary burdens upon industry or hamper innovation (NSW, NSW Freight and Ports Plan 2018-2023, 2018, p. 49). IFCBAA and RfNSW see this initial minor review as a start to achieving these NSW Government commitments. 1.2 Scope of Work The scope of work for this project is divided into three main parts: (i) Complete a review and draft responses to the above-mentioned documents and provide draft responses to IFCBAA and RfNSW by / on 08 January 2021 for review and comment. (ii) Complete subsequent commentary to support the review and suggested responses, to supplementary information supplied by IFCBAA on 22 December 2020. Draft commentary for, and supply to IFCBAA and RfNSW by / on 15 January 2021 for review and comment. (iii) Complete a Final Report incorporating comments received by IFCBAA and RfNSW and deliver this by / on 29 January 2021, for submission by IFCBAA and RfNSW to TfNSW before the due date of 19 February 2020. 1.3 Summary of Approach • Initial consultation with IFCBAA and RfNSW between 17-24 December 2020, understanding deliverables required. • Review of current Ports and Maritime Administration Act 1995 for completeness of context. • Review of current Ports and Maritime Administration Regulation 2012 and the Port Botany Landside Improvement Strategy (PBLIS) Mandatory Standards. • Analysis of Consultation Draft Ports and Maritime Administration Regulation 2020, Regulatory Impact Statement, and PBLIS Mandatory Standards with proposed changes, mark up and comparison to current instruments of government. • Analysis of Comparison Guide to the Regulation and the Draft Regulation, and Summary of proposed changes to PBLIS Mandatory Standards and tabulate suggested responses. • Submission of completed Services 1.1(i) on 08 Jan 2021 for review and feedback. • Call with IFCBAA and RfNSW on 12 Jan 2021 to receive feedback to completed Services 1.1(i). • Submission of completed Services 1.1(ii) on 15 Jan 2021 for review and feedback. • Email correspondence with IFCBAA on Services 1.1(ii) on 19 Jan 2021. • Subsequent call with IFCBAA regarding above on 20 Jan 2021. • Submission of Final Report on 29 Jan 2021 as per Delivery of the Services 1.2(iii)(c). 2. Proposed draft documents summary of changes The five documents reviewed in the initial stage (Services 1.1(i)) of this project, and their purpose is summarised below: • Consultation Draft Ports and Maritime Administration Regulation 2020 This document is a non-marked up version of the Ports and Maritime Administration Regulation 2020 that is proposed by TfNSW to take effect 2021. • Regulatory Impact Statement This document is a Regulatory Impact Statement (RIS) for the Proposed Regulation. It considers the need for and objectives of TfNSW, alternative options to the Proposed Regulation and the costs and benefits of these options. It also contains a summary of the three options available to TfNSW being: 1: No regulation - This option involves repealing of the 2012 Regulation with no regulation implemented in its place. 2: Remaking the 2012 Regulation – this involves remaking of the 2012 Regulation without amendment. 3: Proposed Regulation (this is TfNSW’s preferred option) – which is what is described in detail in this RIS. • Comparison Guide to the Regulation and the Draft Regulation This document shows the revised structure and proposed changes and amendments. It lists the nineteen proposed changes and amendments for the Ports and Maritime Administration Regulation 2012 for remake in 2021. As well as the pg. 4
proposed material changes, it shows how the Regulation has been re-ordered and revised to meet current Regulation drafting standards, including better language for readability. • PBLIS Mandatory Standards with proposed changes This document is the marked-up version of the current PBLIS Mandatory Standards. The proposed changes are relatively minimal, however do have impact to IFCBAA and RfNSW members, as listed below in table 1.0 later in this report. • Summary of proposed changes to PBLIS Mandatory Standards This document lists the seven proposed changes and amendments to the current PBLIS Mandatory Standards and their descriptions. These have been analysed and comments written against each for IFCBAA and RfNSW. 2.1 Port Botany Landside Improvement Strategy The Port Botany Landside Improvement Strategy (PBLIS) consists of a range of measures, fines and penalties designed to improve landside efficiency at Port Botany and has two main objectives: (i) to improve the consistency of truck turnaround times for the collection and delivery of containers; and (ii) to smooth the usage of the port across the day and week. PBLIS has increased efficiency, consistency and transparency at Port Botany and has facilitated the transition towards a 24/7 port. Between 2008 and 2010 the former Sydney Ports Corporation (SPC) worked with industry to implement voluntary industry reform ((IPART), 2008). This voluntary agreement was not achieved. In April 2010, the then NSW Minister for Ports and Waterways implemented new regulations which introduced fairness and equity into landside arrangements at Port Botany. This regulation was later underpinned by the PBLIS Mandatory Standards in December 2010. 2.1.1 History Independent Pricing and Regulatory Tribunal (IPART) In 2008, the NSW Government engaged IPART to review the processes between the stevedores and container transport companies at Port Botany. It made 18 recommendations in its report ((IPART), 2008) for improving landside operations. IPART recognised that if the recommendations and proposed changes were to be implemented, they could not be voluntary due to past experience and that if voluntary, market failure would continue to occur. They strongly recommended the need for government intervention (Government, 2008). 2.1.2 Framework The main players on the landside at Port Botany therefore include the following (Ports N. , Australia’s Premier Port, 2020): • One port operator (NSW Ports) • Three stevedores who operated under different ownership • One rail track which splits into three stevedores, and an empty container park at Port Botany • One rail track owner – the Australian Rail Track Corporation (ARTC) • Six metropolitan intermodal terminals • Six train operators • Over three hundred and fifty road carriers • Software platform providers • Empty container parks • Shipping Lines, Freight Forwarders, Customs Brokers, Importers and Exports 2.1.3 Proposed Changes and Amendments The below table is divided into three parts, being, the proposed amendments to the current PBLIS Mandatory Standards by TfNSW, the proposed supplementary descriptions to these amendments and the proposed responses for IFCBAA and RfNSW back to TfNSW as part of the consultation and feedback process. pg. 5
Table 1.0 PBLIS Proposed Changes and Proposed Responses Proposed 2020 PBLIS MS amendment to Proposed 2020 PBLIS MS Proposed responses from IFCBAA and be made 2021 amendment descriptions to be made RfNSW 2021 1. Clause 10 Truck Identification -RFID tag technology has been Support this change, however: Information Remove references to Radio replaced by Automated Number Plate (i) how are interstate number Frequency Identification (RFID) tag Recognition (ANPR) plates handled? technology technology. This amendment will (ii) What is the accuracy rate of reflect this change in technology, the ANPR technology? including by clarifying that (iii) How is a misread by the the number plate must be legible to ANPR technology treated? ensure it can be read by the ANPR (iv) Can the ANPR technology technology. A definition for ‘Displays handle container trucks in a Legible Number Plate’ queues, as occurred on will be included in the Schedule 1 numerous occasions on the Dictionary to refer to a number plate approach roads to the issued under the Road Transport stevedores during 2019- (Vehicle Registration) Regulation 2020? 2007, or by another State or Territory. (v) Will the ANPR technology be further expanded to include inside the stevedore gate, empty container parks and intermodal locations? TfNSW should make available ANPR trend data to IFCBAA and RfNSW for compliance, accuracy, and future planning purposes. 2. Clause 10 Truck Identification -This change will clarify that a Carrier Support this change as is current practice Information Clarify responsibility for VBS providing information to a Stevedore’s today. supplier data transfer. VBS is deemed to be also providing the information to the Stevedore at the same time. This aligns with current practice. 3. 12.4 and new 12.5 Carrier -This amendment aligns the booking Support this change to maintain Cancellation of Bookings Align the booking cancellation penalty arrangements for consistency. cancellation penalty arrangements for exports with current arrangements for imports and exports imports, when a vessel’s receival date is changed after a booking is made. This provides consistent arrangements for import and export bookings. 4. 14.2 Stevedore Cancellation of -To allow greater flexibility, the This requires further consultation with Bookings Remove the 4 hours booking current timeframe of 4 hours for IFCBAA and RfNSW as to what the cancellation confirmation of booking cancellations confirmation of “requirement for agreed timeframes” will container numbers timeframe container numbers will be replaced be. Also, container truck drivers and with a operators are often small businesses and requirement for agreed timeframes to often owner operated. Updating be notified on the TfNSW website. information on the TfNSW website is not the most user-friendly means to get information to mobile container truck drivers. At the roll out of the Cargo Efficiency Operational System (CEOS) training and launch, there was discussion about push notifications via sms to industry regarding changes such as these. When will this be rolled out? pg. 6
5. Schedule 1 Dictionary Include a -A definition of “Detailed Particulars” This requires further consultation with definition for “Detailed about unforeseen events that may IFCBAA and RfNSW. The Detailed Particulars” disrupt terminal operations will be Particulars of an Unforeseen Event as included. This definition will provide listed in the Dictionary of the Draft Port greater clarity and assist Botany Landside Operations Mandatory communications about events that Standards (Mandatory Standards) provided could disrupt normal operations at the are described as: port. (a) the time the Unforeseen Event commenced; and (b) specification of the event or circumstances constituting the Unforeseen Event by reference to the meaning of that expression (e.g. that the event is a Significant Weather Event under the definition of that expression paragraph (b)(i)); and (c) specification of the facts, so far as they are known at the time to the person required to provide Detailed Particulars (e.g. in relation to a Significant Weather Event the fact that an electrical storm is occurring, or is predicted to occur at a Terminal within a specified timeframe); and (d) the predicted impact on relevant activities such as on Truck Servicing in relation to Time zones; and (e) a forecast of when the Unforeseen Event will end; and (a)(f) information about when and how details of the Unforeseen Event will be updated. However, what is required for IFCBAA and RfNSW members is that these Detail Particulars are provided within 30 minutes of the Unforeseen Event occurring, and every 30 minutes thereafter, in order for members to make informed decisions on container truck planning for that Time Zone or the length of time the Unforeseen Event will continue. This information, as mentioned above should be push information, via sms through the CEOS. Also required is a Corrective Action Plan (CAP) from the terminal or stevedore to prevent the Unforeseen Event from occurring again. For example, what measures are put in place for stevedore employees to not be subject to weather impacts, what measures are put in place to ensure equipment is regularly maintained to prevent mechanical failure, what maintenance checks and balances are in place to ensure stevedore gates do not malfunction, what measures are put in place to ensure labour and industrial disputes do not escalate to the point where pg. 7
stevedore employees either have work upgrade bans or stop work altogether. Lastly, Unforeseen Events for terminals and stevedores MUST be restricted to the operation within the stevedore gates, and not events externally that MAY impact operations inside the terminal or stevedore gate. 6. Schedule 1 Dictionary Expand the -This amendment expands the This is not supported unless this reference definition of “Terminal” definition of “Terminal” to include is in relation to empty container parks in sub-sections of the Terminal the Port Botany vicinity or servicing Port designated with the approval of Botany, whereby, further consultation with TfNSW for the purpose of improving IFCBAA and RfNSW is required to efficiency by dispersing the truck expand the PBLIS regime to the handling servicing task, where suitable. of empty containers. Consideration of implementing sub- sections in a Terminal would include A full list of the specific places to be appropriate consultation. included as “sub-sections” needs to be provided for comment. 7. Schedule 1 Dictionary Amend the -This aligns the definition of “Truck Support this change definition of “Truck service” Services” with “truck servicing” in clause 19 of the Regulation. 2.2 Ports and Maritime Administration Regulation 2012 The Ports and Maritime Administration Regulation 2012 is the legislative instrument of government used to administer the operations of the ports in New South Wales. Relevant to IFCBAA and RfNSW in particular, are: Division 1 Preliminary 5 Definitions, Part 2 Port Charges, Division 3 Furnishing of particulars and calculation of charges, Part 3 Port Botany Landside Improvement Strategy, Part 6 Maritime Advisory Council, and Part 6B Traffic control at ports and wharves. 2.2.1 History of Ports and Maritime Administration Regulation 2012 After the 2008 NSW Government IPART review and report mentioned earlier was completed, during the third quarter of 2010 the NSW Government introduced regulations under the PBLIS program. In the fourth quarter of 2010, data was analysed and audited prior to application of fines and penalties. In the first quarter of 2011 truck tracking, through Radio Frequency Identification Devices (RFID) was put in place, and in the second quarter of 2011 a fully automated reporting system known as the Operational Performance Management System (OPMS) for landside performance was introduced. 2.2.2 Framework The Ports and Maritime Administration Regulation 2012 is divided up into seven Parts, with subsequent Divisions and Schedules. This Regulation commenced on 1 September 2012. The Regulation covers items such as PBLIS, maritime safety, protection of the port waterways and NSW standards. These affect the Port Authority, private port operators, including NSW Ports and Port of Newcastle, the owners, masters and crew of the trading ships that comprise the 6,200 vessel visits to ports in NSW each year, the Harbour Masters of the ports in NSW, three stevedores at Port Botany: DP World, Patrick Stevedores and Hutchison Ports, thousands of importers and exporters, customs brokers and freight forwarders who provide services to facilitate the movement of goods being imported and exported, container road carriers, rail operators, rail track owners, intermodal terminals, thousands of warehouses, local residents, up to 1,200 passenger and charter vessels, a commuter wharf permit or charter wharf booking, up to 20,000 mooring licence holders in NSW, all persons working in ports in NSW, and TfNSW. pg. 8
2.2.3 Ports and Maritime Administration Regulation 2012 remake (changes and amendments) As mentioned earlier in this report, three options were considered by TfNSW: no regulation; remaking the 2012 Regulation without amendment; and the Proposed Regulation. TfNSW concludes that the Proposed Regulation is the preferred option. The Proposed Regulation is subject to a 10-week public consultation period where all submissions will be considered in the finalisation of the proposal. If made, the Proposed Regulation to take effect in 2021. The proposed nineteen changes and amendments affect Part 1 Preliminary, Part 2 Port charges, Division 1 Preliminary, Division 2 Information required for calculation of charges, Part 6 Port Botany Landside Improvement Strategy, Division 1 Preliminary, Division 2 Booking and gate Procedures, Division 3 Operational performance of carriers, Division 4 Operational performance of stevedores, Division 5 Confidentiality of information, Division 6 General, Part 4 from the 2012 Regulations has been moved to Schedule 1, Part 6 from the 2012 Regulations has been moved to Schedule 5, Part 3 Commuter wharf permit Scheme, Part 5 Traffic control at ports and wharves, Part 4 Mooring licences Division 1 Mooring licences, Division 2 Miscellaneous, Part 8 Miscellaneous, Part 7 Management of dangerous Goods, Division 1 Preliminary, Division 2 Notice of dangerous goods, Division 3 Bringing dangerous goods into ports, Division 4 Handling dangerous goods generally, Division 5 Handling explosives, Division 6 Handling radioactive Goods, Division 7 Handling restricted chemicals, Division 8 Handling bulk dangerous goods, Division 9 Miscellaneous, - Part 7 includes modifications to language, Part 8 Miscellaneous, Schedule 5 Members and procedure of Maritime Advisory Council, Schedule 3 Charter wharves, Schedule 4 Mooring licence fees, Schedule 6 Penalty notice offences Schedule 3 Charter wharves and Schedule 2 Commuter wharves. Table 2.0 below, is divided into three parts, being, the 2012 Regulation as it stands today, the proposed TfNSW 2020 changes and amendments to be remade in 2021, and the proposed responses for IFCBAA and RfNSW back to TfNSW as part of the consultation and feedback process. Table 2.0 Proposed Changes and Proposed Responses to the proposed Regulation 2012 Regulation as stands today Proposed 2020 Regulation to be Proposed responses from IFCBAA and remade 2021 RfNSW Part 1 Preliminary Part 1 Preliminary -Updates to reflect the merger of Roads Support this change. All references to and Maritime Services (RMS) and Roads and Maritime Services (RMS) Transport for should be replaced with Transport for NSW in 2019 NSW (TfNSW) regarding the Ports and Maritime Administration Act (PAMA), the Regulation and the Port Botany Landside Improvement Strategy (PBLIS). Part 2 Port charges Part 2 Port charges Division 1 Preliminary Division 1 Preliminary Division 2 General principles Division 2 Information required for calculation of charges for calculation of charges Division 3 Furnishing of particulars - A revised definition of “container” to Requires further consultation with more closely align NSW requirements IFCBAA and RfNSW to ensure the with relevant thorough definition as per the national and international standards, as International Convention for Safe set out in the International Convention for Containers 1972 [clause5(1)] is included. Safe Containers 1972 [clause 5(1)]. Also, further consultation is required regarding: (i) container content loading guidelines (ii) prevention of containers being marked with misleading maximum gross weight pg. 9
(iii) and restricted container stacking capacity. Working day, in relation to a port, means the part of the day, that is not a Saturday, Sunday or public holiday, during which work is normally carried on in the port. This needs revision as ports operate 7 days a week and predominately 24 hours a day. -The principles applied to charging for Support this change, as it does not goods in bulk are to be applied only to directly affect IFCBAA or RfNSW goods that have been loaded or members. discharged from a hold or tank of a vessel [clause 6]. -Vessels that make more than one entry to Support this change, however this should Port Botany and Sydney Harbour, without further be expanded to apportion this entering savings down the supply chain to another port, will receive a 50 per cent IFCBAA and RfNSW members and end reduction on the navigation service uses, whether the 50% reduction relates charge for subsequent entries [clause 7 to container vessels or fuel bulk vessels. (b)]. -Information to be provided for a site Support this change, as it does not occupation charge will include the directly affect IFCBAA or RfNSW purpose for which the site is sought members. [clause 11(1) (a)]. -At Port Kembla, the manifest for goods Support this change, however this discharged from the vessel is to be manifest data should be de-identified and provided by the end of the third working provided to IFCBAA and RfNSW for day after the vessel enters the port [clause trend analysis and future planning. 13(2) (a)]. Support this change, as it does not -Information relevant to the calculation of directly affect IFCBAA or RfNSW berthing charges is no longer required in members. triplicate [clause 15(1)]. Part 3 Port Botany Landside Part 6 Port Botany Landside Improvement Strategy Improvement Strategy Division 1 Preliminary Division 1 Preliminary Division 2 Booking and gate Division 2 Booking and gate procedures Procedures Division 3 Operational performance of Division 3 Operational carriers performance of carriers Division 4 Operational performance of Division 4 Operational stevedores performance of stevedores Division 5 General Division 5 Confidentiality of information Division 6 General -The procedures for booking cancellations have been removed from Support this change, however any the regulation (clause 29 proposed changes by TfNSW to the in the 2012 regulations) and will be current procedure MUST have thorough included unchanged in the mandatory consultation with IFCBAA and RfNSW standards. prior. pg. 10
-Transitional clauses relating to the Support this change. All references to transfer of the PBLIS from Sydney Ports Roads and Maritime Services (RMS) to TfNSW have been removed (clauses should be replaced with Transport for 39A (5) (d1) and 39B NSW (TfNSW) regarding PAMA, the in the 2012 regulations). Regulation and the Port Botany Landside Improvement Strategy (PBLIS). Part 4 Port Boundaries -Part 4 from the 2012 Regulations has Support this change, as it does not been moved to Schedule 1. directly affect IFCBAA or RfNSW members. Part 5 (Repealed in 2012) Supported Part 6 Maritime Advisory Council -Part 6 from the 2012 Regulations has Support this change, however IFCBAA been moved to Schedule 5. and RfNSW should be included in the Minister (s) Maritime Advisory Council. Part 6A Access to wharves Part 3 Commuter wharf permit Division 1 General Scheme Division 2 Commuter wharf permit scheme -The permit allows the normal maximum Support this change, as it does not Division 3 Charter wharf booking system berthing time of 5 minutes or another directly affect IFCBAA or RfNSW timeframe if specified by the permit members. (clause 18(4)). Part 6B Traffic control at ports and Part 5 Traffic control at ports and wharves wharves -Minor rewording and restructuring This requires further consultant with IFCBAA and RfNSW, and NOT minor “rewording or remaking” without amendment. There were numerous occurrences throughout 2019-2020, where terminals and stevedores were unable to meet the demand of container trucks collecting containers in Time Zones, even though these container trucks all had pre-arranged bookings under the PBLIS regime. IFCBAA and RfNSW made representations to the former TfNSW Cargo Movement Coordination Centre (CMCC), the stevedores, the port operator (NSW Ports) and the Ministers offices. Government action is required to ensure that terminals and stevedores have sufficient operators to load container trucks when a surge of volume occurs, as well as TfNSW, port operators and stevedores have sufficient authority to manage container truck and vehicle traffic inside the stevedore gate, as well onto private port and public roads, such as Penryhn, Foreshore and Botany Roads and port approach roads. The Proposed changes need to include this. Part 6C Mooring licences Part 4 Mooring licences Division 1 Mooring licences Division 2 Miscellaneous -The requirement for courtesy and Support this change, as it does not emergency mooring licenses has been directly affect IFCBAA or RfNSW removed (clause 67W (1) in 2012 members. regulations). pg. 11
-Clarification that a mooring licence is Support this change, as it does not not a property right [clause 27(9]. directly affect IFCBAA or RfNSW members. -Clarification that notification is required Support this change, as it does not where a vessel vacates or is absent from a directly affect IFCBAA or RfNSW mooring for a period of 28 consecutive members. days [clauses (31(1) and 34(2)]. -New provision for an application to Support this change, as it does not transfer a mooring licence from a person directly affect IFCBAA or RfNSW acting on behalf of the licensee in certain members. circumstances [clause 32(2)]. -New provision providing a process for managing a mooring licence if a licence Support this change, as it does not holder is deceased [clause 37(2)]. directly affect IFCBAA or RfNSW members. Part 6D General safety provision Part 8 Miscellaneous -Minor rewording and restructuring. Support this change, as it does not directly affect IFCBAA or RfNSW members. Part 11 from the repealed Dangerous Part 7 Management of dangerous Goods (General) Regulation 1999 goods Division 1 Preliminary Division 2 Notice of dangerous goods Division 3 Bringing dangerous goods into ports Division 4 Handling dangerous goods generally Division 5 Handling explosives Division 6 Handling radioactive goods Division 7 Handling restricted chemicals Division 8 Handling bulk dangerous goods Division 9 Miscellaneous -Part 7 includes modifications to As Part 7 requires compliance to the language and requirements to more requirements of the IMDG Code, the closely align with other dangerous goods International Maritime Solid Bulk legislation. In particular, definitions such Cargoes Code (IMSBC Code), Australian as explosives, gas and other classes of Standard AS 3846-2005 The handling dangerous goods are aligned with the and transport of International Maritime Dangerous Goods dangerous goods in port areas (AS 3846) (IMDG) Code [clause 68] and a provision and the Safe Transport for Radioactive is included on the relationship with Material Code that apply to the Commonwealth law [clause 67]. identification, marking, labelling, placarding, separation and segregation, stowage, classification, packaging, handling and testing of the dangerous goods being handled and transported in the port. pg. 12
Part 7 also imposes specific notification, approval, operational and reporting requirements on the transport and handling of dangerous goods in the port. In addition, Part 7 assigns responsibility for compliance to the person(s) or entity(ies) in the supply chain who are in the best position to control the way in which the goods are handled. For example: -consignors are responsible for ensuring compliance with the notification, approval and declaration requirements, packaging requirements and terminal time limits; -masters are responsible for ensuring compliance with the conditions of an approval and with the standards or requirements for loading, unloading and handling dangerous goods; and -terminal operators are responsible for ensuring compliance with handling requirements and with terminal time limits. The consistency in processes that this change seeks to achieve, CANNOT result in additional operational processes and compliance costs to IFCBAA and RfNSW members. Additional processes and costs should be borne by TfNSW, port operators and the stevedores. Clarification required as to whether the -Obligations have been more clearly proposed obligations relate to IFCBAA placed on: - Consignors or agents and RfNSW members. If so, detailed (Clauses 88 and 91. More generally, particulars are required by TfNSW, prior clauses 73, 74, 77, 79, 82,83, 88, 91 and to further comment. 98); and - Terminal operators (Clauses 87, 89 and 94. More generally, clauses 74, 79, 82, 83, 84, 87, 96 and 97). Further consideration MUST be given to -The terminal time limits for some weekend and public holidays, where dangerous goods have been changed from parties involved in the notification often 2 to 12 hours, including for some types of operate business hours Monday to Friday explosives, low 0900-1700, such as shipping lines. specific activity radioactive goods and restricted chemicals [clause 101]. Detailed particulars are required to comment. -Other structural and wording changes have been made to improve readability. Part 7 General Part 8 Miscellaneous - Includes Part 6D from 2012 regulations Support this change, as it does not relating to disturbance of the sea bed in a directly affect IFCBAA or RfNSW port [clause 108]. members. pg. 13
Schedule 1 Description of port Schedule 1 Port boundaries boundaries -No changes Supported Schedule 2 (Repealed in Supported 2012) Schedule 3 Membership and Schedule 5 Members and procedure of procedure of Maritime Advisory Maritime Advisory Council Council -Minor rewording and restructuring only Further consultation is required to provide greater transparency regarding the establishment, membership and procedures of the MAC. The Proposed Regulation remake should not proceed without amendment. Schedule 3A Commuter wharf Schedule 3 Charter wharves permit fees Schedule 3B Charter wharf booking -Updated charter wharf booking fees. Support this change, as it does not system fees directly affect IFCBAA or RfNSW members. Schedule 3C Mooring licence fees Schedule 4 Mooring licence fees -A replacement mooring licence fee is Support this change, as it does not specified as $25. directly affect IFCBAA or RfNSW members. Schedule 4 Penalty notices Schedule 6 Penalty notice offences -Restructuring of existing content into Support this change, as long as there is no this schedule impact to PBLIS Penalty regime. Schedule 5 Charter wharves Schedule 3 Charter wharves Schedule 6 Commuter wharves Schedule 2 Commuter wharves -Updated wharf names. Support this change 3. The International Forwarders & Customs Brokers Association of Australia and Road Freight NSW Commentary and Position on Regulation Changes and Amendments Subsequent to the minor review, proposed minor changes and amendments to the Ports and Maritime Regulation 2012 and PBLIS Mandatory Standards as well as the IFCBAA and RfNSW responses earlier in this report, this section will highlight an urgent requirement for a more significant review of these two instruments of government. PBLIS, as mentioned earlier, was specifically designed and implemented to improve the port and landside interface and remove lengthy queues and congestion from the ports, whilst reducing unnecessary costs to the supply chain and ultimately end-use consumers. Since the implementation of PBLIS in 2010 there has only been minor changes and amendments made in 2015 (CMCC, 2015). Emerging charges and costs have been introduced by stevedores, shipping lines and governments, as well as technological improvements in the port supply chain, both globally and within Australia. IFCBAA and RfNSW, believe it is now timely that a deep dive thorough analysis and review is completed to address these items. IFCBAA and RfNSW received notice from TfNSW that this will occur at the start of the next FY being July 2021. The below commentary is to be considered now in preparation for this review. 3.1.1 Containment and Control of Stevedore Charges On 3 April 2017, DP World Australia (DPWA) introduced a Terminal Infrastructure Surcharge (Management, 2017) at their Sydney terminal, as part of the basis for which access to the terminal is granted for both road and rail operators. Their argument at the time was that property costs at their Sydney terminal had risen considerably in previous years, and that the introduction of a third stevedore, Hutchinson Ports in 2014 (Ports H. , Our Ports, 2014) had driven excess stevedoring capacity and competition driving down service pricing, as well as consolidation of the shipping industry pg. 14
giving shipping lines the ability to negotiate better stevedoring rates. They argued that since 2013, they had incurred material increases in the costs of occupancy of more than 30%, including the cost of council rates, land tax, rent and terminal infrastructure maintenance. The surcharge was introduced at $21.16 per full container received or delivered via road or rail at their Sydney terminal. This charge has regularly increased since then to $91.00 on 01 January 2020 (Australia, DP World Australia Customer, 2019), and then revised on 08 May 2020 to $84.50 per full container export container and $112.10 per full container import container (exclusive of GST). Later that same year on 10 July 2017, their competitor Patrick Stevedore introduced a Terminal Infrastructure Surcharge of $25.24 per full container at the Sydney terminal (Loaded, ATN Fully Loaded Industry News, 2017). They also argued that rent, land tax and council rates placed significant additional cost burden on their operations. In addition, they incurred rising terminal infrastructure maintenance costs relating to the landside interface operations. Since its implementation, the charge has continuously increased to now $84.90 + GST on export containers and $117.85 + GST per import container commencing 01 March 2021 (Stevedore, Patrick Stevedore Customer Information, 2021). Hutchinson Ports Sydney followed both competitors introducing a $10.45 Terminal Infrastructure Surcharge per full container effective 25 June 2018 (CTAA, 2018), their reasoning similar to DPWA and Patricks Stevedore, however also advising that the funds would further support the competition of their terminal. This surcharge is now $88.83 per full container effective 08 September 2020 (Ports H. , Landside Tariffs, 2020). Table 3.0 below is an illustration of the introduced Terminal Infrastructure Surcharges and their increases. Appendix 1.0 references these charges and others that have significantly increased at Port Botany such as Vehicle Booking System (VBS) fees. Table 3.0 Port Botany Stevedore Terminal Infrastructure Surcharges (All Subject to GST) Stevedore Terminal Infrastructure Surcharge Dates of Commencement and Amounts to be Charged DP World Australia 03/04/2017 01/01/2019 01/01/2019 01/01/2020 08/05/2020 $21.16 $37.65 $63.80 $91.00 $84.50 export $112.10 import Patrick Stevedore 01/06/2017 05/03/2018 04/03/2019 09/03/2020 01/03/2021 $25.45 $41.10 $77.50 $82.50 export $84.90 export $114.50 import $117.85 import Hutchinson Ports 25/06/2018 24/02/2019 18/11/2019 08/09/2020 15/3/2021 Sydney $10.45 $35.84 $63.11 $88.83 $135.65 Both IFCBAA and RfNSW have lobbied continuously, both in private meetings and more publicly, the Australian Competition and Consumer Commission (ACCC) (News, 2017) , TfNSW and Federal and State Ministers to initially abolish the Terminal Infrastructure Surcharge, but considering this was not acted upon, later to have it halted from further increase subject to a more level playing field and review on where this charge should rest. IFCBAA and RfNSW argue that this charge should be borne by the shipping lines and not downline to transport companies, customs brokers, freight forwarders, importers and exporters and finally, after marking up, to end use consumers. The Australian Competition and Consumer Commission’s (ACCC’s) latest “Container Stevedoring Monitoring Report 2018-19” (ACCC, ACCC Container stevedoring monitoring report 2018-19, 2020) advises that the financial burden of the Terminal Infrastructure Surcharges as at last FY was at $256 million, not including increases in other charges in the container logistics chain. The NSW Transport Minister in December 2019 wrote to the stevedores telling them that they must act responsibly and immediately put a stop to any price hikes (Review, AFR Exclusive, 2019), however no further action was taken by the pg. 15
NSW Government and TfNSW, and the following year, more increases continued. The NSW Transport Minister referred the increases to the NSW Productivity Commissioner in 2019 for his review (Review, AFR Ports DP World 'snubs' Andrew Constance, hikes port fees, 2020), and IFCBAA and RfNSW have had multiple discussions with the NSW Productivity Commissioner, however to date, no finalisation of his review or a report has been forthcoming. During November 2020, the States Transport Ministers collectively acknowledged that there are concerns in the container transport and logistics chain, and that a soft-touch government approach is required (Loaded, ATN Fully Loaded Industry News TIC GIVES NTC CARRIAGE OF STEVEDORE CONTAINER ACCESS CHARGES, 2020). The Transport and Infrastructure Council (TIC) have stated that "Ministers endorsed for the National Transport Commission [NTC] to develop voluntary national guidelines for applying stevedore infrastructure and access charges (both their introduction and increase) at Australia’s container ports”, and "The introduction and setting of charges at container ports has flow-on effects throughout the supply chain. "The development of these guidelines will provide greater certainty and transparency for both stevedores and landside transport operators and support continued investment in terminal facilities". IFCBAA and RfNSW welcome this and will offer expert advice to TfNSW on what to advocate for, however, as has been proven historically, prior to government intervention with PBLIS, voluntary guidelines have not been successful. IFCBAA and RfNSW strongly recommend that TfNSW investigate global best practices into the handling of the Terminal Infrastructure Surcharges, such as the Port of Piraeus (Piraeus, 2005). At this port, its tariff structure is comprehensive and extensive, similar to ports in NSW. The port has over 25 regulations, each being a document governing a specific aspect of its operation. Of these regulations, 10 have tariffs embedded in them. As the port is a monopoly, all of its regulations and tariffs are mandatory bylaws to clients using the port’s services. Excluding confidential rates, all tariffs of the port are public and are published. The rates go into minute detail for every conceivable service rendered by the port. The law stipulates that the process of rate increase requires the port to present a comprehensive business case for consideration, displaying clearly where each increased revenue dollar will be attributed to, and the productivity improvements for each additional dollar received. If the business case is supported, it initially requires approval by the port’s Board of Directors, and then by the Ministry of National Economy. Only rate decreases do not need Ministerial approval. The current Ports and Maritime Regulation 2012 and PBLIS Mandatory Standards do not require TfNSW or the Minister to approve increases in charges, more so, simply for the stevedores to give 60 days’ notice to government of the proposed increase with limited information or detail of explanation. IFCBAA and RfNSW recommend, that through already established government and industry forums, such as the PTLT, that the above-mentioned Port of Piraeus example is implemented and expanded upon. Recently on 04 January 2021, Patrick Stevedore introduced a new surcharge named a 'Safety' Surcharge at their Brisbane terminal (Stevedore, Patrick Stevedore Customer Information, 2020). This will presumably be also introduced at Port Botany. This Surcharge is for import containers where the declared weight varies from the actual recorded weight by Patrick Stevedore using their weighing device. A Weight Amendment Fee $230.00 per container plus GST will apply to all containers determined to have a weight variance of greater than +/- one metric tonne within the documented weight and will be charged to the container transport organisation. IFCBAA and RFNSW support the importance of accurate container weight declarations, particularly through technological advancements mentioned later in this report. This fee is another example of a new charge levied onto the supply chain, with minimal justification. As mentioned above, this fee is an example that should be included in the proposed Port of Piraeus model recommended and included in the more comprehensive regulatory review later this year. pg. 16
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