{"id":"C2012A00053","name":"Shipping Reform (Tax Incentives) Act 2012","slug":"shipping-reform-tax-incentives-act-2012","collection":"act","jurisdiction":"commonwealth","status":"in_force","isInForce":true,"actNumber":"53 of 2012","makingDate":null,"administeringDepartment":null,"currentVersion":{"id":8368,"registerId":"commonwealth-C2012A00053-current","compilationNumber":null,"startDate":"2026-03-30","status":"InForce","reasons":null,"registeredAt":null},"sections":[{"sectionNumber":"Part 1","sectionType":"part","heading":"Preliminary","content":"## Part 1—Preliminary","sortOrder":0},{"sectionNumber":"1","sectionType":"section","heading":"Short title","content":"#### 1 Short title\n\n  This Act may be cited as the Shipping Reform (Tax Incentives) Act 2012.","sortOrder":1},{"sectionNumber":"2","sectionType":"section","heading":"Commencement","content":"#### 2 Commencement\n\n  This Act commences on 1 July 2012.","sortOrder":2},{"sectionNumber":"3","sectionType":"section","heading":"Object","content":"#### 3 Object\n\n  The object of this Act is to provide the framework for tax incentives:\n    (a) to encourage investment in the Australian shipping industry; and\n    (b) to encourage the development of sustainable employment and skills opportunities for Australian seafarers.","sortOrder":3},{"sectionNumber":"4","sectionType":"section","heading":"Simplified outline","content":"#### 4 Simplified outline\n\n  The following is a simplified outline of this Act:\n\n• A corporation that is issued a certificate under Part 2 for a vessel for an income year can be eligible for tax incentives under the Income Tax Assessment Act 1997 for the income year.\n\n• The corporation can maximise the tax incentives for the first income year for the vessel by applying during that year for a notice under Part 3.\n\n> Note: The tax incentives are set out in subsections 40‑102(4) and 40‑285(5), sections 40‑362 and 51‑100 and Subdivision 61‑N of the Income Tax Assessment Act 1997.","sortOrder":4},{"sectionNumber":"5","sectionType":"section","heading":"Definitions","content":"#### 5 Definitions\n\n  (1) In this Act:\n\n> activities in support of the fishing operations of a fishing vessel include:\n\n    (a) the storage and transport of fish taken, caught or captured by the fishing vessel; and\n    (b) the provision of food, fuel and other supplies to the fishing vessel while it is engaged in fishing operations; and\n    (c) the transport of crew members to and from the fishing vessel while it is engaged in fishing operations.\n\n> approved form has the meaning given by section 26.\n\n> Australia, when used in a geographical sense, includes the external Territories.\n\n> business day means a day that is not:\n\n    (a) a Saturday; or\n    (b) a Sunday; or\n    (c) a public holiday in the Australian Capital Territory; or\n    (d) 27, 28, 29, 30 or 31 December.\n\n> constitutional corporation means a corporation to which paragraph 51(xx) of the Constitution applies.\n\n> excluded vessel has the meaning given by subsections 10(4) and (5).\n\n> fish includes turtles, dugong, crustacea, molluscs and any other living resources of the sea or of the seabed.\n\n> fishing fleet support vessel means a vessel used wholly or mainly in activities in support of the fishing operations of a fishing vessel.\n\n> fishing operations means:\n\n    (a) the taking, catching or capturing of fish for trading or manufacturing purposes; and\n    (b) the processing or carrying of the fish that are taken, caught or captured.\n\n> fishing vessel means a vessel used wholly or mainly for fishing operations.\n\n> government vessel means a vessel:\n\n    (a) that belongs to any of the following entities (a government entity):\n    (i) the Commonwealth, a State or Territory;\n    (ii) a body corporate (other than a constitutional corporation) established for a public purpose under a law of the Commonwealth, a State or Territory; or\n    (b) the beneficial interest in which is vested in a government entity; or\n    (c) that is for the time being demised or sub‑demised to, or in the exclusive possession of, a government entity.\n\n> gross tonnage has the same meaning as in the Tonnage Convention.\n\n> harbour means a natural or artificial harbour, and includes an estuary, navigable river, creek, channel, dock, pier, jetty, offshore terminal or other place in or at which vessels can load and unload goods or embark and disembark passengers.\n\n> inland waterways vessel means a vessel (other than a government vessel) that is used wholly in waters other than waters of the sea.\n\n> lawyer means a barrister, a solicitor, a barrister and solicitor, or a legal practitioner, of a federal court or of a court of a State or Territory.\n\n> management requirements has the meaning given by section 6.\n\n> offshore industry vessel means a vessel that is used wholly or mainly in, or in any operations or activities associated with or incidental to, exploring or exploiting the mineral and other non‑living resources of the seabed and its subsoil.\n\n> recreational vessel means a vessel used wholly for recreational or sporting activities (whether or not let, or intended to be let, for consideration).\n\n> salvage operation means any act or activity undertaken to assist a vessel or any other property in danger in any waters.\n\n> salvage vessel means a vessel that is used wholly or mainly for salvage operations.\n\n> Secretary means the Secretary of the Department.\n\n> shipping cargo means any personal property:\n\n    (a) that is carried on board a vessel under a contract; or\n    (b) that is carried on board a vessel, and for which a bill of lading, or a receipt of a similar kind, is issued.\n\n> shipping exempt income certificate has the meaning given by subsection 9(2).\n\n> shipping passenger means a person carried on board a vessel with the knowledge or consent of the owner, charterer or master of the vessel, other than:\n\n    (a) a person employed or engaged in any capacity on board the vessel by the business operating the vessel; or\n    (b) a person on board the vessel:\n    (i) under an obligation imposed on the owner, charterer or master by any law (including a law of a country other than Australia); or\n    (ii) because of circumstances that could not have been prevented by the owner, charterer or master.\n\n> tonnage certificate means a certificate issued by the Commonwealth Government in accordance with the Tonnage Convention.\n\n> Tonnage Convention means the International Convention on Tonnage Measurement of Ships, done at London on 23 June 1969, as amended and in force for Australia from time to time.\n\n> Note: The text of the Convention is set out in Australian Treaty Series 1982 No. 15 (\\[1982\\] ATS 15). In 2012, the text of a Convention in the Australian Treaty Series was accessible through the Australian Treaties Library on the AustLII website (www.austlii.edu.au).\n\n> training requirements means any requirements specified in regulations made for the purposes of this definition.\n\n> vessel means any kind of vessel used in navigation by water, however propelled or moved.\n\n  (2) Subject to subsection (1), an expression used in this Act that is also used in the Income Tax Assessment Act 1997 has the same meaning in this Act as it has in that Act.","sortOrder":5},{"sectionNumber":"6","sectionType":"section","heading":"Management requirements","content":"#### 6 Management requirements\n\n  (1) Management requirements are any requirements specified in regulations made for the purposes of this section.\n  (2) Without limiting subsection (1), the regulations may require certain management activities to be conducted within Australia, including specified activities relating to any or all of the following:\n    (a) strategic management;\n    (b) technical management;\n    (c) commercial management;\n    (d) crew management.","sortOrder":6},{"sectionNumber":"7","sectionType":"section","heading":"Application to external Territories and outside Australia","content":"#### 7 Application to external Territories and outside Australia\n\n  (1) This Act extends to every external Territory.\n  (2) Except so far as the contrary intention appears, this Act extends to acts, omissions, matters and things outside Australia.","sortOrder":7},{"sectionNumber":"Part 2","sectionType":"part","heading":"Certificates for vessels","content":"## Part 2—Certificates for vessels","sortOrder":8},{"sectionNumber":"8","sectionType":"section","heading":"Certificates for vessels","content":"#### 8 Certificates for vessels\n\n  (1) The Minister must, on application, issue a certificate to an entity for a vessel for an income year (the certificate year) if:\n    (a) the entity is a constitutional corporation; and\n    (b) the requirements in section 10 are met for the vessel for one or more days during the certificate year; and\n    (c) during the income year the vessel was used, or was available for use, wholly or mainly for business or commercial activities involving carrying shipping cargo, or shipping passengers, on voyages.\n\n> Note 1: A certificate is needed for an entity to be eligible for a shipping tax incentive for the certificate year.\n\n> Note 2: A decision under this subsection is reviewable (see section 24).\n\n  (2) The certificate may set out:\n    (a) that the entity’s management arrangements meet the management requirements; and\n    (b) that the entity has a training plan that meets the training requirements; and\n    (c) the days (if any) during the next income year for which all of the requirements referred to in subsection (3) are likely to be met.\n  The certificate may set out other matters.\n\n> Note 1: The certificate will need to set out the matters in paragraphs (a) and (b) for the entity to be eligible for the exempt income incentive (see section 51‑100 of the Income Tax Assessment Act 1997).\n\n> Note 2: For paragraph (c), the applicant may have been required to give information about the next income year (see paragraph 11(2)(b)).\n\n> Note 3: A decision about the matters set out in the certificate is reviewable (see section 24).\n\n  (3) The certificate must set out the days during the certificate year for which all of the following requirements are met:\n    (a) the requirements in paragraphs (1)(a), (b) and (c);\n    (b) the management requirements and training requirements, if the certificate sets out the matters in paragraphs (2)(a) and (b).\n\n> Note: A decision about the matters set out in the certificate is reviewable (see section 24).\n\n  (4) However, the days set out under subsection (3) must not include:\n    (a) a day during the first 9 months of the certificate year if:\n    (i) a certificate under this section has never been issued to the entity for the vessel for an earlier income year; and\n    (ii) the entity does not have a notice under section 14 for the vessel for the certificate year; or\n    (b) a day that is earlier than 1 July 2012.\n  (5) For the purposes of this Act and the Income Tax Assessment Act 1997, the days set out under subsection (3) are the days to which the certificate applies.\n\n> Note: These days may be varied (see section 13).\n\n  (6) Despite subsection (1), the Minister is not required to issue a certificate under this section if a request under section 12 for information about the application for the certificate has not been complied with.","sortOrder":9},{"sectionNumber":"9","sectionType":"section","heading":"Shipping exempt income certificates not to be issued in certain circumstances","content":"#### 9 Shipping exempt income certificates not to be issued in certain circumstances\n\n  10 year lockout period applies in certain circumstances\n  (1) Despite section 8, the Minister must not issue a shipping exempt income certificate under that section to an entity for a vessel for the certificate year if:\n    (a) the entity does not have a shipping exempt income certificate for the vessel for the previous income year; and\n    (b) a shipping exempt income certificate has been issued to the entity for the vessel for that previous income year or an earlier income year; and\n    (c) there are less than 10 income years, or less than the number of income years determined under subsection (3) for the entity, between:\n    (i) the last income year for which a shipping exempt income certificate has been issued to the entity for the vessel; and\n    (ii) the certificate year.\n  (2) A shipping exempt income certificate is a certificate issued under section 8 that sets out the matters in paragraphs 8(2)(a) and (b).\n  Reducing the 10 year lockout period\n  (3) The Minister may, on application, determine a number less than 10 to be the number of income years that applies to the applicant under paragraph (1)(c).\n\n> Note: A decision under this subsection is reviewable (see section 24).\n\n  (4) An application for a determination under subsection (3) must be:\n    (a) in the approved form; and\n    (b) accompanied by the fee (if any) specified in regulations made for the purposes of this paragraph.\n  (5) A determination under subsection (3) is not a legislative instrument.\n  Extension to associates\n  (6) Paragraphs (1)(a), (b) and (c) apply in relation to an applicant for a certificate as if each entity that is, or has at any time been, an associate of the applicant were at all times a part of the applicant rather than a separate entity.\n  Certificate can still be issued for other tax incentives\n  (7) This section does not prevent the Minister from issuing to the entity a certificate under section 8 for the vessel for the certificate year that is not a shipping exempt income certificate.","sortOrder":10},{"sectionNumber":"10","sectionType":"section","heading":"Requirements for vessels","content":"#### 10 Requirements for vessels\n\n  (1) The requirements for the vessel are as follows:\n    (a) the tonnage requirement (see subsection (2) or (3));\n    (b) that the vessel is registered (within the meaning of the Shipping Registration Act 1981);\n    (c) that the vessel is not an excluded vessel.\n  (2) The tonnage requirement is met for the vessel if a tonnage certificate is in force for the vessel stating that the vessel has a gross tonnage of at least 500.\n  (3) The tonnage requirement is also met for the vessel if:\n    (a) a tonnage certificate is in force for the vessel stating that the vessel has a gross tonnage of at least 200 but less than 500; and\n    (b) the Minister is satisfied that during the income year the vessel has been, or will be, used wholly or mainly for carrying shipping cargo to, from or within regional or remote Australia.\n  Excluded vessels\n  (4) The following are excluded vessels:\n    (a) recreational vessels;\n    (b) fishing vessels and fishing fleet support vessels;\n    (c) offshore industry vessels;\n    (d) inland waterways vessels;\n    (e) salvage vessels;\n    (f) tugboats;\n    (g) vessels operating wholly or mainly within a harbour;\n    (h) vessels operating wholly or mainly from a stationary position;\n    (i) government vessels;\n    (j) vessels owned or operated by:\n    (i) the Australian Defence Force; or\n    (ii) the defence force of another country;\n    (k) vessels of a kind specified under paragraph (5)(a).\n  (5) The Minister may, by legislative instrument, specify:\n    (a) kinds of vessels that are to be excluded vessels; and\n    (b) kinds of vessels that are not to be excluded vessels.\n  Despite subsection (4), a vessel of a kind specified under paragraph (b) is not an excluded vessel.","sortOrder":11},{"sectionNumber":"11","sectionType":"section","heading":"Applying for a certificate","content":"#### 11 Applying for a certificate\n\n  (1) An application for a certificate under section 8 must be:\n    (a) in the approved form; and\n    (b) accompanied by the fee (if any) specified in regulations made for the purposes of this paragraph; and\n    (c) made after the end of the income year, but at least 30 days before the entity is required to lodge its income tax return for the income year.\n\n> Note: Section 26 deals with approved forms.\n\n  (2) As well as requiring information relevant to the income year, the approved form may require:\n    (a) information about any tax incentives the entity utilised for the previous income year in reliance on a certificate issued under section 8 for the previous income year; and\n    (b) information about the following for the next income year:\n    (i) the vessel and its expected use;\n    (ii) the applicant’s arrangements in relation to the vessel.\n\n> Note: A certificate may give notice of the likelihood of a further certificate being issued for the next income year (see paragraph 8(2)(c)).","sortOrder":12},{"sectionNumber":"12","sectionType":"section","heading":"Minister may request further information","content":"#### 12 Minister may request further information\n\n  (1) The Minister may request the applicant in writing to give specified information, or specified kinds of information, to the Minister about the application.\n  (2) The request may be for the information or kinds of information to be given within 10 business days after the request was made.\n\n> Note: Failing to comply with the request may result in the Minister refusing to issue the certificate.\n\n  (3) The request may be for the information or kinds of information to be given in the approved form.\n\n> Note: Section 26 deals with approved forms.\n\n  (4) Subsections (2) and (3) do not limit subsection (1).","sortOrder":13},{"sectionNumber":"13","sectionType":"section","heading":"Non‑compliance relating to certificates","content":"#### 13 Non‑compliance relating to certificates\n\n  (1) This section applies in relation to a certificate issued under section 8 to an entity for an income year if:\n    (a) based on information currently before the Minister, the Minister is satisfied that the certificate should not have been issued; or\n    (b) the entity fails to comply, to the extent that it is capable of doing so, with a notice given to it under subsection 19(1) (about providing information) in relation to the certificate.\n  (2) The Minister may:\n    (a) give the entity one or more written requests to take specified remedial action within specified periods; and\n    (b) if satisfied that the entity has failed to comply with a request given under paragraph (a), vary or revoke the certificate by written notice given to the entity.\n\n> Note 1: A decision under paragraph (b) is reviewable (see section 24).\n\n> Note 2: An example of a variation is varying the days to which the certificate applies. Another is varying the certificate so that it no longer sets out the matters in paragraphs 8(2)(a) and (b), and so ceases to be a shipping exempt income certificate.\n\n> Note 3: Revoking the certificate means the entity ceases to have it. If a certificate is revoked, or ceases to be a shipping exempt income certificate, the entity will not be eligible for the exempt income incentive for up to another 10 income years (see section 9).\n\n> Note 4: Consequences of a revocation will cease to apply if the revocation is set aside on review.\n\n  (3) If the Minister is satisfied that the circumstances require immediate action, the Minister may, by written notice given to the entity, vary or revoke the certificate without acting under subsection (2).\n\n> Note: A decision under this subsection is reviewable (see section 24).","sortOrder":14},{"sectionNumber":"Part 3","sectionType":"part","heading":"Notices for vessels","content":"## Part 3—Notices for vessels","sortOrder":15},{"sectionNumber":"14","sectionType":"section","heading":"Notices for vessels","content":"#### 14 Notices for vessels\n\n  (1) The Minister must, on application, give a notice to an entity for a vessel for an income year if:\n    (a) the entity is a constitutional corporation; and\n    (b) the requirements in section 10 are met for the vessel for one or more days during the income year; and\n    (c) during the income year the vessel will be used, or be available for use, wholly or mainly for business or commercial activities involving carrying shipping cargo, or shipping passengers, on voyages.\n\n> Note 1: A notice is only relevant for the first income year that the entity seeks shipping tax incentives for the vessel. Getting the notice maximises the incentives for that year (see subsection 8(4)).\n\n> Note 2: A decision under this subsection is reviewable (see section 24).\n\n  (2) The notice may set out:\n    (a) that the entity’s management arrangements meet the management requirements; and\n    (b) that the entity has a training plan that meets the training requirements.\n  The notice may set out other matters.\n  (3) Despite subsection (1), the Minister is not required to give a notice under this section if a request under section 16 for information about the application for the notice has not been complied with.","sortOrder":16},{"sectionNumber":"15","sectionType":"section","heading":"Applying for a notice","content":"#### 15 Applying for a notice\n\n  An application for a notice under section 14 must be:\n    (a) in the approved form; and\n    (b) accompanied by the fee (if any) specified in regulations made for the purposes of this paragraph; and\n    (c) made at least 3 months before the end of the income year.\n\n> Note: Section 26 deals with approved forms.","sortOrder":17},{"sectionNumber":"16","sectionType":"section","heading":"Minister may request further information","content":"#### 16 Minister may request further information\n\n  (1) The Minister may request the applicant in writing to give specified information, or specified kinds of information, to the Minister about the application.\n  (2) The request may be for the information or kinds of information to be given within 30 days after the request was made.\n\n> Note: Failing to comply with the request may result in the Minister refusing to give the notice.\n\n  (3) The request may be for the information or kinds of information to be given in the approved form.\n\n> Note: Section 26 deals with approved forms.\n\n  (4) Subsections (2) and (3) do not limit subsection (1).","sortOrder":18},{"sectionNumber":"17","sectionType":"section","heading":"Non‑compliance relating to notices","content":"#### 17 Non‑compliance relating to notices\n\n  (1) This section applies in relation to a notice (an eligibility notice) given under section 14 to an entity for an income year if:\n    (a) based on information currently before the Minister, the Minister is satisfied that the eligibility notice should not have been given; or\n    (b) the entity fails to comply, to the extent that it is capable of doing so, with a notice given to it under subsection 19(1) (about providing information) in relation to the eligibility notice.\n  (2) The Minister may:\n    (a) give the entity one or more written requests to take specified remedial action within specified periods; and\n    (b) by written notice given to the entity, vary or revoke the eligibility notice if the Minister is satisfied that the entity has failed to comply with a request given under paragraph (a).\n\n> Note: A decision under paragraph (b) is reviewable (see section 24).\n\n  (3) If the Minister is satisfied that the circumstances require immediate action, the Minister may, by written notice given to the entity, vary or revoke the eligibility notice without acting under subsection (2).\n\n> Note: A decision under this subsection is reviewable (see section 24).","sortOrder":19},{"sectionNumber":"Part 4","sectionType":"part","heading":"Requesting information and documents","content":"## Part 4—Requesting information and documents","sortOrder":20},{"sectionNumber":"18","sectionType":"section","heading":"Persons to whom this Part applies","content":"#### 18 Persons to whom this Part applies\n\n  (1) This Part applies to a person if the Minister believes on reasonable grounds that the person is capable of giving information, or producing a document, relevant to whether any of the following requirements is being met for a certificate issued under section 8:\n    (a) the requirements in subsection 8(1);\n    (b) the management requirements and training requirements, if the certificate sets out the matters in paragraphs 8(2)(a) and (b).\n  (2) This Part applies to a person if the Minister believes on reasonable grounds that the person is capable of giving information, or producing a document, relevant to whether any of the following requirements is being met for a notice (the eligibility notice) given under section 14:\n    (a) the requirements in subsection 14(1);\n    (b) the management requirements and training requirements, if the notice sets out the matters in paragraphs 14(2)(a) and (b).\n  (3) This Part does not apply to a lawyer who is acting, or has acted, for the entity that was issued the certificate or given the eligibility notice (as appropriate).","sortOrder":21},{"sectionNumber":"19","sectionType":"section","heading":"Requesting information or documents","content":"#### 19 Requesting information or documents\n\n  (1) The Minister may, by written notice given to the person, request the person:\n    (a) to give the Minister the information; or\n    (b) to produce to the Minister the document; or\n    (c) to make copies of the document and to produce to the Minister those copies;\n  within the period and in the manner specified in the notice.\n  (2) The notice must:\n    (a) not specify a period shorter than 14 days after the notice is given; and\n    (b) set out the effect of section 20; and\n    (c) if the person is the entity that was issued the certificate, or given the eligibility notice, referred to in section 18—set out the effect of section 13 or 17 (as appropriate).\n\n> Note: Section 13 allows the Minister to vary or revoke the certificate if the person fails to comply with the notice given to it under subsection (1). Section 17 applies in a corresponding way to eligibility notices.","sortOrder":22},{"sectionNumber":"20","sectionType":"section","heading":"Failing to give the information or produce the documents","content":"#### 20 Failing to give the information or produce the documents\n\n  A person commits an offence if:\n    (a) the person has been given a notice under subsection 19(1); and\n    (b) the person fails to comply with the notice to the extent that the person is capable of doing so.\n\nPenalty: 30 penalty units.","sortOrder":23},{"sectionNumber":"21","sectionType":"section","heading":"Copying documents—compensation","content":"#### 21 Copying documents—compensation\n\n  A person is entitled to be paid by the Minister, on behalf of the Commonwealth, reasonable compensation for complying with a request covered by paragraph 19(1)(c).","sortOrder":24},{"sectionNumber":"22","sectionType":"section","heading":"Copies of documents","content":"#### 22 Copies of documents\n\n  (1) The Minister may:\n    (a) inspect a document or copy produced under subsection 19(1); and\n    (b) make and retain copies of, or take and retain extracts from, such a document.\n  (2) The Minister may retain possession of a copy of a document produced in accordance with a request covered by paragraph 19(1)(c).","sortOrder":25},{"sectionNumber":"23","sectionType":"section","heading":"Minister may retain documents","content":"#### 23 Minister may retain documents\n\n  (1) The Minister may take, and retain for as long as is necessary, possession of a document produced under subsection 19(1).\n  (2) The person otherwise entitled to possession of the document is entitled to be supplied, as soon as practicable, with a copy certified by the Minister to be a true copy.\n  (3) The certified copy must be received in all courts and tribunals as evidence as if it were the original.\n  (4) Until a certified copy is supplied, the Minister must, at such times and places as the Minister thinks appropriate, permit the person otherwise entitled to possession of the document, or a person authorised by that person, to inspect and make copies of, or take extracts from, the document.","sortOrder":26},{"sectionNumber":"Part 5","sectionType":"part","heading":"Miscellaneous","content":"## Part 5—Miscellaneous","sortOrder":27},{"sectionNumber":"24","sectionType":"section","heading":"Review by the Administrative Review Tribunal","content":"#### 24 Review by the Administrative Review Tribunal\n\n  An application may be made to the Administrative Review Tribunal for review of any of the following decisions of the Minister:\n    (a) a decision under subsection 8(1) to refuse to issue a certificate;\n    (b) a decision under section 8 about the matters set out in a certificate issued under subsection 8(1);\n    (c) a decision under subsection 9(3) to make or refuse to make a determination;\n    (d) a decision under section 13 to vary or revoke a certificate;\n    (e) a decision under subsection 14(1) to refuse to give a notice;\n    (f) a decision under section 17 to vary or revoke a notice.\n\n> Note: Paragraph (b) enables, for example, review of the number of days to which the certificate applies (see subsections 8(3), (4) and (5)).","sortOrder":28},{"sectionNumber":"25","sectionType":"section","heading":"Disclosing information","content":"#### 25 Disclosing information\n\n  (1) The Secretary may publish on the Department’s website information described in subsection (3) if the information is in an aggregated form that does not disclose, either directly or indirectly, information about a particular:\n    (a) entity; or\n    (b) consolidated group or MEC group; or\n    (c) vessel.\n  (2) The Secretary or an APS employee in the Department may disclose information described in subsection (3) to:\n    (a) the Commissioner; or\n    (b) a person specified in regulations made for the purposes of this paragraph.\n\n> Note 1: Persons may be specified by class, see subsection 13(3) of the Legislation Act 2003.\n\n> Note 2: The expression APS employee is defined in the Acts Interpretation Act 1901.\n\n  (3) The information is information (other than personal information (within the meaning of the Privacy Act 1988)) obtained under this Act, including information relating to:\n    (a) an applicant for a certificate under section 8; or\n    (b) an applicant for a notice under section 14.","sortOrder":29},{"sectionNumber":"26","sectionType":"section","heading":"Approved forms","content":"#### 26 Approved forms\n\n  (1) This section applies if a provision of this Act requires a thing to be in the approved form.\n  (2) To be in the approved form for the provision, the thing must:\n    (a) be in writing in a form approved by the Minister; and\n    (b) include the information required by the form; and\n    (c) include any other material (including documents) required by the form.","sortOrder":30},{"sectionNumber":"27","sectionType":"section","heading":"Delegation","content":"#### 27 Delegation\n\n  (1) The Minister may, by writing, delegate any or all of his or her functions or powers under this Act to:\n    (a) the Secretary; or\n    (b) an SES employee, or acting SES employee, in the Department; or\n    (c) the Commissioner; or\n    (d) a Second Commissioner of Taxation; or\n    (e) an SES employee, or acting SES employee, in the Australian Taxation Office.\n\n> Note: The expressions SES employee and acting SES employee are defined in the Acts Interpretation Act 1901.\n\n  (2) In exercising powers under a delegation, the delegate must comply with any directions of the Minister.","sortOrder":31},{"sectionNumber":"28","sectionType":"section","heading":"Regulations","content":"#### 28 Regulations\n\n  (1) The Governor‑General may make regulations prescribing matters:\n    (a) required or permitted by this Act to be prescribed; or\n    (b) necessary or convenient to be prescribed for carrying out or giving effect to this Act.\n  (2) Without limiting subsection (1), the regulations may specify:\n    (a) fees for making applications under this Act; and\n    (b) a method for indexing the fees.\n  (3) The fees must not be such as to amount to taxation.","sortOrder":32}],"analysis":{"summary":{"complexity_score":6,"scope_assessment":{"changed":false,"description":"The Act's scope appears consistent with its stated object. It is narrowly focused on providing a certificate framework to unlock tax incentives for Australian-registered commercial shipping corporations operating cargo or passenger vessels. The exclusions for fishing, offshore industry, recreational, government and military vessels are internally consistent and reflect a deliberate policy choice to target only commercial cargo/passenger shipping. There is no evidence of scope creep beyond the original policy intent."},"complexity_factors":["Interoperability with the Income Tax Assessment Act 1997: the Act creates no tax incentives itself — it is a gateway framework that only makes sense when read alongside the tax legislation it unlocks","Multi-layered certificate scheme: the distinction between a standard certificate and a 'shipping exempt income certificate' requires careful reading, as different entitlements flow from each","The 10-year lockout rule and its exceptions (including the associate extension and the Minister's discretion to reduce the period) add significant complexity to eligibility analysis","The 'notice' mechanism for maximising first-year benefits creates a parallel application process with different timing rules and different consequences","Management and training requirements are defined by reference to regulations not contained in the Act itself, meaning the full compliance picture cannot be assessed from this Act alone","Multiple defined vessel categories (excluded vessels, fishing vessels, offshore industry vessels, etc.) require careful factual analysis to determine whether a specific vessel qualifies","Delegated legislative instruments allow the Minister to expand or contract the list of excluded vessels, creating a moving compliance target","Tonnage measurement is defined by reference to an international treaty (the Tonnage Convention), adding a layer of international law","The days-based calculation mechanism (tracking qualifying days within an income year) requires precise record-keeping and adds operational complexity"],"plain_english_summary":"## What This Law Does\n\nThe **Shipping Reform (Tax Incentives) Act 2012** creates a system of government-issued certificates that allow Australian shipping companies to access significant tax breaks under Australia's income tax laws.\n\n## Who It Affects\n\nThis law primarily affects **Australian shipping companies** (specifically, corporations registered under Australian law) that own or operate commercial vessels carrying cargo or passengers. It also indirectly affects **Australian seafarers**, as one of the law's goals is to encourage shipping companies to hire and train local crew.\n\n## How It Works — Step by Step\n\n**1. Get a certificate, get tax breaks**\nA shipping company must apply to the Minister (typically after the end of each financial year) for a **vessel certificate**. If approved, that certificate makes the company eligible for a range of tax incentives, including:\n- Reduced tax on certain shipping income (potentially making it **tax-free**)\n- Special depreciation (write-off) rules for vessels and equipment\n\n**2. What vessels qualify?**\nTo get a certificate, the vessel must:\n- Be **registered** under Australian shipping law\n- Have a **gross tonnage** (a standard measure of vessel size) of at least 500 (or at least 200 if it mainly serves regional/remote Australia)\n- Be used commercially to carry **cargo or passengers** on voyages\n- **Not** be a recreational boat, fishing vessel, offshore oil/gas vessel, tugboat, government ship, harbour vessel, or military vessel\n\n**3. Maximising the tax break in Year 1**\nNormally, the tax benefits only apply to the **last 3 months** of the first year a company seeks them. However, by applying for a separate **\"notice\"** at least 3 months before year-end, a company can get the benefits for the **whole first year**.\n\n**4. The management and training bonus**\nCompanies that also show they:\n- **Manage their shipping operations from Australia** (meeting 'management requirements' set by regulations)\n- Have a **training plan for Australian seafarers** (meeting 'training requirements' set by regulations)\n\n...can access the most valuable incentive: **shipping exempt income** (meaning certain profits are completely free from income tax).\n\n**5. The 10-year lockout rule**\nIf a company stops holding the top-tier certificate (the 'shipping exempt income certificate') for a vessel, they face a **10-year ban** before they can get it again for that vessel. This stops companies from dipping in and out of the scheme opportunistically. The Minister can reduce this penalty period on application.\n\n**6. Ongoing compliance**\nThe Minister can:\n- Ask for information at any time to check compliance\n- **Vary or revoke** a certificate if the company is not meeting the rules\n- Act immediately if urgent action is needed\n\nFailing to provide requested documents is a **criminal offence** (carrying a fine of up to 30 penalty units — roughly $9,900 in 2024 terms).\n\n**7. Challenging decisions**\nCompanies can challenge most Ministerial decisions — including refusals to issue certificates and revocations — at the **Administrative Review Tribunal** (an independent government review body).\n\n## Why It Matters\n\nThis law is part of a broader government effort to revive Australia's shipping industry by making it more financially competitive against foreign-flagged vessels. Without these incentives, many shipping companies might register their vessels overseas to access lower tax rates in other countries. The law tries to keep ships — and maritime jobs and skills — in Australia."},"issue_detection":{"absurdities":[{"type":"impossible_compliance","section":"8(4)(a)","severity":"medium","reasoning":"The structural interaction between s8(4)(a) and s15(c) means a first-time applicant is structurally capped at approximately the last quarter of the year regardless of actual operations, which may defeat the incentive purpose stated in s3 for new entrants.","confidence":0.82,"description":"The 9-month exclusion period creates a potential impossibility: an entity applying for its first-ever certificate for a vessel cannot have days recognised for the first 9 months of the certificate year unless it has a notice under section 14. However, section 15 requires the notice application to be made at least 3 months before the end of the income year, meaning the notice can only be obtained in the final quarter of the year. For a standard July-June income year, this means the notice window (April-June) precisely aligns with the only period eligible for recognition under subsection 8(4)(a), leaving a first-time applicant with at most approximately 3 months of eligible days — even if the vessel operated all year."},{"type":"self_contradicting","section":"9(1)","severity":"medium","reasoning":"Section 8(1) imposes a mandatory duty on the Minister to issue a certificate if conditions are met, but s9(1) simultaneously prohibits issuance of a shipping exempt income certificate in lockout circumstances. Section 9(7) partially resolves this by allowing a non-exempt-income certificate to be issued, but the interplay between the mandatory duty and the prohibition is not cleanly drafted.","confidence":0.71,"description":"The 10-year lockout in s9(1) is triggered when an entity does NOT have a shipping exempt income certificate for the previous year but HAS had one issued in an earlier year. However, the Minister may revoke a certificate under s13. Per Note 3 to s13(2), revocation causes the entity to not be eligible for the exempt income incentive for up to another 10 income years under s9. This creates a circular penalty loop: an entity that loses a certificate due to non-compliance is locked out, but if it then somehow receives a certificate (which the Minister 'must' issue under s8(1) if requirements are met), s9 would prohibit issuing a shipping exempt income certificate version of it, which is the only version attracting the exempt income incentive. The mandatory 'must issue' in s8(1) combined with the prohibition in s9(1) creates structural tension."},{"type":"impossible_compliance","section":"9(6)","severity":"high","reasoning":"There is no temporal carve-out for when the associate relationship formed. An entity cannot prospectively audit all potential associates' entire shipping certificate histories before every acquisition, making compliance practically impossible in complex corporate groups.","confidence":0.78,"description":"The associate extension provision deems associates to be 'part of the applicant rather than a separate entity' for the purposes of the lockout. This could mean that an entity acquiring a new associate that previously held and lost a shipping exempt income certificate for a vessel immediately becomes subject to a lockout for that vessel, even if the acquiring entity had no prior connection to the vessel. This creates an impossible compliance situation where a corporation cannot conduct ordinary commercial transactions (acquisitions) without inadvertently triggering a decade-long tax penalty for vessels it did not previously operate."},{"type":"retroactive_impossibility","section":"10(3)(b)","severity":"low","reasoning":"Since applications must be lodged after the income year ends (s11(1)(c)), the 'will be' limb in s10(3)(b) is temporally redundant for standard certificate applications. It may only be coherent in the context of s14 notices, but s10 is cross-referenced from both sections.","confidence":0.75,"description":"The Minister must be satisfied that a 200-499 gross tonnage vessel 'has been, or will be, used wholly or mainly for carrying shipping cargo to, from or within regional or remote Australia' during the income year. The application is made after the end of the income year (s11(1)(c)), yet this subsection still refers to future use ('will be'). By the time the application is assessed, the income year is over and 'will be' is factually inapplicable. The Minister would be required to assess a future-tense condition that has necessarily already been resolved."},{"type":"other","section":"12(2) vs 16(2)","severity":"low","reasoning":"The asymmetric information request windows appear irrational given that retrospective applications deal with past facts (easier to compile) while prospective applications involve estimates and forward-looking arrangements (harder to compile quickly).","confidence":0.65,"description":"The Minister may request further information from an applicant for a certificate (Part 2) within 10 business days, but may request further information from an applicant for a notice (Part 3) within 30 days. The notice application is made prospectively (at least 3 months before year end), while the certificate application is made retrospectively (after year end). The longer timeframe is perversely assigned to the prospective application where urgency is less critical, and the shorter 10-business-day window is imposed on retrospective applications where information is already crystallised. This inversion appears arbitrary."},{"type":"self_contradicting","section":"5(1) - definition of 'fish'","severity":"medium","reasoning":"The definition creates an internal Commonwealth legislative contradiction: this Act defines fishing operations to include taking turtles and dugong for trading or manufacturing purposes, while other Commonwealth legislation makes such taking a serious criminal offence. An activity cannot simultaneously be a defined 'fishing operation' and an unlawful act.","confidence":0.8,"description":"The definition of 'fish' includes 'turtles' and 'dugong'. Both species are protected under Commonwealth law, including the Environment Protection and Biodiversity Conservation Act 1999, and cannot lawfully be taken for 'trading or manufacturing purposes' as required by the definition of 'fishing operations'. Including them in the definition of 'fish' for the purposes of 'fishing operations' implicitly contemplates activity that is unlawful under other Commonwealth legislation."},{"type":"self_contradicting","section":"20","severity":"medium","reasoning":"The word 'request' in s19(1) is incompatible with the criminal sanction in s20. Standard legislative drafting uses 'require' or 'direct' when compliance is mandatory and backed by criminal penalty. This creates ambiguity about the true legal character of the notice.","confidence":0.73,"description":"Section 20 creates a criminal offence for failing to comply with a notice under s19(1), but s19(1) only empowers the Minister to 'request' the person to give information. A 'request' in ordinary legal language is not a compulsory demand. Creating a criminal offence for failing to comply with a 'request' (rather than a 'requirement' or 'direction') is logically inconsistent — one cannot be guilty of an offence for declining a request."},{"type":"other","section":"8(4)(b)","severity":"low","reasoning":"While harmless, a legislative provision that cannot do any work because it merely restates an already-applicable legal constraint represents poor drafting and creates interpretive noise about whether Parliament intended some additional substantive effect.","confidence":0.85,"description":"Section 8(4)(b) prohibits the certificate from applying to any day earlier than 1 July 2012 — the commencement date of the Act. This is self-evidently redundant since s2 provides the Act itself commences on 1 July 2012, making it legally impossible for any certificate to apply to pre-commencement days regardless. The provision states the obvious and is legally superfluous."}],"contradictions":[{"severity":"medium","section_a":"8(1)","section_b":"9(1)","confidence":0.76,"description":"Section 8(1) imposes a mandatory obligation on the Minister ('must... issue a certificate') when the stated conditions are met. Section 9(1) overrides this with 'Despite section 8, the Minister must not issue a shipping exempt income certificate' during a lockout period. Section 9(7) partially resolves this by allowing a non-exempt-income certificate to be issued. However, the tension arises where an entity in lockout meets all s8(1) conditions: the Minister simultaneously must and must not issue a shipping exempt income certificate. The resolution via s9(7) is implicit rather than explicit, creating genuine interpretive uncertainty."},{"severity":"low","section_a":"11(1)(c)","section_b":"10(3)(b)","confidence":0.72,"description":"Section 11(1)(c) requires certificate applications to be made after the end of the income year. Section 10(3)(b) requires the Minister to be satisfied that the vessel 'has been, or will be' used for regional/remote cargo during 'the income year'. The 'will be' limb presupposes a prospective assessment, which is impossible once the income year has concluded and the application is being assessed. The two provisions cannot be simultaneously satisfied in their plain terms."},{"severity":"low","section_a":"14(1)","section_b":"15(c)","confidence":0.68,"description":"Section 14(1) requires the Minister to issue a notice if the vessel requirements in s10 'are met for the vessel for one or more days during the income year'. Section 15(c) requires the application to be made 'at least 3 months before the end of the income year'. At the time of application, the income year is still current and the Minister must assess whether requirements are or will be met for days that have not yet occurred. This makes the s14(1) condition partly speculative at the time of mandatory determination, yet the obligation is expressed as a present-tense mandatory duty."},{"severity":"medium","section_a":"13(3)","section_b":"13(2)(b)","confidence":0.7,"description":"Section 13(2)(b) permits the Minister to vary or revoke a certificate only after satisfying that the entity has failed to comply with a remedial request under s13(2)(a). Section 13(3) allows the Minister to vary or revoke 'without acting under subsection (2)' where 'circumstances require immediate action'. Both pathways lead to the same legal outcome (variation or revocation) but with fundamentally different procedural safeguards. The Act provides no criteria for distinguishing when 'immediate action' is warranted, meaning the Minister can bypass procedural fairness protections entirely at discretion, undermining the structured process in s13(2). This creates a contradictory regime where the same outcome has both a procedurally protected and an unprotected pathway."},{"severity":"low","section_a":"25(1)","section_b":"25(2)","confidence":0.66,"description":"Section 25(1) permits the Secretary to publish information only in aggregated form that does not identify particular entities, consolidated groups, MEC groups, or vessels. Section 25(2) permits disclosure to the Commissioner (of Taxation) or other specified persons with no equivalent anonymisation requirement. The same information that cannot be published publicly in identifiable form can be disclosed in identifiable form to the Commissioner. While operationally explicable, this creates a structural inconsistency in the privacy protection framework within the same section — the protection is absolute for public disclosure but non-existent for governmental disclosure."}]},"kimi_summary":{"content_quality":"ok","complexity_score":5,"scope_assessment":{"changed":false,"description":"The legislation appears consistent with its original intent as stated in section 3: providing tax incentives for shipping investment and Australian seafarer employment. The framework is tightly focused on the certificate/notice mechanism for accessing tax benefits, with no obvious scope creep into unrelated policy areas."},"complexity_factors":["21 defined terms in section 5, including nested definitions (e.g., 'fishing operations' defined in terms of 'fish', which is itself defined)","Cross-references to the Income Tax Assessment Act 1997 for tax incentive mechanics — the actual tax benefits aren't in this Act, only the eligibility framework","Conditional logic with multiple thresholds: 500-tonne default vs 200-tonne alternative for regional/remote vessels","10-year lockout period with discretionary reduction power (section 9) creating a complex temporal eligibility rule","Two-tier certificate system: standard certificates vs 'shipping exempt income certificates' with different eligibility criteria and consequences","Nested exceptions in vessel exclusions: 10 categories in subsection 10(4) plus discretionary Ministerial powers to add/remove categories in subsection 10(5)","Timing restrictions: first 9 months exclusion unless notice obtained (section 8(4)), with different application deadlines for certificates (after year end) vs notices (before year end)","Regulatory dependencies: management requirements, training requirements, and fees all delegated to regulations not contained in the Act"],"plain_english_summary":"This law creates a tax break scheme for Australian shipping companies. Here's what it does:\n\n**The big picture**\nThe government wants to encourage companies to invest in Australian ships and employ Australian crews. To do this, they offer tax incentives (basically, paying less tax) to companies that meet certain rules.\n\n**Who can get the tax breaks?**\n- **Constitutional corporations** (large companies that trade across state borders or with other countries — basically, most big companies)\n- The company must own or operate a **vessel** (ship) that:\n  - Is registered in Australia\n  - Weighs at least 500 tonnes (or 200 tonnes if used for regional/remote cargo)\n  - Is used mainly for carrying cargo or passengers on voyages\n  - Is NOT a fishing boat, recreational boat, tugboat, navy vessel, or various other excluded types\n\n**How it works — two-step process**\n\n**Step 1: Get a certificate (Part 2)**\n- Companies apply to the Minister for a certificate for each ship and each financial year\n- The certificate confirms the ship qualifies and states which days of the year it qualifies for\n- If the company has good management and training plans, they get a \"shipping exempt income certificate\" — this gives them the best tax break (treating some shipping income as tax-free)\n- **Catch**: If you stop using the scheme and want to come back later, there's a **10-year lockout** — you can't get the best certificate for 10 years after you last had one\n\n**Step 2: Get a notice for the first year (Part 3)**\n- For the very first year you want the tax break for a ship, you can apply for a special \"notice\" before the year ends\n- This lets you count the first 9 months of that year toward your tax break (otherwise you can only count from month 10)\n\n**The strings attached**\n- **Management requirements**: Companies must do certain management activities in Australia (strategic, technical, commercial, crew management) — exact rules are set by regulations\n- **Training requirements**: Companies must have training plans for Australian seafarers — exact rules are set by regulations\n- The Minister can demand information and documents, and can revoke certificates if companies don't comply\n- Decisions can be appealed to the Administrative Review Tribunal (a court-like body that reviews government decisions)\n\n**Why this matters**\nThis law tries to stop the decline of the Australian shipping industry by making it cheaper (through tax savings) for companies to operate Australian-registered ships with Australian crews. Without these incentives, companies often register ships overseas and hire cheaper foreign crews."},"flash_summary_failed":{"failed":true,"reason":"A positive credit balance is required for all requests, including BYOK, so fallback providers remain available. Add credits at https://vercel.com/d?to=%2F%5Bteam%5D%2F%7E%2Fai%3Fmodal%3Dtop-up to continue.","source":"analysis-cron"}},"importantCases":[],"_links":{"self":"/api/acts/shipping-reform-tax-incentives-act-2012","history":"/api/acts/shipping-reform-tax-incentives-act-2012/history","analysis":"/api/acts/shipping-reform-tax-incentives-act-2012/analysis","conflicts":"/api/acts/shipping-reform-tax-incentives-act-2012/conflicts","importantCases":"/api/acts/shipping-reform-tax-incentives-act-2012/important-cases","documents":"/api/acts/shipping-reform-tax-incentives-act-2012/documents"}}