CTH Bans Price Gouging and Export of Essential Goods During COVID-19 Emergency Period
Tuesday 7 April 2020 @ 11.44 a.m. | Legal Research | Trade & Commerce
On 29 March, the Customs (Prohibited Exports) Amendment (COVID‑19 Human Biosecurity Emergency) Regulations 2020 (Cth) (‘the Regulations’) was registered on the Federal Register of Legislation. The Regulations commenced on 30 March. On 30 March, the Biosecurity (Human Biosecurity Emergency) (Human Coronavirus with Pandemic Potential) (Essential Goods) Determination 2020 (Cth) (‘the Essential Goods Declaration’) was registered on the Federal Register of Legislation.
Purpose of the Regulations and the Essential Goods Declaration
The purpose of the Regulations is to amend the Customs (Prohibited Exports) Regulations 1958 (Cth) in order to implement a temporary prohibition on the export of goods which are essential to preventing the spread of the COVID-19 virus. The Explanatory Statement states that a further aim of the Regulations is to dissuade bulk purchase by consumers for the purpose of export. The Essential Goods Declaration extends upon the aims of the Regulations by introducing provisions relating to price gouging. In a Media Release on 1 April, the Minister for Home Affairs, Peter Dutton, stated that:
“These measures have become necessary because we have seen a small number of individuals engaging in the bulk purchasing of essential goods from retail outlets in Australia, with the intent of profiteering from exploitative exporting and price gouging... These temporary measures will ensure that essential goods are distributed to those with the highest need, such as vulnerable communities, front line health workers and law enforcement, while safeguarding legitimate trade.”
Prohibited Exportation of Certain Goods
The Regulations prohibit the exportation of the following goods:
(a) any of the following equipment that, when worn, is capable of limiting the transmission of organisms to humans:
(i) disposable face masks;
(ii) disposable gloves;
(iii) disposable gowns;
(iv) goggles, glasses or eye visors;
(b) any of the following disinfectant products:
(i) alcohol wipes;
(ii) hand sanitizer;
Furthermore, the Regulations enable the Minister to determine goods to be included within the scope of the Regulations.
Exceptions
The Regulations also outline a list of circumstances which are exceptions to the Regulations. The exceptions include where:
- the person is a passenger or crew member of the ship or aircraft and the goods are the accompanied personal or household effects of the person and are intended for the personal use of the person,
- the intended recipient is a relative of the person, the goods are for the relative’s personal use and are not exported by post,
- the person is a humanitarian organisation or agency, the goods are for a non-commercial purpose and are not exported by post,
- the person manufactured the goods and the goods are not exported by post or
- the person, who must be registered under the GST Act and has an ABN, exports the goods in the ordinary course of the person’s business and does not export them by post.
Price Gouging
The Essential Goods Declaration prohibits price gouging of the essential goods that
are listed above. The provisions apply to any essential goods purchased on or after
30 January. During the declared COVID-19 human biosecurity emergency period (currently
set to expire of 17 June 2020), the value of the consideration for which a person
supplies, or offers to supply, essential goods cannot exceed 120% of the value of
the consideration for which the person purchased the goods.
Furthermore, the Essential Goods Declaration establishes that a person is prohibited
from disposing of or dealing with essential goods if they have been notified by a
law enforcement officer that the officer suspects on reasonable grounds that the person
has engaged, is engaged or intends to engage in price gouging. The officer may also
in writing require the person to surrender the goods unless the person can satisfy
the officer to the contrary within 21 days. If an officer is satisfied that a person
has not participated in or intended to participate in price gouging, the officer is
required to withdraw the notice. If the 21 day time period elapses, the officer is
required to either destroy the goods if the officer suspects on reasonable grounds
that the goods are defective or otherwise, the officer must give the goods to the
National Stockpile.
Essential Goods in Possession of Officers of Customs
The Essential Goods Declaration also states that any seized goods which are:
- in the possession of an officer of Customs because of prohibited export as outlined by the Regulation or alternatively,
- any goods which a person attempted to export on or after 30 January but prior to the commencement of the Regulations on 30 March and which have been surrendered to the officer of customs due to a notice by writing,
will be destroyed if the officer of customs believes on reasonable grounds that they are defective, or otherwise will be given to the National Medical Stockpile.
Repeal
The Regulation and the Essential Goods Declaration will continue to apply as long as the Biosecurity (Human Biosecurity Emergency) (Human Coronavirus with Pandemic Potential) Declaration 2020 (Cth) (‘the Emergency Declaration’) remains in force. The Emergency Declaration commenced on 18 March and is currently set to end on 17 June, however Parliament may grant an extension of the human biosecurity emergency period.
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Sources:
Customs (Prohibited Exports) Amendment (COVID‑19 Human Biosecurity Emergency) Regulations 2020 (Cth), Biosecurity (Human Biosecurity Emergency) (Human Coronavirus with Pandemic Potential) (Essential Goods) Determination 2020 (Cth) and supporting documents available from TimeBase’s LawOne Service
