1.1 Objectives of the Australian International Shipping Register (AISR)

The AISR has been established to provide a competitive registration alternative for Australian owned ships that are predominantly engaged in international trading. The primary objective of the AISR, as set out in the Act, is to:

  1. Facilitate Australian participation in international trade.
  2. Provide an internationally competitive register to facilitate the long term growth of the Australian shipping industry.
  3. Promote the enhancement and viability of the Australian maritime skills base and the Australian shipping industry.

To promote these objectives ships registered on the AISR will have specific conditions relating to mixed crewing arrangements and international employment terms and conditions. AISR vessels will be able to access the concessional tax arrangements made available by the Australian Government as part of the shipping reforms. However, continued registration under the AISR will be subject to ongoing compliance with the conditions of registration specified in section 33A of the Shipping Registration Act 1981 (SRA).

1.2 Mechanism supporting the AISR

Information on the operation of the AISR and the incentives for ships operating under this register as detailed in this Guide are specified in the following pieces of legislation:

In general terms the incentives to owners/operators registering under the AISR are detailed below. Owners/operators should be aware of the obligations that accessing these mechanism place upon them.

1.2.1 Crew composition

Vessels registered on the AISR are allowed to use mixed nationality crews. The SRA requires that only the Master or Chief Mate and Chief Engineer or First Engineer are Australian nationals or residents (see section 3.2.1 of this guide and s.33A of the SRA).

With regard to the safe manning of the vessel AMSA will determine the minimum safe manning and qualification requirements in accordance with Australian legislation implementing STCW.

Read guidance on how to apply for a Minimum Safe Manning certificate.

1.2.2 Employment terms and conditions

The SRA provides for minimum terms and conditions with wages and compensation requirements set by Ministerial Determination in accordance with the International Transport Workers’ Federation (ITF) template agreement. It is a requirement of registration on the AISR that a collective agreement be made between the owner of the ship and the seafarers’ bargaining unit (SBU) under s11A of the Act. This collective agreement cannot set terms and conditions below the minimum specified in the SRA.

If an AISR ship operates in the coasting trade (as defined in the Coastal Trading (Revitalising Australian Shipping) Act 2012) or intra-state trade then the provisions of the Fair Work Act 2009 apply.

1.2.2.1 For AISR vessels on international trade:

Section 61AA of the SRA disallows the Fair Work Act 2009 and the Seafarers Rehabilitation and Compensation Act 1992 as follows:

  1. The Fair Work Act 2009 2 does not apply in relation to when the ship is used to engage in international trading
  2. The Seafarers Rehabilitation and Compensation Act 1992 does not apply in relation to the ship at any time;

In lieu of the application of these acts the SRA provides for minimum terms and conditions with wages and compensation requirements set by Ministerial Determination in accordance with the ITF template agreement. It is a requirement of registration on the AISR that a collective agreement be made between the owner of the ship and the seafarers’ bargaining unit (SBU) under s11A of the Act. This collective agreement cannot set terms and conditions below the minimums as specified in sections 61AE(2) and 61AE(3) of the SRA.

1.2.2.2 For AISR vessels on the coasting trade:

Noting the application of section 61AA of the SRA, if an AISR ship operates in the coasting trade on interstate trade (as defined in the Coastal Trading (Revitalising Australian Shipping) Act 2012) or on intra-state trade then the provisions of the Fair Work Act 2009 may apply. Where doubts exist it is recommended the Fair work Ombudsman be consulted. Additional advice is available in a fact sheet provided by the Fair work Ombudsman: Maritime industry - workplace rights and entitlements.

1.2.3 Taxation incentives

The Shipping Reform (Tax incentives) Act 2012 will provide access to a range of tax incentives to ship on the AISR. These include:

  • Accelerated depreciation and rollover relief for owners of eligible Australian registered vessels.
  • An income tax exemption for Australian operators of eligible Australian registered ships on qualifying shipping income.
  • A refundable tax offset for employers who employ eligible Australian seafarers.
  • An exemption from royalty withholding tax for foreign owners of eligible ships leased under a bareboat or demise charter to an Australian operator.

The above is provided for information only. Further information on these tax concessions is available on the Department of Infrastructure, Transport, Regional Development and Communications website

1.3 Clarification of definitions used in this guide

For ease of reference this Guide uses the terms “ship”, “trading ship” and “owner/operator” as these are commonly understood. It should be noted the legal definitions to be applied are those within the Shipping Registration Act 1981 (SRA). In this respect the following should be noted:

a) Owner/Operator: There is no definition of “operator” within the SRA but this term is used in the guide for clarity to ensure readers are aware it applies to the party who registers the ship noting that may not be the owner. It should be noted that the definition of “owner” in s.3 of the SRA captures the owner, the operator or the operator of a ship under a demise charter.

b) Ship: It is a common misconception that the term “ship” applies only to a power driven vessel. This is not correct as the definition of ship within s.3 of the SRA captures all ‘vessels’, powered and unpowered and only excludes ships that both of the following:

At the date of publication of this guide neither of these exclusions applied to vessel that would normally be registered under the AISR, however, the SRA and regulations that are in force at the time should be consulted when considering registration.

c) Trading ship: is a ship for use in connection with a commercial activity, but excludes the following:

  • a Government ship
  • a fishing vessel
  • a pleasure craft.

Footnotes:

2. Also see section 11A of the SRA.

3. The text of section 33A of the Shipping Registration Regulations 1981 currently excludes small craft operated by traditional inhabitants and ships propelled only by means of oars.