Since the introduction of the Exporter Supply Chain Assurance Scheme in 2012, the Department of Agriculture has imposed a range of sanctions on Australian exporters for breaches of the welfare assurance regulations.
However to date, there has never been a license suspended as a result of an exporter’s failure to meet ESCAS requirements.
In light of the latest allegations of cruelty to Australian cattle in Vietnam, calls for tougher penalties for repeat ESCAS offenders are again mounting.
An independent review of ESCAS commissioned by the Federal Government in 2014 found the program was working, with more than 8 million head of livestock exported since the introduction of ESCAS in 2012 found to have been properly handled through approved supply chains, a compliance rate in excess of 99pc for all exported stock.
However, some 12,958 animals, including a consignment of 11,000 sheep in Jordan, had been moved outside approved channels during that time, exposing those animals to possible direct animal welfare impacts.
The same report highlighted a degree of frustration that “a limited number of supply chains” continued to experience recurring problems, and that penalties imposed so far had not eliminated the issue.
It noted that there had been no criminal prosecutions because of an exporter’s failure to meet ESCAS requirements. This reflected, in part, the report said, “the difficulties in pursuing criminal action against an exporter for a breach of animal welfare standards occurring in another country and involving third parties outside of Australia’s regulatory control”.
The report suggested the Department investigate introducing an additional layer of compliance, such as fine or enforceable undertakings, to assist it in managing repeated noncompliance.
ESCAS penalties so far
So what sanctions have been handed out to date?
The Department has told Beef Central that punitive actions imposed on exporters in response to breaches of ESCAS so far have included:
- the removal of entire supply chains (for example, in Gaza),
- removing facilities from individual supply chains (such as feedlots in Vietnam and Jordan)
- The imposition of conditions on subsequent ESCAS approvals requiring additional training of staff, better training manuals, and the replacement or repair infrastructure at facilities.
“Exporters may also be required to employ animal welfare officers to report back on the performance of the supply chain on an ongoing basis, or have more regular independent audits. An exporter’s record of adherence to previous approved ESCASs may also be taken into consideration when deciding whether to approve future ESCAS,” a spokesperson said.
Critics say ESCAS lacks teeth
The most common criticism of ESCAS from live export industry opponents is that it effectively lacks teeth because, despite multiple repeated ESCAS breaches by some exporters, there has never been a license suspension or criminal prosecution.
One prevailing view is that while many exporters take their responsibilities to ESCAS and animal welfare seriously, others are less motivated to comply, because they do not believe the Federal Government has the legal authority to justifiably suspend or cancel their license in response to an ESCAS breach.
The Department of Agriculture told Beef Central that it does have this power under the Australian Meat and Livestock Industry Act 1997 (AMLI Act).
Circumstances under which this could happen, a departmental spokesperson explained, included “ceasing to be a person or body corporate of integrity, providing false or misleading information in connection with a licence application, or contravening a condition of the licence”.
One condition of all livestock export licences is that the holder must comply with any relevant provisions of the Export Control Animals Order 2004. These provisions include ESCAS requirements.
While the Department technically has this authority, it has never been used.
Were it to be, it is likely that decision would be challenged by the exporter in court. Whether the blunt instrument of a licence cancellation by Government would be supported by a court has yet to be tested.
The Department has not yet introduced another layer of compliance options, such as fines or enforceable undertakings, as suggested in the 2014 ESCAS review.
One WA based livestock export industry representative told Beef Central that repeated ESCAS breaches were not due to a lack of respect for ESCAS rules.
“All exporters are 100pc aware of the regulations and their obligations to animal welfare in all markets,” he said.
“No one intentionally works outside the rule book – losing your license is losing your livelihood – who is prepared to do that in this day and age?”
But there is also a view the some exporters are still prepared to risk a breach for short-term commercial interests, such as selling to an importer who they know are not fully on board with the requirements of ESCAS. Such actions not only have the potential to tarnish all exporters, but put at risk the entire industry’s access to markets relied upon by thousands of Australian cattle producers and associated service businesses.
ESCAS is designed to assure animal welfare protections by requiring that foreign customers can only receive Australian livestock after they and their staff have received livestock handling training; received approval for their transport, feedlot and abattoir infrastructure; commit to regular third-party audits; and adopt full traceability systems.
ESCAS has no legal jurisdiction in foreign markets. The only penalty it can impose on importers found to be doing the wrong thing is to block their ability to access Australian livestock in future.
For most import customers, this serves as a major incentive to comply with the conditions of ESCAS. Australian cattle are good for business – they reach market weights in their feedlots faster than local cattle and yield well. The threat of losing access to Australian stock is a strong enticement to do the right thing.
But there remains an ever present risk that an importer or their staff may be tempted by short-term gains to sell valuable Australian livestock at a premium outside their approved supply chain. The fact that the missing stock will show up in ESCAS records and is likely to result in access to Australian cattle being cut off is a deterrent, but the financial incentive to break the rules remains a weakness of the system.
In May last year, amid public outrage over the sledgehammering of Australian cattle outside of an approved supply chain in Vietnam, Australian livestock exporters committed to adopting a six point plan “over and above the requirements of ESCAS” to ensure the welfare of stock exported to the market.
Now, just a year later, new evidence of “abhorrent and indefensible treatment” of Australian cattle in an unapproved abattoir in Vietnam is again being investigated by the Department.
That incident is one of several contained in the Federal Government’s latest quarterly report into the regulatory performance of ESCAS, which was released late last week.
Other reported incidents included thousands of sheep being sold outside of approved supply chains in Kuwait and sheep being trussed and thrown into car boots and slaughtered in makeshift slaughter rooms at livestock markets.
The Government is once again facing increasing pressure to increase penalties in the face of continued breakdowns.
“The report, yet again, raises serious concerns about the quality and effectiveness of the auditors and auditing processes that are supposed to underpin the ESCAS. RSPCA Australia is also very concerned that critical and major non-compliances were recorded in the latest report, but no exporters were prosecuted or had their licenses suspended,” an RSPCA statement released on Friday said.
“Livestock Shipping Services (LSS) again featured with non-compliances. It had another two critical and five major non-compliances recorded against its performance, bringing the exporter’s record to five critical and seven major non-compliances.
“The faults in the ESCAS system are amplified yet again, when an exporter such as LSS records numerous non-compliances without the regulator imposing meaningful sanctions.
“Without adequate penalties, exporters will continue to take a cavalier approach to animal welfare and Australian livestock will continue to suffer.”