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CIVIL AVIATION (CARRIERS' LIABILITY) REGULATIONS (AMENDMENT) 1995 NO. 366
EXPLANATORY STATEMENTSTATUTORY RULES 1995 No. 366
Issued by the authority of the Minister for Transport
Civil Aviation (Carriers' Liability) Act 1995
Civil Aviation (Carriers' Liability) Regulations (Amendment)
The Transport Legislation Amendment Act (No. 2) 1995 inserted a new Part IVA into the Civil Aviation (Carriers' Liability) Act 1959 (the Act). Part IVA introduces a requirement that carriers of passengers under the Act are to be insured against liability to passengers for death or personal injury. A carrier must insure each passenger carried for a minimum of $500,000 or its international equivalent.
The purpose of the Civil Aviation (Carriers' Liability) Regulations (Amendment) is to further detail the requirements of the insurance coverage, and to provide for a practical system of administering these requirements.
Section 43 of the Act provides that the Governor-General may make regulations prescribing matters which by the Act are required or permitted to be prescribed, or which are necessary or convenient to be prescribed for carrying out or giving effect to the Act. New section 41K introduces specific regulation-making powers in relation to several subsections of Part IVA. Details of these subsections are as follows:
• Subsection 41C(1) enables the Minister, by written notice to a carrier, to require the carrier to produce evidence satisfactory to the Minister that a contract of insurance meeting prescribed requirements is in force between the carrier and an insurer. The subsection enables the Minister to set out in the notice a time period within which the carrier must produce the evidence. Regulations are necessary to specify time periods in which notices may be given in various circumstances, and to specify the forms in which evidence satisfactory to the Minister is to be provided.
• Paragraph 41C(2)(a) of the Act specifies that the prescribed requirements which must be satisfied in a contract of insurance between the carrier and insurer are those contained in subsections (3) and (4). Paragraph 41C(2)(b) allows further requirements to be specified by regulation. As further prescribed requirements are to be specified, it is necessary for regulations to be made for this purpose.
• Section 41D of the Act prevents an insurer's liability to indemnify the carrier against personal injury to the extent set out in subsection 41C(3) being affected by any warranty or exclusion in the contract of insurance or by any breach of the contract of insurance by the carrier, except as prescribed by the regulations. As exclusions are to be prescribed, it is necessary for these to be contained in regulations.
Section 41K also provides for the making of regulations which require specified persons to provide information to the Minister about events affecting the continuity of a contract of insurance, These regulations are necessary to assist the Minister to ensure that a carrier has a contract of insurance in place on an ongoing basis.
Details of the Civil Aviation (Carriers' Liability) Regulations (Amendment) appear in the Attachment.
The regulations will commence at the same time as Part IVA of the Act.
Attachment
Clause 1 -Commencement
Clause 1 provides that the Regulations are to commence on the same day as Part IVA of the Act.
Clause 2 - Amendment
Clause 2 advises that the existing Civil Aviation (Carriers' Liability) Regulations are to be amended by the new regulations.
Clause 3 - New regulations 5, 6, 7, 8, 9, 10, 11 and 12
Clause 3 provides for insertion after the present regulation 4 of new regulations numbered 5 through 12, which provide as follows:
New regulation 5 - Period for production of evidence of insurance
New regulation 5 establishes periods of notice which the Minister may allow in giving written notice to a carrier to produce evidence that a contract of insurance is in force between the carrier and the insurer, in accordance with subsection 41C(1) of the Act. Subregulation 5(1) specifies, subject to subregulations (2) and (3), that 14 days from date of receipt of the notice is the period of notice. Subregulation (2) provides that 3 days is the period of notice if the Minister has been advised by an insurer of events set out in new regulation 10. Where the Minister believes that a contract of insurance may have ceased to be in force, or no longer meets a prescribed requirement, subregulation (3) enables the Minister to specify 1 day as the period of notice.
Note that section 163 of the Evidence Act 1995 provides that posted notices are presumed to have been received 5 business days after posting.
New regulation 6 - Form of evidence of insurance
New regulation 6 sets out the forms in which the Minister may direct that evidence be given under subsection 41C(1) of the Act.
New regulation 7 - Prescribed requirements in relation to a contract of insurance
New regulation 7 puts in place a prescribed requirement in relation to a contract of insurance under paragraph 41C(2)(b) of the Act. Under subregulation 7(1), an insurer which is a party to a contract of insurance must be:
(a) authorised under section 23 or 24 of the Insurance Act 1973 to conduct insurance business in Australia; or
(b) permitted or authorised under the law of a foreign country to carry on insurance business, and the Minister is satisfied that the requirements imposed on the insurer under that law are similar to or consistent with arrangements under the Insurance Act 1973.
Under subregulation 7(2), the Minister is taken to be satisfied that the requirements imposed on an insurer under the law of a foreign country are similar or consistent with requirements under the Insurance Act 1973 unless he or she has published a notice of a kind referred to in regulation 8.
New regulation 8 - Notice in relation to a foreign law
If the Minister is not satisfied that the law of a foreign country subjects insurers to similar regulation to that imposed on Australian insurers under the Insurance Act 1973, he or she can publish in the Gazette a notice that he or she is not so satisfied. Such a notice will not take effect for 28 days after publication in the Gazette, in order that carriers affected can reorganise their insurance.
New regulation 9 - Prescribed exclusions of insurer's liability
New regulation 9 allows contracts of insurance to exclude an insurer's liability to indemnify the carrier against personal injury in a number of circumstances, set out in subregulations 9(2), (3), (4) and (5).
Subregulation 9(2) permits the inclusion in contracts of insurance of exclusion clauses which have become standard in the international .aviation insurance industry. The texts of these exclusion clauses appear at note 2 of the endnotes to the Regulations.
Subregulation 9(3) permits the inclusion in contracts of insurance of exclusion clauses which prevent the contracts being de facto workers' compensation insurance.
Subregulation 9(4) allows restriction of insurance cover to "notified types" of aircraft. "Notified types" of aircraft are types of aircraft which the insurer has notified the Minister that it is prepared to insure to Act requirements, and which are endorsed on the contract of insurance, subregulation 9(5).
New regulation 10 - Notice of cancellation, etc., of contract of insurance
New regulation 10 sets out the events which affect the currency of a contract of insurance and about which the insurer must notify the Minister. The events are lapsing, expiration, cancellation, and alteration of a contract of insurance in such a way that the contract no longer satisfies a prescribed requirement. The insurer must give the Minister at least 3 business days' notice of the event, unless it is termination of the contract by the carrier, in which case the insurer must give the notice within 3 days of it becoming aware of the cancellation.
New regulation 11 - Effect of failure to give notice under regulation 10
New regulation 11 provides a means of ensuring continuation of terms of a contract in certain circumstances, so as to provide an enhanced degree of certainty of indemnity of the carrier and hence protection for passengers. If an insurer fails to give the Minister notice of an event in accordance with regulation 10 then, notwithstanding anything in the contract of insurance, the contract continues in force until the earlier of:
(a) the time when the insured carrier obtains from the same or another insurer an acceptable contract of insurance;
(b) if the insurer subsequently gives notice - 3 days after notice is received by the Minister; or
(c) if the insurer does not give notice - the end of a period of 3 months beginning on the day the event occurs.
New regulation 12 - Return of certificate
New regulation 12 provides that the Minister may by written notice require a carrier to return a certificate if the Minister is satisfied that an acceptable contract of insurance is either no longer in force, or the certificate requires correction. A carrier must comply with such a notice.