Opinion Number. 206

Subject

TRADING WITH BELLIGERENTS WHETHER SALE OF VESSEL TO SUBJECT OR RESIDENT OF BELLIGERENT STATE IS BREACH OF NEUTRALITY

Key Legislation

CUSTOMS ACT 1901, s. 119 : FOREIGN ENLISTMENT ACT 1870 {IMP.), ss.8,23

Date

The Department of Trade and Customs has asked the Department of External Affairs for information as to what is expected of this Government in connection with the sale of vessels or the shipment of contraband to Russia or Japan.

The Secretary, Department of External Affairs, in submitting the matter to the Prime Minister, cites a passage from Holland's International Law, p. 124, as denning the rule as to contraband, and proceeds:

Section 8 of the Foreign Enlistment Act prohibits the export of ships which the exporter knows or has reasonable cause to believe will be employed by a belligerent power in its military or naval service.It is submitted that if the result of the enquiries made under the authority of section 119 of the Customs Act is satisfactory and definite, the fact that the purchaser of the goods or cargo is a resident of one of the belligerent States gives no authority for the detention of the ship unless where, from the nature of the vessel, it is obvious that she might be used in carrying on offensive operations, but where the vessel is one constructed and hitherto used for trading purposes, and there are no special features such as armament, transport fittings etc. to suggest that she is to engage in operations of war, it would be improper to prevent her despatch.

As regards contraband, I think that the passage cited from Holland correctly states the recognized rule of international law. See also opinion of Mr Attorney-General Drake, dated 11 April 1904(1), to the same effect.

As regards the sale of vessels, I do not think that a vessel should be detained unless there is reasonable cause to believe that an offence against the Foreign Enlistment Act is involved in her equipment or despatch-i.e. that the ship will be employed in the military or naval service of a belligerent state. In the absence of evidence of such intended employment, it is not illegal to sell a merchant vessel to a subject or resident of a belligerent state. If a ship is detained, and the owner establishes to the satisfaction of a Court of Admiralty that she was not intended to be despatched, etc. contrary to the Act, the Government can be cast in damages: section 23 of the Act.

Shortly, the Commonwealth Government is not in my opinion entitled to detain or interfere with the sale of a trading vessel unless there is reasonable ground for believing she is to be used for belligerent purposes.

[Vol. 4, p. 457]

(1) Opinion No.175.