Coates BarryBARRY COATES (Green): Tēnā koe Mr Assistant Speaker. I rise to address the Customs and Excise Bill in its first reading. There is obviously a need to update and modernise this bill. We recognise that there are aims and potential improvements in terms of streamlining our customs procedures reducing the amount of time and cost to importers and exporters modernising legislation and introducing an intention test that would single out those errors by individuals who defraud customs as opposed to those individuals who are accidentally caught up in making a mistake with their customs declarations. So we welcome these aspects of it.We have three major concerns about this legislation. The first and most critical concern is the powers given to Customs to access electronic devices. Electronic devices for most people are part of who they are these days particularly those who are under 40 years old and there has been significant concern from submitters in submissions to the discussion document. There were sweeping powers sought by Customs in the discussion paper and after pushback from the Privacy Commissioner the Ministry of Justice which advised caution political parties including the Green Party and NGOs we saw some limitations that were added to the provisions on access of electronic devices. The issue here is not only access to the devices but divulging the passwords and decryption of those devices.There are concerns from submitters in a number of areas. Firstly for tourists and business visitors this may be an unwarranted intrusion into their privacy and they may resent it. Secondly businesses might be forced to divulge commercial secrets in the process of divulging this information. There are for example consultants who sign contracts that would explicitly prohibit them from releasing confidential information without a court order. There is no court order provided in these powers given to Customs merely a suspicion or reasonable grounds to believe that there may be a criminal act.Thirdly there are in fact significant amounts of personal information that we all store on our electronic devices and personally I would not want customs officers to see some of my photographs thank you very much of my family and myself in some circumstances. We have our financial records we have our medical records we have our emails and this legislation would also give access to our credit cards. In fact much of our lives are on these electronic devices.Finally sensitive information may fall into the wrong hands. This is not just a spurious concern; in fact there are cases such as the Switched on Gardener case where overzealous cooperation between Customs and the Police led to the misuse of information. All of these instances from submitters give rise to serious concerns that there are dangers here in the potential granting of powers to Customs that exceed the necessary powers in order for it to undertake its tasks. Furthermore there are some concerns about how effective this is going to be anyway in so far as the power to access devices does not give Customs the power to access links to those devices and these days much of the information is stored on the cloud or other storage devices which are remote from the handheld devices. So in fact if Customs is after this information then there is no guarantee that they are going to physically have the information on the electronic device itself. Fourthly if somebody wanted to not give over their passwords or their decryption then they would be fined—as far as we can understand from the proposal so far—$5000. If we are looking to perpetrate serious criminal activity then $5000 is probably worth paying in order not to be found out. So we have some concerns over the effectiveness of these provisions. The question comes as a balanced right. Customs can already access devices for suspicion of money laundering terrorism or smuggling if it gets a warrant under the Search and Surveillance Act. So the question is: is the provision of further powers to Customs a breach of privacy without sufficient safeguard? That is our concern. We need a clear threshold and we need due process and we regard the bill as not having yet provided that in draft form.A second area of concern is increased information-sharing with other agencies. Amongst the 91 submissions to the discussion paper there were a number that raised concerns about sharing of information. Although there are some protections of biometric data name and intelligence generated by Customs there are still concerns about the sharing of information widely amongst Government departments particularly given the previous incidents of unauthorised release from Government departments through mismanagement in the past. We welcome consultation with the Privacy Commissioner and others in order to tighten up some of these safeguards.Finally there is a set of issues where we would look to ensure that the Customs and Excise Act is actually fit for purpose—for example one of those is in the area of transfer pricing. Under OECD emerging initiatives on base erosion and profit shifting the transfer pricing issue becomes absolutely crucial. We would want to make sure that the bill includes sufficient powers for Customs and sufficient safeguards to ensure that transfer pricing is able to be dealt with so multinationals cannot get away—as they all too often do at the moment—with shifting their profits to places with low or non-existent tax rates.With those provisos we would support the bill going to the select committee. We will look to engage constructively with this bill in the select committee. We would hope that there will be assurances to these concerns provided in the further development of this legislation. Thank you.