6.7.2.100 Departure prohibition orders

Introduction

The Secretary can make a DPO, preventing a person with a social security debt from leaving Australia.

Making a DPO

The Secretary has the discretion to make a DPO in a case where all 3 conditions below are satisfied:

• the relevant person has one or more outstanding social security debts
• they have not made satisfactory arrangements to wholly discharge their debts, and
• the Secretary believes it is desirable to make such an order to ensure that they do not leave Australia without wholly repaying their debts or making satisfactory arrangements to do so.

Before making an order, the Secretary must also take the following matters into account:

• the person's capacity to pay debt/s
• whether any debt recovery action has been taken and the outcome of the recovery action
• the length of time the debt/s have remained unpaid (after the day on which it became due and payable), and
• any other matters as the Secretary considers appropriate.

What constitutes a satisfactory repayment arrangement will depend on the facts of the case.

The Secretary cannot make a DPO unless all of these conditions are satisfied. Furthermore, as a DPO places significant restrictions on the debtor's freedom of movement, the Secretary will not make a DPO without considering all the relevant circumstances.

Secretary believes it is desirable to make a DPO

The purpose of a DPO is to secure payment of a person's social security debts. As such, the Secretary will not make a DPO unless there are grounds for the reasonable belief that making the order will make recovery of the debt more likely.

Situations where a DPO may be appropriate include:

• The debtor is about to leave Australia - regardless of any plans to return.
• The debtor is transferring assets offshore, either directly or indirectly (for example, borrowing funds overseas by securing Australian assets).
• The debtor has resources, whether financial or otherwise, that would enable them to live offshore, such as family, assets, employment or a business.

Departure from Australia prohibited

A DPO made against a person will prevent them from leaving Australia before either discharging all their debts or making satisfactory arrangements to do so.

A DPO places significant restrictions on the freedom of movement of citizens and residents of Australia and visitors to Australia, and will not be made without consideration of all relevant circumstances.

A DPO does not prohibit travel to Australia's external territories (for example, Christmas Island, Norfolk Island).

Operation of DPOs

Once a DPO is made, it is in force from the time it is made until it is revoked or set aside by a court. However, the Secretary must revoke a DPO in certain circumstances and may revoke or vary it in other circumstances. The Secretary can revoke or vary a DPO after becoming aware of new information or in response to representations made by the debtor.

Revoking a DPO

The Secretary must revoke a DPO in any of the following 3 circumstances:

• The debts have been wholly discharged.

  This condition is met when any combination of repayments, debt waivers or write-offs results in no portion of the debtor's debts being repayable.

• The Secretary is satisfied that there are satisfactory repayment arrangements to wholly repay these debts.

  A common sense approach is required to determine whether arrangements are satisfactory in each case. A repayment arrangement that requires the presence of the debtor in Australia to function is not a satisfactory arrangement. Where the debtor has sold property and needs to leave Australia before settlement occurs, a garnishee notice (6.7.2.50) in relation to the known proceeds would be a satisfactory arrangement.

• The Secretary is satisfied that the debts will be completely irrecoverable.

  A person's debt will be regarded as completely irrecoverable when there is no prospect that the debtor will be able to make any payment towards it. See 6.7.3.10 for further details.

Even when the tests outlined above are not satisfied, the Secretary has the discretion to revoke a DPO where they believe it is desirable to do so. The Secretary will exercise this discretion in a way that supports the purpose of the Acts.

Varying a DPO

The Secretary also has discretion to vary a DPO. They can only use this discretion to correct errors on the face of the order.

The Secretary will not vary a DPO to allow a social security debtor to depart Australia. Where the Secretary is satisfied that it is appropriate and necessary for a debtor to depart Australia, for a defined period, the Secretary will either revoke the DPO or issue a DAC.

Notification requirements to make, vary or revoke a DPO

Where the Secretary makes a DPO in respect of a social security debtor, the Secretary must notify:

• the debtor to whom the DPO applies
• the Australian Border Force
• the Australian Federal Police, and
• where the debtor is not an Australian citizen, the Department of Home Affairs.

Due to the consequences of a DPO, the Secretary will make every effort to ensure that the debtor receives a copy of the DPO as soon as possible after the order is made.

Where the Secretary makes a decision to vary or revoke a DPO, the person to whom the order applies and any other person to whom a copy of the order was provided must be notified. The Secretary must also notify the debtor where they have rejected the debtor's application to vary or revoke a DPO.

DAC

Where a DPO is in force, a social security debtor can apply for the issue of a DAC. A DAC allows the debtor to depart Australia, for a defined period, despite a DPO being in force.

Issuing a DAC

The Secretary must issue a DAC in situations where:

• a debtor is likely to depart and return to Australia within a specified period, revocation of the DPO is likely within a time period that the Secretary considers appropriate, and security for the debtor's return to Australia is not necessary
• a DAC is to be issued as the debtor has provided appropriate security for their return to Australia by a specified date, or
• the debtor is unable to provide appropriate security for their return to Australia, however a DAC is to be issued on humanitarian grounds or in Australia's interests.

There is no discretion to issue a DAC in other situations.

DAC issued where security provided

The Secretary must issue a DAC when the debtor has given appropriate security for their return to Australia. The debtor can provide the security by deposit or by other means. If they do not return to Australia by the agreed date, the security will be forfeited to the Commonwealth. It cannot be applied against the outstanding debts.

The Secretary will only accept a security that:

• is in a form that is readily convertible to cash, such as a bank cheque
• is offered by the debtor rather than third parties on the debtor's behalf, or
• is generally not significantly less in value than the amount of the debts owing.

Note: Security arising from a loan is not accepted.

Where a debtor is able to give appropriate security, it is preferable to use these funds to reduce these debts than to use these funds as security, as this will usually justify revoking the DPO. Offering security may be an appropriate alternative to reducing the debts when the debts are in dispute and the debtor is taking steps to resolve this dispute.

DAC issued on humanitarian grounds or in Australia's interests

The Secretary must also issue a DAC where satisfied that:

• the certificate should be issued on humanitarian grounds, or
• refusing to issue the certificate would be detrimental to Australia's interests,

AND

• the debtor is unable (not unwilling) to provide security satisfactory to the Secretary for their return to Australia.

Humanitarian grounds include compassionate grounds.

The onus is on the debtor to provide evidence satisfactory to the Secretary that shows their situation meets the above requirements.

The Secretary may substitute a later return date on the DAC

The Secretary may substitute a later return date on a DAC, either in response to an application by the debtor or by their own initiative. The debtor may apply in person or in writing.

The Secretary may refuse to substitute a later date for the person's return if they believe an extension would be inappropriate.

The Secretary has the discretion to ask for an additional amount of security, even where a security was not previously required.

Departure dates for a DAC

A DAC authorises a debtor's departure from Australia within an 8 day period beginning on the date specified on the certificate. The date specified on the certificate can only be within one and 7 days after the date the certificate is issued.

A DAC can only be issued between one and 14 days before the debtor's intended date of departure.

Usually, the Secretary will specify the date on the certificate to be the debtor's intended date of departure. However, the Secretary can specify a date other than the debtor's intended date of departure-within the period outlined above-where it is appropriate to do so.

Notification requirements to make, vary or refuse a DAC

Where the Secretary makes or decides to substitute a later day in a DAC, the Secretary must notify:

• the debtor to whom the DAC applies, and
• any other person who was notified of the DPO.

If the Secretary rejects an application to issue a DAC or substitute a later day, they must notify the debtor as soon as practicable.

Appeal & review

Appeals to the Federal Court or Federal Circuit Court

A person aggrieved by the making of a DPO can appeal to the Federal Circuit Court or the Federal Court against the making of the order. The court can either dismiss the application or set aside the DPO. It can determine whether an order is properly made, but cannot exercise the administrative decision-making powers granted to the Secretary (T v Federal Commissioner of Taxation (1986) FCA 433).

Review by the ART

The following decisions made by the Secretary are subject to review by the ART:

• to refuse to revoke or vary a DPO
• to vary a DPO
• to issue or refuse to issue a DAC
• the provision of security, and
• the substitution of later days on a DAC.

The ART will undertake an independent merits review of the decision. The ART can exercise the discretions granted to the Secretary when reviewing decisions.

Reviewable DPO and DAC decisions are eligible for ART review and second review as they are 'eligible social services decisions', as defined in section 131C of the ARTAct. An application cannot be made for the matter to be referred to the guidance and appeals panel (GAP).

Enforcement

Australian Border Force Officers and members of the Australian Federal Police are authorised to prevent the overseas departure of a person subject to a DPO.

If an officer believes that a person is about to depart from Australia when a DPO is in force and without a DAC, they can require the person to answer questions or produce documents.

A person is required to answer these questions, even if the answers may incriminate them or expose them to a penalty. However, their answers are not admissible in evidence against them except in relation to a prosecution for providing false or misleading information or documents.

Offences

It is an offence for a person to depart from Australia for a foreign country:

• knowing, or reckless as to whether, a DPO is in force, and
• the person's departure is not authorised by a DAC, and the person knows the departure is not authorised by such a certificate, or is reckless as to whether the departure is authorised by such a certificate.

Penalty: Imprisonment for 12 months.

A person commits an offence if they fail to answer a question or produce the document and they are capable of doing so.
Penalty: 30 penalty units.

It is also an offence of strict liability if a person who has a valid DAC fails to produce the certificate at the request of an authorised officer.
Penalty: 5 penalty units

A person who provides false or misleading answers to questions commits an offence and can be prosecuted.
Penalty: Imprisonment for 12 months.

An attempt to commit any of these offences is punishable as though the actual offence had been committed.