IMPORT LICENSING

The importation of goods into Australia is controlled primarily by regulations made under the Federal Customs Act and Tariffs applicable under the Customs Tariff Act.  These Acts are administered by the Australian Customs Services.  The purpose of these regulations are, in essence, to protect Australian industry and consumers and to raise revenue.

Goods may be prohibited from importation either absolutely or by reference to their place of origin or unless specified conditions or restrictions are complied.

A tariff quota system operates in Australia for some products. The quota system applies by the imposition of a high rate of duty for certain imports and then making concessional provisions for  goods which fill the quota of imports available.

CUSTOMS

AUSTRALIAN CUSTOMS LEGISLATIONS

Australia, like most other nations, has its own system of customs laws, rules and procedures to ensure that it has control over the nation's borders and its trade. The Customs Acts that provide for the administrative structure and procedure relating to import include:

Customs Act 1901;

Customs Administration Act 1985;

Customs Securities (Penalties) Act 1981;

Customs Undertakings (Penalties )Act 1981;

Customs (Trade Description) Act 1905; and

Commerce (Imports) Regulations.

THE CUSTOMS ACT 1901

In general terms the Customs Act details the requirements for:

The entry of goods into Australia.

The importation procedures to be followed regarding cargo, shipping and aircraft.

The landing and examination of goods.

The warehousing of goods.

Payment of duty and rates of duty.

The sampling of goods.

The valuation of goods.

Rebates, remissions, refunds and deposits for securities.

The powers of Customs Officers.

Prosecutions and penalties.

Commercial Tariff Concession Orders.

Anti-Dumping duties, and

Other miscellaneous matters relating to the importation of  goods.

THE COMMERCE (TRADE DESCRIPTION) ACT 1905

The Commerce (Trade Descriptions) Act 1905 details all the information and requirements for the correct marking of a trade description on imported goods.  Under this Act officers may examine and inspect goods to check that they comply with the requirements of this Act.  Any goods that do not comply with the requirements of this Act become prohibited imports and will not be released until the problem is rectified.

In many cases this is simply a matter of marking the goods with  the correct country of origin. However, some goods may have to be destroyed or re-exported if it is not possible to correct the problem.

Many problems can be overcome in this area if importers are  aware of what trade description is required. It should then be a simple task of placing this information in orders to the overseas suppliers so that the correct markings are placed on the goods or packages.

THE COMMERCE (IMPORTS) REGULATION

The Commerce (Imports) Regulations require all goods to contain a correct trade description and detail what is and what is not acceptable. Details the goods i.e. the package sizes in which  goods can be packed, the percentage requirements of certain  ingredients, the size of the price on packages and containers,  etc are all included in these Regulations.  The regulations are very comprehensive and should be studied by all importers.

As discussed above, if the importer is aware of the requirements of these Regulations then the correct marking, packaging, etc can be completed prior to the arrival of the goods in Australia. This saves time and money and allows the quick clearance of your goods.

THE CUSTOMS (PROHIBITED IMPORTS) REGULATION

These regulations are divided into ten different schedules and  list goods which are:

• prohibited absolutely;
• prohibited unless certain permission is given by approved ministers or authorities or specified conditions and  restrictions are met;
• prohibited unless certain conditions relating to the packing for sale or levels of metal release are met; and
• prohibited from certain countries unless permission is given by the approved authority.

All importers should be aware of these prohibitions, especially those relating to the particular goods that they are importing  or wish to import.

It is important to note that the Customs carries out testing on goods that must meet specified requirements and all testing is charged to the importer.  In recent times these charges have  increased dramatically. In instances where acceptable overseas certificates are available and acceptable by the Customs, which allow exemption from testing it is advisable to obtain these certificates at the time of importation and present them to ensure that any unnecessary testing is not carried out.

THE CUSTOMS TARIFF ACT 1987

This Act relates to the duties of Customs and details amongst other things.

The rules for classifying goods.

Concessions for the importation of certain goods or by certain persons, departments or authorities.

Goods that are subject to quota and information requirements and rates of duty relating to quota and Classes of countries and places in relation to which special duty rates apply.

It is important to be aware of this Act as many concessions and reductions in duty do exist.  The main areas of importance to most importers will be the concessions that apply to goods imported from certain listed countries and the special concessions relate to goods used in particular industries. As with all Acts and Regulations, changes do happen so it is important to frequently check that the concessions still exist for goods you wish to import to avoid problems at time of entry.
 

ANTI-DUMPING LEGISLATION DETAILS 

Antidumping Act and the Antidumping Authority Act 1988 provide industry with relief from injury caused by dumped or subsidized goods. Dumping occurs when the export price is less than the price paid within the domestic market of the exporting country.  Subsidization arises when exported goods have been produced or sold with the benefit of a subsidy, reduction of freight or any other financial assistance from the government of the exporting body.

New dumping legislation currently before the Parliament could impose dumping duty on products using the difference between the normal value and a national export price determined by the  Minister.  It is understood that this dumping duty will apply irrespective of the actual export price of the goods. This is an area where Australia's international rights and obligations  are governed by our membership of the GATT. The GATT and the codes seek a balance of rights and obligations between exporting and importing interests. The Codes state that antidumping and  countervailing practices should not constitute an unjustifiable impediment to international trade, and that the use of subsidies should not adversely affect or prejudice the interests of any signatory.

Any person who believes that there are reasonable grounds for the imposition of a dumping or countervailing duty may apply to have  antidumping or countervailing  measures imposed.The applicant will however need to show that there is an Australian industry producing 'like goods' to the imported goods.

It is important to check if the goods you wish to import are subject to any of these measures prior to importation, especially if there is any doubt that the goods may comply with the dumping definition given above.

Traditionally, as times get tougher, dumping and subsidy complaints and action increase worldwide.

EXPORT LICENSING

As Australia is primarily an exporting nation there are few restrictions on the export of goods.

Federal regulations set out several categories of goods, the export of which is either prohibited or unless government approval is obtained.  There are very few goods the export of which are absolutely  prohibited.  Information on goods which are prohibited can be obtained from the Customs Department.

EXPORT REGULATIONS

The following information is provided to give new and potential exporters an awareness of the regulations that exist with regard to the exportation of goods from Australia.

The Government imposes prohibitions on the export of certain goods for a variety of reasons including:

• industry protection
• quality control
• international agreements
• trade embargoes
• defense considerations. 

Exports are controlled essentially so that Government can:

- implement certain policies which entail prohibiting the export of various goods either absolutely or conditionally.

- levy duties on particular exports, and

- adequately record Australia's international trade.

It should be noted that controls over the exportation of goods are subject to change and any information required  on specific matters or commodities can be obtained from the  Export Section of the Australian Customs Service ('SCS').

Export permits or similar export authorizations issued by government department or agencies responsible for particular goods are to be lodged with the shipping or airline company for production to Customs as required by legislation. These permits are required where goods are subject to export prohibition by virtue of the goods being prescribed in a Schedule to the Customs Prohibited Exports Regulation.

Culture heritage goods, drugs, military goods, civilian arms and explosives, chemical warfare precursors, and primary products are all goods that require permits for export.

An export entry must be obtained for all goods intended for export unless they are exempt. Goods exempt from export entry  requirements are as follows:

1. Goods that are accompanied or unaccompanied, personal or household effect of a passenger in, or a member of the crew of a ship or aircraft, other than goods.

(a) in quantities exceeding what could reasonably be expected to be required by a passenger or member of the crew of a ship or aircraft for his or her own use; or

(b) that are, to the knowledge or belief of a passenger or a member of the crew of a ship or aircraft, to be sold, or used in the course of trading, outside Australia.

2. Goods, other than these listed in (a) to (d) below, included a consignment that is consigned through the Post Office and that has an FOB (Freight on Board) value not exceeding $2,000;

(a) dutiable goods within the meaning of the Customs Act 1901 on which duty is unpaid;

(b) excisable goods within the meaning of the Excise Act 1901 on which excise duty is unpaid;

(c) goods in respect of which a person intends to claim a duty drawback of excise duty under the Excise Act 1901 or a drawback of sales tax under the Sales Tax Assessment Act (No.5) 1930;

(d) goods in respect of which sales tax is payable but unpaid under the Sales Tax Assessment Act (No.5) 1930.

3. Goods, other than those listed in (a) to (d) in item 2 above, included in a consignment to which a single export statistical item in the Australian Harmonized Export Commodity.

4. Classification applies, being a consignment that is exported by ship or aircraft and that has an FOB value not exceeding $5.

5. Containers that are the property of a person carrying on  business in Australia and that are exported on a temporary basis to be reimported, whether empty or loaded.

6. Containers that are intended for use principally in the international carriage of goods, other than containers that, when exported from Australia, cease, or are intended to cease, to be the property of a natural person resident, or a body corporate incorporated, in Australia.

7. Ships/aircraft stores within the meaning of Part VII of the Customs Act, being stores that are;

(a) petroleum products used to provide motive power for a ship/ aircraft;

(b) aircraft stores that are underbond goods as defined below supplied to aircraft by persons engaged in servicing scheduled international flights; and

(c) other ships/aircraft stores that are neither underbond goods as defined below nor petroleum products covered by (a) above.

For the purpose of (a) and (c) above underbond goods are goods of a kind on which Customs duty, Excise duty or Sales Tax under Sales Tax Assessment Act No.5 is generally payable, but on which that duty or Sales Tax has not been paid.

If the required export documents are not lodged with the ACS, goods will not be loaded on departing ships and aircraft as clearances for these vessels will not be issued unless all the
necessary documentation has been lodged and all requirements have been met.

Export entries can be made:

• electronically by a registered user of the EXIT system either as an owner or an agent acting on behalf of an owner; or
• by means of a written document;
• using the entry from B957;
• which may be prepared by the owner or an agent appointed by the owner; and
• which must be lodged by;
• giving or mailing to an officer in the Export Section of an ACS office; or
• faxing to an ACS office.

(The ACS has stressed that it cannot guarantee a standard of service for the processing of export entries and that the processing of manual export entries will be limited to normal business hours Monday - Friday.  Accordingly exporters are encouraged to connect to the EXIT system or seek services of an agent connected to EXIT rather than lodge manual entries.)

Exporters should also be aware of their obligations under section 240 of the Customs Act that requires owners of goods entered for export to retain commercial documents for a period of five years.

These documents may be examined by Customs Officer and failure to retain the required documents could lead to prosecution and a fine of up to $2,000.

DOCUMENTATION

DOCUMENTATION FOR EXPORT

Other than the mandatory export documents required by Australian authorities, the following documentation is also required:

Commercial Documents

Commercial Invoice

Describes the goods which are the subject of the transaction between the buyer and the seller.  Banks, Customs or an insurance company will usually require such documentation.

PACKING LIST/WEIGHT LIST

Will list the precise contents for shipment. Facilitates customs clearance.

TRANSPORT DOCUMENTS

Bill of Lading

Issued by shipping companies, this acts as evidence of a contract of affreightment setting out the conditions of carriage a receipt for goods and a document of title.

Air Waybill

Issued by the airline company acknowledging receipt of the goods for dispatch by air.  This document, however, does not convey title to the goods and is not necessarily required to be produced  for delivery of the goods.

Insurance Documents

Due to the risks of damage or theft in international trade, marine cargo insurance is an important consideration. It is the overseas importers responsibility to insure when the shipment is on a Free On Board (FOB) or Cost and Freight (CFR) basis.  It is the exporters obligation to arrange insurance in CIF/CIP contracts.  Banks providing documentary credit will usually want insurance on at least the CFR value of the goods.

OTHER DOCUMENTS

Certificate of Origin and Value

Certificate of Origin of goods are required for duty and import control purposes while the information on value is required for customs duty purposes in the country of importation.  This  information is required by certain overseas buyers and customs authorities, especially in areas of preferential trade agreements.  Issued by Queensland Confederation of Industry in Brisbane.

Certified Commercial Invoices

Certified by the Queensland Confederation of Industry, these may be customs authorities overseas.

Consular Invoice

An invoice that is certified by the Consul of the country to which the goods are to be exported.  Other documents mentioned above may also be required to be 'legalized' by consular authorities.

If one is unsure of what documentation is required for a particular transaction or country, the Queensland Confederation of Industry gives advice.
 

OTHER TRADE RELATED REGULATIONS

Quarntine

Australia is an island continent and as such is free of a great number of diseases and pests that are prevalent in other countries. Quarantine rules and regulations are designed to ensure that Australia stays this way and to prevent the introduction of these diseases and pests into Australia. Each year more than 4 million passengers and 20 million tones of cargo pass through quarantine on arrival at Australian airports and seaports.  All of these arrivals pose a risk to human health, agricultural industries and the natural environment. The Australian Quarantine Inspection Service (AQIS) is a service within the Department of Primary Industries and Energy.  Its  task is to safeguard Australian primary industries and improve the prospects for marketing of their products by providing:  Quarantine programs which facilitate the importation of animal products, plants and plant products.  The programs aim to promote agricultural production by improving Australian plant and animal genetic stock while maintaining the maximum practical protection against entry and spread of exotic pests and diseases. Exotic pests and diseases are those which come from any country outside Australia.

TRADE AGREEMENTS AND ARRANGEMENTS 

Australia is a signatory to a number of international trade agreements.

The most important international initiatives designed to reduce the impending effect of domestic laws has been the General  Agreement on Tariffs and Trade (the `GATT'). GATT was formed to enhance trade and promote harmonization and liberalization of customs administration around the world.

A GATT contracting party's fundamental obligation is to charge no more than its currently agreed maximum tariff rates on imports from other contracting parties.  Of equal importance, a contracting party is required unconditionally to accord identical tariff treatment to imports from all contracting parties.  The obligation not to discriminate applies to tariff rates and related procedures.

CLOSER ECONOMIC RELATIONS AGREEMENT

The Australia New Zealand Closer Economic Relations Trade Agreement, known as ANZCERTA or the CER Agreement, is the main instrument governing economic relations between Australia and New Zealand.  The agreement establishes a framework for the progressive and automatic accomplishment of a free trade area between the two countries and has enabled the continuing development of closer Trans-Tasman economic relations.  It is fully consistent with the General Agreement on Tariffs and  Trade (GATT).