Trade and goods compliance 2016

Increased industry engagement

We recognise that effective partnerships with industry are critical to achieving our mission of protecting Australia’s border and managing the movement of people and goods across it. 

We are committed to working with industry to identify and address compliance issues. In 2016 we are collaborating with industry to achieve improved compliance with:

  • Cargo reporting, particularly in relation to:
    • cargo reporting timeliness
    • the provision of deficient information in cargo reports.

  • The correct use of Self Assessed Clearance declarations and the Unaccompanied Personal Effects concession.
  • The correct use of Tariff Concession Orders.

  • Valuation of imported goods, particularly in relation to:
    • the inclusion of production assist costs
    • the customs value and quantity.

Increased compliance facilitates legitimate trade, ensures a level playing field for industry and contributes to the protection of Australia’s border.

Over the last few months, we have met with industry representatives and members to advise them of our areas of focus. We also discussed how we can work with industry to improve compliance with their obligations and what information and support might be useful.

Your feedback is also helping us to improve our compliance approach, noting that future work will align with other industry initiatives we are exploring.

We will provide updates through this website, the Goods Compliance Update and through Continuing Professional Development programs run by industry.

In line with the Industry Engagement Strategy 2020: Trade, Customs and Traveller, our approach to trade and goods compliance is focussed on improving voluntary compliance by working with industry. As our operational arm, the Australian Border Force has established the Compliance Advisory Group as a collaborative forum with industry to co-design solutions for trade and goods compliance issues. 

Compliance focus

Cargo reporting timeliness

Cargo reports must be lodged within the timeframes specified in section 64AB of the Customs Act 1901 (the Act) and section 18 and 19 of the Customs Regulation 2015 (the Regulation):

  • Air cargo reports must be lodged at least two hours prior to the estimated time of arrival specified in the impending arrival report.
  • Sea cargo reports must be lodged at least 48 hours prior to the estimated time of arrival of the vessel at the first Australian port, or for voyages less than 96 hours, as defined in the Regulation.

The provision of deficient information in cargo reports

Deficient information within a cargo report includes a consignee or consignor name or address, or goods description that provides us with minimal or no information about the cargo for risk assessment. Examples include 'goods', 'unknown' and 'shipment'. The use of deficient information might not comply with cargo reporting obligations.

Information provided on a cargo report should align with the approved statements for air and sea cargo reports authorised under subsection 64AB (4B) of the Act.

The top ten deficient terms identified in cargo reports at the lowest level bill for 2015 are below.

Air CargoSea Cargo
Goods Address not supplied by loadport
Shipping/Shipment/Shipments TBA
Service Same as above
Consol/Consolidation FCL
Private Same as CNEE
. (full stop) As per attached
Gift General goods
Unknown1/Unknown Please see FID for full details
Product Various
No data Goods

See Common deficient terms (366KB PDF) for the full list.

Self-Assessed Clearance declarations and the Unaccompanied Personal Effects concession

The incorrect use of Self-Assessed Clearance declarations and the Unaccompanied Personal Effects concession can result in the non-payment of customs duty, taxes and charges and in not meeting other import requirements (that is, permits for restricted goods and quarantine requirements). Non-payment of duty and/or taxes is an offence and can result in the application of financial penalties or legal action.

Self-Assessed Clearance declaration

A Self-Assessed Clearance declaration can only be used for imports of goods with a value equal to or less than Australian Dollar (AUD) 1,000 arriving by sea or air cargo. Goods with a value of more than AUD 1,000 must be declared on a Full Import Declaration. Goods that arrive through international mail or arrive as unaccompanied personal effects or under a carnet cannot be cleared on a Self-Assessed Clearance declaration.

There are three types of Self-Assessed Clearance declarations:

  • Cargo Report Self-Assessed Clearance declaration
  • Short Format Self-Assessed Clearance declaration
  • Long Format Self-Assessed Clearance declaration.

For more information on Self-Assessed Clearance declaration types, see the Self-Assessed Clearance declaration fact sheet (233KB PDF).

Unaccompanied Personal Effects

To be eligible for the Unaccompanied Personal Effects concession, the importer must be an arriving person from a place outside Australia and the items must be their personal property that they have owned and used whilst overseas.  The goods must also suitable, and intended, for use by the arriving person. Items that are not eligible for the Unaccompanied Personal Effects concession include alcohol and tobacco, commercial goods, bequeathed goods and goods purchased over the internet.

For more information on the Unaccompanied Personal Effects concession, visit the Sending your belongings as unaccompanied goods webpage.

Tariff Concession Orders

We acknowledge that the interpretation of Tariff Concession Orders is an area of concern for industry members. Throughout 2016, we want to work with industry to ensure that our requirements are clear and that compliance can be improved.

A Tariff Concession Order will be granted on imported goods if substitutable goods are not produced in Australia. If granted, the Tariff Concession Order allows duty free entry of the product into Australia.

Each Tariff Concession Order is keyed to a specific tariff classification and, in order to claim a Tariff Concession Order the goods must:

  • firstly be classifiable to the tariff classification to which the Tariff Concession Order is keyed to; and
  • meet all requirements and conditions of the Tariff Concession Order.

The following advice can be used to help brokers to avoid incorrect use of Tariff Concession Orders:

  • Discuss the properties of the goods imported with your client and advise them to tell you if the properties of the goods change. Particular goods might have been eligible to claim a Tariff Concession Order previously, but changes in the properties or characteristics of the goods, even small variations, might affect their future eligibility.
  • Tariff Concession Orders do not apply to sets, kits, assemblies or systems unless they are specifically referred to in the wording, together with a list of all the items making up the set, kit, assembly or system.
  • Ensure goods are classified correctly before searching for a Tariff Concession Order.
  • Do not undertake a key word search for a Tariff Concession Order.
  • Pay close attention to the wording of Tariff Concession Orders, particularly those containing a number of ‘and’ stipulations, as well as punctuation.
  • Pay particular attention to units stipulated in the wording of the Tariff Concession Order.
  • If doubt exists as to the applicability of a Tariff Concession Order to any goods, the importer can apply for tariff advice or apply for a Tariff Concession Order on the specific goods.

For further information on the interpretation of Tariff Concession Orders, visit the Interpretation of wording in Tariff Concession Orders webpage.

Valuation of imported goods

Undervaluation of customs value will be one of the key areas of compliance focus for 2016. This will include a focus on the failure to include production assist costs in the customs value. Undervaluation of goods imported to Australia impacts on government revenue and creates an uneven playing field for entities operating in the trading environment.

All goods imported into Australia must be declared and assigned a customs value. To avoid non-compliance it is important that importers, working with their broker, ensure that any inland freight, inland insurance and packaging costs incurred by the purchaser before the goods leave the ‘place of export’ are included in the customs value. For more information see valuation of imported goods factsheet (427KB PDF).

Areas of compliance focus in relation to the valuation of imported goods include:

  1. Inclusion of production assist costs

    Production assist costs are the costs incurred when an importer provides goods, materials and certain services, either free of charge or at a reduced cost to use in the production of the imported goods. These costs must be included in the customs value upon import.

    Examples of production assist costs include production materials, dyes, moulds and tools used during the manufacture of the imported goods. For more information see valuation treatment of production assist costs factsheet (556KB PDF).

  2. Customs value and quantity

    The information used to determine the customs value of imported goods must correctly reflect the price paid or payable for the goods to ensure the customs value declared is correct. The customs value provisions are contained in sections 154 to 161L of the Customs Act 1901.

    Quantities must be reported in accordance with the unit required by the good’s tariff classification. For example, for some goods it might be by square metre, by weight or by the number of goods. In some instances, it is not a requirement to declare the quantity.

    As an example, the quantity unit directed by tariff classification 6106.10.00 for women’s cotton blouses is ‘number’. If the commercial invoice for a shipment of women’s cotton blouses stipulates the quantity as a value in kilograms and this quantity is declared, the unit price per blouse will be incorrect. The units must be converted to ‘number’ and that quantity must be declared.

    It is important that the correct quantity and unit is declared. When we analyse importations for risk, if an incorrect quantity or unit is declared, the unit value per item would be inaccurate. It would indicate a possible issue where none might exist and action might be initiated.

Correction of errors made in statements to the Australian Border Force

Did you know that if you have identified an error or omission in a statement made to the ABF, you might be able to correct the error or omission and avoid administrative penalties and legal action that could otherwise apply? 

We encourage all importers and customs brokers to be proactive in reviewing their importation documents to ensure they are accurate and that the correct amount of duty and Goods and Services Tax (GST) has been paid. As an importer, you might need to talk to your customs broker about undertaking a review of your importations.

Examples of errors that might be identified include:          

  • an error in the Customs Value of imported or exported goods
  • an incorrect Tariff classification

If, in a review of your import documents an error or omission is identified, we encourage you to amend the information as soon as possible. This ensures that the correct duty and GST is paid with minimal disruption to your business operations. You might also avoid paying administrative penalties under the Infringements Notice Scheme ranging upwards from AUD 8,100.

Under the Act, there are provisions for an importer or exporter to make a disclosure of errors which protects them from any subsequent related administrative penalty or prosecution. This is generally referred to as a 'voluntary disclosure'.

Voluntary disclosures can be lodged with the Voluntary Disclosures Unit by emailing vdi@border.gov.au.

Resources

The following resources are available to help you comply with your obligations:

More information

More information will be provided as work progresses on these areas of focus.

If you would like to contact us to discuss these issues, or if you have any questions, email goodscompliance@border.gov.au.​