At its recent Industry Summit the Department of Immigration & Border Protection (DIBP) stressed a collaborative approach which continues a shift from a pure compliance and enforcement focus to one of working with industry to facilitate fast and seamless movement of legitimate trade. The Industry Summit, like the DIBP itself, was broad reaching. But for the Australian trade community, the following are some interesting points that came out of the Industry Summit.
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Overall framework at the border
The government wants to see fast border clearance with minimal interference, to support business growth. Business, represented by peak body Australian Industry Group, wants stability, predictability and ease at the border, to enable business to compete globally. The priority of the ABF is to manage and facilitate these expectations for legitimate trade, balanced against the need for community security.
Hunt & Hunt comment: The recent approach to asbestos shows that security will always trump trade facilitation.
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Increasing volumes
There has been significant increase in volumes over the past number of years, driven largely by the globalisation of supply chains. Modern supply chains are more complicated and move faster, which is more complex for ABF.
Hunt & Hunt comment: The approach in recent years to regulating cargo reporting shows the Customs Act is not designed for modern supply chains.
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Australian Trusted Trader
This program continues to form an important part of the overall border framework. It is a profound shift for the DIBP from regulatory and compliance to one of trust. It is also a shift from assessment at a transactional level to one at an entity level. It offers the best opportunity for fast and seamless border clearance for legitimate trade. To optimise benefits for the importing and exporting community, a key element of the program is to enter into Mutual Recognition Agreements with other countries. To this end, negotiations are under way with a number of countries with whom Australia already has free trade agreements.
Hunt & Hunt comment: The challenge for the DIBP remains delivering benefits that makes the program appeal to a wide variety of importers.
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Single window initiative
DIBP is considering how business/importers can give a piece of information to Government one time and that piece of information is used by multiple government departments in different ways for different purposes.
Hunt & Hunt comment: This is a welcome goal. However, at this stage we would settle for the different areas of the DIBP being able to use the same information. Our experience has been that, at times, the teams issuing tariff advices and regulating refunds seemingly work for different agencies.
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Technology solutions
DIBP is investing heavily in technology, and particularly integrated systems, over the next four to five years. Technology and automation are critical for DIBP to meet the ever increasing demands at the border.
Hunt & Hunt comment: It is hard to see how a single window is realistic while the ICS is being used. More flexible technology will also increase Australian Trusted Trader possibilities.
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Talk to DIBP
The evidence indicates that if you voluntarily report an issue to DIBP, this usually leads to a positive outcome. In most cases, DIBP works with importers, rather than initiate further compliance action.
Hunt & Hunt comment: Our view is that the DIBP's approach to voluntary disclosure is better than most countries. It is an appropriate and effective risk management tool where there has been suspected non-compliance.
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Working with the Customs Act
One interesting issue raised at the Industry Summit was the dated nature of the Customs Act. This piece of legislation, originally written in 1901 (but amended many times since!) does not reflect the modern nature of trade in goods. The question was posed by industry – what might legislation look like if it were drafted today?
Hunt & Hunt comment: New Zealand has shown this can be done. There may be easier and quicker problems to solve, but until the Customs Act is modernised, for every minor problem solved, new problems will appear.
On a final note...
The DIBP wants to have continued engagement with industry on a year round basis. This was reinforced by Michael Pezzullo (Secretary) and Roman Quaedvlieg (Commissioner) and filtered right through the organisation at the Industry Summit.
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