Outcry greets Customs infringement notice reform


Critics charge that rushed and incomplete consultation process will lead to unfair outcomes

Outcry greets Customs infringement notice reform
The Customs infringement notice reform process is under fire

Concern is mounting amongst customs brokers and their advisors over the Federal Government development and implementation of the Customs Infringement Notice System (INS).

The INS is part of supply chain anti-crime measures adopted following the findings of Operation Polaris.

The measures incorporated a combination of procedural and legislative changes including limiting access to the Integrated Cargo System (ICS) operated Australian Customs and Border Protection Service imposing additional conditions on those licensed by Customs for various activities in the supply chain, creating new offences particular to those in the supply chain and generally increasing penalties for a variety of offences as well as increasing INS penalties.

But the industry contends that the consultation process for the latest changes were announced on December 29, came into effect a month later and the result took little if any notice of industry submissions.

The Customs Brokers and Forwarders Council of Australia (CBFCA) has taken exception to a Customs statement that "the INS Guide incorporates some of the feedback we received from industry".

It says that "consideration by ACBP not only on the CBFCA’s, but all of industry's submissions did not result in any further consultation or appropriate consideration by the ACBP on changes to the [INS] Guide".

Transport and supply chain lawyer Andrew Hunt, who works closely with the CBFCA, is also exercised about the process and the likely outcome.

"I remain of the view that the new version of the INS is less transparent as to the grounds on which INs will be issued," Hudson says.

He traces the roots of the changes to a Australian National Audit Office (ANAO) review of Customs operations that found Customs was not using the original INS to the degree thought appropriate to improve compliance. 

Part of the response from Customs was that the original INS was too prescriptive and difficult to implement.

"While affected parties were invited to make submissions, there were no specific responses to those submissions and no explanation provided of changes when the revised Regulation and Guide were issued," Hudson says. 

"This hardly seems consistent to the notion of co-operation and transparency.

"The revised Guide was only issuedvery shortly before the new INS commenced. 

"This made it impossible to educate the affected parties as to the approach by Customs to their liabilities under the INS and mitigate their position. 

"This is hardly a reasonable position."

He advises those likely to be affected to:

  • review their terms and conditions of trade, to (so far as possible), pass liability for increased penalties to others in their supply chain
  • increase professional indemnity cover and ensuring that it covers liability for a longer period even after employees leave or businesses are closed;
  • improve compliance arrangements;
  • prepare advice to staff  that they could be required to sign a form consenting to their personal information being provided to Government to check whether they are appropriate people to be working in licensed premises or businesses

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