Australian Trusted Trader Program Sept 2015
Dear Valued Clients,
The Australian Trusted Trader is gaining further momentum and we would like to take this opportunity to update you further. The program is a voluntary partnership between an accredited business and the Australian Government that aims to streamline and facilitate trade, and enhance supply chain security.
The Department of Immigration and Border Protection (DIBP) recently launched the programme announcing the initial four pilot participants and is now extending invitations to other exporters and importers to participate in the initial pilot phase of the programme.
The following is as an independent observation provided by the Freight & Trade Alliance (FTA) outlining the current status of the programme and key considerations for businesses in weighing up whether or not to participate in the programme.
Benefits:
Exporters are expected to benefit from streamlined processes via Mutual Recognition Agreements (MRAs) being established between governments that support global trusted trader programmes.
It is also anticipated that joining the programme will satisfy international airfreight “security” requirements and will be aligned to the Office of Transport Security’s “known consignor” scheme.
Importers are also likely to benefit from participation in the program with priority trade services (including the possible relaxation of document requirements under Free Trade Agreements), access to a relationship manager and increased predictability of cargo release which will assist in the management of logistics operations.
Other benefits are likely to include duty deferral and streamlined reporting processes, including reforms to align cargo reporting requirements with contemporary multiple supplier (assembly order) commercial practices.
In parallel to this, industry is also looking for a reduction in the DIBP administered Import Processing Charge (IPC) that is currently charged on a consignment basis.
Note – effective 1 January 2016 the IPC will increase to $50 for consignments valued > $1,000 – < $10,000 and to $152 for consignments > $10,000.
Further information on how duty deferral and streamlined reporting will operate for Australian Trusted Traders will be subject to Government consideration as part of the 2016 / 2017 federal budget process.
Costs:
DIBP will not charge for the application process or ongoing client management support associated with the programme.
Businesses will need to demonstrate requirements relating to supply chain security and a history of trade compliance. It is anticipated that costs for industry will vary depending on existing audit measures in place and remedial action required for qualification against the DIBP standards.
Next steps:
Until there is a clearer understanding of the programme’s benefits and costs, it is impossible to determine a definitive return on investment.
In the interim and as an indication of requirements, an Australian Trusted Trader self-assessment questionnaire is currently available that forms a part of the application process (https://www.comlaw.gov.au/Details/F2015L01174). It is important to note that not all questions will be applicable to all applicants. We understand that this content will soon be available via an online portal.
It is highly recommended that exporters and importers continue to work closely with their freight forwarders and customs brokers as their trusted advisors to ensure ongoing high levels of compliance with trade measures and to document supply chain processes. In an environment of increased compliance activity, this approach will reduce exposure to significant penalty provisions and will best position businesses to take advantage of the Australian Trusted Trader programme once benefits are clearly established.
If you have any questions please do not hesitate to contact your SILA representative.
King Regards,
SILA Customer Service