Senate

Customs Legislation Amendment and Repeal (International Trade Modernisation) Bill 2001

Explanatory Memorandum

(Circulated by authority of the Minister for Justice and Customs, Senator the Hon Christopher Martin Ellison)
This memorandum takes account of amendments made by the House of Representatives to the bill as introduced.

Chapter 2 - Commercial Compliance Measures

Outline of Chapter

The purpose of the amendments detailed in this Chapter is to:

improve compliance with the commercial obligations under the Customs Act in a self assessment environment;
improve the accuracy of information that is required to be communicated to Customs in relation to imported and exported goods; and
provide for clients who have a proven history of compliance with Customs commercial obligations to report information in a different way.

To achieve these outcomes the amendments detailed in this Chapter will amend the Customs Act to:

extend the obligation to retain commercial documents to people who handle cargo imported into, or exported from Australia;
introduce a new record keeping obligation on people who communicate information in relation to imported or exported goods;
introduce consent based monitoring powers to assess a persons compliance with Customs-related laws, whether record keeping systems are capable of accurately recording and generating information to enable compliance with Customs-related laws, and the correctness of information communicated to Customs;
extend the period for recovery of short paid duty from 12 months to 4 years;
replace the existing administrative penalty system for false and misleading statements with strict liability offences with the administrative option of issuing an infringement notice for a reduced penalty in lieu of prosecting for the offence; and
introduce the Accredited Clients Program for clients who can demonstrate that they provide accurate information to Customs.

Detailed Explanation of new law

Document Retention - Owners and Cargo Handlers

Section 240 of the Customs Act establishes an obligation upon owners of goods imported into, or exported from, Australia to keep commercial documents relating to the goods. In its current format this provision provides the majority of the obligations and powers considered necessary to enable a self-assessment regime based on post transaction audits to be effective. It does not, however, cover some sectors of Customs client base nor does it reflect technological change.

Who must keep commercial documents?

Item 17 of Part 6 of Schedule 1 to the Bill repeals and substitutes subsection 240(1A) of the Act. New subsection 240(1A) will ensure people retain documents relating to all exports not only in respect goods that have been entered for export, as well as replacing the penalty in this subsection.

The amendments at item 18 of Part 6 of Schedule 1 to the Bill impose a new document retention requirement on persons located in Australia who cause cargo to be imported into, or exported from, Australia or who receive cargo that is imported into, or to be exported from, Australia ( new subsection 240(1B) ). This new requirement will extend document retention obligations to persons such as freight forwarders and cargo reporters.

The documents that must be kept include all commercial documents relating to the cargo and its carriage to, or from, Australia that come into the persons possession at any time. Relevant documents are those that are necessary to assess whether the person is complying with a Customs-related law or the correctness of information communicated by, or on behalf of, the person to Customs (whether in documentary or other form). The documents are to be kept for a period of 5 years from the time when the goods were imported into, or exported from, Australia.

Manner of keeping commercial documents

The amendments at item 20 of Part 6 of Schedule 1 to the Bill relate to the manner in which documents are to be kept and modernise the current requirements to take account of advances in technology and the globalisation of business. New subsection 240(4) provides that documents can be kept at any place, including a place outside Australia. New subsection 240 (5) provides that documents may be kept in any form and stored in any way (for example electronic, hardcopy, microfiche etc) provided that:

they can readily be transformed into a document in English or translated to English; and
they are kept in manner that enables a Collector to readily ascertain whether goods have been properly described and properly valued or rated for duty.

Persons required to keep documents are required, on request in writing by an authorised officer, to inform the officer as to the whereabouts of documents within a reasonable time ( new subsections 240(6) and (6A) ).

Offences/Penalties

Strict liability offences apply where a person:

fails to keep the documents for the specified retention period;
fails to inform an authorised officer the location of documents within a reasonable time;
alters or defaces the documents (other than a notation or marking in accordance with normal commercial practice).

Penalty amounts for these offences are set at 30 penalty units. Minor amendments are also made to current subsections 240 (1), (1AA) and (1A) to change the current penalties of $2,000 to 30 penalty units in accordance with the standard level of penalty for failure to meet document retention requirements under other Commonwealth Acts ( items 14, 16 and 17 of Schedule 1 to the Bill refer). Current subsection 240(6) of the Customs Act provides for an increased fine of $5,000 in circumstances where a person has previously been convicted of a records offence. This provision is being repealed by item 20 of Schedule 1 to the Bill as it is inconsistent with current Commonwealth criminal law policy.

For a more detailed discussion of strict liability offences see Chapter 5 of this Explanatory Memorandum.

Production of Commercial documents

As commercial documents will now be able to be kept at a place outside Australia, the exercise of monitoring powers will not be sufficient for Customs to examine all documents for the purpose of assessing a persons compliance with a Customs-related law. New section 240AA will allow authorised officers to give written notice requiring persons to produce in Australia documents required to be kept under section 240. The amount of time specified in the notice for production of the documents is a minimum of 14 days ( new subsection 240AA(2) ). The minimum of 14 days for production will allow people who keep documents outside Australia sufficient time to obtain the document for production in Australia in accordance with the request. Note that failure to produce will be a strict liability offence under new section 243SB .

Record Keeping - Communicators of Information to Customs

Many people who have reporting obligations in relation to imported or exported goods (importers, exporters, cargo handlers etc) use agents (both licensed Customs Brokers and other service providers) to communicate information on their behalf to Customs. In order to verify the content of such communications to Customs it is proposed to introduce a new record retention obligation on communicators of information to Customs ( new section 240AB ). The retention period for such records will be 12 months from the time of the communication is made ( new subsection 240AB(3) ). The 12 months retention period for communicators (compared to 5 years for commercial documents in section 240) acknowledges that the purpose of compliance audits of service providers is to verify the correctness of information that they communicate and to address any non-compliance by improving data quality in a real time context. Compliance audits of owners of imported and exported goods, on the other hand, will concentrate on confirming that the persons revenue related obligations over a longer period in relation to those goods have been met.

The provision is intended to be flexible enough to allow communicators of information to keep records in a variety of forms, for example:

-
photocopies of commercial documents returned to clients;
-
scanned, electronically stored copies of documents/invoices;
-
by creating their own database of the information they receive; or
-
notes of instructions received by phone.

The primary requirement of the record keeping obligation is that the record verifies the content of the communication to Customs.

Similar to the commercial document retention provisions for owners and cargo handlers, the records of communicators may be kept outside Australia ( new subsection 240AB(4) ), in any form and stored in any way provided that they can readily be transformed into a document in English or translated into English ( new subsection 240AB(5) ).

An authorised officer may give written notice requiring a person to inform the officer of the whereabouts of the records and to produce them for inspection at a place in Australia specified in the notice ( new subsection 240AB(6) ). The amount of time specified in the notice for production of the records is a minimum of 14 days ( new subsection 240AB(2) ). The minimum of 14 days for production will allow people who keep records outside Australia sufficient time to obtain the documents for production in Australia in accordance with the request. Note that failure to produce will be a strict liability offence under new section 243SB .

Technical amendment

Item 22 of Schedule 1 to the Bill repeals section 240B of the Customs Act . This section provides that proceedings can be brought against a person for failure to keep documents under either section 240 (commercial documents in relation to imported and exported goods) or section 240A (records in relation to diesel fuel rebate applications). The section is redundant as, since amendments to the diesel fuel rebate system in 1997 (Act No. 97 of 1997), section 240A contains no offence.

Monitoring Powers

The amendments in Part 5 of Schedule 1 to the Bill amend the Customs Act to:

Outline the monitoring powers;
Outline when the monitoring powers may be exercised and by whom they may be exercised;
Provide a modernised legislative framework in which to monitor compliance with the Customs Act and Customs related laws;
Ensure that the ability to monitor and audit is in accordance with Government policy.

Item 13 of Schedule 1 to the Bill repeals the audit powers in sections 214AA, 214AB and 214AC of the Customs Act and substitutes new audit powers, known as monitoring powers. The new powers will be used to assess -

whether a person is complying with Customs related law;
whether a persons record keeping, accounting, computing or other operating systems accurately record or generate information to enable compliance with a Customs related law; and
the correctness of information communicated by a person to Customs.

These powers are intended to enable Customs to monitor compliance with both commercial and border control obligations on importers and exporters and people who cause cargo to be imported into, or exported from, Australia under the Customs Act and other Customs-related laws. Note that Customs-related law is defined in new section 4B ( item 11 of Schedule 1 to the Bill) to include the Customs Act , the Excise Act and any other Act or regulations in so far as they relate to the importation or exportation of goods, where the importation or exportation is subject to compliance with any condition or restriction or is subject to any tax, duty, levy or charge (however described). This broad definition of Customs-related law acknowledges that Customs performs import and export related compliance monitoring on behalf of other Commonwealth agencies, such as AQIS, the ATO and other permit issuing agencies.

The primary means of entry to premises for the purpose of exercising monitoring powers is through consent of the occupier of the premises ( new section 214AE ). Consent must be given and withdrawn in writing. Consent may also be given on a continuing basis; this form of consent may also be withdrawn. A warrant may be sought from a Magistrate either initially or where consent is refused or later withdrawn( new section 214AF ). A monitoring officer may give to the occupier notice that the officer wishes to enter the premises and exercises monitoring powers ( new section 214AD ), but this is optional. Where notice is given, any voluntary notification after the issue of the notice will not be a defence to a statement that is false or misleading under new section 243T or 243U .

Where a monitoring officer is in or on premises that he or she has entered with the consent of the occupier of the premises, the monitoring officer may ask the occupier to answer questions or to provide reasonable assistance. The occupier will not have committed an offence if the occupier does not abide by either request ( new subsections 214AH(1) and 214AI(1) ).

Where a monitoring officer enters premises under a warrant issued under new section 214AF , the officer may require any person on the premises to answer any questions or to provide reasonable assistance ( new subsections 214AH(2) and 214AI(2) ). Failure to answer or provide reasonable assistance when a warrant is in force will be a strict liability offence ( new section 243SA and subsection 214AI(4)) .

The monitoring powers model includes the current power to inspect and make copies of documents in or on the premises to check the accuracy of information provided to Customs ( new paragraphs 214AB(1)(d) and (e) ). This has been expanded to include records, to mirror the document or record keeping requirements in new section 240AB ( item 20 of Schedule 1 ).

As part of the monitoring powers, a monitoring officer will have the power to inspect, examine, count, measure, weigh, gauge, test or analyse, and take samples of anything in or on the premises ( new paragraph 214AB(1)(c) ). A monitoring officer will also be able to take into or onto premises any equipment or materials that are reasonably necessary to exercise certain monitoring powers listed in the provision ( new paragraph 214AB(1)(f) ).

Advances in technology have meant that much of the information communicated to Customs is provided electronically. It is therefore necessary to be able to conduct systems audits ( new paragraph 214AB(1)(g) ). These powers will allow Customs to check the ability of those systems used to accurately generate or record information or documents.

Similarly, electronic storage of records or documents used in the communication of information to Customs will now be permitted. It will be necessary to operate and copy such equipment at the premises to check whether the information is relevant for assessing compliance with a Customs-related law, or whether the information provided to Customs is accurate ( new subsection 214AB(2) ).

In entering premises and exercising monitoring powers it may be necessary to obtain assistance (section 214AC(4)). It may, for example, be necessary for a monitoring officer to use an information technology specialist to conduct systems audits.

The power to search premises is included as a monitoring power in accordance with similar schemes in other Commonwealth legislation ( new paragraph 214AB(1)(a) ). It might be necessary to exercise this power, for example, to search for documents or records on the premises that relate to the communication of information to Customs.

In entering premises and exercising monitoring powers a monitoring officer or person assisting a monitoring officer may use force only against things as is necessary and reasonable in the circumstances ( new subsection 214AC(4) ). It might, for example, be necessary to open a filing cabinet. There is no power to use force against persons in any circumstance.

A monitoring officer, whilst exercising monitoring powers, might find evidence of the commission of an offence against a Customs related law. It is therefore necessary for a monitoring officer to have the power to secure that thing until a warrant to seize can be obtained. The power to secure the thing lapses after 72 hours if a warrant to seize has not been obtained ( new paragraph 214AB(1)(h) ).

Customs must pay reasonable compensation where damage is caused to equipment or data recorded on the equipment as a result of insufficient care either exercised by an officer in selecting the person to operate the equipment or in the monitoring officer operating the equipment ( new section 214AJ ).

New sections 214AF and 214AG set out the requirements for the issue of a warrant for the exercise of monitoring powers in accordance with Commonwealth policy in relation to monitoring powers.

Monitoring officers

Customs officers will need to be authorised by the CEO to exercise the powers of monitoring officers under Subdivision J, Division 1, Part XII of the Customs Act . An authorised officer must be suitably qualified - they must have the ability and experience to exercise those powers ( new subsection 214AC(2) ).

Authorised officers will be issued with an identity card by the CEO under new section 4C , which must be carried at all times while exercising powers in respect of which the card was issued. It will be an offence where a person who ceases to be an authorised officer fails to return the identity card to the CEO as soon as practicable.

Recovery of Short Paid Duty

Section 165 of the Customs Act currently provides for the recovery of duty short levied or erroneously refunded upon a demand being made by the CEO within 12 months of the date of the short levy or refund. This 12 months time limit means that Customs cannot recover any duty when the short payment is the result of Customs error, and that is detected during an audit conducted more than 12 months after the short payment. Where the short payment arises from a misstatement to Customs, action can be taken under section 153 of the Customs Act with no time limit.

To make the recovery period consistent with that under the Taxation Administration Act 1952 for GST, Luxury Car Tax and Wine Tax, items 6 and 7 of Schedule 1 to the Bill amend section 165 of the Customs Act to allow the CEO to demand the payment of short paid duty, and the repayment of erroneously refunded duty, for up to 4 years, without any requirement for there to be fraud involved.

It is also proposed to extend the time limit for refund applications to be lodged for overpaid duty to 4 years. As the time limits for refunds are set out in the Customs Regulations 1926 these changes will be effected by amendments to the regulations at a time corresponding with the commencement of the amendments to section 165.

Offences

Failure to answer questions - s243SA

New section 243SA of the Customs Act will make failure to answer a question that an officer requires a person to answer under the Customs Act , a strict liability offence. The maximum penalty for the offence is 30 penalty units or, alternatively, 6 penalty units if an infringement notice is issued.

Failure to produce documents or records - s243SB

New section 243SB will make failure to produce a document or record that an officer requires the person to produce a strict liability offence. This does not apply to new sections 71DA, 71DL or 114A where the consequence of failure to produce is not getting an authority to deal with goods.

The maximum penalty for the offence is 30 penalty units or, alternatively, 6 penalty units if an infringement notice is issued.

False or misleading statements resulting in loss of duty - s243T

Where the owner of goods makes to an officer a statement that is false or misleading in respect of particular goods, or omits from a statement in respect of particular goods owned by the person any matter or thing without which the statement is misleading in a material particular, which results in the loss of duty, the owner (other than a person treated as an owner by reason of being an agent of the owner) commits an offence. This offence does not apply in relation to a cargo report or outturn report nor to a person who is treated as the owner of goods by virtue of being an agent of the owner.

False or misleading statements resulting in a loss of duty include those that result in:

the amount of duty properly payable exceeding that which is payable on the basis of the statement;
a refund or drawback that is not payable being paid; or
a refund or drawback that exceeds that properly payable being paid ( new subsection 243T(1) ).

Where the matter is prosecuted and a conviction for the offence is obtained then the maximum penalty is the amount of excess of duty (where new subparagraph (1)(b)(i) applies); the refund that would not have been payable or the amount of the excess (where new subparagraph (1)(b)(ii) applies); or the drawback that would not have been payable or the amount of the excess (where new subparagraph (1)(b)(iii) applies). The penalty is in addition to recovering the amount of duty shortpaid, the refund overpaid or excess of refund or the drawback overpaid or excess of drawback, as the case may be.

Alternatively, an infringement notice may be issued, where the penalty will be one fifth of the maximum amount a court may impose (s243Z(4)(b)). If an infringement notice is issued and paid, then Customs right to prosecute will be extinguished ( new section 243ZB ).

In addition to defences under the Criminal Code there are specific 2 defences to this offence. The first is voluntary notification of false or misleading statement (detailed below under a specific heading). The second defence is in similar terms to current section 243V of the Customs Act, and allows a person (whether the owner or the agent of the owner), at the time the statement is made to Customs to:

nominate particular information included in, or an omission from, a statement of which they are uncertain and because of that uncertainty they consider that the statement might be regarded as false or misleading; and
give reasons for their uncertainty ( new subsections 243T(5) and (6) ).

The inclusion of this defence acknowledges that even if reasonable care has been taken in preparing communications to Customs, sometimes not all relevant information in relation to goods is available. In such circumstances, provided that the person notifies their uncertainty at the time of making the statement to Customs, no penalty will apply.

False or misleading statements not resulting in loss of duty - s243U

Where a person makes to an officer a statement that is false or misleading in respect of particular goods owned by that person, or omits from a statement in respect of particular goods owned by the person any matter or thing without which the statement is misleading in a material particular that does not result in the loss of duty, the person will be guilty of an offence. This excludes a cargo report or outturn report.

The introduction of strict liability offences and infringement notices for false or misleading statements not relating to duty is intended to improve the quality of information received by Customs. This data is used for trade statistics and border control purposes and any inaccuracy in that data impinges on Customs ability to perform its functions in these areas effectively.

Where the matter is prosecuted and a conviction for the offence is obtained then the maximum penalty is an amount not exceeding 50 penalty units for each statement that is false or misleading. Alternatively, an infringement notice may be issued, where the penalty will be a penalty unit for each material particular that is false or misleading or each thing that is omitted, up to a maximum of 10 penalty units - which is 1/5 of the maximum penalty that a court might impose ( new section 243Z(4)(a) ). If an infringement notice is issued and the penalty is paid, then Customs right to prosecute will be extinguished ( new section 243ZB ).

The reference to statement does not include a statement made under Part XVA (which relates to the Tariff Concession System) or Part XVB (which relates to Anti-dumping measures) of the Customs Act nor does it include a statement made by a passenger or the crew of a ship or aircraft. These exclusions recognise that the purpose of this new strict liability offence is to improve compliance of those persons who are in the day-to-day business of communicating information to Customs in relation imports and exports.

Electronic communications to be taken to be statements - s243W

So that statements made to Customs electronically are equally subject to these new offence provisions which relate to statements made to an officer , new section 243W provides that electronic communications to Customs are taken to be statements made to the CEO.

Voluntary disclosure of false or misleading statements

The defence of voluntary disclosure of false or misleading statements is a full and true disclosure of all relevant material facts. In considering whether a disclosure is voluntary or not, the timing of the disclosure is important. The defence of voluntary disclosure will not be available after the issue of a notice under new section 214AD for the making of false or misleading statements under new sections 243T and 243U . Persons who voluntarily disclose - or make a genuine attempt to disclose voluntarily - any error or breach that would be otherwise be false or misleading, before the notice will not be penalised.

The voluntary disclosure must be in writing to the officer doing duty in relation to the matter. Where:

a person gives notice in writing to such an officer; and
no notice has been given under new section 214 AD

then the defence of voluntary disclosure is established ( new subsections 243T(4) and 243U(4) ).

Attempts to 'volunteer' errors or breaches after the issuing of a notice under new section 214AD of an intention to exercise monitoring powers, will be taken into account in determining whether an infringement notice should be issued. Such attempts or late disclosures do not constitute a defence, but the degree and timing of the disclosures made will be relevant when considering whether as a consequence, penalties are appropriate. Similarly, incomplete disclosure and the capacity of the person to make a full disclosure at the time, are matters that will also be considered.

A person who, at the time of making a statement that has duty implications, is genuinely uncertain as the accuracy of the information, and communicates that genuine uncertainty with the statement identifying the particular information and the reasons as to the uncertainty, will not be subject to a penalty for a false or misleading statement because of the defence set out in new subsections 243T(5) and (6) .

Accredited Client Arrangements

The amendments contained in Schedule 3 to the Bill that relate to people with whom the CEO may enter into information contracts will:

allow the CEO to enter into contracts (otherwise known as information contracts) with people for the purposes of enabling those people to provide information to Customs in a different way to other clients; and
provide for the CEO to publish business rules that must be complied with by people wishing to enter into, or who are parties to, an information contract.

Customs is introducing a new approach to compliance management for clients who can demonstrate that they provide accurate information to Customs. Rather than relying on the traditional statutory approach, the new arrangements will use a mix of legislation and contract to achieve Customs objectives. These clients will be accredited by Customs.

The legal framework underpinning the accredited client arrangements, includes:

provisions in the Bill;
business rules; and
a contract.

Business Rules

New section 273EB provides for the CEO to publish in the Gazette, business rules that define the qualifications to be held, and the conditions and standards that must be met, by people who wish to enter into, or who are party to, an information contract. Parliament will be able to disallow the business rules. The business rules also specify who will be eligible to carry out commencement audits for people who wish to enter into information contracts.

Information Contracts

The new sections 71DD and 114BB will allow the CEO of Customs to enter into import information contracts and/or export information contracts with people, for the purposes of enabling those people to provide information to Customs in a different way to other clients. These people will be known as accredited clients.

The CEO must not enter into an information contract with a person unless the CEO is satisfied , as a result of an audit, that the person can provide Customs with accurate information that is necessary to enable Customs to perform duties in relation to goods imported into, or exported from, Australia.

The CEO can enter into information contracts with the companies specified in new subsection 71DD(3) and subsection 114BB(3) without them undertaking a commencement audit. These companies are members of a group being used by Customs to pilot the accredited client arrangements. This group was selected by Customs following an application process. To be accepted to pilot the arrangements, these companies import and export procedures were subject to careful consideration by Customs.

The development of individual contracts will allow the parties to tailor arrangements to meet their specific needs. The tailoring is limited to adjustments that do not require changes to legislation.

New subsections 71DD(4) and 114BB(4) state what must be included in the information contracts. For example, the goods covered by the contract, mechanisms for reporting, monitoring and auditing a persons compliance with agreed procedures and the business rules, and the power of the CEO to terminate the contract if the person fails to comply with any of the procedures or business rules.

Entering into an import or export information contact with the CEO of Customs does not affect the exercise by the CEO of any powers conferred on him or her by or under the Customs Act.

For goods covered by their information contract, people who have entered into import and/or export information contracts will be able to provide minimum information at the time of importing or exporting goods, with less time-sensitive information provided at a later date. For example, information required solely for trade statistics will not be required at the time of importation or exportation of the goods. This two-phase approach to providing information will only be available for goods covered by the contract.

The proposed changes give effect to the International Convention for the Simplification and Harmonisation of Customs Procedures (also known as the Kyoto Convention). This Convention permits people with an acceptable record of compliance with Customs requirements, and a satisfactory system for managing their commercial records, to have their goods released by providing minimum information, with other information to be provided at a later date.

For Imports

The new section 71DB will allow importers (and/or any Customs broker(s) nominated in the import information contract), who have entered into an import information contract with the CEO, to communicate minimum information to Customs using a request for cargo release (known as an RCR) when importing the goods.

As the name implies, an RCR is a request to permit goods to be released into home consumption immediately. On receipt of an RCR, the new section 71DE requires Customs to give a cargo release advice, to the effect that the goods are cleared for home consumption or that the goods require further examination or are to be held in their current location. Customs must also provide an authority to take the goods into home consumption once the goods have been cleared for home consumption. In practice, the cargo release advice and the authority will be sent by Customs simultaneously. Once an authority has been given, it may be suspended or cancelled (with reasons given) at any time before the goods have been entered.

Pursuant to new subsection 71DB(4) , the RCR must contain information contained in an approved statement. This information will be sufficient to allow Customs to identify the importer, the consignment they are requesting to be released, and to determine whether a particular consignment contains goods that may pose a risk to the Australian community (for example, by identifying any permission given for the importation of goods).

The new section 71DF requires further information to be provided to Customs in a periodic declaration, for all goods for which an RCR has been submitted to Customs during a particular month. A periodic declaration must be provided to Customs by the first day of the calendar month following the month in which the RCR was submitted.

Import Screening Charges

The new sections 71DC and 71DG create an obligation for clients sending RCRs and periodic declarations to Customs, to be liable to pay processing charges. The processing charges for the RCRs reported on the periodic declaration and the processing charges for the periodic declaration, are payable when the person sends the periodic declaration to Customs.

The new subsection 68(3) makes the RCR an entry for home consumption. This means that when the client submits the RCR to Customs they become liable to pay any duty, goods and services tax or other charge or fee payable at the time of entering the goods. However, it is intended that accredited clients will be people who are allowed to defer the payment of goods and services tax and duty. To facilitate this proposal, it is intended that regulations will be made under section 132AA of the Customs Act , which will allow people who can defer goods and services tax to also defer the payment of duty.

For Exports

New subsection 114BB(1) provides that the CEO may enter into a contract with a person for the purpose of enabling the use of ACEANS in connection with the export of the persons goods. Other people may use ACEANS in connection with the export of the persons goods. Exporters who have entered into an export information contract with the CEO will receive a set number of accredited client export approval numbers, also known as ACEANs. Pursuant to paragraph 114BB(4)(d), each export information contract must contain a provision relating to the allocation of the ACEANs.

In the typical case, the ACEAN will be the only information relating to the goods provided at the time of exportation.

New subsection 114BA(4) provides that an ACEAN can be communicated in respect of goods if the export information contract entered into in respect of goods to which the ACEAN relates is in force.

New subsections 114BA(5) to (6) provide that an ACEAN can only be used in respect of one consignment of goods and if a person uses an ACEAN in respect of more than one consignment the use of the ACEAN is invalid and person is guilty of a strict liability offence.

It will not be necessary for a provision corresponding to new subsection 114(5) in the exportation of goods to be included for ACEANs. This is because:

an ACEAN is only a number and will contain no other information this subsection could never be satisfied; and
the Accredited Client Arrangement information contract will cover the necessary requirements in the information contracts.

If one or more ACEANs are used to report the exportation of goods to Customs, by the first day of the month following the use of the ACEAN/s, the person must provide more information about the goods in a declaration (section 114BC).

No processing charge will be imposed for using an ACEAN or a declaration.


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