1. Responsibilities of a Customs Broker Powerhouse Consultancy Services Pty Ltd Garry Allen Phone: 9667 5058 FAX: 9667 5008 Email: garry.allen@powerhousensw.com.au Web: www.phl.net.au POWERFUL PASSIONATE PROFESSIONAL

2. Responsibility of a Customs Broker To act on behalf of Clientele in relation to transactions at the Import Barrier reporting to the 3 main Government Departments

3. Communicate Commodity Clearance Declarations Communicate Container Packing Declarations -Import Permits -Enter and clear specific protected and restricted commodities (e.g.: food, drugs, vehicles, etc) -FCL Container Declarations -LCL Container Declarations Customs Brokers are required to undertake specific accreditation training every 2 years as qualification to perform barrier clearance functions on behalf of AQIS

4. GST -Collection and payment of GST on behalf of clientele at the import barrier -Assessment and calculation of GST liability on behalf of clientele at the import barrier -Provision of advice in relation to GST matters on imported product

5. Customs Duty Barrier Commodity Issues Tariff & Trade Consultancy Protection of the Community

6. Customs Duty -Collection and payment of Customs Duty on behalf of clientele at the import barrier -Assessment and calculation of Customs Duty liability on behalf of clientele at the import barrier -Provision of advice in relation to Customs Duty matters on imported product

7. Barrier Issues - Prohibited and restricted imports (permits to Import) Flags in Customs ICS system attached to Tariff classifications; automatic referral to ACS (i.e. weapons chapter 93) - Trade Marking issues (use of brand names, parallel importing) - Commerce Marking - Physical barrier examinations

8. Tariff and Trade Consultancy -Tariff and Valuation Advice -Tariff Concession Orders -Project By Laws -Disputes & External Review Avenues -Compliance Modeling

9. Is the commodity prohibited from importation into Australia? Are there any restrictions for importation into Australia? Do I need an Import Permit for the commodity? Are there any Australian Quarantine restrictions or prohibitions? Do I need any special permission/s from Australian Quarantine? Does my commodity need any special treatment/s prior to import? Do I have packing that requires treatment prior to import? Do I have all the required documentation / paperwork? Is the documentation / paperwork accurate? If FCL container: does the combined weight comply with the relevant state transport requirements? What is the Duty rate? Are there any Duty concessions available? Basic Questions Pre Import

11. AQIS Packing Declarations Packing declarations (for Timber Packing) are mandatory for all FCL and LCL consignments arriving into Australia If the importer cannot present a packing declaration, in the approved format at import, AQIS will direct consignment for treatment prior to release. The packer of the goods must provide the packing declaration. Furthermore the declaration must be on their letterhead.

12. Treatment Requirements for Sea Cargo Wooden packing utilised in FCL / LCL consignments should be treated using any of the options available for wooden packing. Such consignments must be accompanied by an acceptable Treatment Certificate The acceptable methods of treatment are: - Fumigation - Heat Treatment - Permanent Immunisation Treatment Treatment Certificates are not required for: - New Processed Panel Product - Timer Treated and marked in compliance with IPSM 15

13. Numerical link It is essential that packing declarations and treatment certificates be directly related to all sea consignments Numerical links will be acceptable on either document in formats such as: - a bill of lading number - marks and numbers - a commercial invoice number - a packing list number - a container number Please note: the amount of packages or weights does not constitute a numerical link

14. What happens if my goods are not accompanied by a packing declaration? A: If a valid packing declaration does not accompany a sea consignment, the consignment will be directed to AQIS for an inspection to verify whether or not wooden packing and/or bark and straw are present. This will be a fee-for-service activity and further action may be required depending on the items found What happens if timber packing is not treated (or not exempt treatment) when they arrive in Australia? A: If a valid treatment certificate does not accompany a sea consignment, the consignment will be directed for treatment, destruction or re-export of the packing material from Australia Questions & Answers

15. Free Trade Agreement Countries USA; Brunei; Cambodia; Indonesia; Laos; Malaysia Chile Myanmar; New Zealand; Philippines; Singapore; Thailand; Vietnam

16. Product specific origin rules Rule/s will vary according to commodity and Tariff Classification, and include the following or a combination of the following: 1.A transformation test (i.e. change in Tariff classification), required to demonstrate a substantial process of manufacture undertaken in the ASEAN region; 2.A regional value content test; 3.Other special rules, as specified

17. Certificate of Origin The importer / owner of the goods must hold a valid certificate of origin, or a copy, when entering goods to Customs; A valid certificate of origin is required for each shipment; Only approved bodies will be able to issue a Certificate of Origin USA do not require Certificate of Origin, but importer will need to present evidence of compliance

18. Free Trade Agreements Under Negotiation 1.China-Australia Free Trade Agreement 2.Japan-Australia Free Trade Agreement 3.Korea-Australia Free Trade Agreement 4.Trans-Pacific Partnership Agreement (Asia-Pacific) Brunei Darussalam, Chile, New Zealand Singapore, Australia, Canada, Japan, Malaysia, Mexico, Peru, USA and Vietnam

19. Tariff Concession Order System TCO Core Criteria - “For the purpose of this part, a TCO application is taken to meet the core criteria if, on the day on which the application was lodged, no substitutable goods were produced in Australia in the ordinary course of business”. Substitutable Goods - “Substitutable Goods, in respect of goods the subject of a TCO application or of a TCO, means goods produced in Australia that are put, or capable of being put, to a use that corresponds with a use (including a designed use), to which the goods the subject of the TCO application can be put.” Market Competition Not Relevant - “In determining whether goods produced in Australia are put, or are capable of being put, to a use corresponding to a use to which goods the subject of a TCO or of an application for a TCO, can be put, it is irrelevant whether or not the first-mentioned goods compete with the second-mentioned goods in any market.” ONUS OF PROOF now rests with the applicant for TCO: This statutory obligation provides the applicant with an “UP-FRONT” responsibility to undertake research as to the existence of potential Australian producers of Substitutable Goods, prior to the lodgement of a TCO application. Applicants are responsible for establishing to Customs satisfaction that the TCO application meets the core criteria. Furthermore, Customs can reject an application if they are not satisfied the above responsibility has been met or if they are aware of an Australia producer of Substitutable goods.

20. New Compliance Monitoring Program A more focussed intelligence-led risk-based Customs Audit Approach Customs have set up a national data monitoring centre in Queensland Will monitor Customs declaration data nationally from a central location A shift from desktop auditing (at importers premises) to barrier compliance auditing, where more shipments will be subject to audits while under customs control (Red Line), prior to release and delivery or cargo Intelligent programs have been put in place that can analyse declaration data and be able to pick up irregularities for further reference

21. Broker / Importer Activities The main areas related to Broker / Importer activities are: The shift from desktop auditing (at importers premises) to barrier compliance - more shipments subject to audits while under customs control (Red Line) Undervaluation of Customs Values Misclassification and misuse of Tariff Concessions Misuse of Free Trade Agreements Incorrect Tax payments (GST) Misuse of SAC (low value clearances under $1,000.00) High volume refund and drawback claims Focus on Motor Vehicle imports Focus on Textile, clothing and footwear importers Post transaction audit action (after clearance) may result from barrier audit detection. Customs will look further when issues detected at a barrier audit

22. Customs Broker Compliance Issues Under these requirements, your Broker must be able to offer the following services, to ensure your compliance needs and demands are meet: - Implementation of sufficient entry checking systems - High level of education and experience - Sufficient spread of qualified staff - Centralised commodity / parts database management system - Periodic reviews of your compliance - Broker has attained required CPB points At Powerhouse we are constantly reviewing your compliance position; furthermore these functions are also strongly supported by our comprehensive Customs consultancy service

23. Documents and Records DocumentsRecords Retained By Owners of imported or exported goods Those who cause goods to be imported into/exported from Australia Those who receive goods that have been imported into/exported from Australia Communicators Period5 years

24. Assembled / Multiple Supplier Consignments Australian Customs has recently changed their stance on Assembled / Multiple Supplier consignments. Multiple suppliers can no longer be declared on the one Import Declaration for any airfreight & Seafreight LCL consignments; as such multiple suppliers can only be declared on the one Import Declaration when in FCX container/s, for all future shipments. In other words, where there are multiple suppliers in an airfreight & Seafreight LCL consignment, you will need to report each suppliers on a separate HAWB number / line. Customs has justified this stance by saying that at the 19 November 2012 meeting of the Customs and Border Protection National Consultative Committee (CBPNCC), members agreed that there should be an increase in activity to ensure compliance with legislative settings, particularly in relation to assembly orders.

25. Hidden in the depths of the Government's recent Budget papers, was a subtle increase in their Import Processing Charges / Fees that they collect on Import Declarations for declarations valued over $10,000.00; these changes will become effective as from 1 st January 2014. These new charges are quite dramatic and are summarised as follows: The IPC for electronic sea import declarations will be increased from $50.00 to $152.60 per consignment, and the IPC for electronic air import declarations will be increased from $40.20 to$122.10 per consignment; when valued over $10,000.00. For consignments valued from $1,000.00 and up to $10,000.00, the IPC will remain at the current level of $50.00 for electronic sea import declarations and $40.20 for electronic air import declarations. The above does not include AQIS fees of $38.00 for sea and $10.00 for air consignments, also included and charged on Import Declarations. It is important to note, that no cost recovery exists in relation to consignments valued at $1,000.00 or less (SACs); as such, significant cross subsidisation currently exists from those importers who are required to have an import declaration lodged with Customs to clear import cargo, against those using SACs. Australian Customs Increase their Import Processing Fees Collected on Import Declarations as from 1 st January 2014