EXPLANATORY STATEMENT
Issued by the Acting Comptroller-General of Customs
Customs Act 1901
Customs (Australian Trusted Trader Programme) Amendment (2017 Measures No.1) Rule 2017
Authority
Section 179 of the Customs Act 1901 (the Customs Act) allows the Comptroller-General of Customs to prescribe rules, by legislative instrument, for and in relation to the Australian Trusted Trader Programme (ATT).
Background
Part XA of the Customs Act provides for the establishment and administration of ATT. ATT is a differentiated trust-based framework at the border for entities that meet or exceed international supply chain security and trade compliance standards. Entities who meet these standards and qualify for participation in ATT are assessed as low-risk and benefit from reduced regulatory burden and streamlined customs processes.
Participation in ATT is voluntary and allows entities such as importers, exporters, customs brokers, freight forwarders and transport companies to nominate themselves to participate in ATT and become an ‘Australian Trusted Trader’.
The regulatory framework for ATT consists of three elements:
- The Customs Act – which provides the necessary heads of power to implement key aspects of ATT;
2. The Customs (Australian Trusted Trader Programme) Rule 2015 (the Rule) – a legislative instrument which prescribes rules for and in relation to the operation of ATT including, for example, the qualification criteria, trade facilitation benefits and conditions of participation; and
3. Trusted trader agreements – which are entered into with qualifying entities and set out further benefits that an entity qualifies for, how certain benefits will apply to that entity and the terms and conditions specific to that entity’s participation in ATT.
Section 179 of the Customs Act allows the Comptroller-General of Customs to prescribe rules, by legislative instrument, for and in relation to:
- the qualification criteria in relation to which a trusted trader agreement may be:
- entered into under section 176A; or
- varied under section 177;
- matters that the Comptroller-General of Customs must consider when deciding whether to:
- enter into a trusted trader agreement under section 176A; or
- vary the agreement under section 177;
- the kinds of benefits that an entity may receive under a trusted trader agreement;
- the conditions on which an entity participates in ATT and any other conditions to which a trusted trader agreement may be subject;
- matters that must be considered before deciding whether to vary, suspend or terminate a trusted trader agreement under section 178A;
- procedures that must be followed when varying, suspending or terminating a trusted trader agreement under section 178A; and
- the kinds of information that may be published on the Register of Trusted Trader Agreements for each agreement entered into with an entity.
Schedule 2 of the Customs and Other Legislation Amendment Act 2017 (the Amendment Act) amended Part XA of the Customs Act to repeal the provisions that require the Comptroller-General of Customs to enter into an interim trusted trader agreement with an entity. Instead of entering into an interim trusted trader agreement with an entity, and subsequently varying the trusted trader agreement to confer ongoing trusted trader status on the entity, the Comptroller-General of Customs now simply enters into a trusted trader agreement with an entity if satisfied that the entity fulfils the qualification criteria set out in the Rule.
As a result of these amendments to Part XA of the Customs Act, consequential amendments to the Rule are required. These are to repeal now redundant references to interim trusted trader agreements and to any provisions of the Rule which applied or were relevant to interim trusted trader agreements.
Purpose
The purpose of the Customs (Australian Trusted Trader Programme) Amendment (2017 Measures No.1) Rule 2017 (the Rule Amendment) is to make amendments to the Rule which are consequential to the Amendment Act.
In particular, the Rule Amendment will amend the Rule to:
- remove any reference to interim trusted trader agreements;
- remove any distinction between an interim trusted trader agreement and a trusted trader agreement on which ongoing status has been conferred; and
- remove any provisions of the Rule which apply specifically to interim trusted trader agreements.
Details of the Rule Amendment are set out in Attachment A.
A Statement of Compatibility with Human Rights for the Rule Amendment has been prepared and is at Attachment B.
In developing the Amendment Act, consultation was undertaken with the Department of Agriculture and Water Resources, and the Department of Infrastructure and Regional Development. Consultation was also undertaken with the ATT First Assistant Secretary Steering Committee; and the ATT Industry Advisory Group, which includes representatives of pilot participants, representatives of industry advocacy groups, and representatives of relevant government agencies.
Further consultation on the Rule Amendment was considered unnecessary in light of the consultations undertaken as part of the Amendment Act consultation process.
The Rule Amendment is a legislative instrument for the purposes of the Legislation Act 2003.
The Rule Amendment commences on 1 July 2017, at the same time that Schedule 2 to the Amendment Act commences by operation of the Customs and Other Legislation Amendment Commencement Proclamation 2017.
ATTACHMENT A
Details of the Customs (Australian Trusted Trader Programme) Amendment (2017 Measures No.1) Rule 2017
Section 1 – Name of Rule Amendment
This section provides that the title of the instrument is the Customs (Australian Trusted Trader Programme) Amendment (2017 Measures No.1) Rule 2017 (the Rule Amendment).
Section 2 – Commencement
This section provides that the Rule Amendment commences on 1 July 2017.
Section 3 – Authority
This section provides that the Rule Amendment is made under section 179 of the Customs Act 1901 (the Customs Act).
The purpose of this section is to set out the Act and provision of that Act under which the Rule Amendment is to be made.
Section 4 – Schedules
This section provides for each instrument that is specified in a Schedule to this instrument to be amended or repealed as set out in the applicable items in the Schedule concerned, and for any other item in a Schedule to this instrument to have effect according to its own terms.
The instrument that is being amended is the Customs (Australian Trusted Trader Programme) Rule 2015 (the Rule).
Schedule 1 – Amendments
Customs (Australian Trusted Trader Programme) Rule 2015
Item 1 – Subsection 6(1)
This item is a consequential amendment to the amendment to paragraph 176A(1)(b) of the Customs Act by the Customs and Other Legislation Amendment Act 2017 (the Amendment Act). It repeals the reference in subsection 6(1) to the variation of a trusted trader agreement under section 177 of the Customs Act.
The effect of this amendment is that Part 2 of the Rule now prescribes the qualification criteria in relation to which a trusted trader agreement may be entered into with an entity under section 176A of the Act only. The reference to variation of a trusted trader agreement under section 177 of the Customs Act is redundant and therefore repealed.
Item 2 – Subsection 14(1)
This item is a consequential amendment to the amendment to paragraph 179(1)(b) of the Customs Act by the Amendment Act, which omits the reference to varying a trusted trader agreement under section 177 of the Customs Act.
The effect of this amendment is that section 14 of the Rule now prescribes the matters that the Comptroller-General of Customs must consider when deciding whether to enter into a trusted trader agreement with an entity nominated under section 176B of the Customs Act. As trusted trader agreements are no longer varied under section 177, and subparagraph 179(1)(b)(ii) has been omitted by the Amending Act, the reference to that provision is omitted from the Rule.
Item 3 – Section 15
This is a consequential amendment to the repeal of subparagraph 179(1)(b)(ii) by the Amending Act.
Section 15 of the Rule prescribes matters that the Comptroller-General of Customs must consider when deciding whether to vary an interim trusted trader agreement entered into with an entity so that it might become an ongoing trusted trader agreement. As the Comptroller-General of Customs is no longer required to enter into an interim trusted trader agreement prior to entering into a trusted trader agreement that confers ongoing trusted trader status on the entity, section 15 is redundant and is therefore repealed.
Item 4 – Section 16
Section 16 of the Rule is a consequential amendment to the amendments to Part XA of the Customs Act by the Amending Act, which abolishes interim trusted trader status.
Section 16 prescribes the kinds of benefits that may be received by an entity under a trusted trader agreement that confers interim trusted trader status on the entity. As the Comptroller-General of Customs is no longer required to enter into an interim trusted trader agreement prior to entering into a trusted trader agreement that confers ongoing trusted trader status on the entity, section 16 is redundant and is therefore repealed.
Item 5 - Section 17 (Heading)
This item repeals and substitutes the heading to section 17 of the Rule.
The new heading clarifies that the purpose of section 17 is to prescribe the kind of benefits that may be received by an entity under a trusted trader agreement for paragraph 179(1)(e) of the Customs Act, with no distinction between the now abolished interim trusted trader agreements and trusted trader agreements that confer ongoing trusted trader status on an entity. As interim trusted trader agreements are now abolished, trusted traders have the benefits that were formerly interim trusted trader benefits and ongoing trusted trader benefits.
Item 6 – Subsection 17(1)
This item omits the words which clarified that section 17 of the Rule prescribes the kind of benefits that may be received by an entity under a trusted trader agreement that confers ongoing trusted trader status on the entity. As the Comptroller-General of Customs is no longer required to enter into an interim trusted trader agreement prior to entering into a trusted trader agreement that confers ongoing trusted trader status on the entity, these words in section 17 are redundant.
Item 7 – After subsection 17(1)
Paragraph 179(1)(e) of the Customs Act allows the Rule to prescribe the kinds of benefits that an entity may receive under a trusted trader agreement. As amended by item 6 above, section 17 of the Rule prescribes the kinds of benefits that may be received by an entity under a trusted trader agreement.
Section 16 of the Rule prescribes the trade facilitation benefits of having a direct contact officer and priority processing for certain requests, claims and applications under the customs legislation as benefits for entities with interim trusted trader status. Section 16 of the Rule is repealed by item 4 above as a consequence of the abolition of interim trusted trader agreements by the Amending Act. However, the benefits of having a direct contact officer and priority processing are to continue to be trade facilitation benefits for entities with ongoing trusted trader status. These trade facilitation benefits are therefore inserted into section 17 of the Rule by this item, which sets out the ongoing trusted trader benefits.
Item 8 – Subsection 17(4)
This item repeals subsection 17(4) of the Rule, which provides that an entity may receive other benefits specified in section 16 of the Rule. As noted, section 16 has been repealed by item 4 above, and the trade facilitation benefits contained in that section are inserted into section 17 by item 7. This means that a trusted trader receives these benefits as well as the other benefits in section 17 and that subsection 17(4) is now redundant.
Item 9 – Paragraph 18(8)(a)
This item omits a reference to the variation of trusted trader agreements from paragraph 18(8)(a) of the Rule. That provision prohibits an entity from providing information that is false and misleading in a material particular in relation to the entity’s entry into a trusted trader agreement, or a variation of the agreement.
This is a consequential amendment to the amendments to Part XA of the Customs Act by the Amendment Act, which abolish interim trusted trader agreements.
Item 10 – Subsection 19(4)
This amendment removes the reference to section 16 in subsection 19(4) and is a consequential amendment to the amendment made by item 4 above, which repeals section 16 of the Rule.
Item 11 – Subparagraph 23(b)(i)
This item omits subparagraph 23(b)(i) of the Rule as a consequence of the repeal of subparagraph 179(1)(j)(ii) of the Customs Act by the Amendment Act. That subparagraph allowed the Comptroller-General of Customs to prescribe rules for and in relation to the kinds of information that may be published on the Register of Trusted Trader Agreements, including whether the agreement confers interim or ongoing trusted trader status on the entity. The repeal of this subparagraph reflects the abolition of interim trusted trader agreements.
ATTACHMENT B
Statement of Compatibility with Human Rights
Prepared in accordance with Part 3 of the Human Rights (Parliamentary Scrutiny) Act 2011
Customs (Australian Trusted Trader Programme) Amendment (2017 Measures No.1) Rule 2017
This legislative instrument is compatible with human rights and freedoms recognised or declared in the international instruments listed in section 3 of the Human Rights (Parliamentary Scrutiny) Act 2011.
Overview of the Customs (Australian Trusted Trader Programme) Amendment (2017 Measures No.1) Rule 2017
Schedule 2 of the Customs and Other Legislation Amendment Act 2017 (the Amendment Act) amended Part XA of the Customs Act 1901 (the Customs Act) to repeal the provisions that require the Comptroller-General of Customs to enter into an interim trusted trader agreement with an entity. Instead of entering into an interim trusted trader agreement with an entity, and subsequently varying the trusted trader agreement to confer ongoing trusted trader status on the entity, the Comptroller-General of Customs now simply enters into a trusted trader agreement with an entity if satisfied that the entity fulfils the qualification criteria set out in the Rule.
As a result of these amendments to Part XA of the Customs Act, consequential amendments to the Customs (Australian Trusted Trader Programme) Rule 2015 (the Rule) are required. The Customs (Australian Trusted Trader Programme) Amendment (2017 Measures No.1) Rule 2017 (the Rule Amendment) amends provisions in the Rule to repeal now redundant references to interim trusted trader agreements and to any provisions of the Rule which applied or were relevant to interim trusted trader agreements.
Human rights implications
The Rule Amendment does not engage any of the applicable rights or freedoms.
Conclusion
This Rule Amendment is compatible with human rights, as it does not raise any human rights issues.
Acting Comptroller-General of Customs