Further to our recent member notice outlining various elements of the Simplified Trade System, Freight & Trade Alliance (FTA) and Australian Peak Shippers Association (APSA) representatives participated in meetings on 15 and 22 October 2021 pertaining to "Streamlined Cargo Intervention" initiatives.
Australian Border Force (ABF) and Department of Agriculture, Water and the Environment (DAWE) presentations on proposed sea and air models are available HERE (FTA/APSA MEMBER LOGIN REQUIRED) In response, FTA / APSA have provided preliminary feedback:
A NEED FOR INCREASED INTERVENTION
As per the explanation provided by ABF / DAWE representatives, the current Container Examination Facilities (CEFs) are now out-dated with the Federal Government now exploring opportunities for revised processes imbedded within the supply chain to increase intervention.
The proposed sea cargo model includes:- continuation of 100% profiling / risk assessment against cargo reports / Full Import Declarations (or a variation of the reporting models into the future);
- on a risk assessed basis, an increased percentage on today's levels (to be advised) to be scanned on-site at stevedore facilities; and
- on assessment of images, a percentage (to be advised) to be transported to a site within the port precinct for ABF and / or DAWE examination.
Preliminary concerns raised from participants appear to be in terms of the 'footprint' required at stevedore premises for scanning and limited availability of separate sites within port precincts for the physical examination of goods within containers (assuming larger facilities are required above and beyond current CEF sites).
INTERMODALS AND OFF-AIRPORT SCANNING
As suggested by a NSW Ports representative during the initial meeting, FTA/APSA see significant merit in using rail scanning technology with the potential of 100% xray of containers going to/and from intermodal terminals (this also aligned with a similar proposal from Salta Properties at Dandenong South, Melbourne). Understandably, ABF/DAWE concerns are for the need to then establish multiple examination facilities and / or a reliance on mobile examination solutions. FTA/APSA see an opportunity to progress this initiative by limiting the scanning deployment to facilities with a prescribed minimum throughput.
FTA/APSA see this as requiring serious consideration now (not in 2 years' time as indicated during the meetings) as many of the facilities are now in a final design phase and could incorporate needs within these 'green-field' sites. Importantly, this could also be showcased as an early deliverable towards the government's broader agenda of border and biosecurity protection.
A similar model was suggested during the discussion on air cargo with the potential to 'carve out' air cargo consolidations moving to express courier facilities and to high volume freight forwarder depots. This would ease congestion at on-airport cargo terminal operations (CTOs) with scanning to be completed off-site under strict underbond conditions. The proposal has merit as a means of keeping these airport gateways free of congestion and to keep cargo moving. While new 'green-field' sites such as Western Sydney Airport offer new modelling opportunities, legacy facilities were not intended and built (fit for purpose) for deconsolidation and to do so will likely introduce OHS issues amongst others.
Like the suggestion to scan at intermodals for sea cargo, this proposal for air cargo appears to be the only viable solution to meet the government's mandate for increased intervention. FTA/APSA look forward to further engagement with ABF/DAWE on this concept to deliver pragmatic solutions.
COSTS
FTA/APSA noted at the meeting on 15 October that any associated costs for these processes must be borne by the Federal Government and remove the onus on stevedores (and potentially intermodal terminals / depots) from using their own mechanisms to cost recover from industry. Stevedores currently charge exorbitant Terminal Access Charges with industry having no means influence service or price – refer HERE
Should the Federal Government opt to recover costs from industry, this would no doubt require further industry consultation. Should the cost recovery be completed via the Import Processing Charge (IPC), FTA/APSA see merit in the introduction of a differential (lower) payment from Australian Trusted Traders that presumably require a lesser level of intervention.
REGULATION
FTA/APSA note the current CEF arrangements whereby stevedores are compensated by the ABF and allow at least one day's free storage from the time the container is cleared and returned to the stevedore. FTA/APSA is of the view that a similar arrangement (preferably offering 3 days free storage as per normal commercial practices) be maintained and extended to any licensed premise handling underbond goods (sea and air cargo).
Shipping lines also charge container detention penalties for delays in the dehire (return) of empty containers to nominated locations. This is generally 7 to 10 days from the time of container discharge / advertised availability. FTA/APSA see a need to provide importers with protections, via regulation, to ensure the 'detention clock' commences from the time cargo is cleared from border / biosecurity intervention.
NEXT STEPS
FTA/APSA will continue engagement with the ABF, DAWE and industry colleagues on this important reform and will keep members up to date with developments.
NOTE - an update will be provided at the CPD Border Compliance Program in Melbourne on Thursday 11 and Saturday 13 November (further details at UPCOMING EVENTS)
At an appropriate stage of the industry engagement process, FTA /APSA intend to provide a formal submission incorporating member feedback.
To support this process we encourage member to provide feedback to pzalai@FTAlliance.com.au.Paul Zalai - Director FTA | Secretariat APSA | Director GSF |