New AQIS documentary requirements for the clearance of imported sea freight cargo
Australian Quarantine and Inspection Service (AQIS) have announced new documentary requirements for the clearance of imported sea freight cargo. Please find following overview of the significant changes:
The proposed implementation date for the new polices is 1st August 2009, which means for consignments arriving in Australia on or after 1st August 2009. To allow sufficient time for the reissue of Annual Packing Declarations, there will be a phase in period where the revised requirements will not be enforced for Annual Packing Declarations until 1st January 2010. There is no phasing period for Single Import Packing Declarations.
Changes to treatment certificates:
For Methyl Bromide only: will have to be included as a statement on the treatment certificate.
Plastic Wrap Declaration: this consignment has been fumigated prior to application of plastic wrapping or plastic wrapping in the consignment conforms to AQIS wrapping and perforation standard as found in the AQIS Methyl Bromide Fumigation Standard.
The Container Cleanliness Declaration has changed to the 'Container Cleanliness Statement' and is mandatory for all containerised consignments except LCL, ISO tanks, and hard frozen containers. This can now be on a separate statement (on company letterhead) to the packing declaration. However, AQIS recommends to include the packing & cleanliness declaration in the same document.
The "Prohibited Packaging Material Statement" is now on the packing declaration (Q1) to include other materials that cannot be used as packaging materials in consignments. Prohibited packaging materials include straw, bamboo, peat, hay, chaff, etc.
The Newly Manufactured Plywood/Veneer Products Declaration is no longer acceptable for packaging and dunnage. Packaging and dunnage made from plywood/veneer must be declared as timber packaging and is subject to mandatory treatment ISPM 15 is not acceptable for plywood and veneer products.
Annual Packing Declarations and consignment specific Packing Declarations must be issued by the packer or supplier of the goods.
New R&D Tax Credit - What this means for those claiming the R&D Tax Concession
In the federal government's budget released 12th May 2009, it was announced that the R&D Tax Credit is to come into effect in the 2010-11 income year.
The R&D Tax Credit is a broad-based, market-driven package to replace the R&D Tax Concession with a tax credit system. It is essentially a simplification of the current R&D Tax Concession so as to provide better incentives for businesses to invest in research and innovation.
The key advantages of the new R&D Tax Credit program are as follows:
a 45 per cent refundable tax credit (the equivalent to a 150 per cent concession) will be provided to small firms with a turnover of less than $20 million per annum. This means that firms will receive a tax refund of 45 per cent of their R&D spending when they file their tax return;
a 40 per cent tax credit (the equivalent of a 133 per cent deduction) will be provided to foreign-owned firms, and firms with a turnover of more than $20 million per annum;
the new refundable tax credit will not be subject to an expenditure cap;
the complex Premium Concession and International Premium will be abolished;
the increased benefits to companies are balanced by removal of the complex R&D Tax Concession Premium and tightening definitions to support genuine R&D.
Since the program does not start until 1 July 2010, as an interim measure, the Government will lift the expenditure cap on eligible R&D that can be claimed under the existing R&D Tax Offset from $1M to $2M with effect from 1 July 2009.
A consultation paper on the eligibility criteria in developing legislation for the new Tax Credit will be released in the next few months.
Please contact Adam Rogers or Damian Smyth at OBM's Brisbane office if you require more R and D information.
Customs to reduce cargo inspections under refined risk based approach
The government announced in the recent Budget that from 1 July2009, Customs and Border Protection will be reducing the volume of import cargo that they inspect at their Sea Freight Container Examination Facilities and in the air cargo environment. Customs calls their "refined approach" to their inspection methods a shift away from the random approach that has upset the importing community, which consistently struggles to retrieve import containers from the wharf without incurring storage fees.
From 1 July, Customs intends to re-focus their efforts on cargo that they deem to be high risk; usually because they have identified that the sender or receiver has a track record of not meeting requirements or having some connection with known offenders. The change will see the number of air cargo inspections fall by 75% to approximately 1.5 million consignments. Similarly, sea cargo inspections will drop by about 25% to approximately 100,000 TEU's per year.
This new strategy to move towards an intelligence based approach rather than one focused on the number of inspections has been welcomed by our industry, which has long called for a system which uncovers more illegal activity, without slowing the flow of other cargo.
Export and Import FCL Freight Rate Increases
What was unexpected but inevitable has happened or is about to happen. Freight rates both in and out of Australia have been mooted to increase dramatically, in some cases up to 100%. This in a small way has been countered by a marginal decrease in bunker (oil) surcharges. From a ship-owner’s perspective, these freight rate increases have been forced upon them.
Shipping Lines have, over the last six months, been experiencing an ever decreasing downturn in loads and downwards pressure on rates due to competition. However, they have now decided either individually or collectively to take dramatic actions to address the situation. For example, some Lines have found it more viable to lay up their vessels and vessel share rather than use their own vessels, thus further reducing capacity.
The net result from a shipper’s perspective is less capacity, less competition and the resulting increase in freight rates.
Space is already harder to secure and this will continue until trade tonnages in both directions increase dramatically and this of course is linked to a dramatic increase in consumer demand. The ship owner’s argument is that this is not an increase, but a return to what they deem to be viable levels of return.
We will monitor the situation on a regular basis and keep you informed.
Please contact Doug Bishop (dougb@obmpl.com.au) or Stewart Schneider-Loos (stewarts@obmpl.com.au) from OBM if you require further information regarding freight rates.
Introduction to new OBM staff member in Melbourne
Shehan Paranavitane has joined the OBM team in the new role of National Freight Manager. Shehan has over 20 years experience in shipping and international freight, having previously worked for Hayleys (a Sri Lankan based, publicly listed Blue chip conglomerate) before moving to Australia. His last role was to develop Hayleys own International Freight and Logistics Brand (Civaro) and he was Director /CEO of this operation for over 6years.
We believe his considerable experience in many global markets will enhance the freight services that we provide to all our clients nationally. He will also, as part of his role, build on his background and strong relationships in the Indian sub continent (ISC),to grow our freight volumes with this region. The ISC consists of Sri Lanka/India/Bangladesh/Pakistan and Maldives. Whilst this part of the globe encounters many challenges, there are serious international trade opportunities in the region.
Please note that Shehan will be based in our Melbourne office and his direct contact details are:
