Legislation designed to promote the trade in legally logged timber and timber products is now law. If you are a business importing timber or timber products into Australia or processing domestically grown raw logs you need to be familiar with the regulations and be aware of your new responsibilities.
Seabridge is monitoring changes in regulation closely and is committed to keeping our clients informed of the latest developments. To learn more about import regulations, please contact us.
What You Need to Know
If you import any timber or timber products into Australia and/or process domestically grown raw logs, it is important that you realise -
It is a criminal offence to intentionally, knowingly or recklessly import or process illegally logged timber or timber products.
These timber products can range from paper towels, to timber flooring, to furniture.
Furthermore, if you import certain timber or timber products (as defined in the regulation) and/or process domestically grown raw logs, it is imperative that you know –
Businesses need to assess and manage the risk that the timber or timber products they are importing for processing has been illegally logged. Known as carrying out due diligence.
If you are unsure if these regulations apply to you or how else this may affect you and your business, we strongly recommend seeking professional advice. At Seabridge you have access to knowledgeable and experienced customs brokers who will be able to consult the most appropriate course of action to ensure you and your business are carrying out due diligence.
Effects on Small Businesses
On 25 February 2016, the Australian Government published the final report of the ‘Independent review of the impact of the illegal logging regulations on small businesses’ and its related response. The review was conducted by independent consultant, KPMG, and evaluated whether the current due diligence requirements strike a suitable balance between the cost of compliance for small businesses and lowering the risk of illegally logged timber entering the Australian market.
The main findings of the report are –
- Nearly 60% of businesses affected by the Regulation are likely to fall within the government’s definition of a small business, with these businesses accountable for importing around 20% of regulated timber products by value
- There is some initial evidence to suggest the Regulation may be helping to reduce the risk of illegally logged products entering Australia, but due to the early stage of the Regulation’s implementation much of the compliance work by Australian businesses is still ongoing
- While there is limited evidence to suggest that business size is a key determinant of risk, it is likely that Australian small businesses contribute at least their share of illegally logged product to the domestic market
- The current requirements of the Regulation are likely to encompass all sources of illegally logged timber entering Australia. However, they do not account for the varying capacity of individual businesses, particularly small businesses, to absorb the associated compliance burden
- There is an opportunity to amend the Regulation to strike a better balance between the cost of compliance to small business and the risk of illegal timber entering the Australian market
- The Australian Government should progress a package of regulatory and non-regulatory reforms to minimise the cost of compliance to small businesses.
The government response notes in-principle support for the review’s five recommendations and commits the Government to developing a package of regulatory and non-regulatory reforms. This will include the consideration of regulatory reforms through a Regulation Impact Statement (RIS) process. The RIS will be progressed by the Government in the first half of 2016 and will include a process of public consultation.
Recognising that it will take some time to develop these initiatives, the Government has also agreed to extend its initial ‘soft-start’ compliance period until any associated amendments have begun. During this soft-start period the Government will not penalise a business if their due diligence practices are found to be non-compliant with the Regulation.
Seabridge recommends taking advantage of the soft-start extension by implementing due diligence practices early and trialing the effect on your business. We are able to advise in current due diligence best practice and consult on the most appropriate course of action to implement this for individual needs.
A full review of the Act and regulation is legislated to take place in 2017. The department information gathered in the first few years of operation of the laws, as well as industry feedback as part of the review.
Seabridge Global Logistics has substantial experience in complying with Australia’s various import laws and regulations. We have the expertise to guide you through these changes and will ensure you are complying with current regulation. If you would like further information on how Seabridge can assist your business, or if you would like to engage with an expert customs broker contact us today.