International trade and commercial transactions in Australia: overview

A Q&A guide to the regulation of international trade and commercial transactions in Australia.

The Q&A covers key matters relating to sale of goods contracts, including rules on formation, price and payment, delivery, passing of title and risk, variation and assignment, enforcement and remedies, exclusion of liability, choice of law and jurisdiction, and arbitration. It also provides an overview of the rules governing storage of goods, imports, trade remedies, exports and international trade restrictions.

To compare answers across multiple jurisdictions, visit the international trade and commercial transactions Country Q&A tool.

This Q&A is part of the International Trade and Commercial Transactions Global Guide. For a full list of jurisdictional Q&As visit www.practicallaw.com/internationaltrade-guide.

Daniel Moulis, Moulis Legal
Contents

Recent trends

1. What are the recent trends affecting the regulation of international trade in your jurisdiction? Is your jurisdiction a member of the World Trade Organization (WTO)?

Recent trends

International security concerns and digital trading have had a major impact on the regulation of trade between Australian nationals and the rest of the world in recent times. Sanctions, defence controls, biosecurity and the origin and destination of money have become increasingly important to the cross-border movement of goods and services, and to the way in which legal tender and financial instruments are used and traded. Disruption to the traditional and accepted ways of doing business arising from the digital systems that are now being made available across the internet, and the rapid change of those systems, have been both part of and separate from these concerns. The non-jurisdictional nature of many trading entities has confounded the traditional modes of imposing and collecting direct and corporate taxation. Of necessity, trading platforms are becoming mini-regulators themselves, in response to the focus of national governments on them and their operations as a conduit for maintaining proper trading and information transparency. Australia is a WTO member. At the same time it has been entering into free trade agreements and restrictive trade agreements and creating new rights and obligations in non-WTO areas.

Trade agreements

Like many countries, Australia has sought to enter into bilateral and regional trading agreements for the purposes of improving market access and competitiveness for its industries. Australia's major trading partners, in two-way trade terms, are China, then Japan, the US, South Korea, Singapore, New Zealand, the UK, Thailand, Malaysia and Germany. Australia has in place (either in force, or awaiting ratification) free trade or economic partnership agreements with all of these trade partners, apart from the EU countries. On 4 February 2016, Australia signed the Trans-Pacific Partnership Agreement (TTP), and discussions on ratification are expected in the coming months. The agreement proposes the elimination of 98% of tariffs among 12 countries which include many of Australia's existing major trade partners. Therefore, the value of trade under the TPP would dwarf the value of trade under any one of the other agreements.

Reform

The Federal Attorney-General's Department constantly evaluates international developments in commercial and contractual law and the enforcement of remedies for the purposes of determining whether and how Australian law may need to adapt or take up such developments. However, Australia has a mature and well-settled system of commercial laws and at present there are no wide-based proposals for reform under consideration at the federal level.

 

Contracts for the sale of goods

General

2. What is the legal system in your jurisdiction based on (for example, civil law (codified), common law or sharia law)?

The Australian legal system is based on the common law and on statute. Statutes are created by a bicameral legislature at the Federal level, and by bicameral and unicameral legislatures at the state and territory level. Courts interpret and apply those statutes and the common law to the extent that it has not been supplanted by those statutes.

There is no common law duty to negotiate contracts in good faith. However, where there is such an express obligation under a contract, the courts give effect to it. There is a common law duty to co-operate under a contract, and this is sometimes relevant to good faith dealing under the contract itself. Duties of fairness and the regulation of unconscionable conduct are part of statute law in all Australian jurisdictions but apply where there is an imbalance in the position of the parties under a contract, and not as a general rule to all contractual relationships.

 

Formation

3. What domestic legislation and international rules apply to a sale of goods contract in your jurisdiction? Are standard international contractual terms commonly used?

Domestic legislation

Each state and territory has a Sale of Goods Act, and these are uniform throughout the country. The Competition and Consumer Act 2010 (CCA) and the Australian Consumer Law (ACL) scheduled to the CCA are Commonwealth legislation. The CCA and ACL are enforceable by all Australian courts through state and territory legislation adopting the CCA and ACL within their jurisdiction. The ACL applies to the sale of goods and services to a value up to AU$40,000. There is no value ceiling for the state or territory Sale of Goods Acts. None of these legislative provisions apply to sales by auction.

International rules

Australia is a party to the:

  • Vienna Convention on Contracts for the International Sale of Goods (Vienna Convention).

  • United Nations Convention on Contracts for the International Sale of Goods (CISG).

  • Convention for the Unification of Certain Rules for International Carriage by Air (Montreal Convention).

Standard contractual terms

The terms and conditions available to be used by contracting parties, and that are frequently used in international contracts to which Australian entities are parties, include the:

  • International Chamber of Commerce (ICC) international commercial terms (Incoterms) 2010.

  • UNIDROIT Principles of International Commercial Contracts (PICC).

  • Uniform Customs and Practice for Documentary Credits (UCP).

  • Uniform Rules for Demand Guarantees (URDG).

The terms adopted depend on the subject matter of the contract and the sophistication of the parties involved. However, standard terms adopted by one of the parties are most frequently the agreed or common negotiation basis for cross-border transactions involving Australian parties.

 
4. What are the authority/capacity rules for entering contracts, for different commercial entities?

Capacity to enter into contracts is governed by common law, with some specific legislative provisions for legal persons. Both domestic and foreign companies registered under the Corporations Act 2001 have full capacity to contract with the legal capacity and powers of an individual both inside and outside Australia.

A partnership registered as an incorporated limited partnership under a state or territory Partnership Act has a separate legal identity with the legal capacity of an individual and a corporation. This includes the power to enter into contracts. A partner or partners acting for such partnerships can bind the entire partnership and the individual partners of the firm, provided they have the authority to do so in that matter.

Partnerships that are not incorporated limited partnerships do not have separate legal identity. Partners possessing authority to act for such partnerships can bind the other partners, as long as they act within the limits of their authority.

Public bodies can only enter into contracts of the kind authorised by the statute under which the public body is established.

Unless a person contracting with a company's agent is aware that the agent does not possess authority to enter into that contract on the company's behalf, the person will generally be able to enforce the contract against the company.

Liquidators have extensive powers to enter into new contracts or honour existing contracts in order to wind up a company.

 
5. What are the essential requirements to create a legally enforceable contract?

Substantive requirements

The creation of an enforceable contract under Australian law requires:

  • Offer.

  • Acceptance.

  • Consideration.

  • An intention to create legal relations.

  • Certainty.

Formal requirements

Except for transfers of real property and other specific cases regulated by statute, contracts do not need to be in writing to be legally enforceable. In practice, commercial due diligence normally dictates that contracts be written and executed with a company seal or with the signatures of a company director, or company directors, or another company official with actual or ostensible authority to sign on the company's behalf.

 

Price and payment

6. If price provisions are not agreed by the parties, does local law impose requirements in relation to price (for example, the time, method and place of payment)?

Under the common law, if a price is not set by the contract, then the buyer must pay a "reasonable price". What is a reasonable price is a question of fact determined on a case-by-case basis.

Unless otherwise agreed, delivery of the goods and payment of the price are concurrent conditions, meaning that the exchange of the goods for the price must take place at the one place and time.

 

Delivery

7. If delivery provisions are not agreed by the parties, does local law impose requirements in relation to delivery (for example, the time, method and place of delivery)?

Unless agreed in the contract, the place of delivery is the seller's place of business. If the goods are known to be in a particular location at the time the contract is formed, that location is the place of delivery.

If the seller is ready to perform the contract and the buyer fails, through negligence or otherwise, to accept the goods, the buyer is liable for the seller's losses arising from the buyer's failure to accept the goods.

 

Passing of title and risk

8. If not agreed by the parties, when does title to the goods pass to the buyer?

Title passes when intended to pass under the contract. In the absence of express agreement as to when title should pass, the parties' intention is inferred from the terms of the contract, the conduct of the parties, and the circumstances of the case.

 
9. Are retention of title clauses enforceable in your jurisdiction? If so, what are the requirements to create a legally enforceable retention of title clause?

Because title passes according to the terms of the contract, retention of title clauses are enforceable in Australia provided they are appropriately drafted. There is no legal requirement that, for example, the clause be in writing, or that the clause prevent the mixing of the seller's goods with other goods of the buyer. However, from a practical point of view, a written clause which contemplates and controls these and other matters is more easily and effectively enforced than a clause which is silent on such issues.

 
10. If not agreed by the parties, when does risk in relation to the goods pass to the buyer?

The default position is that risk passes with title to the goods, regardless of whether delivery has occurred. However, if delivery is delayed through fault of one of the parties, the goods are at the risk of the party who caused the delay. The legislation underpinning these rules does not affect the liabilities of either the seller or buyer as bailee of the goods, or the ability of parties to agree to different terms regarding the passing of risk.

 

Variation and assignment

11. What are the main ways and formalities to transfer contractual rights?

At common law, there is a general right to assign contractual rights to other persons without the consent of the other party to the contract. There is no right at common law to assign contractual liabilities to another person without the consent of the other party to the contract.

As such, whether and the manner in which contractual rights can be assigned is usually restricted by contract terms. For example, terms specifying that "the assignment of rights or obligations under this contract is prohibited unless written consent is given by all parties to this contract" are common in most contracts for the sale of goods. In addition, novation clauses are sometimes negotiated whereby one of the parties can be replaced by a third party under the contract in all respects, if that is agreed to by the parties either in the novation clause or at the time of the novation.

 
12. What are the main rules relating to waiver of contractual rights?

Generally, parties can waive contractual rights. A waiver can constitute an election or an estoppel.

In an election, where the exercise of two contractual rights becomes inconsistent, a party can elect not to exercise one of the rights and continue to exercise the other.

In an estoppel, the waiver can prevent the later enforcement of that contractual right. For example, if the seller indicates that delivery will take place at a time later than agreed, and the buyer accepts this, the buyer cannot then refuse the goods because they were delivered after the original date.

 

Enforcement and remedies

13. What are the seller's obligations in relation to the description and quality of the goods?

Under state or territory Sale of Goods Acts and similar provisions in the Australian Consumer Law, if a buyer indicates that it needs goods which are suitable for a particular end use, there is an obligation on the part of the seller to supply goods reasonably fit for that purpose. When goods are sold by description, there is an implied term that the goods are of merchantable quality, unless the buyer has inspected the goods before purchase.

 
14. What are the different types and legal status of contractual terms in your jurisdiction?

In general, contract terms are divided into:

  • Conditions. A condition is a contract term so important that its breach gives rise to a right to terminate the contract, in addition to a right to damages.

  • Warranties. A warranty is less important than a condition. Breach of warranty gives rise to a right to damages, but not to terminate the contract.

  • Intermediate terms. A breach of an intermediate term, also known as an innominate term, gives rise to a right to damages. It can also give rise to a right to terminate the contract, but only if the breach and its consequences are serious enough to justify termination.

 
15. What are the key rules on privity of contract and third party rights?

The general privity of contract rule in Australia is that only parties to a contract can be bound by and enforce the contract. Contracts generally do not confer third party rights. There are situations where a contract may have implications for a third party, such as where a trustee enters into a contract which has implications for the trust's beneficiary, or where an agent is given authority to enter into contracts which bind the agent's principal. However, these are not true exceptions to the privity rule. The only real exception to the privity rule is based in statute and relates to land. Under certain state and territory property and conveyancing statutes, where an instrument provides a grant or creates a covenant with a third party, this can provide the right of third parties to sue on that instrument as though that party had been named in the instrument.

 
16. What are the rules relating to invalidity, misrepresentation and mistake relating to contracts?

An invalid contract, also referred to as an illegal contract, is invalid on the basis that it is prohibited by statute and/or is contrary to public policy. The statutory prohibition must be explicit or implied. A mere failure to comply with a statutory provision does not necessarily mean the contract is illegal. A contract against public policy (such as the upholding of community standards) can be illegal if it involves the commission of an offence. All illegal contracts are void and unenforceable.

There is a statutory right to damages for misrepresentations and misleading conduct. There is also a common law right for a party to rescind a contract if it was induced to enter into the contract by misleading statements made by the other party.

A mistake can render a contract void at the time of formation if it is a fundamental mistake, or can have no effect if it is minor. For example, a contract for salvage of a ship is void at the time of formation if there is in fact no ship. A mistake made because of a misrepresentation can give rise to a right to rescind the contract and sue for damages.

 
17. What are the main performance and discharge rules relating to contracts?

In general, the kind of contractual breach that entitles a party to terminate the contract is where the other party's conduct displays an intention not to be bound by the contract.

A party must do everything necessary on its part to enable the other party to receive the benefit of the contract. If a party's co-operation is required for the other party's fulfilment of its obligations, a lack of co-operation would excuse non-performance by the other party, and may even entitle the other party to sue for the price of performance as agreed in the contract.

Parties to a contract can, by mutual agreement, elect to discharge the contract at any time.

Excusing performance by reason of force majeure is not a common law principle and instead relies on any relevant contract clause, which will be given effect according to its terms.

Frustration arises where a supervening event makes performance of the contract something fundamentally different from that anticipated by the parties. In such a case, the losses incurred lie where they fall.

 
18. What are the main remedies and rules for losses and damages for breach of a sale of goods contract?

In general, an aggrieved party can sue for damages to cover losses caused by the party in breach of the contract. There is no general positive duty to mitigate losses, although contracts can impose such a duty. Unreasonable behaviour by the innocent party can negatively affect the assessment of damages.

Specific performance can be awarded where damages are an inadequate remedy, provided the plaintiff is still ready and willing to perform the contract, and the defendant is also able to perform the contract.

Courts do not usually correct mistakes, but will imply terms into a contract if they are necessary to give the contract business efficacy.

Injunctions can be granted to prevent repeated breaches, threatened breaches, or breaches which would endanger a proprietary interest which may be difficult to recover if breach occurs.

 
19. What are the buyer's remedies for breach of a sale of goods contract?

Buyers can sue under their state or territory Sale of Goods Act for damages for non-delivery, which may extend to the price of the goods as well as further losses incurred due to non-delivery. Breach of a warranty regarding quality or description can also give rise to a right to damages, or a right to have the price reduced.

Similar provisions relate to consumer transactions under the Australian Consumer Law in respect of transactions worth AU$40,000 or less.

 
20. What are the seller's remedies for non-payment or late payment?

Sellers can sue under their state or territory Sale of Goods Act for the price of the goods. If further losses have been incurred by the seller because of the buyer's failure to accept and pay for the goods, those losses can also be claimed as damages.

 

Exclusion of liability

21. What are the main rules relating to excluding contractual liability? Are exclusion clauses enforceable in your jurisdiction? If so, what are the requirements to create a legally enforceable exclusion clause?

Exclusion clauses are enforceable in Australia, although terms which are harsh, unjust, or unreasonably burdensome can be struck down by a court. Terms which purport to exclude liability for breach of compulsorily applicable laws, such as some provisions of the Australian Consumer Law, are also not enforceable.

Clauses excluding liability for negligence can be effective, but must specifically reference the word "negligent" or "negligence" and so on, as exclusion clauses are strictly construed. Unequivocal language is therefore critical.

 

Choice of law

22. Will local courts recognise a choice of foreign law in a sale of goods contract? Are there any mandatory local rules that apply, despite a choice of foreign law?

Local courts recognise choice of foreign law clauses. The meaning of any such clause is interpreted according to Australian law, not the law chosen under the clause. Consumer guarantees in the Australian Consumer Law continue to apply even if there is an effective choice of foreign law clause. If an applicable statute provides for it, Australian courts can render choice of law clauses void if they are unfair or oppressive to one of the parties.

 
23. If the parties do not make a choice of law, what rules determine the law applicable to a sale of goods contract?

In cases where no choice of law has been made, the choice of law is inferred from the circumstances, taking into consideration factors such as:

  • Where the contract was concluded.

  • Where the principal places of business of the parties are located.

  • Where the subject matter of the contract is or will be located.

  • Whether the contract includes any terms referable only to a particular legal system.

 

Choice of jurisdiction

24. Will local courts recognise a choice of foreign jurisdiction in a sale of goods contract? Are there any mandatory local rules that apply, despite a choice of foreign jurisdiction?

As with choice of law clauses, choice of jurisdiction clauses are recognised and can be effective. They are interpreted according to Australian law. If an applicable statute provides for it, Australian courts can render choice of jurisdiction clauses void if they are unfair or oppressive to one of the parties.

 
25. If the parties do not make a choice of jurisdiction, what rules determine the jurisdiction applicable to a sale of goods contract?

Australian courts normally assume jurisdiction in cases where the parties have not made a choice of jurisdiction in which to hear the dispute, except where one of the parties establishes that the hearing of the matter in Australia is clearly inappropriate. This is judged on factors apparent from the contract itself, the parties, and the performance of the contract.

 

Arbitration

26. Are arbitration clauses commonly included in sales of goods contracts in your jurisdiction?

Arbitration clauses are often included in sales of goods contracts in Australia. It is good practice for these clauses to designate the:

  • Scope of disputes covered by the arbitration clause.

  • Rules to be applied (for example, the Australian Centre for International Commercial Arbitration (ACICA) Arbitration Rules or the UNCITRAL Arbitration Rules).

  • Seat of the arbitration.

  • Language of the arbitration.

  • Number of arbitrators.

Australia is a party to the Convention on the Recognition and Enforcement of Foreign Arbitral Awards 1958 (New York Convention). It is implemented as Australian law by the Foreign Judgments Act 1991 and its accompanying Regulations. If a state is listed in the Regulations as a state whose courts are recognised under the Foreign Judgments Act, then judgments from those courts can be enforced in Australian courts.

 

Storage of goods

27. How is title to goods in storage protected and evidenced? Are warehouse receipts recognised as documents of title in your jurisdiction?

Documents of title suffice to protect and evidence title to goods. Under the Personal Property Securities Act 2009, a document of title is a written document issued by or addressed to a bailee which identifies the goods covered by the title and the person to whom the goods will be delivered. Warehouse receipts generally fit this definition and are therefore recognised in Australia under the Personal Property Securities Act.

 
28. What conditions and formalities must warehouse receipts comply with?

A warehouse receipt must:

  • Be issued by or addressed to the bailee of the goods.

  • Be in writing.

  • Identify the goods to which the receipt pertains.

  • Identify the person to whom they are to be delivered, which can be the bearer.

A receipt which does not contain this information will not be classed as a document of title under the Personal Property Securities Act, and therefore does not provide the statutory guarantee to title that a compliant document would provide.

Registration in the Personal Property Securities Register (PPSR) puts all third parties on notice of the document holder's title to the goods and is evidence of title if a dispute arises. In addition to obtaining documentation such as warehouse receipts for shipping, businesses that sell goods on credit typically register their interest in the goods with the PPSR, preventing subsequent purchasers from registering their own title with the PPSR before the business has received payment for the goods.

 
29. Are other interests over goods in storage recognised?

The Personal Property Securities Act 2009 (PPSA) recognises a number of interests as interests in property, including pledges and charges. The PPSA provides rules for perfection specific to different types of interest, and also general rules applicable to all interests. As a general example, a security interest is perfected under the PPSA if it:

  • Attaches to property.

  • Is enforceable against a third party.

  • Has been registered in the Personal Property Securities Register.

 

Imports

Customs authority

30. What is the authority responsible for enforcing customs laws and regulations? Are certain goods subject to specific examination procedures?

The authority responsible for enforcing customs law and regulations in Australia is the Department of Immigration and Border Protection (DIBP), which carries out enforcement through the Australian Border Force (ABF). The ABF facilitates the lawful passage of people and goods.

The legislative basis for the DIBP's powers of investigation and enforcement is the Customs Act 1901 (Cth). The DIBP's broad powers of investigation include the ability to require an importer to provide additional information in support of an import declaration and the ability to detain imported goods.

The DIBP's enforcement powers include the ability to issue infringement notices where the DIBP has reasonable grounds to believe a person has contravened the law. The recipient can resolve the matter by paying the penalty specified in the infringement notice or have the matter determined by the relevant court.

The Australian government does not impose requirements on importers to hold an import licence. However, depending on the nature of the goods, the government may prohibit or restrict their import. Importers must have a permit issued by the relevant agency to import restricted goods.

 

Import duties, tariffs and rates

31. What are the main customs import tariffs and duties?

General tariffs and rates

Importers must self-assess the tariff classification for the importation of goods. Tariff classifications are made under the Customs Tariff Act 1995 and vary based on the type of goods concerned. Specific tariff rates are set out in Schedule 3 of the Customs Tariff Act.

Preferential tariffs

Designated countries are afforded preferential tariffs. The countries are divided into categories to reflect the reasons for the preferential tariffs. These categories include forum island countries, least developed countries and developing countries. The designated countries and the rates applicable are set out in Schedule 1 of the Customs Tariff Act.

In addition, preferential tariffs are afforded to countries that are parties to free trade agreements with Australia. The tariff amount varies depending on the nature of the good and the particulars of the free trade agreement.

 

Non-tariff barriers to imports

32. Are there non-tariff barriers to imports into your jurisdiction?

Prohibitions and restrictions are placed on the importation of certain goods. Importers are not allowed to import prohibited goods under any circumstances. Restricted goods require the importer to have a permit from the relevant permit issuing agency.

Certain categories of goods require a correctly labelled trade description under the Commerce (Trade Descriptions) Act 1905 to allow importation into Australia. The labels must be in English, in prominent and legible characters, and on a principal label or brand affixed in a prominent position in as permanent a manner as practicable.

Australia has no inbound licensing or quota regimes. Non-tariff barriers such as "buy-local" rules may apply to public procurement at federal and state level.

 
33. Can customs decisions and import restrictions be challenged?

The mechanisms for review of customs decisions include merits review by the relevant agency itself, merits review by the Administrative Appeals Tribunal, and judicial review by the Federal Court.

The Administrative Appeals Tribunal conducts independent merits review of administrative decisions made under Commonwealth laws. Specific decisions, including classification decisions made by customs authorities, can be challenged before the tribunal.

 

Trade remedies

Regulatory framework

34. What are the main regulations and authorities responsible for investigating and deciding on trade remedies?

Regulatory framework

Australia is an anti-dumping user country. It has fully formed anti-dumping and countervailing laws that are frequently called on by domestic industry for relief from import competition. These laws are contained in the Customs Act. Additionally, safeguard measures inquiries can be conducted by the Federal Productivity Commission on reference from the relevant minister.

Regulatory authority

The anti-dumping and countervailing regulatory authority is the Anti-Dumping Commission. Through its Commissioner, it has investigatory powers and the power to impose provisional measures and make recommendations to the minister about final measures.

The safeguard measures regulatory authority, the Productivity Commission, conducts its inquiries by way of submissions, public hearings and its own research.

 

Investigations and enforcement

35. What are the requirements and procedure to start trade remedies investigations?

A domestic industry producing the same or similar goods to those that are being imported can lodge an application, in the approved form, to request the Anti-Dumping Commission to initiate an inquiry into whether the goods are dumped (or subsidised) and whether material injury has been caused to the domestic industry. Non-confidential versions of applications, submissions and other documents and information provided to the Commission must be placed in the public record of the investigation. Interested parties can make their views known by way of comments placed on the public record.

 

Appeals

36. Is there a right of appeal against the authority's decision? What is the applicable procedure?

There are rights of appeal to the Anti-Dumping Review Panel from decisions by the Commissioner not to initiate an investigation, or to terminate an investigation, and from ministerial decisions to impose duties, and from certain other decisions. Typically, the aggrieved interested party has 30 days to appeal the decision concerned.

Rights of appeal through judicial administrative review to the Federal Court of Australia also exist.

 

Exports

Regulatory framework

37. What are the main requirements to export goods from your jurisdiction?

The export of goods from Australia requires the clearance of the Australian Border Force (ABF) under the authority of the Department of Immigration and Border Protection (DIBP). The legislative basis for the DIBP's control over the export of goods is the Customs Act. Additional requirements are imposed on categories of export goods through targeted legislation, such as the:

  • Defence Trade Controls Act 2012 (Cth), which imposes control over defence and strategic goods technologies.

  • Export Control Act 1982 (Cth), which imposes control over primary industry goods.

The additional requirements are regulated by the relevant authorised agencies, such as the Defence Export Control Office under the authority of the Department of Defence.

An export declaration must be provided to the ABF providing information on the goods and the export particulars. The export declaration is required for all goods, unless an exemption applies.

Certain goods can be either prohibited or restricted from export by the Australian government. Where goods are prohibited, they cannot be exported from Australia. Where goods are restricted, an expert permit from the relevant issuing agency is required.

Broad information guides on export requirements are available from the Austrade website (www.austrade.gov.au/Australian/export). Specific information on the requirements for exporting is available from the DIBP (www.border.gov.au/Busi/Expo) and relevant agency websites.

 
38. Are certain categories of goods subject to specific export quotas, restraints or other controls?

Certain categories of goods are subject to overt control by the Australian government. These goods can be either prohibited or restricted from export. (A list of prohibited or restricted goods can be found at www.border.gov.au/Busi/Expo/Proh) A person will not be allowed to export goods that are prohibited and can only export goods that are restricted with a permit obtained from the relevant permit issuing agency.

The process for obtaining an export permit varies depending on the issuing agency and the category of goods involved. For detailed information, please refer to the issuing agency.

 

Penalties

39. What are the consequences of non-compliance with export regulations?

Exporters must provide the Australian Border Force (ABF) with an export declaration providing information concerning the goods and the export transaction. The ABF returns to the exporter an export declaration number that shows the status of the goods and whether export is permitted. Non-compliance with this requirement results in an absence of legal authority to export the goods.

The consequences of non-compliance with export regulations include a range of civil and criminal penalties under the Customs Act. The applicable penalty varies depending on the nature and the scale of the breach, and can include fines or imprisonment. In addition, the goods can be seized and forfeited to the Australian Government.

Additional penalties can be applicable for non-compliance under alternative legislation such as the Criminal Code Act 1995 (Cth) or targeted legislation for certain categories of goods. This includes non-compliance with permit requirements from the issuing agency, which may result in stronger compliance conditions, revocation of permits or criminal prosecution.

 

International trade restrictions

Trade sanctions

40. Are there specific restrictions on trade with certain jurisdictions?

Australia can impose restrictions on activities that relate to particular countries, persons, entities or goods and services. Trade sanctions currently imposed on specific jurisdictions incorporate the United Nations Security Council sanctions regime and Australia's autonomous sanctions regime.

The complete list of trade sanctions imposed by the Australian Government can be found on the Department of Foreign Affairs and Trade website (http://dfat.gov.au/international-relations/security/sanctions/pages/sanctions.aspx).

 
41. What is the authority responsible for imposing trade restrictions?

Australia must adhere to the United Nations Security Council sanctions regime as a matter of international law. This is implemented in Australia through the Charter of the United Nations Act 1945 (Cth) (United Nations Act).

The Department of Foreign Affairs and Trade is responsible for administering the United Nations Act and Australia's autonomous sanctions regime.

 
42. What are the consequences of non-compliance with trade restrictions?

Under Australian law, serious criminal offences are established for contravention of sanctions measures or conditions of a sanctions permit. Individuals potentially face up to ten years in prison and/or a significant fine. Corporate bodies face a fine of the greater of either AU$1.8 million or three times the value of the transaction for non-compliance.

 
43. Are businesses subject to specific compliance requirements? What practical steps should a business take to ensure compliance with trade restrictions?

A sanctions permit is required to engage in trade with a jurisdiction subject to a trade sanction. For a party to make a formal application for a sanctions permit or to contact the Department of Foreign Affairs and Trade for information on sanctions permits, it must be a user of the Online Sanctions Administration System (OSAS).

 

Foreign trade barriers

44. What is the procedure for local exporters to complain against foreign trade barriers contrary to the WTO or other trade agreements?

Local exporters that wish to make a complaint against foreign trade barriers that are contrary to the WTO should advise the Department of Foreign Affairs and Trade (DFAT). DFAT examines the claim and determines whether there is a cause for an action under the WTO dispute settlement system. Exporters are encouraged to engage in bilateral discussions with the foreign government before action is taken under the WTO dispute procedures. The final decision on initiating settlement action is taken by the Minister for Trade.

 

The regulatory authorities

Australian Competition & Consumer Commission (ACCC)

W www.accc.gov.au

Principal responsibilities. The ACCC is responsible for ensuring that individuals and businesses comply with Australian competition, fair trading, and consumer protection laws.

Australian Trade Commission (Austrade)

W www.austrade.gov.au

Principal responsibilities. Austrade is responsible for the promotion, attraction and facilitation of productive foreign direct investment into Australia.

Anti-Dumping Commission

W www.adcommission.gov.au

Principal responsibilities. The Anti-Dumping Commission administers Australia's anti-dumping and countervailing (anti-subsidy) system.

Anti-Dumping Review Panel (ADRP)

W www.adreviewpanel.gov.au

Principal responsibilities. The ADRP conducts independent reviews, on application, of certain decisions made in relation to anti-dumping and countervailing investigations.

Department of Foreign Affairs and Trade (DFAT)

W http://dfat.gov.au

Principal responsibilities. The DFAT provides foreign, trade and development policy advice to the government. 

Department of Immigration and Border Protection (DIBP)

W www.border.gov.au

Principal responsibilities. The DIBP is responsible for immigration and customs border policy.

Department of Industry, Innovation and Science

W www.industry.gov.au

Principal responsibilities. The Department has four key objectives:

  • Supporting science and commercialisation.

  • Growing business investment and improving business capability.

  • Streamlining regulation.

  • Building a high-performance organisation.



Online resources

Australasian Legal Information Institute (AustLii)

W www.austlii.edu.au

Description. Austlii is a joint facility of the UTS and UNSW Faculties of Law. It is a popular free-access resource for Australian legal information.

Commonwealth legislation

W www.comlaw.gov.au

Description. The official government website with a complete and up-to-date collection of Commonwealth legislation.

Australian Capital Territory legislation

W www.legislation.act.gov.au

Description. The official Australian Capital Territory legislation database.

New South Wales legislation

W www.legislation.nsw.gov.au

Description. The official New South Wales legislation database.

Northern Territory legislation

W http://dcm.nt.gov.au/strong_service_delivery/supporting_government

Description. The official Northern Territory legislation database.

Queensland legislation

W www.legislation.qld.gov.au

Description. The official Queensland legislation database.

South Australian legislation

W www.legislation.sa.gov.au

Description. The official South Australian legislation database.

Tasmanian legislation

W www.legislation.tas.gov.au

Description. The official Tasmanian legislation database.

Victorian legislation

W www.legislation.vic.gov.au

Description. The official Victorian legislation database.

Western Australia legislation

W www.slp.wa.gov.au/legislation/statutes.nsf/default.html

Description. The official Western Australian legislation database.



Contributor profile

Daniel Moulis, Principal Partner

Moulis Legal

T +61 2 6163 1000
F +61 2 6162 0606
E daniel.moulis@moulislegal.com
W www.moulislegal.com

Professional qualifications. Solicitor, Supreme Court of the Australian Capital Territory; Admitted to the Roll of Practitioners, High Court of Australia

Areas of practice. International trade; WTO law; cross-border investment; commercial and corporate law.

Non-professional qualifications. LLB, University of Sydney

Recent transactions

  • Advising RGE Group companies on alleged A4 copy paper dumping and subsidisation.
  • Advising Steelforce Group in Federal Court litigation concerning variable factors review (import pricing).
  • Advising APRIL Fine Paper in Federal Court litigation concerning trade mark ownership and infringement.
  • Advising ABB group companies on Australian sanctions compliance.
  • Advising Access USA on compliance with Australian customs requirements.
  • Advising Macquarie Telecom on the Trans-Pacific Partnership Agreement.
  • Advising POSCO in Australian Government cross-border regulatory investigations.
  • Advising Terressentia Corporation on compliance with Australian customs requirements.
  • Advising Tabcorp on property acquisition and divestment.
  • Advising TFE Hotels on serviced apartments investment and operation.
  • Advising various consortia in renewable energy investments.

Languages. English, Greek

Professional associations/memberships. Director, Football Federation Australia; Dispute Settlement Panelist, World Trade Organisation; Member, Australia China Business Council; Member, Australian Institute of Company Directors.


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