This is an article I had published in Lloyds List in August 2016.

This matter has been in discussion since at least February 2015 but is still unresolved. The submission I wrote for CBFCA at that time was acknowledged by the regulator as correct. We keep, however, reading Notices which both fail to properly identify what can be the scope of any refund query and, importantly, to clearly separate a refund query from powers available only to authorised officers under a monitoring audit.

Let’s just review this Notice.

 The Department must satisfy itself that a refund application meets all of the relevant requirements before a refund is approved. This may include requesting additional information from the owner as part of an assessment of the refund application.

Good practice would indicate that this paragraph should be phased in accordance with the legislation. I believe the requirement under the Finance Regulations is that the officer is satisfied that the refund is properly payable, not that the “relevant requirements” are met. What are “the relevant requirements” other than those specified by the legislation? This phrase is too general and too open to interpretation.


Importantly, and the core issue, is that the Notice continues: “At the same time, the Department may also request information about lines on an import declaration that are not part of that refund application.”

It is not in question that claims for refund must be justified. If lines have been adjusted as part of the refund then questions can be asked about the goods for which a refund claim has been made but not, it is suggested, about the original classification of the goods on those lines or the original classification of goods for which the original classification was not amended. Questions cannot be asked about goods not subject to refund if they are not impacted by that refund without the exercise of monitoring powers.


In circumstances where the person who lodges the refund application does not possess documents relating to the original import declaration, the person lodging the refund application should facilitate communication with the owner regarding any request for this information

Brokers work to strict time constraints and our time is precious, as is that of our clients. Certainly time is too precious to chase information from clients that is not required to process the refund.

 If DIBP wish to obtain information unrelated to the goods for which the refund is sought then the proper process is the exercise of monitoring powers and contact with the lodging customs broker or the importer in accordance with the legislation.

In a refund application that goes redline the documents and IDM are emailed to Refunds section by the broker and are effectively a desk audit. A monitoring audit takes place in the importers premise and only after the written consent of the occupier is received. This is a much more formal and controlled process than is currently available to a refund officer. It is also a process that takes place after the ATD is issued, or, in the case of a Refund, after that refund is approved.   Each of the officers must show their identity cards as authorised monitoring officers and be trained as such. Rumour has it that only about 42 ABF officers are so trained.

Before undertaking any monitoring audit DIBP must make written contact with the company to be audited and an entrance interview between the DIBP audit team and key management personnel must be held to discuss the purpose, scope and timing of the audit. In essence they must:

  • Must identify themselves as authorised monitoring officers (S214AC/ S214AE (6))

  • May provide a notice under S214AD.                                                                    

  • Must obtain consent in writing (S214AE (2))                                                         

  • And advise it can be refused. (S214AE (3))                                                                        

  • Must produce a statement of Rights and Obligations (section 214ACA)       


    This process is far removed from a refund query.


The Notice then says that “If information or documents unrelated to the refund application are requested, and not provided, consideration may be given to:

  • issuing a notice to produce commercial documents under section 240AA of the Customs Act 1901 (the Act); and/or

  • issuing a notice to verify records under section 240AC of the Ad; and/or

  • exercising monitoring powers under sections 214AA-214B of the Act.”


The problem is not in providing the documents for the import declaration and illustrative descriptive material (IDM) for the refund, indeed they should have been provided to the DIBP at the time the refund went redline. This has never been in dispute. The problem is in seeking and providing IDM and evidence of money price paid for lines not subject to adjustment, which are not required under either s.240AA or s.240AC. Those materials are not defined in s.4 as “commercial documents”. That obligation to provide is not therefore imposed on a licensed customs broker doing amendments on a FID created by another party by s.240AA, it is the responsibility of the service provider of the original FID.

The legislation exists for a reason. I maintain that DIBP should comply with the legislation and its requirements just as industry must. I query the reason this matter has dragged on so long, when we have industry bodies meant to represent us. There are already delays in obtaining access to entries to process refunds and then in having queries resolved. Perhaps if refund officers concentrated on refunds and allowed audit teams to do more indepth reviews we would see better processing times.