Australia: Defining “owner” in DDP transactions | KPMG | GLOBAL

Australia: Defining “owner” in delivered duty paid transactions, customs purposes

Australia: Defining “owner” in DDP transactions

Australia’s Department of Immigration and Border Protection (Customs) released draft notices that outline its opinion on Incoterms 2010 Delivered Duty Paid (DDP) transactions and the liability for customs duty, revenue recovery and duty demands.


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For Australian customs purposes, the definition of “owner” in the Customs Act 1901 is broad and includes: (1) “any person (other than an officer of Customs) being or holding himself or herself out to be the owner, importer, exporter, consignee, agent, or person possessed of, or beneficially interested in, or having any control of, or power of disposition over the goods.” The position of Australian Customs is that either a foreign supplier or Australian purchaser could be identified as the “owner” in a DDP transaction. While the supplier would generally make an import entry under the proper application of DDP terms, either could be issued a demand of payment of any unpaid import duties.

In the draft DIBP Notices 2016/12 and 2016/13, it is stated that the Comptroller-General of Customs has discretionary power to demand duty of any person identified as an “owner” so that liability for duties under a DDP contract is a joint liability between supplier and purchaser. In practical terms, when the foreign supplier fails to meet its duty obligations, the position of Customs is that it has an ability to issue a demand for duty on the Australian purchaser, even when duty is included in the DDP price.


Read a May 2016 report prepared by the KPMG member firm in Australia: DDP transactions – Who is responsible for duty?

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