7.6 Source Assessed in the Context of Exports to Australia
Aligned with international efforts, including measures developed by the United States and EU, Australia further strengthens its leadership position in the Asia-Pacific region in promoting trade in legally harvested timber and timber products by enacting the Australian Illegal Logging Prohibition Act (AILPA) and enhancing international cooperation to combat illegal logging.
AILPA was passed in 2012, a draft Amendment was issued in May 2013 and is expected to enter into law November 2014. The aims of AILPA are to reduce the harmful environmental, social and economic impacts of illegal logging and affects to Australian timber importers and domestic processors of Australian raw logs.
- The importers must have a due diligence system before importing a regulated timber product to minimise the risk that regulated timber products they import are made from, or include, illegally logged timber.
- Processors need to establish a system of procedures and measures (a due diligence system) to minimise the risk of processing illegally logged raw logs.
The regulation does not require a due diligence system to be created for each transaction. Rather, the regulation requires the establishment of a single due diligence system that can be applied to each import. For example, an importer may establish a due diligence system and apply it to a particular product from a particular source. The outcome of this process will be an understanding of the information and documentation required to be obtained when importing that product from that particular source.
However the regulation that outlines the operational framework for importers and processors will come into effect after 30 November 2014.
In addition, the regulation also provides:
- civil offence and penalties.
- Infringement notice provisions.
- Administrative sanction provisions.
- Identity card requirements.
The law does not impose any Australian legislation on the source country, but uses the laws that are in placed in the country of origin to determine illegality of harvest and trade.
The list of regulated timber products is prescribed in a Schedule of the Regulation (http://www.comlaw.gov.au/Details/F2013L00883). This list is closely aligned with the list of EU products, with some exceptions where the imports of those products to Australia are of low trade value and/or volume. It has fewer products than either the EU or US legislations and has an additional category relating to wooden framed seats.
Some products are exempted from the due diligence requirements of the Regulation. These include: timber products that are recycled material and any content of a timber products that are recycled material. Timber in a regulated timber product is recycled material if:
- material has been, or has been part of, another product
- at the time the material was removed from that other product, that product was no longer used for its intended purpose and was consider to be waste;
- the material has been used as raw material in the regulated timber product.
However, material in a regulated timber product is not recycled material if the material is the by-product of a manufacturing process. Examples: Sawdust or off cuts from sawn timber used to make particle board or plywood
Information the importer needs:
- Product – Description of the regulated timber product, including type, trade name and common name, genus and scientific name of the tree from which the timber used in the product is derived
- Harvest – The country, region and forest harvesting unit in which the timber in the product was harvested
- Manufacturer – name of country where the product was manufactured is required
- Supplier Identity – Name, address, trading name, business and company registration number (if any) of the supplier of the product
- Quantity – of the shipment of the product expressed in volume, weight or number of units
- Supplier Documents – the documentation provided or that will be provided by the supplier in relation to the purchase of the product
- Legality Framework - If a timber legality framework applies to the timber in the product or the area in which the timber is harvested – a copy of the licence or certificate issued to the harvester of that timber, or other relevant person in relation to the timber, that provides evidence of compliance with the standards or requirements of the framework
- Specific Guidelines – If a country specific guideline applies to the timber in the product, or the place in which the timber is harvested – the information or evidence (such as a certificate, licence or other document) relating to the product that the guideline requires the importer to obtain
- Legal Logging:
- Evidence that the product has not been illegally logged
- Information on whether the harvesting of that tree species from which the timber was derived is prohibited in the place of harvest or not
- If the harvest of the timber in that place is authorised by legislation and regulation – proof that the requirements of the legislation been met for the harvest of that timber
- If payment is required for the right to harvest the timber – proof that payment has been made
- Information on whether the harvest of the timber was consistent with the law establishing or protecting the legal rights of use and tenure in the place of harvest or not
Before importing a regulated timber product into Australia, an importer must have a due diligence system and retain a written record of that due diligence system. The requirements for a due diligence system may be summarised as a four step process to be put in place by an importer as set out below.
Step 1: Information gathering (section 10 of the AILPA)
- An importer must obtain as much of the prescribed information as is reasonably practicable. The Regulation includes a list of types of information to be obtained by an importer.
Step 2: Optional process - assessing and identifying risk against a timber legality framework (section 11) or a country specific guideline (once they are prescribed) (section 12)
- ii. Under the Regulation, in certain circumstances, an importer may elect to assess the risk that the timber in the product they are importing has been illegally harvested using either:
- a timber legality framework that is prescribed in Part 1 of Schedule 2 to the Regulation; or
- a country specific guideline (once they are prescribed in Part 2 of Schedule 2 to the Regulation). The Regulation requires that, should an importer elect to use this optional process, they must:
- assess whether the information and evidence obtained by the use of the framework or the guideline (such as a licence or certificate) is accurate and reliable;
- identify and assess the risk that the product is, is made from, or includes, illegally logged timber. To identify and assess this risk, the importer should use the framework/guideline. They should also consider the other information gathered in accordance with Step 1, as well as any other relevant information that the importer knows or ought reasonably to know.
- Should an importer elect to use this optional process and, in doing so, assess that there is a low risk that the timber product is illegally logged, then the requirements under section 13 do not apply. In circumstances where section 13 does not apply, risk mitigation (section 14) also does not apply.
- However, risk mitigation does apply in circumstances where the importer is required to use section 13 and the risk that the timber product was illegally logged, as assessed under section 13, is not a low risk.
Step 3: Risk assessment (section 13)
- i. Where an importer has not used the optional process set out in Step 2, or where they have used the Step 2 process but they have identified a risk that the timber is illegally logged and the risk is other than a low risk, an importer must undertake a risk assessment in accordance with section 13.
- The Regulation requires the importer, as part of this process, to identify and assess any risks by taking into consideration the risk factors that are referred to in subsections 13(2) and (3).
Step 4: Risk mitigation (section 14)
- Where an importer has, during Step 3, identified a risk that the timber was illegally logged and the risk was not a low risk, an importer must undertake a risk mitigation process in accordance with the Regulation. The Regulation requires the risk mitigation process to be adequate and proportionate to the identified risk.
Timber sourced from certified forests (*FSC or **PEFC) will automatically be determined to be “low risk by the AILPA.
The act requires a declaration about the timber legality at the point of import of each shipment. Importers of regulated timber products must have declarations, at the time of import, to the Customs Minister about the due diligence that they have undertaken.
Detailed information on the AILPA can be found here: http://www.comlaw.gov.au/Details/F2013L00883
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