Securing the engagement of overseas third parties that are not directly subject to Australian Chain of Responsibility (CoR) laws can be a major challenge.
Who are the overseas third parties in your chain?
When we talk about overseas third parties, typically we are referring to overseas suppliers of goods that are shipped to Australia before they hit the Australian heavy vehicle road transport supply chain.
These overseas suppliers are not party to CoR, as CoR only captures parties in Australia e.g. importers, distributors and logistics providers.
Despite not being parties to CoR under the HVNL, they are nevertheless a party in the supply chain, and their conduct and breaches can still have a material impact on your CoR compliance in Australia.
For example, if a shipping container of supplies is insufficiently restrained and shipped to Australia, once it hits our roads, a load restraint offence occurs and the domestic importer, distributor, logistics company, etc. can all be held responsible and prosecuted.
4 CoR components to monitor
- Mass Compliance
You should ensure that any mass information contained in transport documents (e.g. bills of lading, packing lists, commercial invoices, Safety of Life at Sea (SOLAS)-verified gross mass declarations) is consistent and accurate.
For example, make sure that the mass information contained in any bill of lading matches that included in your commercial invoice. Some overseas exporters under-declare mass on the bill of lading in order to save on freight costs.
Usually, you would provide the bill of lading or other shipping documents to domestic transport operators and/or base any Container Weight Declaration on the bill of lading weights.
So, any ‘creative accounting’ on the bill of lading can lead to inaccurate weight declaration on the road.
Also, ensure that any loaded mass is within the limit of any shipping container carrying capacity – which is marked on the container information plate on the door of every shipping container.
- Load Restraint Compliance
Insufficient load restraint of goods within shipping containers by overseas suppliers is a huge problem.
It is one of the key targets for enforcement action by the regulators and a number of CoR court prosecutions have been in relation to insufficient load restraint by overseas suppliers.
You should ensure that you:
- advise any overseas suppliers that load restraint of goods shipped to Australia must meet the Performance Standards contained in the Load Restraint Guide and/or HVNL;
- provide overseas suppliers with an extract of the Performance Standards;
- require overseas suppliers to confirm that the restraint of goods meets the Performance Standards (including asking for copies of any load restraint compliance calculations or evidence of the testing or restraint capacity of any load restraint equipment used, as applicable);
- keep your eyes open for any signs of insufficient load restraint (e.g. does the restraint actually used match what the supplier said they were going to do and had tested?) or possible failure of load restraint during shipping and transport (e.g. are there signs of load shift or movement during shipment, such as collapsed stacks, broken or strained restraints or signs of packaging units shifting along a shipping container floor?); and
- investigate and resolve any discrepancies or suspected load restraint issues with the supplier as soon as they are observed.
- Dimension compliance
Dimension compliance may arise for non-containerised goods, if the overseas supplier provides you with incorrect dimension figures. As above, you should ensure that all dimension figures provided are consistent. Seek clarification if there are any issues or if the figures are found to be incorrect upon receipt.
- Speed and fatigue compliance
Speed and fatigue compliance are not likely to arise, as overseas suppliers are unlikely to be involved in booking or scheduling road transport in Australia.
There is no blame game in the CoR – you must take action
You cannot merely tell your overseas supplier that ‘mass and load restraint must meet Australian requirements’, cross your fingers and then see what happens from there forwards.
If goods are sent with insufficient load restraint and you have not done all that is reasonably practicable to prevent that breach from occurring, you may be in breach under the Heavy Vehicle National Law (HVNL) and you can be prosecuted and fined up to:
- $3 million for companies
- $300,000 fines and 5 years’ imprisonment for individuals.
The regulators and the courts therefore expect you to take an active part in making sure that your overseas suppliers are doing the right thing, as per the above recommended steps for load restraint compliance management.
The buck stops with you
We often hear that ‘overseas suppliers aren’t interested in complying with our laws; they just ignore our requests’.
This is not a defence in court.
We understand that it can be very difficult to engage overseas suppliers on issues of local compliance. However, at the end of the day it is usually a bottom line issue – do they want your business and/or does the unit price need to reflect any additional effort required to meet Australian CoR laws?
If overseas suppliers consistently ignore your requests or aren’t prepared to meet the CoR standards, you will unfortunately need to make a costs/benefit decision on the risk of continuing to use them.
Have you done everything to ensure your business is CoR compliant?
If you’re not sure, the time to act is now.
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