Cargo terminal security

Guidance for industry on the obligations of cargo terminal operators

and cargo handlers under Part VAAA of the Customs Act 1901
Table of Contents
1. Introduction 3
1.1. What is a cargo terminal? 3
1.1.1. Determining the cargo terminal area 3
1.1.2. Low-use cargo terminals 4
2. Cargo terminal operators 5
2.1. Who is a cargo terminal operator (CTO)? 5
2.2. What are the obligations of a cargo terminal operator? 5
2.2.1. Register the cargo terminal 5
2.2.2. Ensure the physical security of the cargo terminal 5
2.2.3. Processes and methods to ensure the security of goods 6
2.2.4. Record who enters and exits the cargo terminal 6
2.2.5. Ensure employees in positions of management are fit and proper 7
2.2.6. Event reporting 8
2.2.7. Notify the ABF of changes affecting security 8
2.2.8. Train staff on CTO obligations 8
2.2.9. Keep custom-placed signs in place 8
3. Cargo Handlers 9
3.1. Who are cargo handlers? 9
3.2. What are the obligations of cargo handlers? 9
3.2.1. Event reporting 9
3.2.2. Ensure employees in positions of management are fit and proper 9
3.2.3. Train staff on cargo handler obligations 10
3.2.4. Request approval to unpack goods in containers at a cargo terminal 10
3.2.5. Request approval to facilitate the transhipment or export of goods 10
3.2.6. Using an establishment identification when communicating with the ABF 10
4. Compliance with obligations 10
4.1. Powers of ABF officers in cargo terminals 10
5. Appendix A - Section 15 areas 12
6. Appendix B – Fit and Proper 13

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1. Introduction
Cargo terminal operators (CTOs) and cargo handlers have obligations to ensure the security of customs
controlled goods. These are statutory obligations under Part VAAA of the Customs Act 1901 (the Customs
Act). The purpose of these obligations are to strengthen the cargo supply chain against criminal infiltration.
The obligations include ensuring the physical security of the cargo terminal and cargo, mandatory reporting of
unlawful activity, and fit and proper person checks on management. The obligations are similar to those
required at depots and warehouses licensed under the Customs Act and apply in both the sea and air
environment.
The Australian Border Force (ABF) is responsible to assessing and managing non-compliance with the
obligations.
The information in this handbook will help you understand what your obligations are under Part VAAA of the
Customs Act and who is responsible for meeting the obligations.

1.1. What is a cargo terminal?

Cargo terminals are a key point in the supply chain where international goods are unloaded and loaded.
They are the areas at a wharf or airport where goods under customs control are located either immediately
before being loaded for export, or immediately after being unloaded for import.
They are located within wharf and airport areas appointed under Section 15 of the Customs Act (see
Appendix A – Section 15 areas).
An area licensed under the Customs Act as a s77G depot or s79 depot is not considered a cargo terminal.
The depot and warehouse licence conditions set the requirements for the movement, storage and handling
of goods subject to customs control within these areas. This situation is most common at international
airports. The vast majority of cargo terminals with obligations under Part VAAA will be at sea ports.

1.1.1. Determining the cargo terminal area

Cargo terminal areas should include only those areas associated with the loading and unloading of import or
export cargo.
As part of the cargo terminal registration process, CTOs should provide the ABF with a site map of the cargo
terminal. While this is not mandatory, it will provide the CTO and ABF clarity on the cargo terminal
boundaries.
In the seaport environment, the following are generally not considered part of the cargo terminal:
 areas where bulk cargo is stored for long periods
 production facilities
 suspended conveyer system infrastructure used to transport bulk cargo from stockpiles or storage areas
outside a section 15 wharf area for direct loading onto a ship. In this scenario, the cargo terminal is the
on-the-ground footprint on the section 15 wharf.
The requirement for the cargo terminal to be protected by adequate fencing will in many cases define the
boundary of the cargo terminal.
The CTO can align the boundary of their cargo terminal with a maritime security zone (MSZ) under the
Maritime Transport and Offshore Facilities Security Act 2003 or an airside security (ASZ) zone under the

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Aviation Security Act 2004. This allows security measures in place for the MSZ to, in part, meet the cargo
terminal obligations. However, the CTO should consider:
● whether the MSZ or ASZ includes areas beyond where the immediate loading and unloading of cargo is
being undertaken
● the cargo terminal obligations will apply to the whole MSZ or ASZ. For example the obligation to keep a
record of non-CTO employees who enter and exit the cargo terminal
● a MSZ may cease to be active after the ship departs and security measures may be relaxed as the MSZ
is no longer active. However, while cargo under customs control remains at the cargo terminal, the cargo
terminal obligations still apply.

1.1.2. Low-use cargo terminals

A number of seaports receive a low number of international vessels, and have extended periods where the
cargo terminal is non-operational and no cargo under customs control is present. There are also a small
number of airports that receive infrequent international cargo and the cargo terminal does not have customs
controlled cargo present for extended periods of time.
The CTOs of such low-use cargo terminals can seek agreement from the ABF to not meet the requirements
of Part VAAA of the Customs Act during the periods the cargo terminal is not operational. This means the
CTO can discontinue security measures in place to satisfy Part VAAA requirements if the cargo terminal is
non-operational and there is no cargo under customs controlled present at the cargo terminal.
This arrangement would occur only for a small number of low-use cargo terminals where the ABF considers
the security risk of having such an arrangement in place is low. An arrangement would be agreed in writing
with the ABF. These CTOs must have in place risk-mitigation procedures to adequately manage a transition
to an operational cargo terminal. For example, a CTO would conduct a security sweep of the cargo terminal
prior to the arrival of goods for import or export.
CTOs who consider their cargo terminal to be low-use can contact their local ABF to discuss their situation.

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2. Cargo terminal operators
2.1. Who is a cargo terminal operator (CTO)?
A CTO is broadly defined as a person who manages a cargo terminal. A ‘person’ includes a government
body, corporate body and/or an individual.
Typically, the CTO is responsible for managing the operations at the cargo terminal such as scheduling the
use of a cargo terminal, maintaining the terminal infrastructure and arranging terminal security. A CTO could
be an entity that has long-term exclusive access to a designated area of a port or airport.
In the sea environment, a CTO could also be a port authority who allows third parties to use their facilities on
a short-term basis (e.g. multi user berths).
In the aviation environment, the CTO could be the entity with responsibility for the airport as a whole or a
person who has exclusive long term access to a designated area of an airport and who manages the
operations and the security of that area. It will depend on where the goods are located immediately before
being loaded or immediately after being unloaded, and whether a depot licence is held for that area.
The roles of cargo terminal operator and cargo handler are distinct. However in some cases one entity may
fulfil both roles.

2.2. What are the obligations of a cargo terminal operator?

2.2.1. Register the cargo terminal
The CTO must register their cargo terminal with the ABF using the CTO Notification Form (B1239). This form
is available on the ABF website. This form should also be used by CTOs to update their existing registration
details with the ABF. CTOs are strongly encouraged to provide a site map of the cargo terminal when
registering. However, a site map is not mandatory.
Registration is not a licencing process. The ABF uses the information provided during the registration
process to record all CTOs dealing with international cargo. Registration also notifies the ABF of who the
people in positions of management at the CTO are.
The form can also be used to keep the ABF updated on changes to the information.

2.2.2. Ensure the physical security of the cargo terminal

Protect the cargo terminal with adequate fencing

Adequate fencing must protect a cargo terminal. CTOs are encouraged to consult the ABF ahead of
installing any new fencing, as there is no single national standard of fencing for cargo terminals. The ABF will
use a risk-based approach to determine what is adequate fencing.
For example, the fencing around a major city container terminal should reflect the higher level of security
risk. Whereas some sea cargo terminals, such as remote bulk cargo terminals, where heavy-duty perimeter
fencing is not proportionate to the lower level of security risk.
It is not mandatory for the entire perimeter of a cargo terminal to be fenced. For example, there may be
geographical barriers to entry, or the cargo terminal may sit within a larger secure airport or seaport
boundary fence that provides adequate restrictions.

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Protect the cargo terminal with a monitored security alarm
A monitored security alarm must be in place to protect a cargo terminal. The purpose of a monitored security
alarm is to alert the CTO of any unauthorised access to the cargo terminal when it is either unattended or in
limited use.
It may not be practical or necessary for the entire perimeter of the cargo terminal to be covered by a
monitored security alarm. Instead an alarm could focus on a smaller or critical area within the cargo terminal
boundary such as the terminal building.
The requirement to have a monitored security alarm may be met by a range of security measures. This
includes security patrols, monitored CCTV and gates that provide an alert on forced entry. CTOs are
recommended to consult the ABF if they are planning to meet the monitored security alarm requirement with
a range of measures.
In determining whether a monitored security alarm is in place, the ABF must be satisfied that there is fit-for-
purpose technology or measures in place that alert a CTO of unauthorised access to the cargo terminal.
There should also be appropriate and timely response processes in place. These could be part of a CTO’s
broader security and incident response plan.

Control the cargo terminal entry and exit points

The entry and exit points of a cargo terminal must be controlled or limited. This is to restrict who can access
goods at the terminal. This restriction can be achieved through a range of procedures and processes. For
example, entry points could utilise electronic swipe card access to control entry, which records entry against
the cardholder’s personal profile. Alternatively, access points can be physically manned. In many cases,
fencing and gates will assist with managing access.

2.2.3. Processes and methods to ensure the security of goods

CTOs must have procedures and methods for ensuring the security of goods at the cargo terminal. The
physical security obligations (adequate fencing, monitored security alarm and controlled entry and exit
points) are part of these methods.
Additional processes might include hardware systems like CCTV and standard operating procedures like
retrieving an electronic access card when an employee ceases employment.
A CTO may already have arrangements in place to meet their obligations under other Commonwealth or
state legislation that contribute to ensuring the security of goods. For example, the use of maritime or airside
security zones under the Maritime Transport and Offshore Facilities Security Act 2003 or the Aviation
Transport Security Act 2004. These methods and procedures build the layers of security at the cargo
terminal.

2.2.4. Record who enters and exits the cargo terminal

A CTO must record everyone who enters and exits its cargo terminal. The only exceptions are:
 a CTO employee; and
 an employee or officer of the Commonwealth, or state or territory government i.e. police officer, ABF
officer, biosecurity official
Workers contracted by the CTO are not exempt. Their entry and exit movements need to be recorded.
Entry/exit records can be electronic or paper based and must be kept by the CTO for five years.
The details to be recorded is summarised in Table 1. The details differ depending on whether an electronic
access card is used to access the cargo terminal.

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Table 1: Record keeping requirements by access type

Access by: Information to be recorded:

Electronic  entry time and exit times

Access Card
 type of card used e.g. Maritime or Aviation Identification Security Card,
company issued access card
 unique identification number of card.

Other  entry and exit times

 type of identification sighted e.g. driver’s license, passport
 unique number on identification
 name of the person who sighted the identification
 who the person is visiting at the cargo terminal (if applicable).

What type of identification is acceptable?

The CTO determines what identification it will accept to meet its record keeping obligation. This is because
the CTO is responsible for ensuring the security of the cargo terminal. The CTO should have processes in
place to verify the identity of people accessing the cargo terminal. This can include requiring a certain
standard of identification to access the terminal.
A passport, driver’s licence and transport security identification card are examples of acceptable
identification. However, the type of identification a CTO can accept to meet their record keeping obligations
is not limited to these three types. Other types of identification could include an employer issued work pass
or a document issued by a Commonwealth, state or territory government. There is no legislative requirement
for the identification to be photographic.

Can a CTO prevent a person from entering the cargo terminal if they do not show photo
identification?
Yes. While there is no legislative requirement, the CTO needs to be satisfied of a person’s identity when
recording their details. A CTO can require a person to show photo identification before entering the cargo
terminal. If the CTO is not satisfied the person providing the identification is the person they claim to be, then
the CTO cannot be sure they are recording the correct details for that person. On this basis, the CTO can
refuse entry to a person who does not provide photo identification when requested.

Can a CTO not accept a form of identification, including photo identification?

Yes. The CTO can refuse entry to anyone it considers has not produced appropriate identification. This
includes a person with photo identification that the CTO is not satisfied that the identity is of that person, or is
concerned that the identification may be forged.

2.2.5. Ensure employees in positions of management are fit and proper

The CTO must take all reasonable steps to ensure that people who work in positions of management for the
CTO are fit and proper. This applies to both permanent and contracted employees. The CTO is not required
to assess all of its employees, or workers employed by a cargo handler.
The range of competence and character aspects the CTO must consider in assessing fit and proper is at
Appendix B. A critical consideration is a person’s criminal conviction history in the past 10 years. An

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Aviation Security Identification Card or Maritime Security Identification Card can be factored in an
assessment. However it is not sufficient on its own to determine whether a person is fit and proper.
Fit and proper assessment responsibility sits with the CTO. Ensuring the person continues to be a fit and
proper person is also the responsibility of the CTO. The ABF does not routinely assess fit and proper on
behalf of CTOs.
An ABF officer can ask the CTO to provide information that supports a fit and proper assessment.

2.2.6. Event reporting

The CTO must notify the ABF of certain events happening to goods under customs control. Notifications are
to be made to the local ABF office in writing no later than five days after the CTO becomes aware of the
event. Reportable events are:
 unauthorised access to, or movement of, goods under customs control
 unauthorised access to an information system relating to goods under customs control
 an enquiry relating to goods under customs control from a person with no commercial connection to the
goods
 theft, loss or damage of goods subject to customs control
 break in and entry, or attempted break in, of the cargo terminal
 a change that may adversely affect the physical security of the terminal
 a suspected breach of the Customs Act
 unclaimed goods left in the cargo terminal for over 30 days.
Cargo handlers also have reporting obligations that complement those of the CTO (see section 3.2.1).
CTOs that do not handle cargo will not have visibility of goods left unclaimed in the cargo terminal. In this
circumstance, the CTO should establish a process for the cargo handler to advise them of goods left
unclaimed for over 30 days. Both the CTO and cargo handler have the same obligation to report unclaimed
goods to the ABF.

2.2.7. Notify the ABF of changes affecting security

The CTO must tell the ABF of any substantial change that would adversely affect the physical security of the
cargo terminal or the security of goods at the cargo terminal. This includes significant changes to security
infrastructure and security processes. Unless the change is in response to an emergency or disaster, the
notice must be in writing to the local ABF office at least 30 days before the change occurs.

2.2.8. Train staff on CTO obligations

CTO employees and those involved in the CTO’s business need to be aware of the CTO’s responsibilities in
relation to goods subject to customs control. The CTO must educate and train these people on CTO
obligations. Such training could be included in the CTO’s induction process.

2.2.9. Keep custom-placed signs in place

A CTO must not move, conceal or remove a sign placed at or near a cargo terminal by an ABF officer unless
written approval is provided by the ABF. The sign can be temporarily moved while maintenance or
construction work is carried out and the sign is moved for no more than 5 days.

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3. Cargo Handlers
3.1. Who are cargo handlers?
A cargo handler is a person at a cargo terminal who is involved in the movement of customs controlled
goods. This includes moving the goods in, out or within the cargo terminal; the loading, unloading, handling
or storing of goods; and packing or unpacking of goods.
A ‘person’ includes a government body, corporate body and/or an individual.
In the sea environment, cargo handlers are typically a stevedoring company.

3.2. What are the obligations of cargo handlers?

3.2.1. Event reporting
If a cargo handler knows of certain events happening to goods under customs control it must notify the ABF.
Notification must be made in writing no later than five days after the event.
Reportable events are:
 unauthorised access to, or movement of, goods under customs control
 unauthorised access to an information system relating to goods under customs control
 an enquiry relating to goods under customs control from a person with no commercial connection to the
goods
 theft, loss or damage of goods subject to customs control
 break in and entry, or attempted break in, of the cargo terminal
 a change that may affect the physical security of the terminal
 a suspected breach of the Customs Act
 unclaimed goods in the cargo terminal for over 30 days.
CTO’s have the same obligation as cargo handlers to report these events to the ABF (see section 2.2.6).

3.2.2. Ensure employees in positions of management are fit and proper

The cargo handler must take all reasonable steps to ensure people who work in positions of management
are fit and proper. This applies to both permanent and contracted employees. The cargo handler is not
required to assess all of its employees, or workers employed by the CTO.
The range of competence and character aspects the cargo handler must consider in assessing fit and proper
is at Appendix B. A critical consideration is a person’s criminal conviction history in the past 10 years. An
Aviation Security Identification Card or Maritime Security Identification Card can be factored in an
assessment. However it is not sufficient on its own to determine whether a person is fit and proper.
Fit and proper assessment responsibility sits with the cargo handler. Ensuring the person continues to be a
fit and proper person is also the responsibility of the cargo handler. The ABF does not routinely assess fit
and proper on behalf of cargo handlers.
An ABF officer can ask the cargo handler to provide information that supports a fit and proper assessment.

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3.2.3. Train staff on cargo handler obligations
Cargo handler employees and people involved in the business of the cargo handler need to know the cargo
handler’s responsibilities in relation to goods subject to customs control. The cargo handler must take all
reasonable steps to educate and train these people on the obligations.

3.2.4. Request approval to unpack goods in containers at a cargo terminal

Goods in a container at a cargo terminal must not be unpacked unless the cargo handler has written
approval from an ABF officer. A cargo handler can request the local ABF office for approval to unpack the
container. This approval is intended for exceptional circumstances. For example, where cargo has been
damaged in transit and requires repacking. Approvals to unpack are granted for a specified time, location
and container.

3.2.5. Request approval to facilitate the transhipment or export of goods

If goods are imported into Australia and are subject to customs control, a cargo handler must not facilitate
the transhipment or export of the goods without the written approval of an ABF officer. A cargo handler can
request this from the local ABF office.

3.2.6. Using an establishment identification when communicating with the ABF

A cargo handler must use their correct establishment identification when communicating electronically with
the ABF, for example when reporting the receipt and movement of goods through the Integrated Cargo
System.

4. Compliance with obligations

The CTO and cargo handler obligations are statutory obligations. Non-compliance is a strict liability offence
under the Customs Act. Strict liability refers to an offence where fault does not have to be proved. The
Infringement Notice Scheme (INS) may be applied to non-compliance with CTO and cargo handler
obligations, instead of prosecution of alleged breaches of CTO and cargo handler obligations.
The ABF takes a risk-management approach when assessing CTOs and cargo handlers implementation of
their obligations. This allows the diversity of seaport and airport operations to be reflected in the
implementation of the obligations.
Further information on the INS and the ABF’s approach to trade and goods compliance can be found on the
ABF website.

4.1. Powers of ABF officers in cargo terminals

ABF officers have additional powers with a cargo terminal. These powers can be used to determine whether
a provision of any Customs-related law has been, or is being, complied with. These powers are in addition to
the powers ABF officers can already use within section 15 areas.
An ABF officer may enter a cargo terminal, without a warrant, to search and access information and exercise
functions. ABF officers can access electronic equipment and storage devices at the cargo terminal (without a
warrant) if they suspect it contains information relating to any of the following:
 the security of goods subject to customs control in the cargo terminal
 access to goods subject to customs control in the cargo terminal or on a ship or aircraft within, or adjacent
to, the cargo terminal
 the rostering and attendance of staff

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 ship bay plans relating to the cargo terminal
 the unloading, receipt, movement and stacking of customs controlled goods at the cargo terminal.
An ABF officer can request certain information from a CTO or cargo handler. This includes documentation on
the procedures and methods used by the CTO to secure goods at the terminal, and records relating to each
person who enters the terminal. Authorised officers may also request CTOs and cargo handlers to provide
information to support a fit and proper assessment.
An ABF officer can direct a CTO to carry out work to address security concerns at the terminal. This includes
a direction to carry out remedial work at or near the terminal, and to install CCTV. An authorised officer can
also give a direction to a CTO or cargo handler in relation to the movement, storage, packing or unpacking of
goods subject to customs control.
Any request or direction issued by an ABF officer will be made in writing.

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5. Appendix A - Section 15 areas
Under section 15 of the Customs Act 1901 (the Act) the Comptroller-General of Customs (C-G) can appoint
and fix the limits of seaports, airports, wharfs and boarding stations.
These appointments facilitate the movement of people and goods across the Australian border by
establishing the areas where international trade and travel can take place. It determines where the Act
applies, including where ABF officers can exercise their powers.
The C-G can make four types of section 15 appointments:
 Port - an area of water used by international vessels to gain access to land-based facilities for loading
and/or unloading goods or people.
 Wharf - the landside area of a section 15 port predominately used for the loading and unloading of
international vessels.
 Airport – an area used by international aircraft to unload/disembark or load/embark goods or travellers
 Boarding station- appointed within the boundary of a section 15 sea port, wharf or airport to allow officers
of ABF to board vessels/aircraft and undertake compliance activities
Section 15 appointments are published in the Australian Government Gazette and available at
www.legislation.gov.au.
A section 15 appointment can be revoked, and reappointed if necessary. This would occur when the
boundaries of a section 15 area, most likely a wharf, need to be redrawn to account for operational or
geographical changes. The boundaries of section 15 wharves should be reviewed regularly to ensure they
include, and exclude, the appropriate areas.

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6. Appendix B – Fit and Proper
Meaning of fit and proper person
In deciding whether a natural person is a fit and proper person for the purposes of Part VAAA, the
decision-maker must have regard to:
a) any conviction of the person of an offence against The Customs Act 1901 committed within the 10
years immediately before the decision; and
b) any conviction of the person of an offence punishable by imprisonment for 1 year or longer:
i. against another law of the Commonwealth; or
ii. against a law of a State or Territory;
ii. if that offence was committed within the 10 years immediately before the decision; and
c) whether the person has been refused a transport security card, or has had such a card suspended
or cancelled, within the 10 years immediately before the decision.

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