AFIF is pleased to hear that the proposed new regulations, including the Regulated Shipper Scheme (RSS) and the Enhanced Air Cargo Examination (EACE) program, if introduced, will be implemented over a 3-5 year period, commencing in 2014

Consensus in the room from the industry side was that we thought that there would be a minimal uptake of the RSS for reasons already outlined in the AFIF submission.

It was envisaged that very few companies, except the largest forwarders would invest in X-ray and ETD machines, due to not only their initial capital cost but also the staffing and maintenance. Therefore, it was likely that cargo being forwarded through SME forwarders would need to be delivered to the CTO's for security screening. Alternatively, we may also see the advent of independent off-airport screening facilities who may also provide consolidation break down / rebuild before final despatch to CTO.

OTS need to clarify their figures on how many forwarders intend to purchase and operate X-ray machines at their premises (not total number of locations); and this needs to go into the report to government for the Regulatory Impact Statement (RIS).

Concerns were expressed that costs could impact on the competitive nature of Australian air cargo exports and that business could either be lost to sea freight, or to another country.

Concern from forwarders that there is no OTS requirement for further electronic screening of cargo following despatch from Regulated Shippers, prior to uplift. Industry feels this is a weakness of the proposal. We are yet to be advised of the secure transport arrangements that must also be in place from the RS to the AACA, RACA or CTO. It is an issue that we feel the airlines will also be concerned about.

No definitive (i.e. other than anecdotal) confirmation from many Airlines (the actual Carrier) that cargo from RS will not be X-rayed by the CTO on behalf of the Carriers prior to uplift. What verification has OTS received from Carriers to confirm? This needs to be expressed in the RIS and not estimated or assumed.

No indication as to the costs of becoming a RS and also that the process may be handled by non-Government agencies. No time frame indicated by OTS on getting the process up and running. Also concern on who 'audits the auditors'. We assume this would be the government and we have sought clarification.

No real decision on how perishables will be security screened.

No decision on what will happen with transhipment cargo, or who pays.

Concerns that the whole cost of security screening and risk falls on the forwarding industry.

Questions as to why government cannot mandate that shippers have to become regulated (as they have done with industry in terms of the RACA/AACA schemes).

Government needs to inject revenue by revisiting the funding program and not expect industry to cover all the costs of change. Whilst industry must operate the scheme, the Australian Government, as a signatory to International Civil Aviation Organisation (ICAO) Annex 17 & 18, has an international obligation to implement the requisite security program.