How will recent DTCA changes impact export declarations and dual-use goods compliance for freight forwarders and customs brokers?
- Jessica Rankin
- Mar 21
- 14 min read
Background: New Export Control Amendments and Industry Implications
Significant amendments to Australia’s Defence Trade Controls Act 2012 (DTCA) took effect on 1 September 2024, introducing a “licence-free environment” for most defence-related transfers between Australia, the US, and UK (AUKUS partners) and adding new offence provisions. These offence provisions became enforceable from 1 March 2025 after a transition period. The changes mean companies handling items on the Defence and Strategic Goods List (DSGL) must strengthen compliance. In particular, exporters of dual-use goods (civilian items with potential military applications) and their logistics providers face greater scrutiny to ensure required permits are obtained before export. Industry experts have warned that even minor errors in classification or documentation under the new rules can have serious consequences, and they urge freight forwarders and customs brokers to proactively educate clients and mitigate risks. At the same time, defence export opportunities (e.g. via AUKUS) are growing, making compliance diligence even more critical as authorities intensify enforcement.
Export Controls Australia Group (ECAG):
At ECAG, we have raised these concerns with Defence Export Controls (DEC) and they are reportedly working on formal communications to address this issue, but in the meantime if you’re experiencing unexplained delays, we want to hear from you.
Export Declarations, AHECC Codes and DSGL Controls:
All goods exported from Australia must be reported to the Australian Border Force (ABF) via an Export Declaration. Each export declaration line requires an Australian Harmonised Export Commodity Classification (AHECC) code (8-digit) that classifies the goods. If the item is subject to export controls (such as DSGL-listed goods requiring a permit), the declaration must also include the relevant export permit number and a three-letter permit prefix identifying the permit type. For example, a shipment of controlled chemicals or dual-use equipment must cite the Defence Export Controls permit details on the Export Declaration Number (EDN) submission. ABF explicitly instructs that “a valid permit number must be lodged in ICS for all consignments that require an export permit.” Omitting a required permit at the time of lodgement is a serious breach – goods exported without the requisite permit may be seized, and the exporter can face penalties up to AUD $555,000 and/or 10 years imprisonment under Customs Act 1901 provisions.
Integrated Cargo System (ICS) Linkages: Australia’s Integrated Cargo System (ICS) – the electronic platform for lodgement of export entries – is configured to help flag controlled exports. Permit-issuing agencies (like Defence Export Controls) can map certain AHECC codes to export permit requirements in ICS. In practice, each AHECC in the system is tagged as either:
• Permit “Yes” – A permit is mandatory. The ICS will not allow clearance of the export declaration (status CLEAR) unless a valid permit number (with the correct agency prefix) is provided. For example, AHECC codes covering military firearms or munitions are likely “Yes” and require a Defence permit before the EDN can be finalised.
• Permit “Maybe” – A permit may be required depending on the item’s specifics. The ICS will accept the declaration without a permit number but will generate a warning to alert the lodger/ABF for review. Many dual-use goods fall in this category: the commodity code alone might not confirm if the item meets DSGL control thresholds, so ICS issues a caution. The shipment might then be referred for manual assessment if no permit is attached.
• Permit “No” – No export permit requirement is indicated for that code. The system does not prompt for a permit (though it will still accept a permit number if one is provided). Most ordinary goods not on any control list are “No”.
This ICS validation logic means that for certain sensitive exports, lodging an EDN without the appropriate permit will immediately fail or raise flags. Notably, ABF has advised exporters of controlled chemicals to use the precise AHECC classification for the chemical, since some AHECC codes themselves signal control status. Using the correct specific code ensures the ICS can identify when a chemical is subject to Australia’s export control regime (e.g. chemicals on the Australia Group lists) and prompt for the permit. However, it is ultimately the exporter’s responsibility to self-assess their product against the DSGL – the AHECC mapping is not foolproof. Many dual-use items can be exported under generic AHECC codes, so one cannot rely on the ICS alone to determine if a permit is needed. Exporters should proactively consult the DSGL and, if unsure, seek a formal assessment from Defence Export Controls (DEC) before lodging the export. ABF guidance urges: “if you are unsure whether your export is controlled, you should request a DSGL assessment of your goods… as early as possible”.
ICS Processing and Hold Alerts for Controlled Exports
When an export declaration for a DSGL-controlled item is lodged with a permit, the ICS will record the permit details and, assuming all else is in order, grant an “Authority to Deal” allowing export. (The permit information is cross-checked – e.g. the permit must have a valid prefix and number format and be issued to the same exporter.) If a declaration is submitted without a required permit, two scenarios arise:
• If the AHECC was on the “Yes” list, the declaration will be rejected or not receive clearance in ICS. The exporter or broker will get an error and the shipment cannot progress until a valid permit is added.
• If the AHECC was “Maybe” (or the risk assessment flags the consignment due to description, end destination, etc.), the declaration may technically be accepted but will trigger an alert for ABF officers. In these cases, ABF typically places the goods on hold and contacts the exporter for further information or documentation. The exporter might be asked to produce a DEC permit or an official determination from DEC that the item is not controlled.
Either way, a missing permit will cause delays. ABF’s compliance bulletins repeatedly emphasise lodging export documents with all required permits at the time of initial export entry to avoid last-minute holdups. One ABF notice states: “To avoid delays, exporters should ensure they consult with DEC and/or DFAT to check if the goods require a permit prior to export… Goods lodged for export without the relevant permit may be seized.” In practice, if an export is held pending permit approval, the cargo cannot depart Australia until the issue is resolved (unless it’s removed from export entry altogether).
There is no automatic “mapping” in ICS that perfectly identifies all DSGL items, since whether many dual-use goods are controlled depends on technical specifications, not just the general category code. Instead, the system’s AHECC-based rules and ABF’s risk profiling work together. For example, a dual-use laboratory instrument might share an AHECC with uncontrolled models – ICS might mark it “Maybe” and warn the broker, and ABF may intervene to request the technical details. If the exporter can then demonstrate the item is not on the DSGL (or provide a DEC Export Control Assessment letter indicating the item is not controlled), ABF can release the hold. Otherwise, the exporter must obtain a permit before export clearance. This can lead to significant shipment delays if not handled in advance.
Official Guidance from DEC and ABF on Permits and Delays
Defence Export Controls (DEC) (within the Department of Defence) is the authority that assesses permit applications for exporting DSGL-listed goods, technology, or software. DEC and ABF have issued guidance underscoring that exporters must obtain the required permit prior to exporting. The permit must also be in the name of the goods owner (exporter) and valid at the time of export. In situations where an exporter is unsure if their goods are controlled, DEC encourages submitting an application for an Export Control Assessment (ECA) or using the online DSGL self-assessment tool. If DEC determines a permit is not needed, they will issue an official notice stating the goods are not subject to control, which the exporter can present to ABF. Either a permit or this “ECA” proof should accompany the export declaration to prevent border delays.
The ABF’s public compliance updates (e.g. Autumn 2021 and Autumn 2022 newsletters) reinforce the importance of early engagement with DEC. They advise exporters and customs brokers to consult DEC well before shipment and to lodge export declarations early, attaching any DEC assessment or permit documentation at the time of lodgement. This allows ABF to verify compliance and avoids last-minute interventions. ABF notes that providing complete and accurate information in the correct ICS fields “assists in avoiding unnecessary delays with the export”. In fact, incomplete reporting or failure to lodge a required permit is not only a cause for delay but is considered an offense (a contravention of Regulation 13E of the Customs (Prohibited Exports) Regulations).
DEC’s own service guidance gives an idea of processing times: standard export permit applications (for non-sensitive dual-use items) are typically processed in up to 15 working days, while more sensitive or complex cases can take up to 35 working days or longer due to inter-agency consultations. DEC warns that delays often result from incomplete documentation – for instance, missing end-user certificates or insufficient technical detail will prolong the assessment. Both DEC and research institutions advise exporters to “plan early and obtain the requisite permit well before you need it”, as there is no guarantee to expedite an urgent request. In other words, if a company waits until cargo is at the port to discover a permit is needed, a multi-week delay is almost inevitable.
As part of the 2024 reforms, ABF and Defence also implemented the AUKUS licence-free export exemption. This permits most DSGL items to be exported to the US or UK without a DEC permit, provided certain criteria are met. Exporters using this provision must meet registration and reporting requirements (e.g. a Defence Client Registration Number and a notice to DEC), and ABF still requires the export declaration to indicate the licence-free usage. The Customs (Prohibited Exports) Regulations were amended accordingly to not require a permit for those specific AUKUS transfers. However, if any conditions for the licence-free environment are not satisfied, a permit is still required. Exporters should not assume that all US/UK exports are automatically exempt – DEC has published detailed guidance on the narrow scope of this exemption. Misapplying the AUKUS exception could result in the same border holds or penalties as a missing permit.
Role of Licensed Customs Brokers vs Exporters in Declarations
In Australia, Licensed Customs Brokers (LCBs) and freight forwarders often act as agents for exporters to lodge export declarations in ICS, however it is not a requirement, therefor you may have significantly inexperienced non- LCB's, lodging these EDN's, this can is significantly risky if you have goods that may require a permit.
While these people handle the technical process of lodging the EDN or CRN (for low-value shipments) on the exporter’s behalf, the legal responsibility for compliance remains with the exporter (the “goods owner”). The export declaration must accurately reflect the exporter as the goods owner and the ultimate consignee overseas – it should not list the freight forwarder or a bank as the exporter/consignee. ABF clarifies that the goods owner is the party accountable under Sections 113 and 114 of the Customs Act for ensuring goods are correctly reported and have authority to be exported. Thus, any required Defence permit must be issued to the goods owner (exporter) and held by that entity at the time of export. The broker cannot obtain a permit on the exporter’s behalf under their own name; they can only assist in facilitating the process.
Practical compliance workflow: The exporter should determine if their goods are controlled and, if so, apply to DEC for the permit (or an exemption letter) well in advance. Once obtained, the exporter provides a copy of the permit to their freight forwarder or customs broker. They in turn, must enter the permit details into the ICS when lodging the export declaration.
It’s important to note that while brokers can help ensure the paperwork is in order, they rely on the exporter for accurate technical information about the product and whether a permit was obtained. An industry best practice is for brokers to include export control compliance checks in their client onboarding or shipment booking process – for example, asking the shipper “Does this product appear on the DSGL or require any export permit (DEC or DFAT)?” and encouraging completion of a DSGL self-assessment. Ultimately, if a violation occurs (such as exporting controlled goods without a permit), the exporter is the one liable for the offense. However, brokers also have a duty of care: knowingly facilitating an illegal export can expose the broker to penalties or loss of license. Therefore, leading forwarders are increasingly cautious – if an exporter cannot confirm whether an item is controlled, brokers may suggest obtaining an official DEC assessment before proceeding. ABF has explicitly reminded that it is “the goods owner’s responsibility to ensure permits are obtained prior to export,” but also that this assists in “streamlining the process end-to-end, reducing delays and any unwarranted border holds”. In other words, all parties in the supply chain benefit when compliance is managed upfront.
Delays for Dual-Use Exports Without Pre-Clearance
One of the most significant impacts of the recent DTCA changes has been increased export scrutiny for dual-use goods, which in turn has led to more frequent and sometimes lengthy shipment delays when compliance is not in order. Freight forwarders and exporters have reported that consignments of seemingly commercial items are being delayed by ABF if there is any indication the goods could be DSGL-controlled, and the paperwork is not sufficient. In some cases, these holds can exceed 60 days as the exporter scrambles to obtain a DEC permit or provide technical evidence to satisfy DEC/ABF that the item is not controlled. This kind of delay typically encompasses the time for the exporter to prepare a permit application, DEC to process it (15–35 working days or more for complex cases), and ABF to then verify and release the goods.
For example, an exporter of an industrial electronics module (which falls under DSGL Category 3 – Electronics) that did not realise it required a permit could lodge the export, only to have ABF flag it. Without a permit or DEC advisory, the shipment would be put on hold. The exporter would then need to submit a permit application to DEC and await approval. During this period – which could stretch over several weeks – the goods remain under ABF control and cannot be exported. If DEC approves the permit, the exporter can then provide the permit number to ABF/ICS and secure release for export. If DEC finds the item was not actually controlled, they issue an assessment letter which likewise must be given to ABF to lift the hold. In both scenarios, the export is delayed far beyond normal transit times. Industry groups have noted that these delays disrupt supply chains and project timelines, especially for companies unfamiliar with the tightened rules. A Defence industry analysis in late 2024 highlighted “Delays: Securing permits for newly controlled items may disrupt timelines” as a key challenge, urging businesses to thoroughly review the updated DSGL and align compliance processes to avoid such disruptions.
Official commentary reinforces that prevention is better than cure. The University of Wollongong’s guidance on export controls advises researchers and exporters: if you strongly believe no permit is required, document your reasoning and any DSGL tool results – but if unsure, do not ship without clarification. ABF’s own recommendation is to consult DEC “in the first instance” to determine permit needs, and to lodge entries early. Freight forwarder associations echo this: the Freight & Trade Alliance (FTA) advises that forwarders should work with their clients’ weeks or months ahead of export to get export control clearance, rather than treating it as a last-minute customs formality.
In practical terms, 60+ day delays are avoidable if exporters engage early. DEC’s free self-assessment tools and application process mean there is little excuse for not obtaining a permit or official advice before the goods arrive at the port. However, the reality is that awareness is still catching up. Many exporters in industries not traditionally associated with “defence” remain unaware their products have become subject to DSGL controls under the 2024 updates. These companies may only discover the requirement when a shipment is stopped. This reactive approach is what the government and industry bodies are trying to change through outreach and education.
Industry Commentary and Practical Tips
Industry groups and experts have been actively commenting on the challenges and best practices arising from the DTCA reforms. The newly established Export Controls Australia Group (ECAG) and freight forwarder associations (like FTA and IFCBAA) have noted that a significant knowledge gap exists among exporters and some logistics providers regarding the expanded controls on dual-use goods. They stress the need for training operational teams on identifying controlled goods and navigating permit processes. A key recommendation is that classification of defence and dual-use items should involve compliance specialists or licensed customs brokers with export control expertise, rather than leaving it solely to sales or shipping staff. Having an expert ensure the correct AHECC and export control status can prevent inadvertent mistakes.
Customs brokers and forwarders are seen as crucial “gatekeepers” in this process. As the FTA notes, they are in a prime position to “mitigate these risks by ensuring they and their clients are fully informed.” Brokers are increasingly incorporating export control checkpoints in their workflows – for instance, some now require clients to fill out a questionnaire about the nature of the goods, end use, and whether a DEC permit is in place, before agreeing to lodge the export. This not only protects the broker but also serves to prompt exporters to consider export control obligations they might have overlooked.
ECAG also suggests maintaining good communication with DEC and ABF. If an exporter anticipates a tight timeline (e.g. a last-minute order for a controlled item), notifying DEC of the urgency in advance and similarly alerting ABF cargo officers can sometimes help. While DEC cannot guarantee faster processing, being proactive is viewed positively. On ABF’s side, having the DEC case reference or any interim correspondence uploaded to ICS or sent to the Regional Cargo Control may help demonstrate the exporter is addressing the issue in good faith, potentially preventing escalation to enforcement action while the permit is pending.
Practical tips for exporters and brokers dealing with dual-use exports:
• Start DSGL screening early: As soon as a new order or product is considered for export, screen it against the DSGL (using the online tool or consulting DEC). Don’t wait until packing or customs documentation stage.
• Obtain a Defence Client Registration Number (DCRN): This is required to apply for DEC permits. Companies should register with DEC ahead of time so they are ready to apply when needed.
• Engage experts for classification: If your item is technical, consider getting a professional assessment (some firms specialise in export controls compliance). Misclassification can be costly, whereas the correct identification of a DSGL entry (or confirmation that the item is not listed) will inform the entire export approach.
• Keep documentation ready: If a permit is required, ensure all supporting documents (technical specs, end-user certificates, cover letters) are correctly prepared. Incomplete submissions to DEC cause most delays . Similarly, keep copies of any DEC determination (permits or exemption letters) and provide them to your customs broker.
• Plan for contingencies: If despite best efforts a permit might not be in hand by shipping time, communicate with your freight forwarder. It may be wiser to delay loading goods until the permit is granted than to have them stuck at the wharf or airport under Customs hold.
Both government and industry voices agree that the changes introduced in the DTCA Amendment Act 2024 will ultimately “add complexity for businesses in assessing whether particular activity is regulated and needs a permit as well as being able to demonstrate that an activity is not regulated.” Compliance costs may rise in the short term as companies adapt, but these measures are aimed at protecting national security and keeping Australia’s export activities in line with international obligations. For freight forwarders and customs brokers, the evolving framework means a greater duty to stay informed and to advise clients on export control obligations. The upside is that those forwarders who invest in robust compliance practices will stand out to defence industry clients (who increasingly prioritise compliance and reliability over speed alone). In sum, the recent DTCA changes reinforce a simple message for industry: know your product, check the DSGL, get your permits in order, and you won’t be caught out at the border .
Jessica Rankin - CEO | ECAG
Sources:
1. Australian Border Force – Goods Compliance Update Autumn 2021, export controls overview .
2. Australian Border Force – Goods Compliance Update Autumn 2022, exporter permit obligations .
3. Defence Export Controls – official guidance on DTCA 2024 amendments and licence-free AUKUS environment .
4. Baker McKenzie – Analysis of DTCA Amendment Act 2024 (Anne Petterd & Kirsten Foley) .
5. Export Controls Australia Group – industry presentation on new laws (Jessica Rankin, Oct 2024) .
6. DTC DILP Research Paper – Impact of DTCA Changes on Industry (Nov 2024), key challenges .
7. University of Wollongong – Defence Export Controls guidance (permit processing times) .
8. Australian Customs Notice No. 2017/17 – Export Reporting Obligations (ICS permit flagging) .