Tradex Scheme Grant Program

Program Overview

Tradex Scheme offers an upfront exemption from customs duty and Goods and Services Tax (GST) for imported goods that are intended for re-export. This scheme provides significant cash flow benefits to Australian businesses involved in international trade. By eliminating the need to pay and then claim back duty and GST, businesses can avoid tying up capital, making their import-export operations more financially efficient.

Tradex Scheme’s primary purpose is to enhance Australian businesses’ competitiveness in the global market. It supports various re-export activities, including processing, manufacturing, repairing, or simply re-selling originally imported goods. This scheme fosters international trade by reducing the financial burden on importers who intend to re-export their products.

The Tradex Scheme is not a grant program with a specific funding pool. It is an ongoing exemption from import duties and GST, meaning there is no fixed “total available funding.” The benefit derived is the direct saving on duty and GST payments at the time of import.

Key Details

• Funding Amount or Range: Not a direct funding program. The benefit is an upfront exemption from customs duty and GST on eligible imported goods. The value of this benefit depends on the volume and value of your imports and the applicable duty/GST rates.
• Application Open and Close Dates: Applications for Tradex orders are open continuously. There are no specific application open and close dates as it is an ongoing scheme.
• Eligible Industries and Business Types: The Tradex Scheme is available to any Australian business that imports goods to re-export them. This includes businesses involved in:
  • Manufacturing, where imported components are used in products for export.
  • Processing, where imported raw materials are transformed and then exported.
  • Repair and alteration are where imported goods are repaired and re-exported.
  • Wholesaling or trading, where goods are imported for direct re-export without significant alteration.
• Co-contribution or Matching Fund Requirements: No co-contribution or matching fund requirements apply. The scheme provides an upfront exemption rather than requiring a financial contribution from the business.
• Location/State/Territory Applicability: The Tradex Scheme is a federal Australian Government program and applies to all eligible businesses across all Australian states and territories.

Eligibility Criteria

To be eligible for a Tradex order, businesses must meet the following requirements:

• Be an Australian entity with an Australian Business Number (ABN).
• Demonstrate a clear intention to re-export the imported goods. This includes goods that will be:
  • Re-exported in the same form as imported.
  • Used as materials in the manufacture or production of goods for re-export.
  • Treated, processed, or incorporated into goods for re-export.
  • Repaired, renovated, or altered and then re-exported.
• Have systems in place to track and account for the imported goods and their subsequent re-export.
• Maintain accurate records of all imports under the Tradex order and corresponding re-exports.
• Comply with all reporting obligations to the Australian Border Force (ABF).

Eligible Activities and Expenses

The Tradex Scheme provides an exemption for customs duty and GST on goods imported for the following re-export activities:

• Manufacturing: Importing raw materials or components to produce finished goods that will be exported.
• Processing: Importing goods to undergo a processing operation (e.g., refining, assembly) before re-export.
• Repair and Alteration: Importing goods for repair, renovation, or alteration, followed by their re-export.
• Trading/Re-selling: Importing goods solely for the purpose of re-selling and re-exporting them.
• Packaging and Repackaging: Importing goods that will be packaged or repackaged before being exported.

The exemption applies to the duty and GST levied on the imported goods themselves. It does not cover other business expenses such as marketing, R&D, capital costs, or general operational expenditures.

Assessment Process

The Tradex Scheme is an entitlement-based program, not a competitive grant. If a business meets the eligibility criteria and complies with the scheme’s requirements, it is entitled to receive a Tradex order. The application process involves submitting a request to the Australian Border Force (ABF).

Assessment criteria include:

• Verify the applicant’s ABN and business details.
• Confirmation of the applicant’s intention to re-export the goods.
• The applicant’s capacity to meet record-keeping and reporting obligations.
• The nature of the goods being imported and their intended re-export purpose.

The ABF may conduct regular compliance checks to ensure ongoing adherence to the scheme’s conditions. 

Application Tips

• Understand Your Obligations: Thoroughly review the Customs Act 1901 and Tradex Scheme Act 1999 requirements and relevant legislative instruments to understand your obligations fully.
• Accurate Record-Keeping: Establish robust internal systems for tracking all imported goods under the Tradex order, their use, and their eventual re-export. This includes invoices, customs declarations, shipping documents, and evidence of export.
• Clear Intent to Re-export: Clearly demonstrate your intention to re-export the goods at the time of import. This can be evidenced through business plans, contracts with overseas buyers, or an established export history.
• Consult ABF Guidance: Utilise the information and guidance provided by the Australian Border Force on the Tradex Scheme to ensure compliance.
• Seek Professional Advice: For complex import-export operations or to ensure full compliance, consider obtaining advice from a customs broker or a specialist in trade legislation.

Further Support

Navigating customs regulations and trade schemes can be intricate. Seeking professional advice can help ensure compliance and maximise the benefits of the Tradex Scheme. Pattens Group has supported businesses in Australia with grant applications for three decades. Contact us for assistance with understanding the Tradex Scheme and its application to your business operations.