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importing.com.au

6 min read · Updated October 2026

Illustration for the guide: Freight, Incoterms & Customs Brokers

Key takeaways

  • FOB is the most common sea-freight term for importers — you control freight, insurance and the GST base.
  • GST applies to freight and insurance regardless of Incoterm — don't double-count on CIF/DDP.
  • Use a licensed customs broker once you import regularly or anything restricted.

Freight, Incoterms & Customs Brokers

Sea vs air

Factor Sea (FCL/LCL) Air
Transit time 2–6 weeks typical 1–2 weeks typical
Cost Low per cubic metre/TEU; FCL for volume High; for urgent/high-value/low-weight
Best for Bulk, heavy, non-urgent Samples, e-commerce restock, perishables
Restrictions BMSB seasonal measures apply IATA dangerous goods rules strict (aerosols, lithium batteries, magnets, liquids)

Express couriers (DHL/FedEx/UPS) handle their own clearance for parcels under AUD 1,000; above that you'll need an Import Declaration. Sourcing from China? See importing from China.

Incoterms 2020 — who pays for what

Incoterm Main carriage paid by Risk transfers to buyer Insurance Notes for AU importers
EXW Buyer (all) At seller's factory gate Buyer's option Maximum buyer responsibility; seller does almost nothing
FOB Buyer (sea) On board vessel at origin Buyer's option Common for sea freight; buyer controls freight and insurance (controls VoTI)
CIF Seller (to AU port) On board vessel at origin Seller (minimum cover) Seller arranges freight+insurance; watch under-insurance
CFR Seller (to AU port) On board vessel at origin Buyer's option Like CIF without seller insurance
DAP/DDP Seller At named AU destination (DAP) / delivered duty paid (DDP) Seller DDP: seller pays AU duty/GST — great for buyers, but confirm seller can actually lodge AU declarations correctly

Practical note: VoTI (GST base) includes T&I regardless of who arranges it — on CIF/DDP the freight cost is already inside the invoice value, so don't double count.

Landed cost model

Landed cost/unit =
  Product cost
+ Freight (per-unit share)
+ Insurance
+ Customs duty
+ GST (recoverable if GST-registered — treat as cash-flow, not cost)
+ Import processing charge + broker fees (amortised)
+ DAFF inspection/treatment (if any)
+ Compliance/certification (RCM, testing, labelling)
+ Last-mile delivery + state charges

Run the numbers in our landed cost calculator.

Customs brokers & freight forwarders

  • Licensed customs brokers lodge declarations on your behalf, classify goods, and manage permits/referrals. Strongly recommended once you're importing regularly or anything restricted.
  • Find licensed brokers via the ABF listing. Fees: typically per-declaration + disbursements.
  • Freight forwarders book cargo space and handle logistics; many partner with brokers for clearance.
  • You can self-lodge via ICS with a digital certificate — viable for simple, low-volume imports.

Practical tips

  • Insist on a detailed commercial invoice (HS codes, values, currency, Incoterm, origin) — sloppy invoices are the #1 cause of clearance delays.
  • For FTA duty rates, ensure the Certificate of Origin is valid and presented at entry.
  • Consider a Customs Warehouse or bonded warehouse to defer duty/GST on stock not yet sold.
  • Keep records 5 years (customs and tax law).

Frequently asked questions

Should I ship sea or air freight to Australia?

Sea (FCL for volume, LCL for smaller loads) is far cheaper per unit but takes 2–6 weeks; air takes 1–2 weeks and suits urgent, high-value or light goods — but IATA dangerous goods rules are strict for batteries, aerosols and liquids.

Which Incoterm is best for Australian importers?

FOB is common for sea freight because the buyer controls freight and insurance (and therefore the GST base). DDP shifts all work to the seller, but confirm the seller can actually lodge Australian declarations correctly. Note GST is calculated on freight and insurance regardless of Incoterm.

How do I find a licensed customs broker in Australia?

The ABF publishes a listing of licensed customs brokers. Brokers charge per declaration plus disbursements, and handle classification, lodgement, permits and DAFF referrals on your behalf.