PARTIES in the commercial world have been exposed to insolvency, which has increased and unsurprisingly spread to the international supply chain.
As a consequence, they likely have been taking steps to try and reduce risks through increased due diligence on legal and financial risks of customers before taking work and taking steps to secure better protections during that risk including requiring payment in advance from some customers, developing improved terms and conditions of trade, requiring letters of credit or registering other securities under the personal properties securities regime as well as credit insurance.
Many of these steps were aimed at giving the service provider better security over goods being carried by them so that they could assert rights over the goods to try and recover amounts owed to them.
The range of insolvency issues affecting the international supply chain are now fully on display due to the insolvency of a key player in the Australian supply chain.
Rumours have been swirling for some time and now developments are rising in public forums relating to ACFS Port Logistics (ACFSPL) and related parties in the ‘ACFS Group'.
There had been stories of insolvency risks to ACFSPL which had been dismissed. ACFSPL has now appointed Salea Advisory as Administrators of ACFSPL.
The “administration” process is one adopted in Australia by directors of companies who believe that their company may be insolvent. Control of the company then passes to those administrators who would normally make a rapid independent assessment of the company including meeting with creditors and determine whether the company should pass into a more formal stage of insolvency or be bought by others (on occasion the directors of the company) at a discount to full value to try and realise assets and continue the operations of the company.
However, in this case the situation has been made more complex by the appointment of partners from BDO as receivers of ACSPL by ScotPac, (a specialist business lender) on 6 August 2026. A “receiver” is a different type of insolvency practitioner appointed by a secured creditor as is a “liquidator” who is another type of practitioner more usually called on to “liquidate” and “wind up” a company”.
In this case, the receiver had moved to stop a “winding–up” of the company at the instigation of the ATO as a major creditor.
All the insolvency practitioners have different roles, and, in this case, the administrator has stated that it will continue to run the companies in the ACFS Group while the receivers will be undertaking a sale campaign for ACFS and its assets as a “going concern”.
The administration and other steps will impact customers, retailers, ACFS employees and the ports. The ABF and DAFF may move to stop ACFS from conducting customs brokerage or biosecurity services.
The ports may close ACSF premises stopping delivery, arrival or departure of goods or containers. Readers should watch the sources of news and seek advice from industry sources, including the International and Customs Brokers Association of Australia (IFCBAA) and their own financial advisors.
Readers scheduled to collect and deliver goods and containers from ACFS and those holding containers to be de–hired at ACFS premises, must advise their customers of the effect of these developments and likely delays, costs and uncertainties in their supply chains.
Overseas suppliers need to be advised of possible venue changes for deliveries of shipments. Deliveries to ACFS may be stopped and long lines of trucks may also appear outside ACFS facilities in various ports, congesting vehicle movements.
In the immediate future, readers may look to negotiate with competitors of ACFS, probably at higher rates.
Editor's note: Andrew Hudson is a director and Life Member of the International Forwarders & Customs Brokers Association Australia (IFCBAA).