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Posted by Chris Roberts
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2 March, 2026
ONE of the most persistent misconceptions in the customs brokerage sector is that regulatory silence equals commercial safety. Nowhere is this more evident than in the growing use of ABN-to-ABN arrangements between nominee licensed customs brokers and corporate brokerages.
Recent correspondence from the Australian Border Force (ABF) Broker Licensing team makes one thing clear: there is no licence condition that requires a nominee broker to be an employee of a corporate licence holder. In written response to an industry enquiry, ABF confirmed that employment status is not a condition attached to a nominee licence, nor is there a regulatory prohibition on ABN-to-ABN engagement models.
That confirmation is often taken as the end of the discussion. In reality, it is only the beginning.
Regulatory Permission Does Not Equal Risk Transfer
The ABF’s position is narrow and deliberate. Licensing determines who may act, not who ultimately bears financial risk when something goes wrong. The Customs Act 1901 and the infringement notice framework focus on conduct and responsibility, not commercial arrangements sitting behind the licence.
In practical terms, this means that when an ABF infringement notice is issued for a strict liability offence such as an incorrect declaration the regulator may direct enforcement action at a natural person, a body corporate, or both. The legislation allows for that flexibility, and the regulator is not required to untangle private contractual arrangements before issuing a notice.
The same principle applies under the Department of Agriculture, Fisheries and Forestry’s infringement regime for biosecurity contraventions. Payment of an infringement notice may discharge regulatory liability, but it does not determine who ultimately pays the bill.
Where the Insurance Question Actually Gets Decided
That determination is made later, by insurers.
In separate industry correspondence, an well-known industry insurer, has confirmed what many brokers only discover after the fact: insurers will seek recovery from the party whose actions gave rise to the infringement, regardless of whether the regulator imposed the notice on a corporate licence holder or an individual.
In ABN-to-ABN arrangements, nominee brokers are frequently:
- Engaged as independent contractors.
- Required to maintain their own professional indemnity or statutory liability cover.
- Subject to indemnity clauses in favour of the corporate brokerage.
From an insurer’s perspective, this is not an employment model it is outsourced professional risk. Where a nominee broker’s conduct is the operative cause of an infringement, insurers may respond to the claim and then pursue recovery directly against the nominee broker under rights of subrogation or contractual indemnity. This commercial reality was explicitly acknowledged in the Insurers email to industry participants.
This is not a regulatory issue. It is a policy wording and recovery issue – and regulators do not intervene in it.
Why This Catches Nominee Brokers Off Guard
The problem is not that ABN-to-ABN arrangements are unlawful. They are not. The problem is that many nominee brokers assume regulatory permission implies insurance protection. It does not.
The ABF has confirmed that employment status is irrelevant to licensing. At the same time, insurers have confirmed they will look past licence structures and focus on who caused the loss when deciding recovery pathways.
Those two positions are not contradictory. They operate in entirely different spheres.
Strict Liability Makes the Exposure Sharper
Customs and biosecurity offences are frequently strict liability. Intent, negligence or good faith are not required to establish a contravention. Once an incorrect statement is made, exposure exists.
For nominee brokers operating independently:
- The defence burden is personal
- The compliance history follows the individual
- The insurance recovery risk sits squarely with the person who exercised judgment
In ABN-to-ABN models, the corporate brokerage may satisfy the regulator, but the nominee broker may still satisfy the insurer – after the fact.
A Risk the Industry Needs to Acknowledge
The takeaway is not that ABN-to-ABN nominee arrangements should stop. The takeaway is that they should be entered into with eyes open.
Nominee brokers should be asking:
- Does my insurance explicitly respond to ABF and DAFF infringement notices issued in my name?
- Do my contracts expose me to recovery action by a corporate broker’s insurer?
- Am I relying on regulatory silence where only insurance wording matters?
The ABF has been clear about what licensing does not require. Insurers have been equally clear about what they will do. The danger lies in assuming one answers the other.
In today’s enforcement environment, the absence of a licence condition is not the absence of liability and it never has been.
