EXPLANATORY STATEMENT
Customs By-law No. 1303873
Customs Act 1901
Section 271 of the Customs Act 1901 (the Act) provides, in part, that where an item of a Customs Tariff is expressed to apply to goods, or to a class or kind of goods, as prescribed by by-law, the Chief Executive Officer of Customs may make by-laws for the purposes of that item. A Customs Tariff is defined in section 4 of the Act to mean an act imposing duties of customs. The Customs Tariff Act 1995 (the Customs Tariff Act) is a Customs Tariff for the purposes of the Act.
Background
The Customs Tariff Amendment (Schedule 4) Act 2012 will repeal the existing Schedule 4 of the Customs Tariff Act and replace it with a new Schedule 4. As part of this process, new
by-laws are required for all items that provide for goods to be prescribed by by-law.
Item 48 in the new Schedule 4 combines items 36, 38, 39A, 39B and 39C of the previous
Schedule 4 to the Customs Tariff Act. Item 48 provides that goods, as prescribed by by-law that are classified under certain headings applying to chemicals, photographic film, plastics and paper, are dutiable at the rate of “Free”.
New By-law No. 1303873 replaces previous By-law No. 9640069.
Instrument
By-law No. 1303873 prescribes gelatin, classified under subheading 3503.00.10 in
Schedule 3. The goods are to be for use in the manufacture of capsules.
A security is required to be lodged with the Australian Customs and Border Protection Service to ensure compliance.
Consultation
No consultation was undertaken in relation to By-law No. 1303873 as it does not alter existing arrangements.
Human Rights Implications
This by-law does not engage, impact on, or limit in any way, the human rights and freedoms recognised or declared in the international instruments listed in the definition of human rights at section 3 of the Human Rights (Parliamentary Scrutiny) Act 2011.
Commencement
By-law No. 1303873 takes effect on and from the date that the Customs Tariff Amendment (Schedule 4) Act 2012 commences, that is 1 March 2013.
Overview
The Customs By-law No. 1303873, enacted in 2013, was introduced to address the need for updated regulations under the Customs Tariff, as necessitated by the Customs Tariff Amendment (Schedule 4) Act 2012. This by-law was created to prescribe the application of duty-free status to gelatin, classified under subheading 3503.00.10 in Schedule 3, specifically for use in the manufacture of capsules. The Customs Act 1901, enacted by the Commonwealth Parliament, empowers the Chief Executive Officer of Customs to establish such by-laws. The policy objective of this by-law is to ensure that the transitional changes in the Customs Tariff do not disrupt existing trade arrangements and maintain compliance through the requirement of a security deposit with the Australian Customs and Border Protection Service.
Scope and Application
The Customs By-law No. 1303873, under the Customs Act 1901, applies to gelatin classified under subheading 3503.00.10 in Schedule 3, intended for use in the manufacture of capsules. This by-law, which replaces the previous By-law No. 9640069, specifies that these goods will be dutiable at the rate of “Free” as per the new Schedule 4 introduced by the Customs Tariff Amendment (Schedule 4) Act 2012. The by-law is applicable nationwide across Australia and governs the import and use of specified goods within the defined industry, ensuring compliance through the requirement of a security deposit with the Australian Customs and Border Protection Service. Notably, this by-law does not extend or alter existing arrangements and therefore did not necessitate consultation. It is effective from 1 March 2013, the date the Customs Tariff Amendment (Schedule 4) Act 2012 came into force.
Key Provisions
The main operative sections of the Customs By-law No. 1303873 pertain to the classification and duty-free status of specific goods under the Customs Tariff Act 1995. Section 271 of the Customs Act 1901 allows the Chief Executive Officer of Customs to create by-laws for items in the Customs Tariff, and the Customs Tariff Act 1995 defines these as acts imposing duties of customs. In this case, By-law No. 1303873 prescribes the classification of gelatin under subheading 3503.00.10, which is intended for use in the manufacture of capsules, as being dutiable at a "Free" rate (section 271, Customs Act 1901). This means that no customs duty will be applied to this specific type of gelatin.
The by-law imposes certain obligations and requirements on the parties involved. Manufacturers or importers of gelatin intended for capsule production must ensure that the gelatin is classified correctly under the specified subheading and headings. Additionally, a security must be lodged with the Australian Customs and Border Protection Service to ensure compliance with the by-law. This security serves as a guarantee that the goods are being used for their intended purpose and are not subject to any customs duties (Customs By-law No. 1303873).
In terms of penalties and consequences for non-compliance, the by-law does not explicitly state the penalties for breach. However, under the Customs Act 1901, breaches of customs laws can result in severe penalties. These may include fines, imprisonment, or both, depending on the severity of the breach. For instance, individuals or entities found guilty of evading customs duties could face fines of up to $22,000 and/or imprisonment for up to five years, as per section 246 of the Act. Furthermore, persistent offenders might face higher penalties, including longer prison sentences and more substantial fines (section 247, Customs Act 1901). The precise penalties for breaching By-law No. 1303873 would likely be determined based on these general provisions within the Customs Act 1901.