EXPLANATORY STATEMENT
Statutory Rules 1982 No. 335
Customs Regulations (Amendment)
Issued by the Authority of the Minister of State for the Capital Territory acting for and on behalf of the Minister of State for Industry and Commerce.
The purpose of these regulations is to amend the Customs Regulations to give effect to the Government’s decision to remove the provisions in the regulations enabling the “manufacture in bond” of wood and articles of wood from imported timber.
The decision to remove this facility forms part of a range of Government measures of long-term assistance for the Timber Industry in Australia. It follows the Government’s acceptance of a recommendation by the Industries Assistance Commission (IAC) in its Report No. 275 of 17 August 1981 entitled “Wood and Articles of Wood”.
In October 1981 the Government announced that a decision on the IAC report would be deferred so that the recommendations of the Commission could be considered along with the Senate Standing Committee on Trade and Commerce report on Australia’s Forestry and Forest Products Industries and the Forest Products Industries Advisory Council report on Australia’s Forest Products Industries. The deferrment has allowed long-term policies for the industry to be formulated after full consideration of the proposals and recommendations contained in the three reports.
The “manufacture in bond” facility provides a means whereby payment of duty on imported timber used for manufacture in licenced warehouses (also known as “bonds” or “bond stores”) may be deferred until manufactured for sale or use.
In its report the IAC commented that “this long-standing facility for “manufacture in bond” of timber and timber products perpetuates a number of undesirable anomalies and distortions:
• It discriminates against users of small quantities of imported timber whose potential duty savings would not offset their costs of operating a “bond”;
• the significant duty savings through allowances for waste are not available to other industries;
• it lowers the rate of tariff assistance which has been considered appropriate for the processing of local timber; and
by reducing the duty payable on imported inputs it raises the level of effective assistance for some manufacturers”.
It was for these reasons that the Commission recommended that the provisions for “manufacture in bond” of the timber products be terminated.
Overview
The Customs Regulations (Amendment) Statutory Rules 1982 No. 335 were enacted to address the issue of the "manufacture in bond" of wood and articles of wood from imported timber, a facility that had been in place within the Customs Regulations. This legislation was introduced to give effect to the Australian Government's decision to remove this facility as part of a broader strategy to provide long-term assistance to the timber industry. The decision followed recommendations by the Industries Assistance Commission in its Report No. 275 of August 1981, which identified various anomalies and distortions perpetuated by the "manufacture in bond" provisions. The policy objective behind this amendment was to rectify these issues and support the industry through comprehensive policy measures.
These regulations were issued by the Authority of the Minister of State for the Capital Territory, acting on behalf of the Minister of State for Industry and Commerce. The removal of the "manufacture in bond" facility aimed to address concerns such as discrimination against small-scale users of imported timber, the lack of duty savings for other industries, and the inappropriate levels of tariff assistance for local timber processing. By deferring the decision on the IAC report to allow for a thorough review of related proposals and recommendations, the Government sought to formulate effective long-term policies for the timber industry.
Scope and Application
The Statutory Rules 1982 No. 335, which amend the Customs Regulations, apply to the removal of the "manufacture in bond" provisions for wood and articles of wood from imported timber within the Australian Capital Territory. This amendment is intended to address the anomalies and distortions identified by the Industries Assistance Commission in its Report No. 275, which recommended the termination of the "manufacture in bond" facility. The decision aligns with the Government's broader strategy to support the timber industry in Australia. This legislative change affects entities and individuals involved in the manufacture of wood products from imported timber within licensed warehouses, where duty payment on the imported timber can be deferred until the manufactured goods are ready for sale or use. The exclusion of this facility is a targeted measure aimed at correcting economic imbalances identified in the IAC report, thereby providing a more equitable approach to duty payments and tariff assistance within the industry.
Key Provisions
The Customs Regulations (Amendment) Statutory Rules 1982 No. 335 primarily concern the removal of the "manufacture in bond" provisions for wood and articles of wood from imported timber, as stated in section 1 of the explanatory statement. This amendment is intended to address the anomalies and distortions identified by the Industries Assistance Commission (IAC) in its Report No. 275, such as discrimination against small users of imported timber and inequity in duty savings compared to other industries. The changes are a response to the IAC's recommendation to terminate the "manufacture in bond" facility for timber products, which previously allowed for deferred duty payments on imported timber used in licensed warehouses until the manufactured products were ready for sale or use.
Under these amended regulations, the obligations and requirements imposed on parties or entities governed by the Act include ceasing the practice of "manufacture in bond" for wood and articles of wood derived from imported timber. This means that duty on such items must now be paid immediately upon importation, rather than being deferred until the manufactured products are completed. This change applies to all licensed warehouses and entities involved in the manufacture and storage of these materials, ensuring that they comply with the updated customs regulations. It is imperative that these entities adjust their operations to align with the new requirements, which involve paying duty upfront rather than deferring it until the end of the manufacturing process.
In terms of potential consequences for non-compliance, the amended regulations do not explicitly state specific offences, penalties, or civil/criminal consequences for breach. However, failure to comply with the updated customs regulations could result in penalties under the broader Customs Act 1901, which governs customs and border protection in Australia. These penalties could include fines, seizure of goods, or other legal actions as determined by the relevant authorities. The exact penalties would depend on the specific circumstances of the non-compliance, but it is clear that adherence to the new regulations is mandatory for all affected parties.