EXPLANATORY STATEMENT
Tariff Concession Instrument No. 0412876
Customs Act 1901
Background
Part XVA of the Customs Act 1901 (the Act) sets out a scheme under which Tariff Concession Orders (TCOs) may be made by the Chief Executive Officer of Customs (the CEO). A lower rate of customs duty applies to goods that are the subject of a TCO.
Under section 269F of the Act, a person may apply to the CEO for a TCO in respect of goods. If the CEO is satisfied that the application is not in respect of goods specified in section 269SJ of the Act, which sets out those goods that cannot be subject to a TCO, the CEO must decide whether the application meets the core criteria.
Section 269C of the Act provides that a TCO application meets the core criteria if, on the day on which the application was lodged, no substitutable goods were produced in Australia in the ordinary course of business. Section 269B of the Act provides that ‘goods produced in Australia’ has the meaning given by section 269D, ‘ordinary course of business’ has the meaning given by section 269E and ‘substitutable goods’ in respect of goods the subject of a TCO application, means goods produced in Australia that are put, or are capable of being put, to a use that corresponds with a use (including a design use) to which the goods the subject of the application can be put.
Subsection 269P(3) of the Act provides that if the CEO is satisfied that a TCO application meets the core criteria, the CEO must make a written order (a TCO) declaring that the goods the subject of the TCO application are goods to which a prescribed item of Schedule 4 to the Customs Tariff Act 1995 (the Tariff) specified in the order applies.
Resident Agent Services Ltd applied for a TCO in respect of certain polycondensators on 30 November 2004.
Instrument
TCO No 0412876 was made on 25 February 2005. It declares that those certain polycondensators are goods to which item 50 of Schedule 4 to the Tariff applies since the CEO was satisfied that no substitutable goods were produced in Australia. The general rate of duty on these goods is 5%. The rate of duty for the goods subject to the TCO is 3%.
Consultation
Subsection 269K(1) of the Act provides in part that as soon as practicable after accepting a TCO application as a valid application, the CEO must publish a notice in the Gazette which includes an invitation to any person who considers that there are reasons why the TCO should not be made to lodge a submission with the CEO. The CEO did not receive any submissions in response to this invitation.
Commencement
Subsection 269S(1) relevantly provides that a TCO is to be taken to have come into force on the day on which the application for the TCO was lodged. TCO No. 0412876 is taken to have come into force on 30 November 2004.
The TCO does not affect the rights of a person (other than the Commonwealth) as at the date of registration so as to disadvantage that person or impose liabilities on a person (other than the Commonwealth) in respect of anything done or omitted to be done before the date of registration. The rights of importers will be beneficially affected. Under paragraph 126(1)(r) of the Regulations, importers of such goods will be able to apply for a refund of duty on goods imported since the day on which the TCO is taken to have come into force. The TCO does not impose any liabilities on any person.
Overview
The Tariff Concession Instrument No. 0412876 was enacted in 2005 under the Customs Act 1901 to address the need for tariff concessions on certain imported goods, specifically polycondensators in this instance. The Customs Act 1901 allows for Tariff Concession Orders (TCOs) to be made by the Chief Executive Officer of Customs to apply lower rates of customs duty to specified goods. The Act was introduced by the Parliament of Australia and aims to provide economic benefits by reducing duty on imported goods where no substitutable goods are produced in Australia. In this case, Resident Agent Services Ltd applied for a TCO for certain polycondensators, which was subsequently granted by the CEO after determining that no substitutable goods were produced domestically. This resulted in a reduction of the duty rate from 5% to 3%. The TCO was published in the Gazette, inviting submissions from interested parties, though none were received. The order came into effect on the date the application was lodged, 30 November 2004, and provides for potential duty refunds to importers for goods imported since that date.
Scope and Application
The Customs Act 1901, specifically under Part XVA, facilitates the creation of Tariff Concession Orders (TCOs) by the Chief Executive Officer of Customs (CEO) to apply lower rates of customs duty on certain goods. This process is available to any person who can demonstrate that no substitutable goods are produced in Australia in the ordinary course of business, as per section 269C of the Act. The legislation defines "substitutable goods" as those produced in Australia that serve a similar purpose to the goods in question. Exclusions apply to goods specified in section 269SJ, which cannot be subject to a TCO. This act applies nationally across Australia, overseen by the Commonwealth, and its application can be extended or restricted through subordinate instruments. In the case of TCO No. 0412876, made on 25 February 2005, it was determined that certain polycondensators qualified for a lower duty rate under item 50 of Schedule 4 to the Customs Tariff Act 1995, effectively reducing the duty from 5% to 3%. The process requires publication of the application in the Gazette, inviting submissions from interested parties, although in this instance, no submissions were received.
Key Provisions
The Tariff Concession Order No. 0412876, as detailed in the Explanatory Statement, outlines the key provisions of the Customs Act 1901 concerning the application and approval of Tariff Concession Orders (TCOs). According to section 269F, any person may apply to the Chief Executive Officer (CEO) of Customs for a TCO in respect of specified goods. Section 269C stipulates that an application for a TCO meets the core criteria if, on the day the application was lodged, no substitutable goods were produced in Australia in the ordinary course of business. The definitions of "goods produced in Australia," "ordinary course of business," and "substitutable goods" are provided by sections 269D, 269E, and 269F respectively. If the CEO is satisfied that the application meets these core criteria, they are required under subsection 269P(3) to make a written order, effectively granting the TCO.
The obligations imposed by the Customs Act 1901 on the parties involved are primarily centred around the application and approval process for TCOs. The CEO must ensure that the application meets the core criteria, as outlined in section 269C, and if satisfied, make the requisite TCO within the legislative framework. Moreover, under subsection 269K(1), the CEO must publish a notice in the Gazette inviting submissions from any person who believes the TCO should not be made. This process ensures transparency and allows interested parties to voice their opinions. In the case of TCO No. 0412876, the CEO did not receive any submissions in response to the Gazette notice.
The Act also outlines specific consequences for non-compliance or breaches related to TCOs. While the explanatory statement does not explicitly detail offences or penalties for breaching the Act, it is understood that failure to comply with the provisions for TCOs could lead to legal repercussions. Typically, breaches of the Customs Act 1901 can result in civil or criminal penalties, including fines and imprisonment, depending on the severity of the breach. However, the specific penalties are not detailed in the explanatory statement for this particular TCO. The rights of importers are protected, and they can apply for a refund of duty on goods imported since the TCO came into force, as per paragraph 126(1)(r) of the Regulations. Importantly, the TCO does not impose any liabilities on any person.