EXPLANATORY STATEMENT
Tariff Concession Instrument No.0502990
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.
O E & D R Pope Pty Ltd applied for a TCO in respect of certain woven polypropylene and/or polyethylene bags on 8 March 2005.
Instrument
TCO No 0502990 was made on 20 May 2005. It declares that those certain woven polypropylene and/or polyethylene bags 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 10%. The rate of duty for the goods subject to the TCO is 0%.
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.0502990 is taken to have come into force on 8 March 2005.
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 Customs Act 1901, enacted by the Australian Parliament, includes a scheme for Tariff Concession Orders (TCOs) which allow for reduced customs duty on certain goods. This initiative was introduced to address the issue of ensuring that Australian consumers and businesses have access to competitively priced imported goods, particularly where no suitable domestic alternatives exist. The explanatory statement for Tariff Concession Instrument No. 0502990, made on 20 May 2005, outlines that the Chief Executive Officer of Customs must consider applications for TCOs and determine if they meet core criteria, such as the absence of substitutable goods produced in Australia. For the particular case of woven polypropylene and/or polyethylene bags, the instrument confirms the application of a 0% duty rate under item 50 of Schedule 4 to the Customs Tariff Act 1995, which contrasts with the general rate of 10%. This concession was granted following a successful application by E & D R Pope Pty Ltd, and the instrument came into force on the date the application was lodged, 8 March 2005, without affecting pre-existing rights or imposing new liabilities.
Scope and Application
The Customs Act 1901, specifically under Part XVA, establishes a framework for the creation of Tariff Concession Orders (TCOs) which provide for lower rates of customs duty on certain goods. These orders are issued by the Chief Executive Officer of Customs (CEO) upon application, provided the goods do not fall under the exclusions outlined in section 269SJ and meet the core criteria set forth in sections 269C, 269D, 269E, and 269P of the Act. This process ensures that the concession only applies to goods for which no substitutable goods are produced in Australia in the ordinary course of business. The application of the TCO is limited geographically to Australia and applies to the specific goods identified in the order, in this case, certain woven polypropylene and/or polyethylene bags, as specified in item 50 of Schedule 4 to the Customs Tariff Act 1995. The TCO is effective from the date the application was lodged, as per subsection 269S(1) of the Act, and does not affect the rights of any person in relation to actions taken before the date of registration. The CEO is required to publish notices in the Gazette to allow for public submissions, though in this instance, no submissions were received.
Key Provisions
The key operative sections of this legislation include sections 269C, 269F, 269P, and 269SJ of the Customs Act 1901. Section 269F allows a person to apply to the Chief Executive Officer of Customs (CEO) for a Tariff Concession Order (TCO) in respect of certain goods. If the CEO determines that the application meets the core criteria (section 269C), they must make a written order declaring that the goods are subject to a specified rate of customs duty (section 269P). Section 269SJ sets out the goods that cannot be subject to a TCO. In this case, TCO No.0502990 was made in respect of certain woven polypropylene and/or polyethylene bags, declaring that they are subject to a rate of duty of 0%.
The Act imposes certain obligations and requirements on the parties involved. For instance, section 269K(1) requires the CEO to publish a notice in the Gazette as soon as practicable after accepting a TCO application as valid, inviting any person who believes the TCO should not be made to lodge a submission with the CEO. This ensures transparency and allows for public input before a decision is made. Additionally, section 269S(1) specifies that a TCO comes into force on the day on which the application for the TCO was lodged, ensuring that the effective date is clearly defined.
Breach of the provisions outlined in this legislation can lead to various consequences. The Customs Act 1901 includes a range of offences and penalties for non-compliance, though specific penalties are not detailed in the explanatory statement provided. Generally, breaches can result in civil or criminal penalties, including fines and imprisonment, depending on the severity of the offence. It is essential for all parties involved to adhere to the requirements set forth in the Act to avoid potential legal repercussions.
In summary, TCO No.0502990 provides for a concession on customs duty for certain woven polypropylene and/or polyethylene bags, reducing the duty rate from 10% to 0%. The CEO must follow specific procedures when considering and approving TCO applications, including publishing notices in the Gazette and considering any submissions received. Failure to comply with the Act’s provisions can result in civil or criminal penalties, underscoring the importance of adhering to the outlined requirements.