EXPLANATORY STATEMENT
Tariff Concession Instrument No. 0506682
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.
Cryovac Australia Pty Ltd applied for a TCO in respect of certain ethylene vinyl acetate copolymer granules on 31 May 2005.
Instrument
TCO No 0506682 was made on 07 October 2005. It declares that those certain ethylene vinyl acetate copolymer granules 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 free.
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. 0506682 is taken to have come into force on 31 May 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 Tariff Concession Instrument No. 0506682, enacted in 2005, is an instrument under the Customs Act 1901 that addresses the problem of ensuring that Australian businesses have access to essential goods without being burdened by excessive customs duties. This instrument was developed to provide tariff concessions for specific goods that are not produced in Australia and are necessary for local industries. The policy objective is to support Australian industries by reducing the customs duty on imported goods that do not have Australian substitutes, thereby facilitating trade and economic growth. The instrument was made by the Chief Executive Officer of Customs following a valid application by Cryovac Australia Pty Ltd for tariff concessions on certain ethylene vinyl acetate copolymer granules. The instrument came into force on the date of the application, 31 May 2005, and no submissions were received against the application.
Scope and Application
The Tariff Concession Instrument No. 0506682, which was established under the Customs Act 1901, applies to specific goods for which an application has been made and approved by the Chief Executive Officer of Customs. This Act is relevant to entities that are seeking tariff concessions for goods that are not produced in Australia and for which there are no substitutable goods available in the domestic market. The geographic reach of this Act extends nationally, as it is a Commonwealth legislation. Notably, the Act excludes goods that are specified in section 269SJ of the Customs Act 1901, which cannot be subject to a tariff concession order. The application of this Act may be further extended or restricted through subordinate instruments, which are not detailed in the provided text. The primary effect of this legislation is to provide tariff concessions for certain imported goods, thereby potentially lowering the duty rates for those goods from their standard rates, as illustrated by the case of ethylene vinyl acetate copolymer granules.
Key Provisions
The Tariff Concession Instrument No. 0506682, as outlined in the Customs Act 1901, provides a framework for the Chief Executive Officer of Customs (the CEO) to issue Tariff Concession Orders (TCOs). Section 269F of the Act allows for an application to be made for a TCO in respect of specific goods, provided they do not fall under the exclusions listed in section 269SJ. If an application is deemed valid, the CEO must evaluate it against the core criteria set out in section 269C, which requires that on the date of application, no substitutable goods were produced in Australia in the ordinary course of business. This is further defined in sections 269B, 269D, and 269E of the Act, which clarify the meanings of terms such as ‘goods produced in Australia,’ ‘ordinary course of business,’ and ‘substitutable goods.’ If the CEO determines that the application meets these criteria, they must issue a written TCO under subsection 269P(3), specifying the reduced duty rate applicable to the goods.
The obligations imposed on the parties governed by the Act include the requirement for the CEO to publish a notice in the Gazette upon accepting a TCO application, inviting any interested parties to submit objections if they believe the TCO should not be granted. In the case of TCO No. 0506682, the CEO did not receive any submissions opposing the concession. Additionally, the Act mandates that the TCO does not retroactively affect the rights of any person, ensuring that the rights of importers are beneficially impacted. Importers can apply for a refund of duties on goods imported since the date the TCO is deemed to come into force, as per paragraph 126(1)(r) of the Regulations.
There are no specific offences, penalties, or consequences outlined for breaches of the Act in the context of TCOs. However, the general provisions of the Customs Act 1901 apply, which may include penalties for non-compliance with customs regulations. The Act ensures that the rights and interests of all parties are protected and that any changes in duty rates do not impose liabilities on individuals or entities for actions taken prior to the TCO's effective date. The Tariff Concession Instrument No. 0506682 thus provides a clear and structured process for granting tariff concessions while safeguarding the interests of all stakeholders involved.