EXPLANATORY STATEMENT
Tariff Concession Instrument No. 0507060
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.
Visypak Operations Pty Ltd applied for a TCO in respect of certain bleached paperboard on 9 June 2005.
Instrument
TCO No 0507060 was made on 9 September 2005. It declares that the certain bleached paperboard is a product 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. 0507060 is taken to have come into force on 9 June 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, provides a framework for the imposition and collection of customs duties, including the ability to grant tariff concessions through Tariff Concession Orders (TCOs). The problem this legislation addresses is the potential for unfair competitive disadvantage faced by Australian businesses when they cannot competitively source certain goods domestically. The Tariff Concession Instrument No. 0507060 was introduced to provide tariff concessions to Visypak Operations Pty Ltd for certain bleached paperboard, ensuring that they could import these goods duty-free, thereby enhancing their competitiveness and operational efficiency. The policy objective is to foster a competitive business environment in Australia by allowing the import of goods that are not produced domestically, subject to certain criteria being met, thereby benefiting importers and potentially lowering costs for end consumers.
Scope and Application
The Tariff Concession Instrument No. 0507060, made under the Customs Act 1901, applies to the importation of certain bleached paperboard, for which a lower rate of customs duty is set by a Tariff Concession Order (TCO). This Act governs the process by which the Chief Executive Officer of Customs can reduce or eliminate customs duty on specified goods through the issuance of a TCO, provided that no substitutable goods are produced in Australia in the ordinary course of business. The TCO applies to entities involved in the importation of the specified bleached paperboard, granting them the benefit of a reduced duty rate. The geographical scope of this Act is national, as it pertains to the entire Commonwealth of Australia, and it affects the customs duties applicable across the country. The Act does not provide for any exclusions, exemptions, or thresholds beyond those specified in the Customs Act 1901, and its application can be extended or restricted through subordinate instruments such as regulations or further orders under the Customs Act 1901.
Key Provisions
The Customs Act 1901, as amended, provides a mechanism for the Chief Executive Officer of Customs (CEO) to issue Tariff Concession Orders (TCO) under section 269F (1). These orders apply a lower rate of customs duty to specified goods. For example, in the case of TCO No. 0507060, the CEO issued an order on 9 September 2005, declaring that certain bleached paperboard is a product to which item 50 of Schedule 4 to the Customs Tariff Act 1995 applies, resulting in a duty rate of free rather than the general rate of 5%. This concession is granted if the CEO is satisfied that no substitutable goods were produced in Australia on the day the application was lodged, as outlined in section 269C.
Under the Act, any person may apply to the CEO for a TCO in respect of goods, provided the goods are not specified in section 269SJ, which excludes certain goods from eligibility for a TCO. The CEO must evaluate whether the application meets the core criteria, primarily whether no substitutable goods were produced in Australia in the ordinary course of business on the application date, as defined in section 269D and 269E. If the application meets these criteria, the CEO is required to make a written TCO order, as stipulated in section 269P(3). This process ensures that the concessions are granted appropriately and fairly.
The obligations imposed by the Act on the parties include the requirement for applicants to ensure their applications meet the eligibility criteria and provide sufficient evidence that no substitutable goods were produced in Australia. The CEO must evaluate these applications and make decisions based on the criteria set out in the Act. Furthermore, once an application is accepted, the CEO must publish a notice in the Gazette inviting submissions from interested parties, as required by subsection 269K(1). In this instance, the CEO did not receive any submissions against the application.
For breaches of the Act's provisions or conditions imposed by a TCO, the Act may impose civil or criminal penalties. However, the specific details of these penalties are not explicitly stated in the provided text. Typically, penalties can include fines or imprisonment, depending on the nature and severity of the breach. The Act also ensures that the rights of persons, other than the Commonwealth, are not adversely affected by the TCO, and it does not impose any liabilities on any person. This protects the interests of importers and ensures that the TCO does not unfairly disadvantage anyone.