EXPLANATORY STATEMENT
Tariff Concession Instrument No. 0507515
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.
I.N.C. Corporation Pty Ltd applied for a TCO in respect of certain polypropylene extruded sheet on 20 June 2005.
Instrument
TCO No 0507515 was made on 16 September 2005. It declares that the certain polypropylene extruded sheet 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. 0507515 is taken to have come into force on 20 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 Tariff Concession Instrument No. 0507515 was enacted in 2005 as a response to the need for facilitating trade by reducing customs duties on specific goods under the Customs Act 1901. This legislation enables the Chief Executive Officer of Customs to grant tariff concessions on goods that are not produced in Australia and for which there are no substitutable domestic products. The aim is to lower the economic barriers for importers by eliminating or reducing customs duty on certain goods, thus encouraging trade and economic growth. The policy objective is clearly to foster a more competitive market environment by allowing the import of goods at reduced costs, which in turn can lead to lower prices for consumers and increased availability of goods. The instrument was enacted by the relevant federal authority, and it came into force on the day the application was lodged, providing immediate benefits to importers who can now seek refunds for duties paid on goods imported since the commencement date.
Scope and Application
The Tariff Concession Instrument No. 0507515 under the Customs Act 1901 applies to the specific category of polypropylene extruded sheet for which a Tariff Concession Order (TCO) has been granted by the Chief Executive Officer of Customs (CEO). This legislation allows for a lower rate of customs duty on goods specified in a TCO, provided certain criteria are met. The application of this Act is primarily concerned with entities or individuals who are importing or intend to import the specified goods into Australia. The Act operates within the jurisdictional reach of the Commonwealth, as it is a federal statute. It is important to note that the Act does not apply to goods specified in section 269SJ of the Customs Act 1901, which outlines those goods that cannot be subject to a TCO. Additionally, the Act can be extended or restricted through subordinate instruments, such as regulations or further orders made by the CEO. The TCO No. 0507515 became effective on the date the application was lodged, 20 June 2005, and it does not affect any pre-existing rights or liabilities of persons other than the Commonwealth.
Key Provisions
The main operative sections of the Tariff Concession Instrument No. 0507515, as outlined in the explanatory statement, are sections 269C, 269P(3) and 269S(1) of the Customs Act 1901 (the Act). Section 269C outlines the core criteria for a Tariff Concession Order (TCO) application to be accepted, which is when no substitutable goods are produced in Australia on the day the application is lodged. If the Chief Executive Officer of Customs (CEO) is satisfied that the application meets these criteria, they are required under section 269P(3) to make a written order declaring the goods to which the TCO applies. Section 269S(1) stipulates that a TCO is taken to have come into force on the day on which the application for the TCO was lodged.
The Act imposes certain obligations and requirements on parties applying for a TCO. Firstly, the applicant must ensure that the goods they are applying for do not have substitutable goods produced in Australia on the day of the application. This means that no goods produced in Australia are put, or are capable of being put, to a use that corresponds with the use of the goods the subject of the application. Secondly, the applicant must provide sufficient information to satisfy the CEO that the core criteria are met. If the CEO is satisfied, they must make a written order declaring the goods to which the TCO applies. Furthermore, as per section 269K(1) of the Act, the CEO must publish a notice in the Gazette inviting any person who considers that there are reasons why the TCO should not be made to lodge a submission with the CEO.
Failure to comply with the requirements of the Act and the TCO may result in various consequences. While the explanatory statement does not detail specific offences or penalties, the Act generally provides for both civil and criminal penalties for breaches. For instance, section 269 of the Act may be relevant in cases of non-compliance, potentially leading to fines and imprisonment depending on the severity of the breach. Additionally, if a person imports goods that are subject to a TCO and fails to claim a refund of duty, they may face penalties under the relevant regulations. The exact penalties would depend on the specific provisions of the Customs Act 1901 and related regulations.