EXPLANATORY STATEMENT
Tariff Concession Instrument No. 0507516
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 polyolefin film on 20 June 2005.
Instrument
TCO No 0507516 was made on 16 September 2005. It declares that the certain polyolefin film 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. 0507516 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 Customs Act 1901, enacted by the Australian Parliament, was designed to establish a comprehensive framework for managing customs and excise duties, among other things. This Act includes provisions for the creation of Tariff Concession Orders (TCOs) under section 269F, which allow for reduced customs duties on certain goods. The underlying problem or gap that the Customs Act was introduced to address includes the need for a flexible and responsive mechanism to adjust tariffs based on economic, social, and policy considerations, ensuring that Australian industries can compete effectively in both domestic and international markets. The Tariff Concession Instrument No. 0507516, made on 16 September 2005, exemplifies this flexibility by providing a tariff concession for certain polyolefin film, thereby reducing the duty from 5% to free. The policy objective of this particular TCO, as with others under the Customs Act, is to support Australian industries by making imported goods more competitive without imposing any liabilities on individuals or entities other than the Commonwealth.
Scope and Application
The Tariff Concession Instrument No. 0507516 made under the Customs Act 1901 applies specifically to the certain polyolefin film, a type of goods that has been granted a tariff concession order (TCO) by the Chief Executive Officer of Customs (CEO). This legislation aims to provide a lower rate of customs duty on these goods, making them more affordable for consumers and businesses. The TCO applies to the entity or individual who imports the specified goods and benefits them by reducing the duty from the general rate of 5% to free. This concession is applicable nationally, following the provisions set out in the Customs Act 1901, and it does not affect any pre-existing rights of other parties except the Commonwealth. The scope of this TCO is limited to the specific goods mentioned in the instrument, and it does not extend to other goods or industries. The application of the TCO is governed by the core criteria outlined in the Act, which ensure that the goods are not substitutable by any goods produced in Australia in the ordinary course of business. The TCO is effective from the date of the application, which is 20 June 2005, and any importers can apply for a refund of duty on goods imported since this date.
Key Provisions
The key operative sections of the Tariff Concession Instrument No. 0507516 under the Customs Act 1901 (the Act) are primarily section 269F, which allows for applications for Tariff Concession Orders (TCOs), and section 269C, which sets out the core criteria for such orders. Specifically, section 269F allows a person to apply to the Chief Executive Officer of Customs (the CEO) for a TCO in respect of goods. The CEO must then assess whether the application meets the core criteria, which are detailed in section 269C. If no substitutable goods were produced in Australia on the day the application was lodged, and the goods in question are not specified in section 269SJ of the Act, the CEO must make a written order, the TCO, declaring that the goods are subject to a prescribed item of Schedule 4 to the Customs Tariff Act 1995.
The Act imposes several obligations on the parties involved. The CEO of Customs is required to ensure that any TCO application that meets the core criteria is processed in accordance with the legislative provisions. This includes publishing a notice in the Gazette (subsection 269K(1)) and inviting submissions from any interested parties. If no submissions are received, the CEO can proceed to make the TCO. The TCO itself, once made, declares that the specified goods are subject to the prescribed tariff rate and comes into force on the day the application was lodged, as stated in subsection 269S(1). Importers of the goods covered by the TCO can apply for a refund of duty on those goods under paragraph 126(1)(r) of the Regulations.
There are no explicit offences, penalties, or civil/criminal consequences mentioned in the explanatory statement for breaches related to the TCO itself. However, the Customs Act 1901 and the Customs Tariff Act 1995 generally provide for various penalties and enforcement mechanisms for breaches of customs laws, including fines and imprisonment. The specific penalties would be determined according to the relevant provisions of those Acts. The Tariff Concession Instrument No. 0507516 focuses on the procedural aspects of granting tariff concessions and does not detail penalties for non-compliance with its specific provisions.