EXPLANATORY STATEMENT
Tariff Concession Instrument No. 0508311
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.
Greif Australia Pty Ltd applied for a TCO in respect of certain Steel Tear Off Caps on 27 June 2005.
Instrument
TCO No 0508311 was made on 9 September 2005. It declares that those certain Steel Tear Off Caps 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 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. 0508311 is taken to have come into force on 27 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 Parliament of Australia, established a framework for administering customs duties and tariff concessions. Specifically, the Act allows the Chief Executive Officer of Customs to grant Tariff Concession Orders (TCOs) that provide for reduced customs duties on certain imported goods, provided these goods are not being produced domestically. The Tariff Concession Instrument No. 0508311, enacted on 9 September 2005, addresses the specific issue of applying tariff concessions to certain Steel Tear Off Caps imported by Greif Australia Pty Ltd. This instrument was made under the authority of the Customs Act 1901 and aims to ensure that the importer's rights are beneficially affected without imposing any liabilities on persons other than the Commonwealth. The policy objective is to facilitate the importation of goods that are not domestically produced, thereby supporting trade and economic activities.
Scope and Application
The Tariff Concession Instrument No. 0508311, made under the Customs Act 1901, applies to the concession of customs duty rates for certain goods, specifically Steel Tear Off Caps, as requested by Greif Australia Pty Ltd. This Act allows for the reduction of customs duty for goods that are not substitutable by any goods produced in Australia, as stipulated under section 269C. The application for such concessions must be submitted to the Chief Executive Officer of Customs, who evaluates it against the core criteria outlined in the Act. In this case, the CEO determined that no substitutable goods were produced in Australia, thus approving the tariff concession order which reduces the duty rate from 5% to 0%. The geographic reach of this legislation is national, applying to all entities importing these specific goods into Australia. The application of this concession is effective from the date the application was lodged, 27 June 2005, and does not retroactively affect any pre-existing rights or liabilities of non-Commonwealth entities.
Key Provisions
The primary operative sections of this legislation, specifically section 269F, allow for the application to the Chief Executive Officer of Customs (CEO) for a Tariff Concession Order (TCO) in respect of goods. Section 269C outlines the core criteria that the CEO must consider when deciding whether to grant such an application. A TCO application is deemed to meet the core criteria if, on the day the application is lodged, no substitutable goods were produced in Australia in the ordinary course of business, as defined by section 269D and section 269E. Once the CEO determines that the application meets the core criteria, section 269P(3) mandates the CEO to issue a written order, or TCO, specifying that the goods in question are subject to a particular rate of customs duty as outlined in Schedule 4 to the Customs Tariff Act 1995.
This Act imposes certain obligations 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. This notice must invite any person who believes there are reasons why the TCO should not be made to submit their views to the CEO. Greif Australia Pty Ltd, the applicant in this case, has fulfilled their part by submitting a valid application on 27 June 2005. The CEO, upon finding that no submissions opposing the TCO were lodged, proceeded to make the TCO, as mandated by the Act.
Under the Customs Act 1901, breaches of the provisions outlined can lead to specific consequences. However, the Explanatory Statement does not detail specific offences or penalties related to the failure to comply with TCO requirements. Typically, breaches of customs regulations can lead to civil penalties, including fines and, in some cases, criminal charges. The maximum penalties for breaches can vary significantly depending on the nature and severity of the offence, often involving substantial fines and, in severe cases, imprisonment. The Act, therefore, ensures that parties adhere to its provisions to maintain the integrity and effectiveness of the tariff concession scheme.