EXPLANATORY STATEMENT
Tariff Concession Instrument No. 0508479
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.
Signum Specialties Pty Ltd applied for a TCO in respect of certain Calendering Rolls on 30 June 2005.
Instrument
TCO No 0508479 was made on 9 September 2005. It declares that those certain Calendering Rolls 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. 0508479 is taken to have come into force on 30 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 was enacted by the Australian Parliament to regulate the importation and exportation of goods, among other things, and to provide for the collection of customs duty. One of the mechanisms within this Act is the Tariff Concession Order (TCO), which allows for the application of a lower rate of customs duty on certain goods. The purpose of this legislation is to ensure that the Australian economy benefits from the importation of goods where it is in the national interest, particularly in cases where the goods cannot be produced domestically. In the context of Tariff Concession Instrument No. 0508479, the policy objective was to provide a tariff concession for certain Calendering Rolls, effectively reducing the customs duty rate from 5% to 0% for these goods, thereby encouraging their importation. This measure was introduced to address the specific economic needs and competitive considerations of the importing party, Signum Specialties Pty Ltd, in line with broader economic policies aimed at fostering industry competitiveness and facilitating access to essential goods.
Scope and Application
The Tariff Concession Instrument No. 0508479 under the Customs Act 1901 applies specifically to the concession of customs duty rates for certain goods that are not produced in Australia and for which a Tariff Concession Order (TCO) has been granted. The act pertains to any individual or entity that applies for and receives a TCO, thereby qualifying for a reduced customs duty rate on the specified goods. The geographic reach of the act is national, as it applies across Australia under the Commonwealth jurisdiction. The act explicitly excludes goods listed in section 269SJ of the Customs Act 1901, which cannot be subject to a TCO. The application of the act may be extended or restricted through subordinate instruments, such as regulations, which provide further details on the procedures and criteria for TCO applications. The TCO in question benefits importers by allowing them to apply for refunds of duty on goods imported since the effective date of the TCO, without imposing any liabilities on persons other than the Commonwealth.
Key Provisions
The main operative sections of the Customs Act 1901 (the Act) in relation to Tariff Concession Orders (TCOs) include sections 269C, 269F, 269P, and 269S. Section 269F allows a person to apply to the Chief Executive Officer of Customs (CEO) for a TCO in respect of goods. If the application is not for goods specified in section 269SJ, which are ineligible for TCO, the CEO must then determine whether the application meets the core criteria outlined in section 269C. If the CEO is satisfied that the application meets the core criteria, a TCO is issued, as described in section 269P(3), which declares that the goods in question are subject to a lower rate of customs duty as specified in the Customs Tariff Act 1995.
The obligations imposed by the Act on the parties and entities it governs are primarily concerned with the application process and the criteria for issuing TCOs. The CEO must ensure that the application for a TCO is not for goods listed in section 269SJ of the Act. Additionally, the CEO must satisfy themselves that no substitutable goods were produced in Australia on the day the application was lodged, in accordance with section 269C. If these conditions are met, the CEO is required to issue a written order (the TCO) specifying the applicable rate of duty as per the Customs Tariff Act 1995.
The legislation also outlines the consequences for breaches and non-compliance. Although the explanatory statement does not explicitly detail specific offences or penalties, it is implicit that failure to comply with the requirements for TCOs, such as providing false information in an application, could lead to legal repercussions under the general provisions of the Customs Act 1901. These might include fines or other penalties for non-compliance with customs regulations. Given that the Act does not provide specific maximum penalties in this context, any breaches would likely be subject to the general enforcement mechanisms and penalties available under the broader customs legislation.
In terms of civil or criminal consequences, any breach of the conditions specified in the TCO or the underlying customs regulations could result in administrative or legal action. This might include financial penalties, confiscation of goods, or other civil or criminal sanctions as deemed appropriate under the Customs Act 1901. The Act ensures that the TCO does not disadvantage any person other than the Commonwealth and does not impose any liabilities for actions taken before the TCO's effective date. This is outlined in subsection 269S(1), which specifies that the TCO does not affect existing rights or impose new liabilities retroactively.