EXPLANATORY STATEMENT
Tariff Concession Instrument No. 0510005
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.
Projex Group Pty Limited applied for a TCO in respect of certain polyvinyl chloride sheet on 01 August 2005.
Instrument
TCO No 0510005 was made on 04 November 2005. It declares that those certain polyvinyl chloride sheets 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 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. 0510005 is taken to have come into force on 01 August 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 to provide a framework for the administration of customs and excise duties in Australia. The Act was introduced to address the need for a structured approach to the regulation and control of imported goods, ensuring that duties are collected appropriately and fairly. The Tariff Concession Instrument No. 0510005, enacted in 2005, is a specific measure under the Customs Act designed to provide relief by way of tariff concessions on certain goods, thereby reducing the financial burden on businesses and consumers. This instrument was created in response to an application by Projex Group Pty Limited for tariff concessions on certain polyvinyl chloride sheets, aiming to ensure that these goods are subject to a lower rate of customs duty if no substitutable goods are produced in Australia. The policy objective of this instrument is to promote fair trade practices and to provide economic benefits to importers by reducing the overall cost of importing these goods.
Scope and Application
The Tariff Concession Instrument No. 0510005 under the Customs Act 1901 applies to any person who has applied for a Tariff Concession Order (TCO) in respect of specific goods, namely certain polyvinyl chloride sheets, in this case. The instrument is issued by the Chief Executive Officer of Customs (CEO) and provides for a concessional rate of customs duty, in this instance reducing the duty from the general rate of 5% to free. The Act applies to the geographic jurisdiction of Australia, affecting all entities involved in the import and trade of these goods. The scope of the Act does not extend to goods that are specified as ineligible for a TCO under section 269SJ of the Customs Act 1901. The application of the TCO does not impose any liabilities on any person, and it is effective from the date of application, which is 1 August 2005, in accordance with subsection 269S(1) of the Act. There are no exclusions or exemptions specified within the primary Act or the explanatory statement for this particular TCO. The application process involves the CEO considering whether the goods in question meet the core criteria, primarily whether no substitutable goods are produced in Australia, as per section 269C of the Act.
Key Provisions
The primary operative sections of the Tariff Concession Instrument No. 0510005 under the Customs Act 1901 (the Act) pertain to the process of applying for and granting a Tariff Concession Order (TCO) for certain polyvinyl chloride sheets. Section 269F allows a person to apply to the Chief Executive Officer of Customs (the CEO) for a TCO in respect of goods, provided those goods are not specified in section 269SJ, which lists goods that cannot be subject to a TCO. The CEO must then determine whether the application meets the core criteria as outlined in section 269C. If the CEO is satisfied that the application meets these criteria, they must make a written order, a TCO, declaring that the goods in question are subject to a prescribed item of Schedule 4 to the Customs Tariff Act 1995 (the Tariff).
Under the Act, the CEO has specific obligations and requirements when processing a TCO application. Firstly, the CEO must ensure that the application is not in respect of goods that are excluded under section 269SJ. If the CEO accepts the application as valid, they must publish a notice in the Gazette inviting any interested parties to lodge submissions if they believe the TCO should not be made. This process is detailed in subsection 269K(1) of the Act. In the case of TCO No. 0510005, the CEO did not receive any submissions in response to the published notice. Once the CEO is satisfied that the application meets the core criteria, they must issue a TCO, as stipulated in subsection 269P(3) of the Act.
The Act does not specify any offences, penalties, or consequences for breach related to the issuance of a TCO. However, the obligations of the CEO to follow the statutory process and consider submissions are paramount. The TCO itself, once issued, does not impose any liabilities on any person, including the importer, in respect of actions taken before the TCO came into force. Instead, the TCO aims to provide a benefit to importers by allowing them to apply for a refund of duty on goods imported since the TCO is taken to have come into force, as per paragraph 126(1)(r) of the Regulations. This refund provision highlights the Act’s intention to provide relief to importers without imposing additional burdens or liabilities.