EXPLANATORY STATEMENT
Tariff Concession Instrument No. 0510306
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.
Cinqplast Plastop Aust Pty Ltd applied for a TCO in respect of certain Cast Polypropylene Film on 5 August 2005.
Instrument
TCO No 0510306 was made on 21 October 2005. It declares that those certain Cast Polypropylene Film 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. 0510306 is taken to have come into force on 5 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, enacted by the Australian Parliament, establishes a framework for the application of customs duty, including provisions for Tariff Concession Orders (TCOs). The Tariff Concession Instrument No. 0510306, made in 2005, addresses the problem of ensuring that certain goods, which are not produced domestically and have no substitutable alternatives, receive a tariff concession to support Australian industries or economic policy objectives. This instrument was created to provide a mechanism through which businesses can apply for a reduction in customs duty on specified goods, subject to certain criteria being met by the Chief Executive Officer of Customs. The policy objective is to provide relief from customs duty for imported goods that are essential for industry and do not have a domestic equivalent, thereby supporting the competitiveness and efficiency of Australian businesses.
Scope and Application
The Customs Act 1901 applies to individuals and entities involved in the importation of goods into Australia, particularly those seeking tariff concessions on specific goods. The Act facilitates the process through which the Chief Executive Officer of Customs can grant Tariff Concession Orders (TCOs) that reduce the customs duty on certain goods. This application is subject to the core criteria outlined in the Act, specifically that no substitutable goods are produced in Australia in the ordinary course of business on the day the application is lodged. The TCOs extend to the Commonwealth level, meaning they are effective across Australia and apply to all importers of the specified goods. However, they do not affect the rights of any person in respect of anything done before the date of registration, nor do they impose any liabilities on any person. The geographic and jurisdictional reach of this Act is thus national, impacting all entities involved in the importation of the goods for which a TCO is made. The Act does not specify exclusions or exemptions other than those set out in section 269SJ, which details goods that cannot be subject to a TCO. The application of the Act may also be extended or restricted through subordinate instruments, although no such instruments are detailed in the provided explanatory statement.
Key Provisions
The Tariff Concession Instrument No. 0510306, pursuant to the Customs Act 1901, specifies the terms and conditions under which a Tariff Concession Order (TCO) may be granted (sections 269C, 269P). According to section 269C, a TCO application meets the core criteria if, on the day the application is lodged, no substitutable goods are produced in Australia in the ordinary course of business. Section 269P(3) mandates that if the Chief Executive Officer (CEO) is satisfied that an application meets the core criteria, a TCO must be issued, declaring that the goods in question are subject to a prescribed rate of customs duty as specified in the Customs Tariff Act 1995.
The obligations under this legislation for the parties involved are primarily centred around the application process and the conditions for issuing a TCO. The applicant, such as Cinqplast Plastop Aust Pty Ltd in this case, must ensure their application is lodged in accordance with section 269F and meets the core criteria outlined in section 269C. The CEO has the responsibility to evaluate the application against these criteria and, if satisfied, issue a TCO as per section 269P(3). Additionally, as per section 269K(1), the CEO must publish a notice in the Gazette inviting submissions from any interested parties regarding the application, although in this instance, no submissions were received.
In terms of consequences for non-compliance, the Customs Act 1901 does not explicitly outline specific offences, penalties, or consequences for breach of the TCO provisions. However, any failure to comply with the terms of the TCO or the associated regulations could potentially lead to legal actions under other relevant sections of the Customs Act or associated legislation. For example, if an importer or exporter were to falsely claim eligibility for a tariff concession, they could face penalties under sections pertaining to fraud or misrepresentation in customs matters. The specific penalties would depend on the nature and severity of the breach, with potential fines and imprisonment for serious offences.