EXPLANATORY STATEMENT
Tariff Concession Instrument No. 0513210
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.
Plaspak Closures Pty Ltd applied for a TCO in respect of certain bottle cap liners on 29 September 2005.
Instrument
TCO No 0513210 was made on 23 December 2005. It declares that those certain bottle cap liners 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. 0513210 is taken to have come into force on 29 September 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 Tariff Concession Instrument No. 0513210 was enacted in 2005 as part of the Customs Act 1901, to provide a lower rate of customs duty on certain goods not produced in Australia, specifically certain bottle cap liners. This instrument was introduced to address the issue of providing tariff relief for imported goods that have no substitutable domestic equivalents, thereby supporting the competitiveness of Australian industries that rely on imported components. The enacting body was the Chief Executive Officer of Customs, who was required to assess applications against specific criteria set out in the Act, including the absence of substitutable goods produced in Australia. The policy objective was to facilitate the import of necessary goods at a reduced duty rate, benefiting importers by potentially allowing them to claim a refund of duty on goods imported since the TCO was taken to have come into force.
Scope and Application
The Tariff Concession Instrument No. 0513210, made under the Customs Act 1901, applies to specific goods identified in the instrument, namely certain bottle cap liners, for which Plaspak Closures Pty Ltd applied for a tariff concession order (TCO). The Act allows for the application of a lower rate of customs duty on goods that are the subject of a TCO if certain criteria are met, including the absence of substitutable goods produced in Australia in the ordinary course of business. The geographic reach of this legislation is national, applying across Australia in accordance with the provisions of the Customs Act 1901. The TCO does not disadvantage any person, including the Commonwealth, nor does it impose any liabilities on persons in respect of anything done or omitted before the date of registration. Importantly, the instrument does not specify any exclusions, exemptions, or thresholds beyond the core criteria outlined in the Customs Act 1901, and its application may be extended or restricted through subordinate instruments as necessary.
Key Provisions
The main sections of the Tariff Concession Instrument No. 0513210 under the Customs Act 1901, provide a framework for the application and approval of Tariff Concession Orders (TCOs). Under section 269F, any person can apply to the Chief Executive Officer of Customs (CEO) for a TCO in relation to certain goods. Section 269C outlines the core criteria for a TCO, which include the requirement that no substitutable goods are produced in Australia in the ordinary course of business on the day the application is lodged. If the CEO determines that the application meets these criteria, they must make a written order under section 269P(3) that declares the goods subject to the TCO. This specific TCO No. 0513210, declared on 23 December 2005, applies to certain bottle cap liners and specifies that they are subject to item 50 of Schedule 4 to the Tariff, with a rate of duty of free, down from the general rate of 5%.
The obligations and requirements imposed by the Act on the parties involved are quite specific. For applicants like Plaspak Closures Pty Ltd, the primary obligation is to ensure that their application for a TCO is complete and meets the core criteria as specified in sections 269C and 269F. This includes demonstrating that no substitutable goods are produced in Australia on the day of application. For the CEO, the obligations include reviewing the application, ensuring it is valid, and publishing a notice in the Gazette inviting any interested parties to lodge submissions if they oppose the TCO. Additionally, the CEO must decide whether the application meets the core criteria and make the written order if satisfied. In this case, the CEO did not receive any submissions opposing the TCO, which facilitated a straightforward approval process.
In terms of penalties and consequences for breach, the Customs Act 1901 does not explicitly outline specific offences or penalties for failing to comply with the requirements of a TCO. However, general provisions of the Act and associated regulations could apply to any non-compliance with customs duties and obligations. For example, under the Customs Act, breaches such as incorrect declarations or fraudulent activities can lead to substantial penalties, both civil and criminal. While the specific TCO No. 0513210 does not detail unique penalties, it is important to note that failure to adhere to the terms of the TCO could result in the imposition of the standard duty rates, which in this case would revert to the general rate of 5% for the bottle cap liners.