EXPLANATORY STATEMENT
Tariff Concession Instrument No. 0516814
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.
Segafredo Zanetti Australia Pty Ltd applied for a TCO in respect of certain polyethylene self adhesive foam sheets on 20 December 2005.
Instrument
TCO No 0516814 was made on 10 March 2006. It declares that those certain polyethylene self adhesive foam 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. 0516814 is taken to have come into force on 20 December 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 Commonwealth Parliament to regulate and facilitate trade in Australia through the administration of customs duties, excise, and other taxes. The Act, particularly Part XVA, provides a framework for Tariff Concession Orders (TCOs) that can be issued by the Chief Executive Officer of Customs. These TCOs aim to reduce the customs duty on certain goods, provided they meet specific criteria, such as not having substitutable goods produced in Australia. This legislative instrument addresses the gap by offering relief to importers of specified goods, thereby encouraging trade and reducing costs associated with customs duties. The policy objective is to support Australian businesses by making imported goods more affordable and competitive.
Scope and Application
The Customs Act 1901, as elaborated by Tariff Concession Instrument No. 0516814, facilitates the granting of Tariff Concession Orders (TCO) for certain goods by the Chief Executive Officer of Customs. This Act applies to any person or entity that seeks to import goods eligible for a tariff concession, provided these goods are not specified in section 269SJ of the Act, which lists goods that are ineligible for a TCO. The instrument is applicable nationally within Australia and operates under the overarching framework of the Customs Act, which is a Commonwealth statute. This particular TCO applies to certain polyethylene self-adhesive foam sheets, granting them a tariff concession that lowers the duty rate from 5% to free, effective from the date the application was lodged. The application process requires the CEO to ensure that no substitutable goods are produced in Australia, as per section 269C of the Act. The TCO does not impose any liabilities on individuals or entities and does not disadvantage any person other than the Commonwealth by affecting their rights as at the date of registration.
Key Provisions
Section 269F of the Customs Act 1901 (the Act) allows a person to apply to the Chief Executive Officer of Customs (the CEO) for a Tariff Concession Order (TCO) in respect of goods. If the CEO determines that the application pertains to goods not listed in section 269SJ, which are ineligible for a TCO, the CEO must assess whether the application meets the core criteria outlined in section 269C. The application meets these criteria if, on the date it was submitted, no substitutable goods were produced in Australia in the ordinary course of business. The meanings of "goods produced in Australia", "ordinary course of business", and "substitutable goods" are provided in sections 269D, 269E, and 269F of the Act, respectively.
The obligations imposed by the Act on the parties involved primarily revolve around the application and assessment process for TCOs. The CEO must make a written TCO if the application meets the core criteria, as specified in section 269P(3). Furthermore, under subsection 269K(1), the CEO must publish a notice in the Gazette inviting submissions from any person who may have reasons why the TCO should not be made, and consider these submissions before making a decision.
In terms of penalties and consequences for breach, the Customs Act 1901 does not explicitly outline specific offences, penalties, or civil/criminal consequences for failing to comply with the TCO provisions. However, it is reasonable to infer that any misuse or fraudulent activities related to the application and issuance of TCOs could be subject to the general penalties outlined in other sections of the Act or related legislation, including fines and imprisonment for serious breaches. Given that the Act focuses on the procedural aspects of TCOs, it is likely that any enforcement actions would be pursued under broader customs and trade laws.