EXPLANATORY STATEMENT
Tariff Concession Instrument No. 0601895
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.
Consolidated Paper Industries applied for a TCO in respect of certain carbonless multiply paper on 4 January 2006.
Instrument
TCO No 0601895 was made on 31 March 2006. It declares that those certain carbonless multiply paper 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. 0601895 is taken to have come into force on 4 January 2006.
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. 0601895 was enacted under the Customs Act 1901 to provide a concession on the customs duty applicable to certain carbonless multiply paper, responding to an application by Consolidated Paper Industries. This legislation was introduced to address the gap in the tariff structure by allowing the Chief Executive Officer of Customs to reduce the duty rate for specific goods if no substitutable goods are produced in Australia. The Act, overseen by the Australian Parliament, aims to facilitate trade and support local industries by ensuring that imported goods do not compete unfairly with domestic production. This instrument ensures that importers of such goods are not disadvantaged and can apply for a refund of duty on imports from the date the tariff concession is deemed to have come into force.
Scope and Application
The Customs Act 1901, specifically under Part XVA, facilitates the creation of Tariff Concession Orders (TCOs) by the Chief Executive Officer of Customs. These orders apply to goods for which an applicant can seek a lower rate of customs duty, provided certain criteria are met. A person may apply for a TCO in respect of goods if they are not specified in section 269SJ of the Act, which excludes certain goods from TCO consideration. The application must meet the core criteria, outlined in sections 269C and 269D, which require that no substitutable goods were produced in Australia in the ordinary course of business on the day the application was lodged. If the CEO is satisfied with the application, a TCO is issued, specifying a lower rate of duty as per Schedule 4 to the Customs Tariff Act 1995. TCO No. 0601895, for instance, pertains to certain carbonless multiply paper and was issued on 31 March 2006, reducing the duty from 5% to 0%. The TCO applies nationally and does not disadvantage any person other than the Commonwealth or impose liabilities for actions taken before the TCO's registration date. The TCO’s commencement date aligns with the application date, in this case, 4 January 2006, and it benefits importers by allowing them to apply for duty refunds.
Key Provisions
The main operative sections of the Customs Act 1901 (the Act) relevant to Tariff Concession Orders (TCOs) include sections 269C, 269B, 269D, 269E, 269F, 269P, and 269SJ. Section 269F allows a person to apply to the Chief Executive Officer of Customs (the CEO) for a TCO in respect of goods. Section 269C specifies that a TCO application meets the core criteria if no substitutable goods were produced in Australia in the ordinary course of business on the day the application was lodged. If the CEO is satisfied that the application meets these criteria, they must make a written order under section 269P(3). This order declares 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) applies.
The Act imposes several obligations and requirements on the parties it governs. Firstly, any person who wishes to apply for a TCO must ensure that their application is not in respect of goods specified in section 269SJ, which lists those goods that cannot be subject to a TCO. If the CEO is satisfied that the application is valid and meets the core criteria set out in section 269C, the CEO must publish a notice in the Gazette inviting any interested parties to lodge submissions. This is stipulated in subsection 269K(1) of the Act. In this case, the CEO did not receive any submissions in response to the published notice. Additionally, the Act ensures that a TCO does not affect the rights of any person, except the Commonwealth, as at the date of registration. It also ensures that no liabilities are imposed on any person in respect of anything done or omitted to be done before the date of registration.
In terms of offences, penalties, or civil/criminal consequences for breach, the Act does not specify particular penalties for failing to comply with the provisions related to TCOs. However, any breach of the Act could result in general legal consequences as outlined under Australian law. For instance, failure to comply with the core criteria for a TCO application could lead to the CEO declining the application. While specific penalties for such breaches are not detailed in the provided text, they could potentially involve civil or administrative penalties, depending on the nature and severity of the breach. It is essential for applicants and entities governed by the Act to ensure compliance with its provisions to avoid any adverse legal consequences.