EXPLANATORY STATEMENT
Tariff Concession Instrument No. 0608616
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.
Visy Packaging applied for a TCO in respect of certain can palletising lines on 18 May 2006.
Instrument
TCO No 0608616 was made on 04 August 2006. It declares that those certain can palletising lines 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. 0608616 is taken to have come into force on 18 May 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 Customs Act 1901, enacted by the Parliament of Australia, establishes a framework under which Tariff Concession Orders (TCOs) can be issued by the Chief Executive Officer of Customs. This legislative instrument was introduced to address the need for a mechanism to provide lower rates of customs duty on specific goods, subject to certain criteria. The primary objective is to facilitate trade by reducing the cost burden on importers for goods that are not domestically produced in a substitutable form. Under section 269F of the Act, an applicant may request a TCO for goods, provided these goods do not fall under the categories specified in section 269SJ of the Act. If the application meets the core criteria outlined in section 269C, including the absence of substitutable goods produced in Australia, the CEO is mandated to issue a written TCO. This process ensures that the rights of importers are protected and potentially benefited, while also maintaining the integrity of the customs duty regime by preventing the imposition of duties on imported goods that are not domestically produced.
Scope and Application
The Tariff Concession Instrument No. 0608616 under the Customs Act 1901 applies to entities seeking tariff concessions for specific goods, in this case Visy Packaging for certain can palletising lines. The application process is governed by section 269F of the Act, where an applicant must submit a request to the Chief Executive Officer (CEO) of Customs. The CEO is mandated to assess whether the application meets the core criteria specified in section 269C of the Act, which includes determining if no substitutable goods are produced in Australia at the time of the application. The instrument is effective from the date the application was lodged, 18 May 2006, as stipulated by subsection 269S(1) of the Act. Notably, the tariff concession does not affect existing rights or impose new liabilities on persons other than the Commonwealth. The CEO is also required to publish a notice in the Gazette inviting submissions from interested parties, although no submissions were received in this instance. The concession effectively reduces the duty rate from 5% to free, benefiting importers who can apply for duty refunds on imports since the commencement date.
Key Provisions
The main operative sections of the Tariff Concession Instrument No. 0608616 under the Customs Act 1901 include section 269F, which allows for applications for Tariff Concession Orders (TCOs) from individuals or entities (section 269F). Section 269C specifies that a TCO application meets the core criteria if no substitutable goods are produced in Australia on the day the application was lodged (section 269C). Additionally, section 269P(3) requires the Chief Executive Officer of Customs (CEO) to issue a written order (a TCO) if satisfied that the application meets these criteria (section 269P(3)). The TCO declares that the goods in question are subject to a prescribed rate in Schedule 4 of the Customs Tariff Act 1995, in this case, a free rate of duty for the specified can palletising lines (section 269P(3)).
The Act imposes several obligations on the parties it governs. Firstly, the CEO must ensure that any TCO application is not in respect of goods specified in section 269SJ of the Act, which excludes certain goods from TCO eligibility (section 269SJ). If the application meets the core criteria outlined in section 269C, the CEO is required to issue a TCO (section 269C). Additionally, the CEO must publish a notice in the Gazette inviting any interested parties to lodge submissions if they believe the TCO should not be made (subsection 269K(1)). Should the CEO receive submissions, they must consider them before making a final decision (subsection 269K(1)). In this instance, no submissions were received, allowing the CEO to proceed with issuing the TCO.
There are no specific offences, penalties, or civil/criminal consequences detailed for breaches of the provisions within this TCO. However, the general framework under the Customs Act 1901 provides that non-compliance with customs regulations can lead to penalties, including fines and imprisonment. The exact penalties would depend on the nature and severity of the breach. For instance, under the Customs Act, unauthorised importation or exportation of goods can result in fines up to 10,000 penalty units and/or imprisonment for up to 10 years for individuals, and up to 50,000 penalty units for bodies corporate (section 224AA). While this specific TCO does not detail additional penalties, it operates within the broader regulatory scheme where breaches can lead to significant consequences.