EXPLANATORY STATEMENT
Tariff Concession Instrument No. 0610950
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.
Bridgestone Australia Ltd applied for a TCO in respect of certain polybutadiene rubber on 27 June 2006.
Instrument
TCO No 0610950 was made on 22 September 2006. It declares that those certain polybutadiene rubber are goodsis a product 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. 0610950 is taken to have come into force on 22 September 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. 0610950, enacted in 2006, amends the Customs Act 1901 to provide a concessional tariff for certain polybutadiene rubber. This legislative instrument was introduced to address the need for tariff concessions that encourage the importation of specific goods which are not produced in Australia. The instrument allows for the reduction of customs duties on certain imported goods, provided that no substitutable goods are produced domestically. The Customs Act 1901 empowers the Chief Executive Officer of Customs to grant such tariff concessions, ensuring that the application meets the specified criteria. The instrument was made following an application by Bridgestone Australia Ltd, and it aims to facilitate the importation of these specific rubber products without imposing any additional liabilities on importers or affecting existing rights.
Scope and Application
The Tariff Concession Instrument No. 0610950 under the Customs Act 1901 applies to the specific goods identified in the instrument, namely certain polybutadiene rubber, as determined by the Chief Executive Officer of Customs. This application is restricted to the goods that meet the core criteria outlined in the Act, ensuring that no substitutable goods are produced in Australia. The geographic reach of this Act is national, encompassing the entire Commonwealth of Australia, and it is administered at a federal level by the CEO of Customs. Notably, the Act excludes certain goods as per section 269SJ, which specifies goods that cannot be subject to a Tariff Concession Order. The instrument's scope can be further extended or specified through subordinate instruments, though this particular instrument does not incorporate such provisions. The application of the TCO is effective from the date the application was lodged, in this case, 22 September 2006, and it does not disadvantage any person or impose liabilities on anyone for actions taken prior to the registration date.
Key Provisions
The main operative sections of the Tariff Concession Instrument No. 0610950, which amends the Customs Act 1901, concern the establishment and application of Tariff Concession Orders (TCOs) for specific goods. Section 269F (paragraph 1) allows for the application of a TCO by a person seeking to reduce the customs duty on goods. Section 269C (paragraph 2) outlines the core criteria that the Chief Executive Officer of Customs (CEO) must consider when determining if an application meets the requirements for a TCO. Specifically, the CEO must be satisfied that no substitutable goods are produced in Australia in the ordinary course of business. Section 269P (paragraph 3) mandates that if the CEO is satisfied with the application, they must issue a written TCO specifying the lower rate of duty for the goods in question.
The obligations and requirements imposed by the Act on the parties involved are primarily centred around the application and approval process for TCOs. The CEO has the responsibility to assess each application against the core criteria specified in section 269C. This involves verifying that the goods in question are not substitutable by any Australian-produced goods. Additionally, the CEO must publish a notice in the Gazette inviting any interested parties to submit reasons against the issuance of the TCO within a specified timeframe. The Act also stipulates that the rights of any person, other than the Commonwealth, will not be adversely affected by the TCO, ensuring that existing rights and liabilities are protected.
In terms of breaches and consequences, the Customs Act 1901 does not explicitly outline specific offences or penalties for failing to comply with the TCO provisions. However, any actions that contravene the core criteria for TCO applications could potentially lead to legal disputes or administrative penalties. The Act ensures that the TCO does not impose any new liabilities on individuals or entities, thereby protecting them from financial repercussions arising from the issuance of the TCO. Nevertheless, any misuse or fraudulent claims related to the TCO could attract penalties under other relevant sections of the Customs Act or associated regulations.