EXPLANATORY STATEMENT
Tariff Concession Instrument No. 0612228
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.
Australian Pacific Paper Products applied for a TCO in respect of certain polyester fibre fabric on 21 July 2006.
Instrument
TCO No 0612228 was made on 13 October 2006. It declares that those certain polyester fibre fabric 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. 0612228 is taken to have come into force on 21 July 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. 0612228 was enacted in 2006 under the Customs Act 1901, addressing the need for a scheme where the Chief Executive Officer of Customs could provide tariff concessions on certain goods. This legislative instrument was designed to ensure that if no substitutable goods were produced in Australia, a lower rate of customs duty could apply to specified goods, thereby facilitating trade and potentially reducing costs for importers. The policy objective, as outlined in the Act, was to provide an efficient process for tariff concession applications, ensuring that the application criteria were met and that the rights of importers were protected. The instrument was made effective from the date the application was lodged, ensuring that there were no disadvantages to persons other than the Commonwealth, and no liabilities were imposed prior to the registration of the tariff concession.
Scope and Application
The Tariff Concession Instrument No. 0612228, under the Customs Act 1901, applies to the import of certain polyester fibre fabric by granting a tariff concession. This instrument was made by the Chief Executive Officer of Customs and reduces the duty on these goods from the general rate of 5% to 0%. The instrument is applicable to Australian Pacific Paper Products and any other entities importing these specific goods, provided they meet the criteria of the Tariff Concession Orders scheme. The geographic reach of this legislation is national, as it applies throughout Australia and is subject to the provisions of the Customs Act 1901, which is a Commonwealth Act. Exclusions from this concession include goods specified in section 269SJ of the Act, which cannot be subject to a TCO. The application of the Act can be extended or restricted through subordinate instruments, which may further define the types of goods eligible for concessions or specify additional criteria for applications. The commencement of this particular TCO is considered to be effective from the date the application was lodged, 21 July 2006, without affecting any pre-existing rights or imposing new liabilities on any parties.
Key Provisions
The Tariff Concession Instrument No. 0612228 pertains to the Customs Act 1901, specifically under Part XVA, which allows for the creation of Tariff Concession Orders (TCOs) by the Chief Executive Officer of Customs (CEO). This instrument was issued in response to an application from Australian Pacific Paper Products, who sought a tariff concession for certain polyester fibre fabric, as outlined in section 269F (1) of the Act. The CEO’s decision to grant the concession hinges on whether the goods are eligible and meet the core criteria as defined in section 269C. This includes ensuring that no substitutable goods are produced in Australia at the time of application, with definitions provided under sections 269D, 269E, and 269P(3).
Under the Act, the CEO is mandated to make a written order (a TCO) if satisfied that the application meets the core criteria. For the goods in question, item 50 of Schedule 4 to the Customs Tariff Act 1995 applies, resulting in a 0% duty rate, down from the general rate of 5%. The TCO became effective on 21 July 2006, the date the application was lodged as per subsection 269S(1) of the Act. It is important to note that this concession does not adversely affect any rights or impose liabilities on individuals other than the Commonwealth, for actions taken before the TCO's effective date. Importers of the specified goods will benefit from this concession, as they can apply for a refund of duties paid on imports since the TCO's effective date, in line with paragraph 126(1)(r) of the Regulations.
The CEO is required to publish a notice in the Gazette, inviting submissions from any interested parties who might have reasons against the concession, as per subsection 269K(1). In this instance, no submissions were received. The legislation does not detail specific offences, penalties, or civil/criminal consequences for non-compliance with the TCO. However, any failure to adhere to the terms of the concession could potentially lead to disputes over duties and refunds, necessitating clarification or resolution through the legal framework governing customs and tariffs in Australia.