EXPLANATORY STATEMENT
Tariff Concession Instrument No. 0613055
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.
Geofabrics Australasia Pty Ltd applied for a TCO in respect of certain slitfilm polypropylene fabric on 03 August 2006.
Instrument
TCO No 0613055 was made on 27 October 2006. It declares that those certain slitfilm polypropylene 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 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. 0613055 is taken to have come into force on 03 August 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 within which Tariff Concession Orders (TCOs) can be issued by the Chief Executive Officer of Customs (CEO). This legislation aims to address the need for tariff concessions on goods that are not produced in Australia, ensuring that these goods can enter the market without incurring prohibitive duties. The 2006 Tariff Concession Instrument No. 0613055 was introduced to provide a tariff concession on certain slitfilm polypropylene fabric, a product for which no substitutable goods were being produced in Australia at the time. The policy objective of this measure is to facilitate the entry of these goods into the Australian market, thereby benefiting importers and potentially stimulating demand for these non-domestically produced items.
Scope and Application
The Customs Act 1901 applies to entities and individuals involved in the importation of goods into Australia, specifically under Part XVA, which governs the process of Tariff Concession Orders (TCOs). The Act allows the Chief Executive Officer of Customs to grant lower rates of customs duty on specified goods, provided certain criteria are met. The legislation applies to goods for which no substitutable goods are produced in Australia in the ordinary course of business, as defined in sections 269D, 269E, and 269F of the Act. Exclusions under section 269SJ specify certain goods that cannot be subject to a TCO. The Act's application extends to all imported goods within the Commonwealth of Australia and is effective from the date the TCO application is lodged, as outlined in subsection 269S(1). The scope of the Act may also be extended or refined through subordinate instruments, though this specific TCO does not impose any new liabilities and only benefits importers by potentially allowing for duty refunds on eligible goods imported since the TCO's effective date.
Key Provisions
The key operative sections of the Tariff Concession Instrument No. 0613055, under the Customs Act 1901 (section 269F), allow for the Chief Executive Officer (CEO) of Customs to make a Tariff Concession Order (TCO) if certain conditions are met. Specifically, section 269C states that a TCO application is considered valid if, on the day the application is lodged, no substitutable goods are produced in Australia in the ordinary course of business. Furthermore, section 269B clarifies the definitions of terms such as "goods produced in Australia," "ordinary course of business," and "substitutable goods," which are crucial for assessing the validity of the TCO application. If the CEO is satisfied that the application meets these core criteria, they must make a written order (section 269P(3)) declaring that the goods in question are subject to a prescribed item of Schedule 4 to the Customs Tariff Act 1995.
The obligations imposed by this legislation on the parties involved are primarily centred around the application and assessment process for a TCO. For instance, applicants, such as Geofabrics Australasia Pty Ltd, must ensure that their applications are lodged correctly and meet the core criteria outlined in section 269C. The CEO, on the other hand, must rigorously assess each application to determine if it meets these criteria and must publish notices in the Gazette (section 269K(1)) to invite submissions from any interested parties. If no submissions are received, the CEO can proceed to make the TCO. The process ensures that the interests of all stakeholders are considered before a concession is granted.
The legislation outlines specific offences, penalties, and consequences for breaches. However, the Explanatory Statement does not detail specific penalties for non-compliance with the TCO provisions. Nonetheless, under the general framework of the Customs Act 1901, breaches of customs laws can result in both civil and criminal penalties. Civil penalties might include fines, while criminal penalties could involve imprisonment, reflecting the seriousness with which the Australian Government treats non-compliance with customs regulations. The exact penalties would depend on the nature and severity of the breach, as well as other relevant laws and regulations.
In summary, the Tariff Concession Instrument No. 0613055 under the Customs Act 1901 provides a structured process for applying for and granting tariff concessions on specific goods. It mandates clear criteria for assessment by the CEO and requires transparency through public notice and invitation for submissions. While the specific penalties for non-compliance are not detailed in the Explanatory Statement, the broader framework of the Customs Act 1901 implies significant consequences for breaches, underscoring the importance of adherence to the legislative requirements.