EXPLANATORY STATEMENT
Tariff Concession Instrument No. 0613083
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.
Alphapharm applied for a TCO in respect of certain shrink or sleeve or blister wrapper parts on 07 August 2006.
Instrument
TCO No 0613083 was made on 10 November 2006. It declares that those certain shrink or sleeve or blister wrapper parts 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. 0613083 is taken to have come into force on 07 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 Australian Parliament, provides a framework for the regulation of customs and excise, including the establishment of a tariff concession order (TCO) scheme. This scheme allows the Chief Executive Officer of Customs to reduce the customs duty on specified goods through a TCO when certain criteria are met. The Tariff Concession Instrument No. 0613083, issued in 2006, addresses the specific need to reduce the duty on certain shrink or sleeve or blister wrapper parts, applying a zero-rate duty instead of the general 5% rate. The policy objective is to facilitate the import of these goods by reducing the financial burden on businesses, thereby promoting economic efficiency and competitiveness without disadvantaging any existing rights holders or imposing new liabilities. The instrument was introduced following an application by Alphapharm, and no objections were raised during the consultation period, leading to its immediate effect from the date of application.
Scope and Application
The Customs Act 1901, specifically through Part XVA, facilitates the implementation of Tariff Concession Orders (TCOs) by the Chief Executive Officer of Customs (CEO). This legislation applies to any person or entity wishing to import certain goods that qualify for a reduced rate of customs duty. The scope of the Act encompasses the application process for TCOs, where the CEO evaluates whether the application meets the core criteria, notably that no substitutable goods are produced in Australia at the time of the application. The Act delineates the process of applying for a TCO and sets out clear criteria for the CEO to consider, ensuring that the concession does not apply to goods specified in section 269SJ of the Act. The TCOs, once approved, affect the importation of specific goods and reduce the duty on these goods to zero, as opposed to the general rate which is set at 5% for the goods in question. The Act’s jurisdictional reach is national, applying across Australia, and it extends its application through subordinate instruments such as the Customs Tariff Act 1995, which specifies the duty rates and concessions. There are no stated exclusions or exemptions within the Act, but the CEO must be satisfied that the application is valid and meets the specified criteria.
Key Provisions
The primary sections of this legislation (sections 269C, 269B, 269D, 269E, 269P(3), and 269SJ) establish the framework for Tariff Concession Orders (TCOs) under the Customs Act 1901. These sections provide the criteria for the Chief Executive Officer (CEO) of Customs to consider when determining whether to grant a TCO, which involves applying a lower rate of customs duty on specified goods. Specifically, section 269C requires that the application meet core criteria, which includes ensuring that no substitutable goods are produced in Australia in the ordinary course of business on the day the application is lodged (section 269SJ specifies goods that cannot be subject to a TCO). If the CEO is satisfied that the application meets these criteria, they must make a written order declaring that the goods are subject to a prescribed tariff item (section 269P(3)).
The Act imposes several obligations and requirements on the parties involved. For example, any person seeking a TCO must apply to the CEO in accordance with the provisions of section 269F. The CEO must then review the application to determine whether it meets the core criteria as outlined in sections 269C and 269SJ. Upon making a decision, the CEO must issue a written order if the application meets the criteria (section 269P(3)). Additionally, the CEO is required to publish a notice in the Gazette inviting any interested parties to submit objections or submissions if they believe the TCO should not be made (subsection 269K(1)). The Act also mandates that the TCO will come into effect on the day the application is lodged (subsection 269S(1)).
Breaching the requirements set forth in the Act can lead to various legal consequences. While the explanatory statement does not explicitly detail specific offences or penalties, it is clear that non-compliance with the statutory provisions could result in the nullification of the TCO or other legal challenges. For instance, if a person fails to comply with the conditions or misrepresents information in their application, the CEO may refuse to issue a TCO, which could lead to the applicant facing legal action or other administrative consequences. Moreover, if the TCO is found to have been improperly granted, it could be subject to judicial review, potentially leading to its invalidation.
In summary, the Tariff Concession Instrument No. 0613083 under the Customs Act 1901 sets out a process for granting tariff concessions on specific goods, provided that certain criteria are met. The CEO of Customs is responsible for reviewing applications and making written orders if the criteria are satisfied. Parties must adhere to the statutory obligations and requirements to avoid potential legal repercussions, although specific penalties are not detailed in the explanatory statement.