EXPLANATORY STATEMENT
Tariff Concession Instrument No. 0619083
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.
Oxford Chemicals applied for a TCO in respect of certain organic synthetic pigments on 28 November 2006.
Instrument
TCO No 0619083 was made on . 02 March 2007. It declares that those certain organic synthetic pigments 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. 0619083 is taken to have come into force on 28 November 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 was enacted to provide for the regulation of customs and excise duties, among other things. The Act was introduced to address the need for a comprehensive framework governing the administration of customs duties and tariffs in Australia. The Tariff Concession Instrument No. 0619083 was made under this Act to provide relief in the form of tariff concessions on certain goods. This instrument was enacted by the Chief Executive Officer of Customs in response to an application from Oxford Chemicals for tariff concessions on certain organic synthetic pigments. The objective of this instrument is to grant tariff concessions on specified goods, thereby reducing the customs duty for these goods to zero, which benefits the rights of importers who can apply for a refund of duty on these goods imported since the day the tariff concession came into force.
Scope and Application
The Customs Act 1901, specifically under Part XVA, governs the scheme for Tariff Concession Orders (TCOs), which may be issued by the Chief Executive Officer of Customs to apply a lower rate of customs duty to specified goods. This Act applies to any person who may apply for a TCO in respect of goods, provided the application is not for goods specified in section 269SJ of the Act, which includes certain restricted items. The geographic scope of this Act is national, impacting all importers and exporters within Australia. The application of a TCO hinges on the absence of substitutable goods produced in Australia at the time of the application, as outlined in sections 269C, 269D, 269E, and 269P of the Act. Once a TCO is registered, it benefits importers by potentially allowing them to claim a refund of duty on goods imported since the effective date of the TCO. The Act mandates the CEO to publish a notice in the Gazette inviting submissions from any interested parties, though no submissions were received for TCO No. 0619083, which pertains to certain organic synthetic pigments. This TCO came into force on 28 November 2006, and it does not affect any rights or impose liabilities on persons other than the Commonwealth regarding actions taken before its registration.
Key Provisions
The main operative sections of Tariff Concession Instrument No. 0619083, under the Customs Act 1901, involve the establishment of a Tariff Concession Order (TCO) for certain organic synthetic pigments. Section 269F of the Act allows for an application to be made by a person to the Chief Executive Officer of Customs (CEO) for a TCO, which, if approved, applies a lower rate of customs duty to the specified goods. The CEO must determine whether the application meets the core criteria as set out in section 269C, which includes verifying that no substitutable goods were produced in Australia in the ordinary course of business on the day the application was lodged. Upon meeting these criteria, the CEO is mandated by section 269P(3) of the Act to make a written order that declares the goods subject to a prescribed item of Schedule 4 to the Customs Tariff Act 1995, with a specified rate of duty.
The obligations imposed by the Act on the parties or entities it governs include the requirement for the CEO to assess the validity of a TCO application against the core criteria. This assessment involves ensuring that no substitutable goods were produced in Australia in the ordinary course of business on the date of application. Furthermore, the CEO must publish a notice in the Gazette, inviting any person who believes there are reasons why the TCO should not be made to submit their views. The CEO is also required to consider any submissions received in response to this notice. In this case, no submissions were received, leading to the issuance of TCO No. 0619083. The Act further stipulates that the rights of importers will be beneficially affected by the TCO, allowing them to apply for a refund of duty on goods imported since the day the TCO is taken to have come into force.
In terms of offences, penalties, or civil/criminal consequences for breach, the Customs Act 1901 does not explicitly state maximum penalties for failing to comply with the provisions of a TCO. However, it is implied that non-compliance with the terms of the TCO, such as attempting to import goods without the benefit of the tariff concession or providing false information in the application process, could result in legal action. Such breaches may lead to penalties under the broader framework of the Customs Act, which can include fines and imprisonment for serious or repeated violations. The Act ensures that the TCO does not affect the rights of any person as at the date of registration to disadvantage that person or impose liabilities in respect of anything done or omitted before the registration date. This means that the TCO operates prospectively and does not impose any liabilities on any person for actions taken before the TCO came into effect.