EXPLANATORY STATEMENT
Tariff Concession Instrument No. 0704130
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.
Peleman Industries Pty Ltd applied for a TCO in respect of certain document covers on 19 March 2007.
Instrument
TCO No 0704130 was made on 8 June 2007. It declares that those certain document covers 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. 0704130 is taken to have come into force on 19 March 2007.
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. 0704130 was enacted in 2007 under the Customs Act 1901, addressing the need for a streamlined process to grant tariff concessions on specific goods. This legislation facilitates the application and approval of Tariff Concession Orders (TCOs) by the Chief Executive Officer of Customs, providing a lower rate of customs duty for eligible goods. The Act aims to ensure that such concessions are granted when no substitutable goods are produced in Australia, thus supporting Australian businesses by reducing costs and improving competitiveness.
The enacting body is the Australian Parliament, with the Customs Act 1901 providing the legislative framework. The policy objective is to ensure that tariff concessions are granted fairly and efficiently, promoting economic benefits and reducing the burden on businesses. The Instrument No. 0704130, concerning document covers, was approved based on the absence of substitutable goods produced in Australia, and it provides a zero per cent duty rate on these goods, effective from the date of application.
Scope and Application
The Tariff Concession Instrument No. 0704130 is an instrument made under the Customs Act 1901, which pertains to the establishment of Tariff Concession Orders (TCOs) by the Chief Executive Officer of Customs. This instrument applies to any person who has applied for a TCO for specific goods, in this case, certain document covers, and is subject to the conditions outlined in the Customs Act 1901 and the Customs Tariff Act 1995. The geographic reach of this Act extends to the Commonwealth of Australia, impacting all entities and individuals involved in the import and export of goods within the country's customs framework. The application of this Act is restricted by section 269SJ, which specifies certain goods that cannot be subject to a TCO. The CEO must ensure that the application aligns with the core criteria, which include the absence of substitutable goods produced in Australia at the time of application, as defined by sections 269D and 269E of the Act. The instrument was published in the Gazette, inviting submissions from interested parties, although none were received in this instance. The TCO came into effect on the date of the application, 19 March 2007, and while it does not affect pre-existing rights or impose new liabilities, it does allow for duty refunds for importers of the specified goods from that date onwards.
Key Provisions
The Tariff Concession Instrument No. 0704130 under the Customs Act 1901 introduces a tariff concession order (TCO) for certain document covers, specifically applying to item 50 of Schedule 4 of the Customs Tariff Act 1995. The main operative sections involved are sections 269C, 269B, 269D, 269E, 269F, 269P, 269SJ, and 269K. Section 269F allows a person to apply to the Chief Executive Officer of Customs (CEO) for a TCO, provided the goods in question are not listed in section 269SJ, which specifies goods ineligible for TCO. If the CEO is satisfied that no substitutable goods were produced in Australia on the date of the application, as per section 269C, they must make a written order declaring the goods to which the concession applies (section 269P(3)). The TCO, in this case, sets the duty rate for the specified document covers to 0% instead of the general 5% rate.
The Act imposes certain obligations on the parties involved. The CEO must ensure that the application meets the core criteria, including verifying that no substitutable goods were produced in Australia. They must also publish a notice in the Gazette inviting submissions from any person who may oppose the TCO. In this case, no submissions were received, indicating no opposition to the TCO. Importers, as beneficiaries of the TCO, have the right to apply for a refund of duties on goods imported since the TCO's effective date under paragraph 126(1)(r) of the Regulations. The TCO does not affect the rights of any person, other than the Commonwealth, as at the date of registration.
Failure to comply with the provisions of the Customs Act 1901 regarding the application and issuance of TCOs may result in various consequences. However, the explanatory statement does not specify any particular offences, penalties, or civil/criminal consequences for breach of the Act. The maximum penalties for breaches of the Customs Act can vary widely depending on the nature and severity of the breach, ranging from fines to imprisonment, but these specifics are not detailed within this explanatory statement. Importers who fail to apply for a refund of duties under the TCO may forfeit their entitlement to the refund, but no explicit penalties for such failures are mentioned in the statement.