EXPLANATORY STATEMENT
Tariff Concession Instrument No. 0709262
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.
Glanela Paper Agencies Pty Ltd applied for a TCO in respect of certain machine glazed poster paper on 03 July 2007.
Instrument
TCO No 0709262 was made on 21 September 2007. It declares that those certain machine glazed poster papers 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. 0709262 is taken to have come into force on 03 July 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 Customs Act 1901, as supplemented by the Tariff Concession Instrument No. 0709262 enacted in 2007, addresses the need for tariff concessions on specific imported goods to encourage trade and economic growth. This instrument, issued by the Chief Executive Officer of Customs, applies to cases where the imported goods are not substitutable by any goods produced in Australia, thereby ensuring that local industries are not unfairly disadvantaged. The policy objective is to provide relief on customs duties for certain imported goods, thereby making them more competitively priced in the Australian market.
The instrument was enacted by the Australian Parliament and aims to facilitate trade by reducing the cost of importing specific goods. By allowing tariff concessions, the Act supports economic activity by making imported products more affordable, which in turn can stimulate demand and support broader economic objectives. This legislative approach ensures that while local production is encouraged, importers are not unduly burdened, thus balancing the interests of domestic producers with those of consumers and importers.
Scope and Application
The Tariff Concession Instrument No. 0709262 applies to individuals and entities, specifically importers of certain machine glazed poster paper, seeking tariff concessions under the Customs Act 1901. This instrument pertains to goods that are subject to a Tariff Concession Order (TCO), which is issued by the Chief Executive Officer of Customs (CEO) when certain criteria are met. The Act applies on a national level, with the CEO’s decision-making process being integral to the scheme. The geographic reach of this legislation is nationwide, affecting all importers of the specified goods within Australia. The Act excludes certain goods from being subject to a TCO, as outlined in section 269SJ of the Customs Act. The instrument also specifies that the application for a TCO must be made in accordance with the core criteria set out in sections 269C, 269D, and 269E of the Act. The application process requires the CEO to ensure that no substitutable goods are produced in Australia at the time of application. The instrument allows for the CEO to extend or restrict the application through subordinate instruments, as outlined in the Customs Tariff Act 1995. The TCO in question became effective on the date the application was lodged, 3 July 2007, and no submissions were received during the consultation period.
Key Provisions
The main operative sections of this legislation concern the establishment and application of Tariff Concession Orders (TCOs) under the Customs Act 1901 (sections 269C, 269F, 269P(3), and 269S(1)). Section 269F allows an individual or entity to apply for a TCO in respect of certain goods. If the Chief Executive Officer of Customs (CEO) is satisfied that the application meets the core criteria (section 269C), which essentially means that no substitutable goods were produced in Australia, the CEO must make a written order declaring that the goods in question are subject to a specific tariff rate, often a concessional rate (section 269P(3)). The commencement of the TCO is deemed to be the day on which the application was lodged (section 269S(1)).
The obligations imposed by this Act on the parties or entities it governs are primarily centred around the application process for TCOs. The applicant must ensure that their application is valid and meets the core criteria set out in section 269C. This involves demonstrating that no substitutable goods are being produced in Australia. The CEO, on their part, must ensure that the application is assessed against these criteria and, if satisfied, make the TCO within the legislative framework. The CEO is also required to publish a notice in the Gazette inviting any interested parties to lodge submissions if they believe the TCO should not be made, as stipulated in section 269K(1).
In terms of offences, penalties, or consequences for breach, the legislation does not explicitly outline specific offences or penalties for non-compliance with the TCO provisions. However, failure to comply with the core criteria or providing false information in the application could potentially lead to the TCO being contested or revoked, with implications for the applicant's ability to import goods at the concessional rate. Additionally, if an entity is found to have imported goods under a TCO without meeting the eligibility criteria, it could face penalties related to the duty paid or owed, as well as potential legal actions for misrepresentation or fraud.
While the Act does not specify maximum penalties, breaches of customs regulations generally can attract significant penalties under other sections of the Customs Act 1901. These penalties may include fines and imprisonment, depending on the severity of the breach and the discretion of the court. The specific consequences for any breaches would need to be evaluated in the context of the broader customs and trade laws in Australia.