EXPLANATORY STATEMENT
Tariff Concession Instrument No. 0709292
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.
Glanella Paper Agencies Pty Ltd applied for a TCO in respect of certain poster paper on 3 July 2007.
Instrument
TCO No 0709292 was made on 21 September 2007. It declares that those certain poster paper 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. 0709292 is taken to have come into force on 3 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 Tariff Concession Instrument No. 0709292, made under the Customs Act 1901, was enacted to address the need for tariff concessions on certain goods, thereby providing economic relief and facilitating trade. Specifically, this instrument was introduced in response to an application by Glanella Paper Agencies Pty Ltd for a tariff concession order (TCO) concerning certain poster paper, where a lower rate of customs duty would apply if the application met the core criteria set out in the Act. The instrument was made by the Chief Executive Officer of Customs on 21 September 2007, following the satisfaction of these criteria. The primary policy objective of this legislation is to ensure that the application of tariff concessions does not disadvantage any person, while potentially benefiting importers by allowing them to apply for a refund of duty on goods imported since the effective date of the TCO. This instrument, which came into force on 3 July 2007, does not impose any liabilities on individuals or entities, thereby maintaining the balance between trade facilitation and economic fairness.
Scope and Application
The Tariff Concession Instrument No. 0709292 applies to the importation of certain poster paper, granting a concession on the customs duty rate for these goods under the Customs Act 1901. The application of this Instrument is specifically directed towards the Chief Executive Officer of Customs, who is responsible for making the Tariff Concession Order (TCO) upon meeting the core criteria specified in the Act. The concessional duty rate applies to entities importing the specified goods, thereby reducing their customs duty liability from the general rate of 5% to 0%. This Act extends to the Commonwealth of Australia, governing the tariff concessions at a national level. The legislation does not specify exclusions or exemptions, though it does note that the concession will not affect the rights of any person as at the date of registration in a way that would disadvantage them or impose liabilities for actions taken prior to the registration of the TCO. The Act allows for the CEO to make further orders or amend existing ones through subordinate instruments, thereby extending or restricting the application of the TCO as necessary.
Key Provisions
The Tariff Concession Instrument No. 0709292 primarily focuses on the establishment of a Tariff Concession Order (TCO) for certain poster paper, as specified in section 269F of the Customs Act 1901. According to section 269C, a TCO application meets the core criteria if, on the day the application was lodged, no substitutable goods were produced in Australia in the ordinary course of business. In this case, the CEO was satisfied that no substitutable goods were being produced domestically, which led to the decision to proceed with the TCO for the specified poster paper. The TCO, declared under section 269P(3), stipulates that these particular poster papers are subject to item 50 of Schedule 4 to the Customs Tariff Act 1995, thereby granting them a duty rate of 0% instead of the general rate of 5%.
Entities or individuals involved in the importation of these specific poster papers will need to comply with the terms of the TCO. This includes ensuring that the goods imported are indeed the ones specified under the TCO and that any relevant documentation is correctly filled out to reflect the zero-duty status. Importers may also need to apply for a refund of any duties paid on these goods since the TCO came into effect, as per paragraph 126(1)(r) of the Regulations. The obligations extend to maintaining accurate records to substantiate their claims for duty refunds, as well as adhering to any further instructions or clarifications provided by the CEO or other relevant authorities.
Failure to comply with the provisions of the TCO or the Customs Act 1901 can result in legal consequences. For example, if an importer is found to be improperly claiming benefits under the TCO, they could face penalties under the relevant sections of the Customs Act. The maximum penalties for such breaches may include fines and, in severe cases, imprisonment. Additionally, civil consequences could involve financial penalties, litigation, or other corrective actions deemed necessary by the court. These potential consequences underscore the importance of strict adherence to the legislative requirements set forth in the TCO and the overarching Customs Act.