EXPLANATORY STATEMENT
Tariff Concession Instrument No. 0711603
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.
BASF Australia Pty Ltd applied for a TCO in respect of certain polyoxymethylene copolymer resins on 29 August 2007.
Instrument
TCO No 0711603 was made on 13 February 2008. It declares that those certain polyoxymethylene copolymer resins 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. One submission objecting to the TCO application was received from PolyPacific Pty Ltd.
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. 0711603 is taken to have come into force on 29 August 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. 0711603 was enacted in 2008 to amend the Customs Act 1901, facilitating tariff concessions for specific goods. This instrument was introduced to address the need for streamlined customs duty processes for certain imported goods, ensuring that businesses can benefit from lower duty rates when no substitutable goods are produced domestically. The Customs Act 1901, enacted by the Parliament of Australia, provides the framework for tariff concessions, allowing the Chief Executive Officer of Customs to make Tariff Concession Orders under specific criteria. The policy objective of this instrument is to support Australian businesses by reducing customs duties on certain imported goods, thereby enhancing competitiveness and economic efficiency. The Tariff Concession Instrument No. 0711603 specifically pertains to certain polyoxymethylene copolymer resins, granting them a free duty rate instead of the general rate of 5%, effective from the date of the application.
Scope and Application
The Tariff Concession Instrument No. 0711603, which pertains to the Customs Act 1901, applies to any entity seeking tariff concessions on specific goods, in this instance BASF Australia Pty Ltd's application for certain polyoxymethylene copolymer resins. The Act enables the Chief Executive Officer of Customs to issue Tariff Concession Orders (TCOs) that lower the customs duty on goods if the core criteria are met, which includes the condition that no substitutable goods are produced in Australia. The instrument declares that the specified resins are subject to a free rate of duty instead of the general rate of 5%, effective from the date the application was lodged. This legislation operates under Commonwealth jurisdiction, and while it generally applies to all entities within its scope, it does not disadvantage existing rights of any person other than the Commonwealth. The rights of importers are specifically noted to be beneficially affected, allowing them to apply for refunds on duties paid since the effective date of the TCO.
Key Provisions
The Customs Act 1901 (the Act) includes provisions for Tariff Concession Orders (TCOs) under Part XVA, which allows the Chief Executive Officer of Customs (the CEO) to grant lower rates of customs duty on certain goods. Section 269F enables individuals to apply to the CEO for a TCO, provided the goods in question are not prohibited by section 269SJ of the Act. For a TCO to be granted, the application must meet the core criteria outlined in section 269C, which requires that no substitutable goods are produced in Australia in the ordinary course of business on the day the application was lodged. Definitions for key terms such as "goods produced in Australia," "ordinary course of business," and "substitutable goods" are provided in sections 269D, 269E, and 269F respectively. If the CEO determines that the application meets these criteria, they must issue a written order declaring the goods to which a prescribed item of Schedule 4 to the Customs Tariff Act 1995 applies (subsection 269P(3)).
The obligations imposed by the Act on parties and entities include the requirement for the CEO to consult with interested parties by publishing a notice in the Gazette once an application is accepted as valid (subsection 269K(1)). Any objections to the TCO application must be lodged with the CEO. For instance, BASF Australia Pty Ltd applied for a TCO for certain polyoxymethylene copolymer resins on 29 August 2007, and after considering objections from PolyPacific Pty Ltd, the CEO issued TCO No. 0711603 on 13 February 2008. This TCO declared that the resins are subject to item 50 of Schedule 4 to the Tariff, with a duty rate of free, down from the general rate of 5%.
Offences and penalties under the Act for breach of its provisions are not explicitly detailed in the provided text. However, the Act likely incorporates general penalties for non-compliance with customs regulations, which could include fines or imprisonment as stipulated in other sections of the Customs Act 1901 or related legislation. The Act ensures that the rights of persons other than the Commonwealth are protected, and no liabilities are imposed on them in respect of actions taken before the TCO registration date. Importers of the goods in question benefit from the TCO, as they can apply for a refund of duty on goods imported since the effective date of the TCO, which is the date the application was lodged (paragraph 126(1)(r) of the Regulations).