EXPLANATORY STATEMENT
Tariff Concession Instrument No. 0713878
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 glass filled polyamide 6 resins on 31 August 2007.
Instrument
TCO No 0713878 was made on 22 February 2008. It declares that those certain glass filled polyamide 6 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. 0713878 is taken to have come into force on 31 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. 0713878, enacted under the Customs Act 1901, was introduced to address the need for tariff concessions for certain imported goods, ensuring that Australian businesses can access necessary materials at reduced costs, thereby fostering economic efficiency and competitiveness. The Customs Act 1901, enacted by the Australian Parliament, provides the legislative framework for the regulation of customs duties and includes provisions for Tariff Concession Orders (TCOs) that can be applied for by interested parties. The policy objective of this particular instrument was to lower the customs duty on certain glass filled polyamide 6 resins, benefiting BASF Australia Pty Ltd, while ensuring that the process was transparent and allowed for objections from other stakeholders, as evidenced by the submission received from PolyPacific Pty Ltd. The instrument was effective from the date the application was lodged, 31 August 2007, and did not impose any liabilities on persons other than the Commonwealth.
Scope and Application
The Tariff Concession Instrument No. 0713878 under the Customs Act 1901 applies to entities seeking tariff concessions for specific imported goods, in this instance BASF Australia Pty Ltd applying for concessions on certain glass filled polyamide 6 resins. The Act allows for the Chief Executive Officer of Customs to make Tariff Concession Orders, which reduce the rate of customs duty on specified goods. This instrument is applicable across Australia, enforcing the terms of the Customs Act 1901 at a national level. The Act does not apply to goods specified in section 269SJ, which cannot be subject to a Tariff Concession Order. The CEO must ensure that the application for a tariff concession meets the core criteria, which includes verifying that no substitutable goods are produced in Australia in the ordinary course of business. This instrument extends its application through subordinate instruments such as the Customs Tariff Act 1995, which outlines the specifics of the duty rates and items affected by the Tariff Concession Orders.
Key Provisions
The primary sections relevant to this Tariff Concession Order (TCO) include section 269F, which allows a person to apply to the Chief Executive Officer of Customs (CEO) for a TCO in respect of goods. Section 269C sets out the core criteria that the CEO must consider to determine whether the application meets the necessary requirements. The CEO must decide if the application is for goods not specified in section 269SJ, which lists those goods that cannot be subject to a TCO. If the application satisfies these criteria, the CEO must make a written order, as per section 269P(3), declaring that the goods are subject to a prescribed item of Schedule 4 to the Customs Tariff Act 1995. In this case, TCO No 0713878 was issued for certain glass filled polyamide 6 resins, with a rate of duty reduced from 5% to free.
Under the Customs Act 1901, the CEO has the obligation to publish a notice in the Gazette as soon as practicable after accepting a TCO application as valid. This notice must include an invitation for any person who believes there are reasons why the TCO should not be made to lodge a submission with the CEO. This ensures transparency and allows for any objections to be considered before the TCO is issued. The CEO also has the responsibility to assess whether the application meets the core criteria outlined in section 269C. This involves determining whether no substitutable goods were produced in Australia on the day the application was lodged, as defined by sections 269D, 269E, and 269F of the Act. If these conditions are met, the CEO is required to issue the TCO.
In terms of consequences, if a TCO is issued improperly, it could potentially lead to civil or criminal penalties, though specific provisions for penalties are not detailed within the text of the Explanatory Statement. Generally, under Australian law, improper issuance of a TCO could be considered a breach of administrative law principles, potentially leading to judicial review or other legal actions. However, the text does not provide specific maximum penalties, and further details would need to be sought from the relevant legislation or legal precedents.
The commencement of a TCO is effective from the day on which the application is lodged, as stipulated by subsection 269S(1). In this case, TCO No 0713878 is taken to have come into force on 31 August 2007. This means that any rights of importers regarding the goods covered by the TCO are beneficially affected from that date, and they can apply for a refund of duty on goods imported since that date under paragraph 126(1)(r) of the Regulations. The TCO does not impose any liabilities on any person, ensuring that there are no retroactive disadvantages or liabilities for actions taken prior to the TCO's effective date.