EXPLANATORY STATEMENT
Tariff Concession Instrument No. 0713879
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 Ltd applied for a TCO in respect of certain unfilled polyamide 6 unfilled nucleation agent on 31 August 2007.
Instrument
TCO No 0713879 was made on 16 November 2007. It declares that those certain unfilled polyamide 6 unfilled nucleation agents 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. 0713879 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 Customs Act 1901 was amended to introduce a scheme under which Tariff Concession Orders (TCOs) can be made by the Chief Executive Officer of Customs (the CEO). The 2007 Explanatory Statement outlines Tariff Concession Instrument No. 0713879, which was enacted to provide tariff concessions on certain unfilled polyamide 6 unfilled nucleation agents. The instrument was introduced by the Parliament of Australia and aims to provide a lower rate of customs duty for goods specified in a TCO, provided certain criteria are met. Specifically, the CEO must be satisfied that no substitutable goods are produced in Australia. In this instance, BASF Australia Ltd applied for a TCO on these agents, and the CEO was satisfied that no substitutable goods were produced in Australia, resulting in a free rate of duty on these goods.
The CEO published a notice in the Gazette inviting any person to submit reasons why the TCO should not be made, but no submissions were received. The TCO came into force on the day the application was lodged, 31 August 2007. Importantly, the TCO does not affect the rights of any person, other than the Commonwealth, in a manner that disadvantages them or imposes liabilities for actions taken before the TCO’s registration. Importers of these goods can apply for a refund of duty from the date the TCO came into force.
Scope and Application
The Tariff Concession Instrument No. 0713879 under the Customs Act 1901 applies specifically to the goods identified in the instrument, namely certain unfilled polyamide 6 unfilled nucleation agents. This instrument is pertinent to entities or individuals engaged in the importation of these goods, as it provides a concession on the customs duty rate. The Act applies at the national level, governed by the Commonwealth, and the concession provided by the TCO is in accordance with the Customs Tariff Act 1995. The legislation excludes goods specified in section 269SJ of the Customs Act 1901, which outlines goods that cannot be subject to a Tariff Concession Order (TCO). The scope of the TCO is limited to the specific goods mentioned and does not extend to other goods unless further orders are made by the Chief Executive Officer of Customs (CEO). The CEO has the authority to make further orders that extend or modify the application of the TCO through subordinate instruments, thereby allowing for a more tailored approach to tariff concessions based on changing economic or trade conditions.
Key Provisions
The main operative sections of this legislation concern the process and criteria for making Tariff Concession Orders (TCOs) under the Customs Act 1901. Section 269F allows a person to apply to the Chief Executive Officer of Customs (CEO) for a TCO in respect of goods. If the CEO is satisfied that the application does not involve goods specified in section 269SJ, they must determine if the application meets the core criteria outlined in section 269C. If the CEO is satisfied that the application meets the core criteria, they must make a written TCO, as per section 269P(3). This written order declares that the goods specified in the application are subject to a prescribed item of Schedule 4 to the Customs Tariff Act 1995.
The obligations imposed on the parties or entities governed by this legislation include the requirement for the CEO to publish a notice in the Gazette as soon as practicable after accepting a TCO application, inviting any interested parties to submit reasons why the TCO should not be made, as outlined in subsection 269K(1). In this instance, the CEO did not receive any submissions. The TCO itself does not affect the rights of any person, as stipulated in subsection 269S(1), which provides that the TCO is taken to have come into force on the day the application was lodged. In this case, the TCO came into force on 31 August 2007.
Under this legislation, there are no explicit offences or penalties for breach; however, the implications of non-compliance are significant. If a TCO is issued based on incorrect information or criteria, it could lead to incorrect duty assessments and potential financial liabilities for importers or the government. The potential civil or criminal consequences are not detailed in this particular legislation but would likely involve administrative penalties or legal action for fraud or misrepresentation if applicable. The maximum penalties would depend on the specific nature of the breach and would be determined under the relevant sections of the Customs Act 1901 or other related laws.