EXPLANATORY STATEMENT
Tariff Concession Instrument No. 0715783
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.
Australian Wood Panels applied for a TCO in respect of certain plywood door skins on 20 September 2007.
Instrument
TCO No 0715783 was made on 30 November 2007. It declares that those certain plywood door skins 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. 0715783 is taken to have come into force on 20 September 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. 0715783 was enacted under the Customs Act 1901 to provide tariff concessions on certain plywood door skins, addressing the need for more competitive pricing and accessibility of these goods in the Australian market. The instrument was introduced to facilitate the application process for tariff concessions by Australian Wood Panels, ensuring that these specific goods are subject to a lower customs duty rate, thus promoting economic benefits and potentially increasing market competition. The instrument was enacted by the Chief Executive Officer of Customs, following the core criteria set out in the Customs Act, which mandates that the application for a tariff concession order be valid if no substitutable goods are produced in Australia in the ordinary course of business. The policy objective is to reduce the financial burden on importers and consumers of these goods by granting them a tariff concession that results in a zero duty rate.
The instrument was made on 30 November 2007, and it came into effect on 20 September 2007, the day the application was lodged. No submissions opposing the concession were received by the CEO, indicating widespread acceptance of the tariff reduction. This concession does not disadvantage any person or impose liabilities on any person for actions taken before the date of registration, aligning with the policy to benefit importers and consumers while maintaining fairness and legality in the customs duty application process.
Scope and Application
The Tariff Concession Instrument No. 0715783, under the Customs Act 1901, applies to any individual or entity that seeks to import goods eligible for a tariff concession order, as determined by the Chief Executive Officer of Customs. The Act applies specifically to the goods that are the subject of a tariff concession order (TCO) application, and it is limited to those goods which are not specified in section 269SJ of the Act as ineligible for such concessions. The application of this legislation is geographically and jurisdictionally confined to Australia, as it is an instrument of Commonwealth law. The instrument is designed to exempt certain goods from the standard customs duty, provided that the goods are not substitutable by products manufactured within Australia. The Act's scope is extended through subordinate instruments, which define specific terms such as 'goods produced in Australia', 'ordinary course of business', and 'substitutable goods'. This instrument came into effect on the date the application was lodged, which was 20 September 2007, and it does not retroactively disadvantage any person or impose new liabilities on them for actions taken before its registration.
Key Provisions
The primary sections of this Tariff Concession Instrument (No. 0715783) under the Customs Act 1901 (section 269F) permit the Chief Executive Officer of Customs (CEO) to make a Tariff Concession Order (TCO) for goods on which a lower rate of customs duty applies. Specifically, section 269C mandates that the CEO must consider whether an application for a TCO meets the core criteria, which include the absence of substitutable goods produced in Australia at the time the application was lodged (section 269P(3)). If the CEO determines that the application meets these criteria, they are required to issue a written order (TCO) declaring that the goods in question are subject to a specified tariff concession (section 269P(3)). This particular instrument declares that certain plywood door skins are subject to item 50 of Schedule 4 to the Customs Tariff Act 1995, with a duty rate of free, as opposed to the general rate of 5%.
The obligations imposed by the Act on the parties governed by this legislation are quite clear. The CEO is required to assess the validity of TCO applications against the core criteria outlined in the Act. For applicants, this means ensuring that their applications provide sufficient evidence that no substitutable goods are being produced in Australia at the time of application. Additionally, the CEO must publish a notice in the Gazette inviting any interested parties to submit reasons why the TCO should not be made (section 269K(1)). This notice serves as an opportunity for public consultation before the CEO makes a final decision on the application.
Failure to comply with the requirements of the Customs Act 1901 in relation to the issuance and application of TCOs can lead to various consequences. While the explanatory statement does not detail specific offences, penalties, or consequences for non-compliance, it is implied that breaches of the statutory provisions could lead to legal actions or administrative penalties. Typically, such breaches could involve civil or criminal penalties as prescribed by other sections of the Customs Act 1901, which may include fines or other sanctions. The precise nature of these penalties would be determined in accordance with the broader legal framework provided by the Act and any applicable regulations.