EXPLANATORY STATEMENT
Tariff Concession Instrument No. 0720095
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.
Geofabrics Australia Pty Ltd applied for a TCO in respect of certain screen changers on 26 November 2007.
Instrument
TCO No 0720095 was made on 08 February 2008. It declares that those certain screen changers 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. 0720095 is taken to have come into force on 26 November 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 enacted by the Australian Parliament to provide a framework for the administration of customs and excise duties, including the imposition of tariffs on imported goods. The Act was introduced to address the need for a comprehensive legal framework governing the collection of customs duties and the regulation of imported goods. A specific problem the Act aimed to address is the facilitation of tariff concessions for certain goods under specific circumstances. This is achieved through Tariff Concession Orders (TCOs), which can be applied for by interested parties and, if approved, result in a lower rate of customs duty on the specified goods. The explanatory statement for Tariff Concession Instrument No. 0720095, made under the Customs Act 1901, pertains to an application by Geofabrics Australia Pty Ltd for a TCO in respect of certain screen changers. The policy objective is to provide relief from customs duty for goods that are not substitutable by Australian-produced alternatives, thereby supporting industries that may face competitive disadvantages due to the lack of local production.
Scope and Application
The Tariff Concession Instrument No. 0720095 applies to specific screen changers that were the subject of an application by Geofabrics Australia Pty Ltd, with the aim of providing a concessional rate of customs duty under the Customs Act 1901. This Act applies Commonwealth-wide, and the instrument itself extends to the application of the concessional rate to the specified goods. The Act applies to any person or entity seeking to import these goods into Australia, thereby directly affecting importers by granting them the opportunity to apply for a refund of duties paid on these goods since the day the TCO is deemed to have come into force. The TCO does not impose any liabilities on any person and ensures that no person other than the Commonwealth is disadvantaged or imposed with liabilities for actions prior to the registration of the TCO. This instrument is an example of how the Customs Act 1901 can be utilised to provide targeted tariff relief to specific goods, contingent on meeting the criteria outlined within the Act.
Key Provisions
The main operative sections of the Tariff Concession Instrument No. 0720095 under the Customs Act 1901, include sections 269C, 269F, 269B, 269D, 269E, 269P, and 269K. Section 269F allows for an application to be made to the Chief Executive Officer (CEO) of Customs for a Tariff Concession Order (TCO) in respect of goods. If the CEO is satisfied that the application meets the core criteria as per section 269C, they are required to make a written order (section 269P). Section 269K stipulates that the CEO must publish a notice in the Gazette, inviting submissions from any person who believes there are reasons why the TCO should not be made.
The obligations imposed on parties or entities governed by this Act include the requirement for the CEO to assess the validity of a TCO application against the core criteria, which include ensuring that no substitutable goods are produced in Australia on the day the application is lodged (section 269C). The CEO must also ensure that the terms of the TCO do not disadvantage any person other than the Commonwealth and do not impose any liabilities on any person (section 269S). Additionally, the CEO must publish a notice in the Gazette and consider any submissions received (section 269K).
In terms of penalties or consequences, the Act does not explicitly state criminal or civil penalties for breaches of the TCO provisions. However, any breach of the customs regulations or misrepresentation of facts in an application could potentially lead to legal consequences under other sections of the Customs Act 1901 or associated regulations. It is important to note that while the Act itself does not specify maximum penalties, general provisions of the Customs Act 1901 and associated regulations may apply, which could include fines and imprisonment for serious offences.