EXPLANATORY STATEMENT
Tariff Concession Instrument No. 0800279
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.
Elof Hansson Pty Ltd applied for a TCO in respect of certain 2 sided silicone base paper on 07 January 2008.
Instrument
TCO No 0800279 was made on 28 March 2008. It declares that those certain 2 sided silicone base papers 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. 0800279 is taken to have come into force on 07 January 2008.
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. 0800279, enacted in 2008, pertains to the Customs Act 1901, addressing the need for tariff concessions to facilitate trade and economic efficiency. This instrument was introduced to allow the Chief Executive Officer of Customs to provide tariff concessions on specific goods, thereby reducing customs duties on imported goods when no suitable Australian-made alternatives exist. The objective of this legislation is to promote the efficient use of resources and to support industries by ensuring that they have access to competitively priced imported goods. The instrument was enacted by the relevant legislature, ensuring that it aligns with broader trade policies aimed at enhancing economic growth through tariff adjustments.
This legislation was developed to meet the policy objective of reducing trade barriers, ensuring that Australian businesses and consumers benefit from lower costs of imported goods. The process involves an application to the CEO for a Tariff Concession Order, which is granted if the goods do not have a substitutable Australian counterpart and if the application meets specified criteria. The Tariff Concession Instrument No. 0800279 specifically applies to certain 2-sided silicone base papers, reducing their duty from 5% to free, effective from the date of the application. This measure directly benefits importers by allowing them to seek refunds on duties paid prior to the instrument's effective date.
Scope and Application
The Tariff Concession Instrument No. 0800279, which is made under the Customs Act 1901, applies to specific goods for which a Tariff Concession Order (TCO) has been requested and granted. The TCO applies to certain 2-sided silicone base papers, allowing these goods to benefit from a lower rate of customs duty than the standard rate. The application for a TCO was made by Elof Hansson Pty Ltd, and the order was issued by the Chief Executive Officer of Customs (CEO) on 28 March 2008. The TCO modifies the rate of customs duty for these particular goods, which is specified in Schedule 4 to the Customs Tariff Act 1995, from a general duty rate of 5% to a rate of duty that is free. The instrument applies across the Commonwealth of Australia and affects the rights of importers of the specified goods from the date the TCO application was lodged, which is 7 January 2008. Importantly, the TCO does not impose any liabilities or disadvantages to any person other than the Commonwealth and does not affect any rights or liabilities in respect of actions taken before the TCO was registered.
Key Provisions
The main operative sections of the Customs Act 1901, particularly as they relate to Tariff Concession Orders (TCOs), include sections 269F, 269C, 269B, 269D, 269E, and 269P. Section 269F allows a person to apply to the Chief Executive Officer of Customs (CEO) for a TCO in respect of goods. Section 269C stipulates that a TCO application meets the core criteria if no substitutable goods were produced in Australia on the day the application was lodged. Definitions for "goods produced in Australia," "ordinary course of business," and "substitutable goods" are provided in sections 269B, 269D, and 269E respectively. If the CEO determines that the application meets these criteria, they are required under section 269P(3) to make a written TCO, declaring the applicable duty rate as specified in the Customs Tariff Act 1995.
The obligations imposed on parties by this Act primarily focus on the CEO and the applicant. The CEO must ensure that any TCO application is assessed against the core criteria outlined in section 269C. This involves verifying that no substitutable goods were produced in Australia on the day the application was made, as per the definitions provided in sections 269B, 269D, and 269E. Once the CEO is satisfied that the application meets these criteria, they are obligated to issue a written TCO, specifying the new duty rate for the goods in question. Additionally, under section 269K(1), the CEO must publish a notice in the Gazette inviting any interested parties to submit objections to the TCO. Importers, as beneficiaries of the TCO, may also be required to apply for a refund of duties paid on the goods prior to the TCO's effective date, as per paragraph 126(1)(r) of the Regulations.
The Act does not explicitly outline offences, penalties, or specific civil or criminal consequences for breaches related to TCOs. However, general provisions of the Customs Act 1901 and associated regulations might apply to any non-compliance or misuse of TCOs. The penalties for breaches of customs laws can vary widely and may include fines, imprisonment, or both, depending on the severity and nature of the breach. For instance, section 245 of the Act allows for penalties of up to 10,000 penalty units or imprisonment for five years, or both, for serious breaches such as smuggling or making false statements. The specific penalties would be determined based on the nature of the breach and the discretion of the court.