EXPLANATORY STATEMENT
Tariff Concession Instrument No. 0803087
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.
Sport Numbers Australia applied for a TCO in respect of certain polyester polyurethane polyvinylchloride film on 26 February 2008.
Instrument
TCO No 0803087 was made on 23 May 2008. It declares that those certain polyester polyurethane polyvinylchloride films 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. 0803087 is taken to have come into force on 26 February 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. 0803087, enacted in 2008, amends the Customs Act 1901 to address the issue of customs duty concessions for specific goods. This instrument was introduced to provide a mechanism through which the Chief Executive Officer of Customs can grant tariff concessions on certain imported goods, thereby reducing the customs duty applied to those goods. The enacting body responsible for this instrument is the Australian Government, specifically through the implementation of the Customs Act 1901. The policy objective is to facilitate trade by lowering the duty on goods for which there are no Australian-produced substitutes, thereby encouraging the importation of these goods and potentially benefiting consumers by reducing prices.
Scope and Application
The Tariff Concession Instrument No. 0803087 under the Customs Act 1901 applies to any entity seeking a reduction in customs duty on specific goods imported into Australia. The instrument was made by the Chief Executive Officer of Customs in response to an application from Sport Numbers Australia for tariff concessions on certain polyester polyurethane polyvinylchloride films. This legislation operates at the Commonwealth level and is designed to facilitate trade by providing lower customs duty rates on specified goods, provided that no substitutable goods are produced in Australia and the application meets the core criteria outlined in the Act. The instrument provides a free rate of duty for the specified goods, which contrasts with the general rate of 5%. This concession is effective from the date the application was lodged, 26 February 2008, and does not impose any liabilities on persons other than the Commonwealth or affect any existing rights they may have as of the date of registration. The Customs Act 1901 extends its application through subordinate instruments such as Tariff Concession Orders, which can be tailored to specific goods and circumstances.
Key Provisions
The main operative sections of Tariff Concession Instrument No. 0803087 under the Customs Act 1901 (sections 269C, 269B, 269D, 269E, 269P(3), 269K(1), and 269S(1)) outline the process for granting tariff concessions on specific goods. Section 269C requires that an application for a Tariff Concession Order (TCO) meets core criteria if, on the day the application was lodged, no substitutable goods were produced in Australia in the ordinary course of business. This means that if the goods in question are not being manufactured domestically, a concession may be granted. Section 269B defines 'goods produced in Australia,' 'ordinary course of business,' and 'substitutable goods,' which are critical for determining eligibility. Section 269P(3) mandates that if the Chief Executive Officer (CEO) of Customs is satisfied that the application meets these criteria, a written order (the TCO) must be issued. Section 269K(1) stipulates that a notice must be published in the Gazette inviting submissions on the proposed TCO, although no submissions were received in this case. Finally, section 269S(1) establishes that the TCO comes into force on the day the application was lodged.
The obligations and requirements imposed by this Act on the parties involved primarily rest on the CEO of Customs. The CEO must first ensure that the application for a TCO meets the core criteria as outlined in section 269C. This involves verifying that no substitutable goods were produced in Australia in the ordinary course of business. Once satisfied, the CEO must publish a notice in the Gazette under section 269K(1) and consider any submissions received, although in this instance, none were submitted. Upon meeting the criteria and without any objections, the CEO must issue a written TCO as per section 269P(3). The TCO, once issued, declares that the specified goods are subject to a reduced rate of customs duty as outlined in the Customs Tariff Act 1995.
In terms of legal consequences for non-compliance or breach of the provisions within this legislation, the Customs Act 1901 does not explicitly outline specific offences, penalties, or civil/criminal consequences for failing to comply with the requirements of a TCO. However, general contraventions of the Customs Act may incur penalties under section 223 of the Act, which can include fines of up to $13,200 for individuals and significantly higher amounts for corporations, alongside potential imprisonment terms. Additionally, any fraudulent claims or misrepresentations made during the application process could potentially be prosecuted under criminal law for offences such as fraud, with penalties that may include imprisonment and fines. The specific penalties and consequences would depend on the nature and severity of the breach.