EXPLANATORY STATEMENT
Tariff Concession Instrument No. 0803138
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.
Unilever Australia Ltd applied for a TCO in respect of certain aerosol cap sorters on 25 February 2008.
Instrument
TCO No 0803138 was made on 02 May 2008. It declares that those certain aerosol cap sorters 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. 0803138 is taken to have come into force on 25 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. 0803138 was enacted in 2008 under the Customs Act 1901 to address the need for a scheme that allows for tariff concessions on certain imported goods, providing a lower rate of customs duty for those goods. This legislation was introduced to provide relief to businesses that rely on importing specific items for which there are no domestic substitutes, thus promoting competitive markets and economic efficiency. The instrument was made by the Chief Executive Officer of Customs, in accordance with the authority granted by the Customs Act. The policy objective is to ensure that businesses can access necessary goods without undue financial burden, thereby facilitating trade and supporting industrial activities that might otherwise be hindered by high import duties. The instrument was effective from the date the application was lodged, ensuring that no party’s rights were adversely affected by the timing of the concession.
Scope and Application
The Tariff Concession Instrument No. 0803138, made under the Customs Act 1901, applies specifically to the goods that are the subject of the Instrument, in this case, certain aerosol cap sorters. The Act allows for the creation of Tariff Concession Orders (TCOs) by the Chief Executive Officer of Customs (CEO) to reduce the rate of customs duty on specified goods, provided that certain criteria are met. The application of this Instrument is triggered by an application under section 269F of the Act, and it is contingent upon the CEO being satisfied that no substitutable goods are produced in Australia in the ordinary course of business, as outlined in sections 269C and 269P of the Act. Once a TCO is made, it has retrospective effect from the date of the application, which in this instance was 25 February 2008. The Instrument does not affect any pre-existing rights or impose any liabilities on individuals or entities other than the Commonwealth, and it benefits importers by potentially entitling them to a refund of duty on goods imported since the commencement date of the TCO. The Instrument’s scope is limited to the goods specified and does not extend to any other goods or industries unless specifically included in a subsequent TCO.
Key Provisions
The Tariff Concession Order No. 0803138, issued under the Customs Act 1901, outlines specific conditions under which certain goods can receive a concession on customs duty rates (s 269P). In this case, the order applies to certain aerosol cap sorters, which are now exempt from the general 5% duty rate, instead being subject to a zero rate (s 269P(3)). This concession is contingent upon the Chief Executive Officer (CEO) of Customs being satisfied that no substitutable goods are produced in Australia, meaning that there are no locally produced alternatives that serve the same purpose as the aerosol cap sorters (s 269C).
The Act imposes several obligations on both applicants and the CEO. Applicants must ensure that their submissions meet the core criteria, which includes demonstrating that no substitutable goods are produced in Australia at the time of application (s 269C). The CEO, on the other hand, is mandated to make a written order if the application satisfies these criteria (s 269P(3)). Additionally, the CEO must publish a notice in the Gazette inviting any interested parties to lodge submissions if they believe the TCO should not be granted (s 269K(1)). In this instance, no submissions were received, allowing the CEO to proceed with the order.
Failure to comply with the requirements set forth in the Customs Act 1901 could lead to various consequences. While specific offences and penalties are not detailed in the provided text, general provisions of the Act likely encompass both civil and criminal penalties for non-compliance. These could include fines or imprisonment for knowingly providing false information or engaging in activities that circumvent the provisions of the Act. The precise penalties would depend on the severity of the breach and other relevant legal considerations.
Overall, Tariff Concession Order No. 0803138 provides a clear framework for the concession of customs duty on certain aerosol cap sorters, ensuring that the process is transparent and fair. By adhering to the requirements and obligations set out in the Customs Act 1901, both applicants and the CEO can effectively manage the application and approval process for tariff concessions.