EXPLANATORY STATEMENT
Tariff Concession Instrument No. 0803845
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.
Empire Resources Pacific Ltd applied for a TCO in respect of certain aluminium foil on 7 March 2008.
Instrument
TCO No 0803845 was made on 30 May 2008. It declares that those certain aluminium foil 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. 0803845 is taken to have come into force on 7 March 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 Customs Act 1901 was enacted by the Parliament of Australia and provides a framework for the administration of customs duties and other charges. The Act establishes a scheme under which Tariff Concession Orders (TCOs) can be issued to provide relief from certain customs duties. This is done to encourage the import of goods that are not produced domestically, thereby supporting industries that cannot compete with local production and fostering economic efficiency. The Tariff Concession Instrument No. 0803845 was introduced to address the specific need to grant a tariff concession for certain aluminium foil, facilitating the import of these goods without the burden of customs duty. The instrument was made under the authority of the Customs Act 1901, with the objective of ensuring that the application of tariff concessions aligns with the broader policy goals of supporting industry and economic activity.
Scope and Application
The Customs Act 1901, specifically under Part XVA, governs the process for Tariff Concession Orders (TCOs) which allow for a lower rate of customs duty on certain goods. The application for a TCO must be made to the Chief Executive Officer of Customs (CEO) and must meet core criteria, including the absence of substitutable goods produced in Australia in the ordinary course of business. If the CEO is satisfied that the application meets these criteria, a written order is issued that specifies the prescribed item of Schedule 4 to the Customs Tariff Act 1995 that applies to the goods. The CEO is required to publish a notice in the Gazette inviting any interested party to lodge a submission if they believe the TCO should not be made, although in the case of TCO No. 0803845, no such submissions were received. The TCO applies to the goods from the date the application was lodged, and it does not affect the rights of any person, including the Commonwealth, in relation to actions taken prior to the TCO's registration. Importers of the affected goods may apply for a refund of duty paid on those goods since the effective date of the TCO. The TCO does not impose any liabilities on any person, thereby ensuring that the rights of importers are beneficially affected by the concession.
Key Provisions
The Tariff Concession Instrument No. 0803845, made under the Customs Act 1901, primarily focuses on the application and implementation of a Tariff Concession Order (TCO) for specific goods. Section 269F of the Act allows individuals or entities to apply to the Chief Executive Officer (CEO) of Customs for a TCO. If the CEO determines that the application pertains to goods not listed in section 269SJ, which includes goods that cannot be subject to a TCO, the CEO must assess whether the application meets the core criteria as outlined in section 269C. This criterion requires that on the date the application was lodged, no substitutable goods were being produced in Australia in the ordinary course of business.
The obligations imposed on parties under this Act include the requirement for applicants to submit a valid application to the CEO and for the CEO to review and decide on the application based on the criteria specified in the Act. The CEO must also ensure that any relevant notices are published in the Gazette to allow for public submissions, as required by subsection 269K(1). In this particular instance, the CEO did not receive any submissions opposing the TCO.
In terms of potential offences, penalties, or consequences, the Act does not explicitly detail specific penalties for breaches related to the TCO application process. However, general compliance with the Customs Act 1901 is essential. Any failure to comply with the requirements set forth in the Act or the regulations could potentially lead to legal consequences, although the specifics of such penalties are not outlined in the explanatory statement for this particular TCO. The rights of importers are protected under this Act, allowing them to apply for a refund of duty on goods imported since the TCO was taken to have come into force, as per paragraph 126(1)(r) of the Regulations.