EXPLANATORY STATEMENT
Tariff Concession Instrument No. 0814476
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.
Multix Pty Ltd applied for a TCO in respect of certain polyethylene film on 25 June 2008.
Instrument
TCO No 0814476 was made on 12 September 2008. It declares that those certain polyethylene film 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. 0814476 is taken to have come into force on 25 June 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, enacted by the Commonwealth Parliament, established a framework for the administration of customs duties and the regulation of imports and exports in Australia. To address specific economic and trade policy needs, the Act allows for the creation of Tariff Concession Orders (TCOs) through which certain goods can be granted a lower rate of customs duty. This legislative mechanism was introduced to ensure that Australian industries can remain competitive by reducing the cost of importing specific goods that are not produced domestically. The Tariff Concession Instrument No. 0814476, made under this Act, aims to provide tariff relief for certain polyethylene film by granting it a free rate of duty, thereby alleviating the financial burden on businesses that rely on importing these goods. The policy objective is to support domestic industries by ensuring they are not disadvantaged by the importation of substitutable goods, thus encouraging economic growth and efficiency.
Scope and Application
The Customs Act 1901 applies to individuals and entities involved in the importation of goods into Australia, providing a framework for the regulation and administration of customs duties and tariffs. Specifically, the Act empowers the Chief Executive Officer of Customs to make Tariff Concession Orders (TCOs) under Part XVA, which offer lower rates of customs duty on specified goods. The application of a TCO is contingent on the CEO being satisfied that the goods in question are not substitutable by products manufactured within Australia and meet the core criteria outlined in the Act. This instrument affects the rights of importers by allowing them to apply for a refund of duty on goods imported since the TCO's effective date, without imposing any liabilities on individuals or entities. The TCO's geographic and jurisdictional reach is national, as it applies across Australia in accordance with the Customs Act 1901 and the Customs Tariff Act 1995. Any exclusions or exemptions are detailed within the specific sections of these Acts, and the application of the TCO can be extended or restricted through subordinate instruments.
Key Provisions
The Customs Act 1901, specifically under Part XVA, provides a framework for the Chief Executive Officer of Customs (CEO) to make Tariff Concession Orders (TCOs) (s 269F). A person may apply to the CEO for a TCO if they wish to obtain a lower rate of customs duty for certain goods (s 269F). If the CEO determines that the goods are not prohibited under section 269SJ and that the application meets the core criteria, a TCO will be issued (s 269C, s 269P(3)). This means that the CEO must be satisfied that no substitutable goods were produced in Australia in the ordinary course of business on the day the application was lodged (s 269C, s 269D, s 269E). In the case of TCO No. 0814476, the CEO was satisfied that no such goods existed, and thus the TCO was made, declaring that the specified polyethylene film would be subject to a free rate of duty as opposed to the general rate of 5% (s 269P(3)).
The Act imposes several obligations on the CEO when processing a TCO application. Firstly, the CEO must ensure that the application is not in respect of goods specified in section 269SJ, which outlines those goods that cannot be subject to a TCO (s 269F). Secondly, the CEO must determine if the application meets the core criteria by confirming that no substitutable goods were produced in Australia in the ordinary course of business on the day the application was lodged (s 269C). Additionally, the CEO must publish a notice in the Gazette as soon as practicable after accepting the TCO application as valid, inviting any person who believes there are reasons why the TCO should not be made to lodge a submission (s 269K(1)). In the case of TCO No. 0814476, no submissions were received in response to the published notice (s 269K(1)).
Failure to comply with the requirements set out in the Customs Act 1901, particularly in relation to the TCO process, may result in legal consequences. However, the explanatory statement does not provide specific details about offences, penalties, or civil/criminal consequences for breach under this particular TCO. It is essential to refer to the broader provisions of the Customs Act and any related regulations for comprehensive information regarding potential penalties and consequences for non-compliance.