EXPLANATORY STATEMENT
Tariff Concession Instrument No. 0816724
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.
Venture Industries applied for a TCO in respect of certain foam backed sheets on 08 July 2008.
Instrument
TCO No 0816724 was made on 26 September 2008. It declares that those certain foam backed sheets 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. 0816724 is taken to have come into force on 08 July 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. 0816724, enacted in 2008, amends the Customs Act 1901 by providing for tariff concessions on certain foam backed sheets, thereby addressing the gap in duty rates for goods not produced in Australia. This instrument was made under the authority of the Chief Executive Officer of Customs, who must be satisfied that the application for tariff concession meets the core criteria, including the absence of substitutable goods produced in Australia. The instrument was introduced following an application by Venture Industries, and the CEO’s decision was based on the absence of any submissions opposing the concession. The policy objective behind this instrument is to support industries by reducing the duty on imported goods that are not domestically produced, thus encouraging the importation of these goods and potentially benefiting importers through duty refunds.
Scope and Application
The Tariff Concession Instrument No. 0816724, made under the Customs Act 1901, applies to specific foam-backed sheets that Venture Industries applied for on 8 July 2008. This instrument, which came into force on the same date, designates these sheets as eligible for a tariff concession order (TCO) due to the absence of substitutable goods produced in Australia at the time of the application. The TCO, issued on 26 September 2008, reduces the general customs duty rate from 5% to free for these particular goods, as per item 50 of Schedule 4 to the Customs Tariff Act 1995. The TCO does not disadvantage any person other than the Commonwealth and does not impose any liabilities on any person. It is designed to benefit importers of these goods, allowing them to apply for a refund of duty on goods imported since the TCO's effective date. The scope of the TCO is limited to the specified goods and does not extend to other products or entities unless they meet the criteria and apply for a similar concession. The CEO of Customs must ensure that the application complies with the core criteria set out in the Customs Act before making a decision on the TCO.
Key Provisions
The Tariff Concession Instrument No. 0816724 (TCO No. 0816724) under the Customs Act 1901 establishes the terms under which certain foam backed sheets are subject to a tariff concession. This instrument, made by the Chief Executive Officer of Customs, specifies that these goods are to be treated under item 50 of Schedule 4 to the Customs Tariff Act 1995, which results in a tariff rate of free instead of the general 5% rate (section 269P(3)). This concession applies because the CEO determined that no substitutable goods were produced in Australia on the date the application was lodged (section 269C).
The Act imposes certain obligations on applicants for a Tariff Concession Order. For instance, applicants must ensure that their application meets the core criteria outlined in the Act, such as the absence of substitutable goods produced in Australia (section 269C). The CEO is also required to publish a notice in the Gazette inviting any interested parties to submit objections to the concession if they believe there are valid reasons why it should not proceed (subsection 269K(1)). In this case, the CEO did not receive any submissions against the concession, leading to its approval.
Failure to comply with the provisions of the Customs Act 1901 and related instruments can lead to various legal consequences. While the explanatory statement does not detail specific offences or penalties, it is known that breaches of the Customs Act can result in both civil and criminal penalties. For instance, penalties for providing false or misleading information in customs-related matters can be severe, potentially including fines and imprisonment. The exact penalties depend on the nature and severity of the breach but are intended to enforce compliance with the Act's requirements.