EXPLANATORY STATEMENT
Tariff Concession Instrument No. 0816893
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.
Labelmakers Group Pty Ltd applied for a TCO in respect of certain label paper on 09 July 2008.
Instrument
TCO No 0816893 was made on 26 September 2008. It declares that those certain label paper 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. 0816893 is taken to have come into force on 09 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 Customs Act 1901, enacted by the Australian Parliament, establishes a framework under which Tariff Concession Orders (TCOs) may be made by the Chief Executive Officer of Customs (CEO) to reduce the rate of customs duty on certain goods. This legislative framework aims to facilitate trade by offering tariff relief to importers who demonstrate that no substitutable goods are produced in Australia, thereby addressing the gap in domestic production for particular goods. The Tariff Concession Instrument No. 0816893 was introduced to grant a tariff concession for specific label paper, following an application by Labelmakers Group Pty Ltd on 9 July 2008. The CEO determined that no substitutable goods were produced in Australia for these specific label papers, thereby meeting the core criteria for a TCO under section 269C of the Act. Consequently, the Instrument was made on 26 September 2008, with the TCO taking effect from the date of the application, 9 July 2008. This legislative action benefits importers by allowing them to apply for a refund of duty on goods imported since the TCO's effective date, as per the Regulations.
Scope and Application
The Customs Act 1901 provides a framework for the application of Tariff Concession Orders (TCOs) through which the Chief Executive Officer of Customs can apply a lower rate of customs duty on certain goods. This legislation applies to persons or entities seeking to import goods eligible for a TCO, specifically targeting those goods not produced in Australia and not listed in section 269SJ as ineligible. The scope of this Act is both national and jurisdictional, operating under the Commonwealth framework but applicable across Australia. It does not impose liabilities on persons other than the Commonwealth and does not disadvantage existing rights of non-Commonwealth persons. The Tariff Concession Instrument No. 0816893, which came into effect on 09 July 2008, exemplifies the application of this Act by granting a free duty rate on certain label paper, subject to the conditions specified in Schedule 4 of the Customs Tariff Act 1995. The Act also mandates public consultation on TCO applications, although in this instance, no submissions were received.
Key Provisions
The Tariff Concession Instrument No. 0816893, made under the Customs Act 1901, pertains to the concession of tariff rates for certain label paper, as applied for by Labelmakers Group Pty Ltd on 09 July 2008. The instrument, which came into force on the same date, declares that the specified label paper is subject to item 50 of Schedule 4 of the Customs Tariff Act 1995, resulting in a tariff rate of free, instead of the general rate of 5% (sections 269C, 269P(3)). This means that the tariff concession applies to the goods in question from the date the application was lodged.
In terms of obligations, the Chief Executive Officer of Customs (CEO) has specific duties under the Customs Act 1901 when considering an application for a Tariff Concession Order (TCO). Firstly, the CEO must ensure that the application is not in respect of goods that are explicitly excluded under section 269SJ. If the application is valid, the CEO must then assess whether it meets the core criteria outlined in section 269C, which requires that on the date the application was lodged, no substitutable goods were produced in Australia in the ordinary course of business (sections 269B, 269C, 269D, 269E). If these conditions are met, the CEO must proceed to issue a written TCO.
Moreover, as per subsection 269K(1) of the Act, the CEO is required to publish a notice in the Gazette after accepting a TCO application as valid. This notice must include an invitation for any interested parties to lodge submissions opposing the making of the TCO. In this instance, no submissions were received by the CEO in response to the published notice.
Should any party feel that the application for a TCO should not proceed, or if there are concerns regarding compliance with the Act, penalties and consequences may apply. Breaches of the Act, including the making of false statements or the failure to comply with the requirements of a TCO, could result in both civil and criminal penalties. While the specific penalties are not detailed in the explanatory statement, they generally could include fines and, in severe cases, imprisonment. The exact nature and severity of these penalties would depend on the particular breach and the discretion of the court.