EXPLANATORY STATEMENT
Tariff Concession Instrument No. 0835379
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.
Tcl Australia applied for a TCO in respect of certain polyethylene based catalyst on 14 October 2008.
Instrument
TCO No 0835379 was made on 14 January 2009. It declares that those certain polyethylene based catalyst 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. 0835379 is taken to have come into force on 14 October 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. 0835379, enacted under the Customs Act 1901, addresses the need for the concession of customs duties on certain goods that are not produced domestically, thereby encouraging importation and ensuring that consumers have access to a wider variety of products at potentially lower costs. The Act was introduced by the Australian Parliament to facilitate this process through the establishment of a scheme whereby Tariff Concession Orders (TCOs) can be made by the Chief Executive Officer of Customs. The underlying policy objective is to ensure that the application for a TCO is processed efficiently and fairly, while also providing a mechanism for public consultation to ensure transparency and accountability. This legislative framework enables the CEO to determine whether an application for a TCO meets the core criteria, which includes assessing whether substitutable goods are produced in Australia, and subsequently, to make a written order declaring the application successful and specifying the applicable rate of duty.
Scope and Application
The Customs Act 1901, through its Tariff Concession Instrument No. 0835379, applies to goods for which an application has been made to the Chief Executive Officer of Customs for a Tariff Concession Order (TCO). This legislative instrument concerns specific polyethylene-based catalysts where Tcl Australia has applied for reduced customs duty rates. The application of the Act is targeted at entities or individuals who are seeking to import these particular goods into Australia and benefit from the tariff concession. The instrument is geographically applicable to the Commonwealth of Australia, governing the customs duty concessions at the national level. The Act does not specify any exclusions or exemptions, except for those goods outlined in section 269SJ which cannot be subject to a TCO. The scope of the Act can be further extended or restricted through subordinate instruments, which may include regulations or further orders issued by the CEO under the Customs Act.
Key Provisions
The Customs Act 1901, specifically under Part XVA, establishes a framework whereby Tariff Concession Orders (TCOs) can be made by the Chief Executive Officer of Customs (section 269F). Section 269C stipulates that a TCO application meets the core criteria if, on the day the application was lodged, no substitutable goods were produced in Australia in the ordinary course of business. If the CEO is satisfied that the application meets these criteria, they are required to make a written order (a TCO) declaring that the goods in question are subject to a prescribed item of Schedule 4 to the Customs Tariff Act 1995 (section 269P(3)). This particular TCO, No. 0835379, applies to certain polyethylene based catalyst and declares that they are subject to item 50 of Schedule 4, resulting in a free rate of duty instead of the general 5% rate.
The Act imposes certain obligations on the parties involved. For instance, section 269K(1) mandates that the CEO must publish a notice in the Gazette as soon as practicable after accepting a TCO application as valid, inviting any person who believes there are reasons why the TCO should not be made to lodge a submission with the CEO. In this case, the CEO did not receive any submissions. Furthermore, section 269S(1) specifies that a TCO is considered to come into force on the day the application for the TCO was lodged, which in this instance was 14 October 2008. Importantly, the TCO does not affect the rights of any person (other than the Commonwealth) as at the date of registration in a way that would disadvantage them or impose liabilities for anything done or omitted before the registration date.
In terms of offences and penalties, the Act does not explicitly outline specific criminal or civil penalties for breaches related to TCOs. However, any improper application or fraudulent submission could potentially lead to legal consequences under other relevant sections of the Customs Act 1901 or other related legislation. For instance, section 237 of the Customs Act 1901 imposes a penalty of up to 10 years imprisonment for knowingly importing goods in a manner that contravenes the Act. Additionally, section 240 of the Act imposes a penalty of up to 10 years imprisonment for making a false statement or document in relation to customs matters. Although these sections do not specifically mention TCOs, they highlight the seriousness with which the law treats breaches related to customs duties and regulations.