EXPLANATORY STATEMENT
Tariff Concession Instrument No. 0843181
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.
Cryovac Food Packaging applied for a TCO in respect of certain plastic blown film extrusion plant on 09 December 2008.
Instrument
TCO No 0843181 was made on 06 March 2009. It declares that those certain plastic blown film extrusion plant 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. 0843181 is taken to have come into force on 09 December 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. 0843181 was enacted in 2009 to provide a concession on the customs duty for certain plastic blown film extrusion plant, facilitating the import of these goods under the Customs Act 1901. This legislation was introduced to address the gap where importers of specific industrial equipment faced higher tariffs, potentially impacting the competitiveness of businesses reliant on these goods. The instrument was enacted by the Chief Executive Officer of Customs, in accordance with section 269F of the Customs Act 1901, and aims to ensure that the application of a tariff concession order aligns with the policy of promoting efficient and cost-effective business operations by reducing the duty on goods not produced domestically. The measure was introduced without any public submissions, indicating a clear path for the concession without opposition.
Scope and Application
The Tariff Concession Instrument No. 0843181, made under Part XVA of the Customs Act 1901, applies to entities or individuals who are seeking tariff concessions on certain goods. Specifically, it pertains to the application submitted by Cryovac Food Packaging for a lower rate of customs duty on certain plastic blown film extrusion plant. The application was lodged on 09 December 2008, and the instrument was made on 06 March 2009, declaring that these particular goods are subject to item 50 of Schedule 4 to the Customs Tariff Act 1995, effectively reducing the duty rate from 5% to free. The Act applies at the Commonwealth level, impacting customs duty rates across Australia. Notably, the instrument does not disadvantage any person other than the Commonwealth, and it does not impose any liabilities on any person. The TCO also benefits importers by allowing them to apply for a refund of duty on goods imported since the effective date of the concession. The Act extends its application through subordinate instruments such as the Customs Tariff Act 1995, which specifies the duty rates.
Key Provisions
The main operative sections of this legislation, Tariff Concession Instrument No. 0843181, pertain to the Customs Act 1901 (section 269F), which allows for the application of Tariff Concession Orders (TCOs) by the Chief Executive Officer of Customs (CEO). If an application for a TCO is made and the CEO determines that the goods in question are not excluded under section 269SJ and meet the core criteria outlined in section 269C, the CEO must issue a written order declaring the goods subject to the TCO (section 269P(3)). This particular TCO No. 0843181, declared on 6 March 2009, pertains to certain plastic blown film extrusion plant, which are now subject to a 5% duty rate instead of the general rate, as specified in item 50 of Schedule 4 to the Customs Tariff Act 1995.
The obligations and requirements imposed by this Act on the parties involved are primarily centred around the application and approval processes for TCOs. The applicant must ensure that the goods they are applying for a TCO for are not specified in section 269SJ of the Act and that they meet the core criteria as per section 269C. The CEO must then conduct a review to ascertain whether these criteria are met, and if so, proceed to issue a written order. Additionally, under subsection 269K(1) of the Act, the CEO must publish a notice in the Gazette inviting submissions from any person who may have objections to the TCO. In this case, no submissions were received.
In terms of offences, penalties, or civil/criminal consequences for breaches, the Act does not explicitly outline specific penalties for failing to comply with the requirements or obligations set out in the TCO. However, general provisions in the Customs Act 1901 would apply for non-compliance with customs regulations. For example, under section 222 of the Act, any person who knowingly makes a false statement or representation in relation to the import or export of goods may be subject to a fine of up to 10,000 penalty units or imprisonment for up to five years, or both. It is important to note that the maximum penalties may vary depending on the nature and severity of the breach.