EXPLANATORY STATEMENT
Tariff Concession Instrument No. 0911328
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.
Detmold Packaging Pty Ltd applied for a TCO in respect of certain cones paperboard food on 03 April 2009.
Instrument
TCO No 0911328 was made on 29 June 2009. It declares that those certain cones paperboard food 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. 0911328 is taken to have come into force on 03 April 2009.
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. 0911328, enacted in 2009, was introduced to provide relief in the form of tariff concessions under the Customs Act 1901. This legislation was enacted by the Parliament of Australia to facilitate tariff reductions on specific goods, thereby addressing economic challenges and fostering trade efficiency. Specifically, it targets goods for which no substitutable domestic production exists, allowing for a lower rate of customs duty to be applied, which ultimately aids in making such goods more competitively priced in the market. The objective of this instrument is to enhance the economic viability of imported goods by reducing the financial burden on importers, thus promoting fair trade practices.
Scope and Application
The Tariff Concession Instrument No. 0911328, made under the Customs Act 1901, applies to Detmold Packaging Pty Ltd's application for tariff concessions on certain cones paperboard food. This legislation pertains to specific goods, in this case, certain cones paperboard food, and is applicable to entities involved in the import of these goods. The geographic reach of this Act is national, as it falls under the Commonwealth’s purview. The application of this Instrument is restricted by the criteria outlined in the Customs Act, including the necessity for the absence of substitutable goods produced in Australia at the time of application. The Act allows the Chief Executive Officer of Customs to make such tariff concession orders if certain conditions are met, which was the case here, leading to the issuance of the TCO No. 0911328 on 29 June 2009. The TCO exempts these goods from the general 5% duty rate, setting their duty rate at free. The rights of the Commonwealth and other entities remain unaffected by this concession, with the only beneficiaries being importers who can now apply for duty refunds on these goods imported since the effective date of the TCO, which is 3 April 2009.
Key Provisions
The Tariff Concession Instrument No. 0911328, made under the Customs Act 1901 (the Act), pertains to the application of tariff concessions for specific goods. Under section 269F, an individual or entity can apply to the Chief Executive Officer of Customs (CEO) for a Tariff Concession Order (TCO) in respect of goods, provided these goods are not specified in section 269SJ as ineligible for such concessions. The CEO's decision to grant a TCO hinges on whether the application meets the core criteria outlined in section 269C. This requires that, on the day the application is lodged, no substitutable goods were produced in Australia in the ordinary course of business. The definitions of key terms such as 'goods produced in Australia', 'ordinary course of business', and'substitutable goods' are provided in sections 269D, 269E, and 269F respectively.
Once the CEO is satisfied that the application meets these criteria, they are mandated under section 269P(3) to issue a written TCO. This order declares the specified goods as subject to a prescribed item of Schedule 4 to the Customs Tariff Act 1995 (the Tariff), thereby reducing the duty rate. For instance, TCO No. 0911328 made on 29 June 2009, declared that certain cones paperboard food would be subject to item 50 of Schedule 4, granting them a duty-free status where the general rate was previously 5%.
The obligations imposed by this legislation include the CEO's responsibility to publish a notice in the Gazette, inviting submissions from any person who believes there are grounds for the TCO not to be made (subsection 269K(1)). The CEO must also ensure that the TCO does not disadvantage any person or impose liabilities on them in respect of actions taken before the registration date (subsection 269S(1)). This TCO specifically benefits importers by allowing them to apply for a refund of duty on goods imported since the TCO's effective date.
The consequences for non-compliance or breaches of the provisions in this legislation can include civil or criminal penalties, depending on the severity and intent behind the breach. However, the specific penalties are not detailed in the provided text. In general, breaches of customs regulations can result in financial penalties, prosecution, or both, depending on the circumstances and the discretion of the relevant authorities.