EXPLANATORY STATEMENT
Tariff Concession Instrument No. 0911330
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 cartons paperboard on 03 April 2009.
Instrument
TCO No 0911330 was made on 29 June 2009. It declares that those certain cartons paperboard 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. 0911330 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 Customs Act 1901, enacted by the Parliament of Australia, provides a framework for the imposition of customs duties on imported goods. The Act allows for the creation of Tariff Concession Orders (TCOs) through which the Chief Executive Officer of Customs can reduce the duty on certain goods, provided specific criteria are met. TCO No. 0911330 was introduced to address the need for tariff concessions on certain cartons paperboard, as applied for by Detmold Packaging Pty Ltd. This instrument was enacted to provide a lower rate of customs duty on these goods, from the general rate of 5% to free, effective from the date of the application, 3 April 2009. The CEO was satisfied that no substitutable goods were produced in Australia at the time of the application, fulfilling the core criteria set out in the Customs Act. The order does not adversely affect any existing rights or impose new liabilities, and it provides potential benefits to importers by enabling them to apply for a refund of duty on goods imported since the TCO came into force.
Scope and Application
The Customs Act 1901, specifically Part XVA, governs the scheme under which Tariff Concession Orders (TCOs) can be made by the Chief Executive Officer of Customs (CEO). The Act applies to applications for tariff concessions on goods, which must be lodged by a person, and the CEO must ensure these applications meet certain criteria, such as the absence of substitutable goods produced in Australia in the ordinary course of business. The application process includes publishing a notice in the Gazette inviting any interested parties to lodge submissions, although in this case, no submissions were received. The TCO, once made, applies to the specific goods from the date the application was lodged, providing a lower rate of customs duty or, in some cases, a free rate. The application of TCOs is limited by exclusions such as goods specified in section 269SJ, which cannot be subject to a TCO. The TCO does not affect pre-existing rights or impose liabilities on persons other than the Commonwealth. The geographical reach of this legislation is national, as it applies to the entire Commonwealth of Australia, and extends to the international transactions involving the importation of the specified goods.
Key Provisions
The primary operative sections of the Tariff Concession Instrument No. 0911330 (Instrument) under the Customs Act 1901 (Act) pertain to the granting of a Tariff Concession Order (TCO). Section 269F allows an individual or entity to apply to the Chief Executive Officer of Customs (CEO) for a TCO for specific goods. The CEO, under section 269C, is required to determine if the application meets the core criteria, which include verifying that no substitutable goods were produced in Australia at the time of the application (section 269D and 269E). If the CEO is satisfied that the application meets these criteria, they must issue a TCO (section 269P(3)). This instrument specifically addresses cartons paperboard, declaring them subject to a concessional rate under item 50 of Schedule 4 of the Customs Tariff Act 1995, with the duty rate set at free, as opposed to the general rate of 5% (section 269K(1)).
The obligations imposed by the Act on the parties include the requirement for the CEO to carefully assess TCO applications to ensure compliance with the core criteria. This involves confirming that no substitutable goods are produced in Australia at the time of application. The CEO must also publish a notice in the Gazette inviting any interested parties to submit objections if they believe the TCO should not be granted. In this instance, the CEO did not receive any submissions (subsection 269K(1)). Additionally, the CEO must ensure that the TCO does not disadvantage any person or impose liabilities on anyone except the Commonwealth in respect of actions taken before the TCO was registered (subsection 269S(1)). The TCO is effective from the date the application was lodged, which is 03 April 2009, for this particular instrument.
The Act delineates several potential consequences for non-compliance with its provisions. While the explanatory statement does not explicitly state the penalties for breaches, the overarching framework of the Customs Act 1901 and related instruments typically includes both civil and criminal penalties. For instance, failure to comply with a TCO could potentially result in fines or legal action against the non-compliant party. The exact penalties would depend on the specific breach and could be interpreted under the general provisions of the Customs Act and the applicable regulations. For example, under the Customs (Prohibited Imports) Regulations 1997, contraventions can lead to fines and even imprisonment for serious offences. However, in the context of this specific TCO, no penalties are outlined as it pertains strictly to the tariff concessions and their effective date.