EXPLANATORY STATEMENT
Tariff Concession Instrument No. 0911333
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 lids high impact polystyrene on 03 April 2009.
Instrument
TCO No 0911333 was made on 29 June 2009. It declares that those certain lids high impact polystyrene 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. 0911333 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. 0911333, enacted in 2009 under the Customs Act 1901, addresses the problem of ensuring that certain goods receive appropriate tariff concessions to foster fair trade practices and economic efficiency. This instrument was introduced by the Chief Executive Officer of Customs, following an application from Detmold Packaging Pty Ltd for tariff concessions on specific high impact polystyrene lids. The Act's objective is to provide a mechanism for tariff reductions on goods where no suitable Australian-made alternatives exist, thereby promoting the importation of competitively priced goods. The instrument came into effect on the date the application was lodged, ensuring that no person other than the Commonwealth is disadvantaged by its enactment. The absence of submissions against the tariff concession indicates a consensus on the appropriateness of the concessions granted.
Scope and Application
The Tariff Concession Instrument No. 0911333 under the Customs Act 1901 applies to individuals and entities that seek a tariff concession order (TCO) for goods they intend to import, ensuring that the goods in question do not have substitutable equivalents produced in Australia. The instrument is primarily directed towards importers who apply to the Chief Executive Officer of Customs for a TCO, with the application process detailed in sections 269C, 269B, and 269E of the Act. The scope of the Act extends to any goods that are not specified in section 269SJ of the Act, which outlines the categories of goods that cannot be subject to a TCO. The instrument’s application is national in scope, operating under the jurisdiction of the Commonwealth of Australia. The TCO, once granted, allows for the importation of specified goods under a reduced customs duty rate, contingent upon the CEO’s satisfaction that the application meets the core criteria. The instrument also ensures that the rights of any person, except the Commonwealth, are not adversely affected by the implementation of the TCO, particularly concerning any actions taken prior to the instrument's registration.
Key Provisions
The main operative sections of the Tariff Concession Instrument No. 0911333 are sections 269C, 269F, 269P(3), and 269S(1) of the Customs Act 1901. Section 269F allows a person to apply to the Chief Executive Officer of Customs (CEO) for a Tariff Concession Order (TCO) in respect of certain goods. If the CEO is satisfied that the application meets the core criteria set out in section 269C, the CEO must make a written order, which is the TCO, declaring that the goods are subject to a prescribed rate of customs duty as specified in the order (section 269P(3)). Section 269S(1) provides that a TCO is taken to have come into force on the day on which the application for the TCO was lodged.
The obligations and requirements imposed by this Act on the parties it governs are primarily directed towards the CEO and the applicant. The CEO is obligated to consider the application and determine whether it meets the core criteria, which includes verifying that no substitutable goods were produced in Australia on the day the application was lodged. If the application meets the criteria, the CEO must make a TCO and publish a notice in the Gazette inviting any submissions from interested parties. The applicant, in this case Detmold Packaging Pty Ltd, must provide sufficient information to substantiate their claim that no substitutable goods are produced in Australia and that the goods in question correspond to those listed in the Customs Tariff Act 1995.
The Act also outlines the consequences for breach, although specific penalties are not detailed within the explanatory statement. Generally, under the Customs Act 1901, breaches related to customs duties can result in both civil and criminal penalties. Civil penalties may include fines up to a significant amount, depending on the severity and intent of the breach. Criminal penalties can include imprisonment, reflecting the seriousness of the offence. However, the precise penalties would need to be referred to within the broader context of the Customs Act and any relevant case law.
In the specific context of this Tariff Concession Instrument, the implications of non-compliance with the TCO requirements could involve the nullification of the tariff concession, leading to the reversion to the general rate of duty for the goods. This would result in financial penalties for the applicant and potentially higher costs for importers of the goods in question. The Act ensures that the rights of third parties, including importers, are protected by ensuring that any tariff concession does not affect their rights or impose liabilities on them for actions taken prior to the TCO's effective date.