EXPLANATORY STATEMENT
Tariff Concession Instrument No. 0920520
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.
Power Fasteners Pty Ltd applied for a TCO in respect of certain polyurethane sealant adhesive concrete and or masonry on 17 June 2009.
Instrument
TCO No 0920520 was made on 04 September 2009. It declares that those certain polyurethane sealant adhesive concrete and or masonry 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. 0920520 is taken to have come into force on 17 June 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 Australian Parliament, includes provisions for Tariff Concession Orders (TCOs) under Part XVA, allowing for lower rates of customs duty on certain goods. This legislative framework was designed to address the issue of ensuring that imported goods, particularly those for which no Australian-made substitutes exist, do not face prohibitive tariffs that could hinder their availability and affordability. The Tariff Concession Instrument No. 0920520, specifically, was introduced to provide tariff relief for certain polyurethane sealant adhesive concrete and masonry products, effectively setting their customs duty rate to free, down from the general rate of 5%. This instrument was implemented to support businesses like Power Fasteners Pty Ltd, ensuring that they are not at a competitive disadvantage due to import duties when no local alternatives are produced. The policy objective behind this concession is to encourage the importation of goods that are not domestically produced, thereby benefiting consumers and maintaining competitive market conditions.
Scope and Application
The Customs Act 1901, through Tariff Concession Orders (TCOs) under Part XVA, applies to individuals and entities seeking lower customs duty rates for specific goods. The Act allows the Chief Executive Officer of Customs (CEO) to grant TCOs if the applicant's goods are not substitutable by any goods produced in Australia and if the application meets the core criteria outlined in the Act. Notably, the application process involves a public notification period where objections can be lodged, although in this instance, no objections were received. The geographic reach of this legislation is national, as it pertains to the importation of goods into Australia. Any person applying for a TCO must ensure that their goods do not fall under the categories of goods specified in section 269SJ that are ineligible for tariff concessions. The instrument, TCO No. 0920520, specifically applies to certain polyurethane sealant adhesive concrete and masonry, reducing their duty from 5% to free. This concession does not retroactively affect any rights or impose any liabilities on persons other than the Commonwealth.
Key Provisions
The main operative sections of the Tariff Concession Order No. 0920520 under the Customs Act 1901 (section 269C, 269B, 269D, 269E and 269P) provide the framework for granting tariff concessions on specific goods. Essentially, this legislation allows the Chief Executive Officer of Customs to reduce or eliminate customs duties on certain goods if they meet certain criteria, such as not having substitutable goods produced in Australia. In this case, the order was made for certain polyurethane sealant adhesive concrete and masonry products, which now enjoy a duty-free status under item 50 of Schedule 4 to the Customs Tariff Act 1995.
The Act imposes several obligations on the parties involved. For the applicant, Power Fasteners Pty Ltd, the process involved submitting an application to the CEO of Customs, demonstrating that the goods in question met the core criteria, which included proving that no substitutable goods were being produced in Australia. The CEO of Customs is required to make a decision on the application based on the evidence provided and, if satisfied, issue a written order that declares the goods eligible for tariff concessions. Additionally, the CEO must publish a notice in the Gazette inviting any interested parties to submit objections to the concession, although in this case, no objections were received.
Failure to comply with the requirements of the Customs Act 1901 may result in various civil or criminal consequences. While specific offences, penalties, or maximum penalties are not detailed in the explanatory statement, it is known that breaches of the Customs Act can lead to significant penalties. These can include fines, imprisonment, or both, depending on the severity of the breach. For example, knowingly making false statements in an application or providing misleading information can result in criminal charges, while administrative penalties may apply for lesser infractions. The exact penalties would be determined based on the specific breach and the discretion of the court or relevant authority.
In summary, Tariff Concession Order No. 0920520 under the Customs Act 1901 provides for reduced customs duties on certain polyurethane sealant adhesive concrete and masonry products, provided the core criteria are met. The Act mandates certain procedures for application and decision-making by the CEO of Customs, including public notice and the opportunity for objections. While the explanatory statement does not detail specific penalties, non-compliance with the Act can result in civil or criminal consequences, including fines and imprisonment.