EXPLANATORY STATEMENT
Tariff Concession Instrument No. 0931491
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.
Applied Biosystems applied for a TCO in respect of certain polypropylene film in sheets or rolls on 26 August 2009.
Instrument
TCO No 0931491 was made on 13 November 2009. It declares that those certain polypropylene film in sheets or rolls 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. 0931491 is taken to have come into force on 26 August 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, provides a framework for the imposition and administration of customs duty, including mechanisms for tariff concessions. This Act aims to streamline the process of granting tariff concessions to certain goods, thereby encouraging trade and investment by reducing the cost of imported goods. The Explanatory Statement outlines Tariff Concession Instrument No. 0931491, which was introduced to address the specific issue of providing tariff concessions for certain polypropylene film in sheets or rolls. This measure was designed to ensure that such goods are subject to a lower rate of customs duty, in this case, free of charge, provided no substitutable goods are produced in Australia. The policy objective is to facilitate the importation of these goods by making them more affordable, which in turn could stimulate demand and potentially lead to economic benefits.
Scope and Application
The Customs Act 1901, specifically under Part XVA, governs the process through which Tariff Concession Orders (TCOs) can be issued by the Chief Executive Officer of Customs. This Act applies to any person or entity seeking a concession on customs duty for particular goods, which must not be specified in section 269SJ of the Act. The application process requires the applicant to demonstrate that no substitutable goods were produced in Australia at the time of the application, thereby meeting the core criteria outlined in section 269C. Once an application meets these criteria, the CEO is mandated to issue a written order, which specifies the reduced duty on the goods. This order has a jurisdictional reach that encompasses the entire Commonwealth of Australia and applies to the customs duties set out in the Customs Tariff Act 1995. The TCO does not retroactively affect the rights of any person except the Commonwealth, thus ensuring that no existing liabilities or disadvantages are imposed on any person or entity due to the issuance of the order. The application of the Act extends to all Commonwealth territories and adheres to the principles set out in the Customs Act 1901 without any specified exclusions, exemptions, or thresholds within the primary text of the Act itself.
Key Provisions
The key provisions of the legislation, specifically Tariff Concession Instrument No. 0931491 under the Customs Act 1901, revolve around the establishment of a Tariff Concession Order (TCO) (s 269C). The CEO of Customs is mandated to consider applications for TCOs where the goods in question are not specified in section 269SJ of the Act (s 269F). To qualify for a TCO, the application must meet the core criteria, which includes a condition that no substitutable goods were produced in Australia on the day the application was lodged (s 269C). The definitions for key terms such as 'goods produced in Australia', 'ordinary course of business', and'substitutable goods' are provided in sections 269D, 269E, and 269P(3) of the Act, respectively.
The obligations imposed by the Act on the parties involved primarily concern the application process and the criteria for approval. An applicant must ensure that their TCO application is lodged in accordance with the legislative requirements, including satisfying the core criteria that no substitutable goods were produced in Australia on the application date. The CEO, on the other hand, is required to evaluate the application against these criteria and, if satisfied, issue a written TCO. Additionally, the CEO must publish a notice in the Gazette inviting submissions from any interested parties, although no submissions were received for this particular TCO (s 269K(1)).
The legislation outlines potential consequences for non-compliance, although specific offences or penalties are not detailed within the explanatory statement. However, it is implied that any breach of the conditions or misrepresentation of facts in an application could lead to legal consequences. The Tariff Concession Instrument No. 0931491 itself does not impose any liabilities on any person, but general legal principles would apply to any breaches of the Customs Act or related regulations. The rights of importers are positively affected as they can apply for a refund of duty on goods imported since the TCO came into force (Reg. 126(1)(r)). The TCO does not affect the rights of any person (other than the Commonwealth) as at the date of registration, ensuring that no one is disadvantaged or imposed liabilities for actions taken before the TCO's effective date.