EXPLANATORY STATEMENT
Tariff Concession Instrument No. 0946733
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.
Reschem Technologies applied for a TCO in respect of certain acrylic hybrid copolymer emulsions on 2 December 2009.
Instrument
TCO No 0946733 was made on 26 February 2010. It declares that those certain acrylic hybrid copolymer emulsions 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. 0946733 is taken to have come into force on 2 December 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. 0946733, enacted in 2010 under the Customs Act 1901, addresses the need to provide tariff concessions for specific goods to foster trade and economic benefits. This instrument was introduced to allow the Chief Executive Officer of Customs to make Tariff Concession Orders (TCOs) for goods where no substitutable goods are produced in Australia, thus ensuring that Australian consumers and businesses have access to competitive and diverse products. The Tariff Concession Instrument No. 0946733 specifically concerns certain acrylic hybrid copolymer emulsions, granting them a concession on the duty rate, reducing it from 5% to free, effective from 2 December 2009. The policy objective is to provide tariff relief on these goods, thereby enhancing their availability and affordability in the Australian market.
Scope and Application
The Tariff Concession Instrument No. 0946733 is a legislative instrument under the Customs Act 1901, which provides for the granting of Tariff Concession Orders (TCOs) by the Chief Executive Officer of Customs. This specific instrument applies to the importation of certain acrylic hybrid copolymer emulsions, which are subject to a lower rate of customs duty as specified in item 50 of Schedule 4 to the Customs Tariff Act 1995. The Act applies to any person or entity seeking a tariff concession for goods that are not being produced in Australia and for which no substitutable goods are produced domestically. The instrument has a national reach as it is part of the Commonwealth's customs legislation. The application process involves meeting core criteria such as the absence of substitutable goods produced in Australia, and the process includes public consultation as mandated by the Act. The instrument does not impose any liabilities on persons other than the Commonwealth and does not affect rights as at the date of registration for actions taken prior to the registration of the TCO.
Key Provisions
The Customs Act 1901 (the Act) provides a framework through which Tariff Concession Orders (TCOs) can be established under section 269F. The core criteria for a TCO application are outlined in sections 269C and 269S, which mandate that the goods in question should not have any substitutable products produced in Australia at the time the application is lodged. Specifically, section 269C states that a TCO application meets the core criteria if no substitutable goods were produced in Australia in the ordinary course of business on the day the application was lodged. Section 269B clarifies that ‘goods produced in Australia’ and ‘ordinary course of business’ are defined by sections 269D and 269E respectively, while ‘substitutable goods’ refers to goods produced in Australia that can be used in a manner similar to the goods in the TCO application. If the Chief Executive Officer of Customs (the CEO) is satisfied that these criteria are met, they are required to issue a written order under section 269P(3), declaring that the specified goods are subject to a prescribed item of Schedule 4 to the Customs Tariff Act 1995.
The obligations imposed by the Act on the parties involved are primarily focused on the process of applying for and receiving a TCO. The CEO must, as soon as practicable after accepting a TCO application as valid, publish a notice in the Gazette inviting any person who believes there are reasons why the TCO should not be made to submit their views (subsection 269K(1)). This ensures transparency and allows for public input on the potential concession. In the case of TCO No. 0946733, the CEO did not receive any submissions in response to the Gazette notice. Once a TCO is made, it is effective from the day the application was lodged (subsection 269S(1)), ensuring that any applicable tariff concessions begin immediately.
The Act also delineates the consequences of breaches related to the TCOs. While the explanatory statement does not explicitly mention offences, penalties, or civil/criminal consequences, it is understood that any misuse or fraudulent activities associated with the TCO process could result in legal ramifications. Typically, such breaches could lead to fines, imprisonment, or both, depending on the severity of the offence under the Customs Act 1901. However, the specifics of penalties would need to be referred to other sections of the Act or relevant subsidiary legislation. It is also noted that the TCO does not affect the rights of any person other than the Commonwealth and does not impose any liabilities on any person in respect of actions taken before the registration date of the TCO.