EXPLANATORY STATEMENT
Tariff Concession Instrument No. 1124534
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.
Boral Australian Gypsum Ltd applied for a TCO in respect of certain plasterboard parts on 21 July 2011.
Instrument
TCO No 1124534 was made on 17 October 2011. It declares that those certain plasterboard parts 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. 1124534 is taken to have come into force on 21 July 2011.
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 was amended to introduce the scheme for Tariff Concession Orders (TCOs), which provides for reduced customs duty on certain imported goods, effective from 1901. This was enacted to address the need for a mechanism to grant tariff concessions on specific goods, allowing for a more flexible approach to customs duties. The enacting body responsible for this legislation is the Parliament of Australia. The policy objective behind this scheme is to facilitate the import of goods that are not produced domestically or are not substitutable with Australian-made products, thereby promoting trade and economic efficiency. The Tariff Concession Instrument No. 1124534, introduced under this Act, specifically addresses the application by Boral Australian Gypsum Ltd for tariff concessions on certain plasterboard parts, effective from the date of application on 21 July 2011, with no submissions opposing the concession received by the Chief Executive Officer of Customs.
Scope and Application
The Customs Act 1901, specifically under Part XVA, governs the application and administration of Tariff Concession Orders (TCOs), which are subject to the approval of the Chief Executive Officer of Customs. These orders apply to particular goods that are not produced in Australia in the ordinary course of business, allowing for a lower rate of customs duty to be applied to those goods. An application for a TCO can be submitted by any person, and the CEO is obligated to consider the application if it pertains to goods not excluded under section 269SJ. If the CEO determines that the application meets the core criteria outlined in section 269C, they must issue a TCO specifying the applicable tariff concession. The geographic scope of this legislation is national, as it is enacted under the Commonwealth and applies across Australia. Any TCO made under this Act does not affect existing rights or impose liabilities on persons other than the Commonwealth, thus protecting third parties from any disadvantage arising from the order. Additionally, the Act allows for the extension and restriction of its application through subordinate instruments, which may include further regulations and specific guidelines for TCOs.
Key Provisions
The primary operative sections of the Customs Act 1901, relevant to Tariff Concession Orders (TCOs), are sections 269C, 269F, 269P, and 269SJ (referred to in parentheses). Section 269F allows an individual or entity to apply to the Chief Executive Officer of Customs (CEO) for a TCO concerning specific goods. This application process is subject to the criteria set out in section 269C, which requires that, on the day the application was lodged, no substitutable goods were produced in Australia in the ordinary course of business. Section 269P mandates that if the CEO is satisfied that the application meets these core criteria, a written order declaring the goods to which the TCO applies must be made. These sections effectively streamline the process for obtaining tariff concessions on goods that are not domestically produced as substitutable goods.
The Customs Act 1901 imposes several obligations on both the applicant and the CEO. The applicant must ensure their application is made in accordance with the stipulated criteria and provides all necessary information for the CEO to make an informed decision. Section 269K(1) requires the CEO to publish a notice in the Gazette once an application is accepted as valid, inviting any interested parties to submit any objections or reasons why the TCO should not be granted. This transparency ensures that all relevant stakeholders have the opportunity to voice their concerns before the TCO is finalised. The CEO must then review any submissions and make a decision based on the application’s compliance with the core criteria outlined in section 269C.
In the event of a breach of the provisions outlined in the Customs Act 1901, there are potential civil and criminal consequences. However, the specific offences, penalties, or consequences for breach are not explicitly detailed in the provided text. Generally, under Australian law, breaches of customs regulations can result in penalties that may include fines, imprisonment, or both, depending on the severity and intent of the breach. The maximum penalties would be determined based on the specific nature of the violation and the relevant sections of the Customs Act 1901 or other applicable legislation.