Unmanufactured tobacco leaf
- Document symbol
- G/LIC/N/3/AUS/16
- Original language
- English
- Published on
- 27/11/2023
Outline of Systems
Q1. Give a brief description of each licensing system as a whole and, with respect to each, reply to the following questions as relevant, placing all of the material with respect to a given system in sequence together, and using cross references as appropriate when elements which have already been described are also present in another system.
The importation of unmanufactured tobacco leaf is prohibited under provisions of the Customs Act 1901 (Customs Act) and the Customs (Prohibited Imports) Regulations 1956 (PI Regulations) unless the permission of the Commissioner of Taxation (Commissioner), or an authorised person, has been obtained. Permission from the Commissioner requires an Excise licence to manufacture tobacco or a licence to deal in tobacco products, granted under the Excise Act 1901 (Excise Act). In addition, the site where imported tobacco leaf is to be dealt with must be licensed under the Customs Act.
Purposes and Coverage of Licensing
Q2. Identify each licensing system maintained and state what products, appropriately grouped, are covered.
The goods covered include tobacco that is not stemmed or stripped and includes whole tobacco plants or leaves in the natural state, or as cured or fermented leaves. Licensed tobacco manufacturers and dealers who also hold a permission to import unmanufactured tobacco leaf (permission) are able to import these goods as an input to manufacture or more generally deal in tobacco seed, plant or leaf.
Q3. The system applies to goods originating in and coming from which countries?
The system applies to unmanufactured tobacco leaf originating from all countries.
Q4. Is the licensing intended to restrict the quantity or value of imports, and if not, what are its purposes? Have alternative methods of accomplishing the purposes been considered and if so which? Why have they not been adopted?
The PI Regulations are not intended to restrict the quantity or volume of imports. The importation of unmanufactured tobacco leaf is regulated to limit access to those licensed as manufacturers or dealers and therefore reduce illicit production.
Q5. Cite the law, regulation and/or administrative order under which the licensing is maintained. Is the licensing statutorily required? Does the legislation leave designation of products to be subjected to licensing to administrative discretion? Is it possible for the government (or the executive branch) to abolish the system without legislative approval?
The control on the specified goods is a statutory requirement under Regulation 4D of the PI Regulations made under the Customs Act. The control cannot be abolished without legislative approval.
An Excise licence for tobacco is a legislative requirement under Sections 25 (Manufacturers) and 33 (Dealers) of the Excise Act. There is no administrative discretion – manufacturers or dealers in tobacco leaf must be licensed under the Excise Act. The control cannot be abolished without legislative approval.
Links to legislation:
Procedures
Q6. For products under restriction as to the quantity or value of imports (whether applicable globally or to a limited number of countries or whether established bilaterally or unilaterally):
Q6.I. Is information published, and where, concerning allocation of quotas and formalities of filing applications for licences? If not, how is it brought to the attention of possible importers? Of governments and export promotion bodies of exporting countries and their trade representatives? Is the overall amount published? The amount allocated to goods from each country? The maximum amount allocated to each importer? How to request any exceptions or derogations from the licensing requirement?
Q6.II. How is the size of the quotas determined: on a yearly, six-monthly or quarterly basis? Are there cases where the size of quota is determined on a yearly basis but licences are issued for imports on a six-monthly or quarterly basis? In the latter case, is it necessary for importers to apply for fresh licence on a six-monthly or quarterly basis?
Q6.III. Are licences allotted for certain goods partly or only to domestic producers of like goods? What steps are taken to ensure that licences allocated are actually used for imports? Are unused allocations added to quotas for a succeeding period? Are the names of importers to whom licences have been allocated made known to governments and export promotion bodies of exporting countries upon request? If not, for what reason? (Indicate products to which replies relate.)
Q6.IV. From the time of announcing the opening of quotas, as indicated in I above, what is the period of time allowed for the submission of applications for licences?
Q6.V. What are the minimum and maximum lengths of time for processing applications?
Q6.VI. How much time remains, at a minimum, between the granting of licences and the date of opening of the period of importation?
Q6.VII. Is consideration of licence applications effected by a single administrative organ? Or must the application be passed on to other organs for visa, note or approval? If so, which? Does the importer have to approach more than one administrative organ?
Q6.VIII. If the demand for licences cannot be fully satisfied, on what basis is the allocation to applicants made? First come, first served? Past performance? Is there a maximum amount to be allocated per applicant and, if so, on what basis is it determined? What provision is made for new importers? Are applications examined simultaneously or on receipt?
Q6.IX. In the case of bilateral quotas or export restraint arrangements where export permits are issued by exporting countries, are import licences also required? If so, are licences issued automatically?
Q6.X. In cases where imports are allowed on the basis of export permits only, how is the importing country informed of the effect given by the exporting countries to the understanding between the two countries?
Q6.XI. Are there products for which licences are issued on condition that goods should be exported and not sold in the domestic market?
Q7. Where there is no quantitative limit on importation of a product or on imports from a particular country:
Q7.a. How far in advance of importation must application for a licence be made? Can licences be obtained within a shorter time-limit or for goods arriving at the port without a licence (for example, owing to inadvertency)?
The Australian Taxation Office (ATO) standard for issuing manufacturer licences, dealers' licences or permissions is 28 days from receipt of all required information.
Q7.b. Can a licence be granted immediately on request?
No.
Q7.c. Are there any limitations as to the period of the year during which application for licence and/or importation may be made? If so, explain.
No.
Q7.d. Is consideration of licence applications effected by a single administrative organ? Or must the application be passed on to other organs for visa, note or approval? If so, which? Does the importer have to approach more than one administrative organ?
Yes, the application for an Excise licence and a permission is considered in its entirety by the ATO. From 1 July 2010, the ATO took over the administration of excise equivalent goods (EEGs) under delegation from the Department of Home Affairs.
Q8. Under what circumstances may an application for a licence be refused other than failure to meet the ordinary criteria? Are the reasons for any refusal given to the applicant? Have applicants a right of appeal in the event of refusal to issue a licence and, if so, to what bodies and under what procedures?
Failure to meet the ordinary criteria, as described in sections 39, 39A, 39B & 39C of the Excise Act, are grounds for refusing to grant a manufacturer or dealer licence. These grounds include where the applicant is not deemed fit and proper, the applicant does not have the skills and experience to carry out the activity, or the applicant does not have a market for the goods. When a licence is refused, the applicant is provided with reasons for the decision in writing. Applicants have a right to object under section 39Q of the Excise Act.
Regulation 4D of the PI Regulations states that consideration must be given to the applicant's compliance with the Excise Act and any other relevant matters when assessing a permission to import unmanufactured tobacco leaf. The same regulation allows a person who is dissatisfied with a decision to object to it in the manner set out in Part IVC of the Taxation Administration Act 1953.
Eligibility of Importers to Apply for Licence
Q9. Are all persons, firms and institutions eligible to apply for licences: (If not, is there a system of registration of persons or firms permitted to engage in importation? What persons or firms are eligible? Is there a registration fee? Is there a published list of authorized importers?) a) under restrictive licensing systems? b) under non-restrictive systems?
No. Importers cannot apply for a customs licence to warehouse tobacco products.
Documentational and Other Requirements for Application for Licence
Q10. What information is required in applications? Submit a sample form. What documents is the importer required to supply with the application?
An application for a licence to manufacture or deal in tobacco must be made in writing to the ATO. Information can be found at: Tobacco licence processes and obligations | Australian Taxation Office (ato.gov.au)
If an applicant is applying for the first time, that applicant will be required to complete a Consent to a Criminal Record History Check and a Declaration of criminal history.
Applicants are also required to supply the following information:
- name, address, ABN and other contact details;
- details of the premises where the activity will occur including certified copies of the floor plan of the proposed licence site;
- supplier's name and address; and
- quantity of product.
Finally, during the review process the applicant may be required to send additional documents in support of their claims - for example, a business plan, evidence of a market, details of security arrangements or insurance policy details.
There is no specified application form for the import permission, although a written application must be lodged providing the Commissioner with any information they may reasonably require to make their decision.
Q11. What documents are required upon actual importation?
The original permission from the Commissioner or authorised person must be produced upon importation in addition to the normal importation documentation required by the Department of Home Affairs.
Q12. Is there any licensing fee or administrative charge? If so, what is the amount of the fee or charge?
There are no fees associated with the Excise licences or the permission.
Q13. Is there any deposit or advance payment requirement associated with the issue of licences? If so, state the amount or rate, whether it is refundable, the period of retention and the purpose of the requirement.
No.
Conditions of Licensing
Q14. What is the period of validity of a licence? Can the validity of a licence be extended? How?
A licence to manufacture or deal in tobacco is valid for three years and must be renewed before the end of the three-year period. The validity of a licence can be extended if it is approved for renewal by the ATO. The associated permission is valid for the same period as the licence although, rather than being renewed, it must be re-issued. This is an administrative requirement only.
Q15. Is there any penalty for the non-utilization of a licence or a portion of a licence?
No.
Q16. Are licences transferable between importers? If so, are any limitations or conditions attached to such transfer?
Excise manufacturer or dealer licences are not transferable. Although the ATO licenses the site, the licence cannot be transferred and any change in ownership would require a new licence application. The permission also is not transferable.
Q17. Are any other conditions attached to the issue of a licence? a) for products subject to quantitative restriction? b) for products not subject to quantitative restriction?
Section 39D of the Excise Act allows the ATO to apply conditions to a licence to protect the revenue or to facilitate compliance with the relevant Act. There are no limitations on the conditions that can be applied on a permission under the PI Regulations.
Other Procedural Requirements
Q18. Are there any other administrative procedures, apart from import licensing and similar administrative procedures, required prior to importation?
No.