From: Ian Manning [mailto:[email protected]] Sent: Tuesday, 21 October 2014 10:52 AM To: TarconConsult Mailbox; John McNally; Gary Slowgrove; Warren Kerby; Andrew Hudson; Ben Simpson; Neil Macgroarty Subject: SUBMISSION - NNF 2014/145 CUSTOMS PROPOSED TCO AMENDMENTS - 25% LOCAL CONTENT Good morning, The proposed amendment can only add confusion to the TCO system. Replacing the current "25%" requirement with a requirement for "substantial" Australian manufacturing content opens the way for debate on what "substantial" might mean and replaces a specific requirement with a vague one. It is difficult to know how this will make the system any more efficient. It is likely to add confusion and debate and waste the time of all parties. It may end up being the subject of legal proceedings simply to re-establish the certainty which already exists under current legislation. A quick look at the Macquarie dictionary's definition indicates that there are quite a few options to be argued. One of them is "of real worth or value". On that basis I suspect that 1% will probably be good enough, and without a clear definition I would be happy to argue that it is good enough. It is important to remember that the current requirement of 25% still allows an Australian manufacturer some assistance through the TCO system because it allows up to 75% imported content. The manufacturer who operates at this level of imported/local content is more an importer than a local manufacturer anyway. The question is: Who will this amendment help? Even the 25% local content manufacturer will be disadvantaged because these manufacturers actually benefit from the TCO system in reducing the Customs duty on the 75% imported components which they use in manufacture. There is no black or white line between importers, exporters or manufacturers. Imports are important for both manufacture and for exports. As a consequence, no-one can benefit from the proposed amendment. The downside will be the lack of clarity which the amendment will introduce into the legislation as well as the time wasted in confusion and debate about what exactly the newly worded legislation actually means. There will also be an opening for one manufacturer to impose extra costs onto another manufacturer by objecting in an unreasonable fashion. The proposed amendment sounds like an attempt to assist Australian manufacturers. In reality it can only assist those manufacturers whose imported content exceeds 75%. Is that what was intended? Thanks and all the best IAN MANNING SENIOR CUSTOMS BROKER 20 Cube, Level 1, 26 Commercial Road Newstead Brisbane QLD 4006, AU t +61 7 3317 9819 f +61 7 3854 1351 This e-mail (including any attachments) may contain confidential or privileged information and is intended for the sole use of the person(s) to whom it is addressed. If you are not the intended recipient, or the person responsible for delivering this message to the intended recipient, please notify the sender of the message or send an e-mail to [email protected] immediately, and delete all copies. Any unauthorised review, use, alteration, disclosure or distribution of this e-mail by an unintended recipient is prohibited. 20 Cube accepts no responsibility for the content of any e-mail sent by an employee which is of a personal nature. Please refer to www.20cube.com for 20 Cube's Terms and Conditions.