EXPLANATORY STATEMENT
Tariff Concession Instrument No. 0505968
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.
Repaire Pacific Unit Trust applied for a TCO in respect of certain disposable nappy/diaper receptacle cassettes on 19 May 2005.
Instrument
TCO No 0505968 was made on 23 September 2005. It declares that the certain disposable nappy/diaper receptacle cassettes 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. 0505968 is taken to have come into force on 19 May 2005.
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. 0505968 was enacted in 2005 under the Customs Act 1901 with the aim of addressing the gap in tariff concessions for specific goods not produced in Australia. The Customs Act 1901, enacted by the Australian Parliament, provides a framework for the creation of Tariff Concession Orders (TCOs) that allow for reduced customs duty on certain goods not manufactured domestically. The policy objective is to ensure that Australian consumers and businesses have access to a diverse range of competitively priced goods, while also encouraging domestic production where possible. This specific instrument was introduced following an application by Repaire Pacific Unit Trust for tariff concessions on certain disposable nappy/diaper receptacle cassettes, leading to a TCO that effectively provides a duty-free status on these imported goods, benefiting importers and consumers alike.
Scope and Application
The Tariff Concession Instrument No. 0505968, made under Part XVA of the Customs Act 1901, applies to specific goods, namely disposable nappy/diaper receptacle cassettes, as identified by Repaire Pacific Unit Trust in their application dated 19 May 2005. This instrument is designed to provide tariff concessions by granting a tariff concession order (TCO) to these goods, reducing their customs duty rate from the general rate of 5% to free. The application of the TCO is contingent upon the Chief Executive Officer of Customs determining that no substitutable goods were produced in Australia on the day the application was lodged, as per the core criteria outlined in section 269C of the Act. The TCO applies nationally and its effects are immediate from the date of the application, 19 May 2005, without retroactively affecting any existing rights or liabilities of parties other than the Commonwealth. The instrument does not exclude any specific entities or industries but rather operates within the broader framework of the Customs Act 1901, which is applicable across the Commonwealth of Australia.
Key Provisions
The primary sections of this legislation pertain to the process and criteria for making a Tariff Concession Order (TCO) under the Customs Act 1901. According to section 269F, an individual can apply to the Chief Executive Officer of Customs (CEO) for a TCO concerning specific goods. The CEO is then required to assess whether the application aligns with the core criteria set out in section 269C. This section stipulates that for the application to meet the criteria, there must be no substitutable goods produced in Australia on the day the application is lodged. Substitutable goods, as defined in section 269D, are goods produced in Australia that can serve the same purpose as the goods in question, which in this case are disposable nappy/diaper receptacle cassettes.
The CEO must also consider the definition of 'ordinary course of business' in section 269E and must be satisfied that the application meets the criteria. If satisfied, the CEO must issue a written order, as outlined in section 269P(3), which declares that the goods are subject to a specified item in Schedule 4 of the Customs Tariff Act 1995. For the disposable nappy/diaper receptacle cassettes, this results in the application of a 0% duty rate instead of the general 5% rate.
The obligations imposed by the Act on the parties involved are primarily focused on the CEO's role in assessing and approving TCO applications. The CEO must ensure that applications are evaluated against the core criteria, including the absence of substitutable goods produced in Australia. This involves a detailed examination of the goods in question and any potential domestic substitutes. Additionally, the CEO is required to publish a notice in the Gazette, inviting any interested parties to submit objections or submissions regarding the proposed TCO, as stipulated in section 269K(1). In this case, no submissions were received, indicating that the application met the necessary criteria without opposition.
The legislation also outlines the consequences for breaches or non-compliance with the TCO provisions. While specific offences, penalties, or civil/criminal consequences are not detailed in this excerpt, the Act generally provides for enforcement measures in cases of non-compliance with customs regulations. These measures can include fines, penalties, or other legal actions to ensure adherence to the tariff concession rules. For instance, any misrepresentation or failure to comply with the conditions of a TCO could potentially lead to revocation of the concession and the imposition of applicable duties retroactively.