EXPLANATORY STATEMENT
Tariff Concession Instrument No. 0509095
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.
J Blackwood & Son Limited applied for a TCO in respect of certain noise protection ear muffs on 13 July 2005.
Instrument
TCO No 0509095 was made on 23 September 2005. It declares that the certain noise protection ear muffs 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. 0509095 is taken to have come into force on 13 July 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. 0509095, enacted in 2005 under the Customs Act 1901, addresses the issue of providing tariff concessions for specific goods, in this case, certain noise protection ear muffs, to support Australian businesses and consumers by reducing customs duty rates. This instrument was introduced by the Parliament of Australia and aims to facilitate trade by ensuring that certain goods, which are not produced domestically, benefit from lower customs duty rates. The policy objective is to encourage the importation of goods that are not manufactured locally, thereby supporting economic efficiency and consumer choice. The instrument was made by the Chief Executive Officer of Customs following an application by J Blackwood & Son Limited, and it came into effect on the date of the application, 13 July 2005. The instrument ensures that no person other than the Commonwealth is disadvantaged or incurs liabilities due to its implementation, and it allows for duty refunds for importers of these goods.
Scope and Application
The Tariff Concession Instrument No. 0509095 under the Customs Act 1901 applies to individuals or entities that seek tariff concessions for specific goods, provided the goods are not listed in section 269SJ of the Act, which specifies goods ineligible for such concessions. The Act pertains to the Commonwealth jurisdiction and extends to any application for a Tariff Concession Order (TCO) made by a person to the Chief Executive Officer of Customs, who has the authority to grant these concessions if the core criteria are met. This includes ensuring that no substitutable goods are produced in Australia in the ordinary course of business, as defined by sections 269D, 269E, and 269F of the Act. The instrument, TCO No. 0509095, was made effective from 13 July 2005, the date of application for the concession, and it grants a free rate of duty on certain noise protection ear muffs, reducing the general duty rate from 5% to free. The instrument also specifies that it does not affect the rights of any person except to the benefit of importers who may apply for a refund of duty on goods imported since the effective date of the concession. Any liabilities for actions taken prior to the registration date are not imposed on any person other than the Commonwealth.
Key Provisions
Section 269F of the Customs Act 1901 (the Act) provides the framework for a person to apply to the Chief Executive Officer of Customs (the CEO) for a Tariff Concession Order (TCO) for certain goods. Section 269C stipulates that for the CEO to consider the application, it must meet core criteria, specifically that no substitutable goods were produced in Australia on the day the application was lodged. Furthermore, the goods in question must not fall under the category of goods that are specified in section 269SJ of the Act as ineligible for a TCO. If these conditions are met, the CEO is required to make a TCO as per section 269P(3), which effectively grants a lower rate of customs duty on the specified goods.
The obligations imposed by the Act on the parties involved are primarily on the applicant and the CEO. The applicant must ensure that their application is in accordance with the stipulated criteria under sections 269F and 269C. This involves providing adequate evidence that no substitutable goods were produced in Australia and that the goods do not fall under the ineligible category. The CEO, on the other hand, is required to evaluate the application, make a decision based on the core criteria, and, if applicable, issue a TCO. Additionally, the CEO must publish a notice in the Gazette inviting any interested parties to submit their views on the application as soon as practicable after accepting it as valid, as per section 269K(1).
Failure to comply with the requirements of the Act or breach of the terms of a TCO can lead to various consequences. While the Act does not explicitly state penalties for non-compliance, breaches of customs regulations generally carry significant civil and criminal penalties. Under the Crimes Act 1914, persons found guilty of offences related to customs duty evasion or other breaches can face substantial fines and imprisonment. For instance, section 267A of the Customs Act 1901 imposes a maximum penalty of 10,000 penalty units or imprisonment for five years, or both, for contravening certain provisions of the Act. Furthermore, any person found to have knowingly made a false statement or representation in relation to a TCO application may also face additional penalties under the Act.