EXPLANATORY STATEMENT
Tariff Concession Instrument No. 0509096
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 And Son Ltd applied for a TCO in respect of certain Ear Muffs on 13 July 2005.
Instrument
TCO No 0509096 was made on 30 September 2005. It declares that those certain 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 0%.
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. 0509096 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 Customs Act 1901 was enacted by the Australian Parliament to regulate the import and export of goods, including the imposition of customs duty. The Act establishes a framework for tariff concession orders (TCOs), which provide for reduced rates of customs duty on certain goods, subject to specific criteria. The Tariff Concession Instrument No. 0509096, issued under this Act, addresses the specific problem of providing tariff concessions for goods where no substitutable goods are produced in Australia. This instrument was introduced to facilitate more competitive pricing and accessibility for certain imported goods, thereby supporting trade and economic objectives without imposing undue burdens on Australian producers. The policy objective of the Act, as reflected in this particular instrument, is to allow for tariff reductions in cases where it can be demonstrated that no suitable domestic alternatives exist, thus promoting fair trade practices and potentially benefiting consumers through lower prices.
Scope and Application
The Tariff Concession Instrument No. 0509096 applies to specific goods, in this case certain Ear Muffs, and it is enacted under the Customs Act 1901. The Act facilitates the reduction of customs duty rates on goods through Tariff Concession Orders (TCOs), which are issued by the Chief Executive Officer of Customs. These orders are applicable to the goods specified in the instrument, provided no substitutable goods are produced in Australia in the ordinary course of business on the day the application for the TCO was lodged. The instrument specifically benefits importers by allowing them to apply for a refund of duty on goods imported since the TCO came into force. The instrument has a Commonwealth jurisdictional reach and applies nationally, as it is derived from a federal act. There are no stated exclusions or exemptions in the instrument, though the application of a TCO is contingent on meeting the core criteria set out in the Customs Act 1901. The scope of the Act can be extended or restricted through subordinate instruments, although no such provisions are mentioned in the explanatory statement.
Key Provisions
The Tariff Concession Instrument No. 0509096, under the Customs Act 1901, outlines the specific concessions applicable to certain Ear Muffs, which have been granted a tariff concession order (TCO) by the Chief Executive Officer (CEO) of Customs. The primary sections involved are 269F, 269C, and 269P(3). Section 269F allows for applications to be made for TCOs, while section 269C stipulates the core criteria that must be met for an application to be valid, specifically that no substitutable goods were produced in Australia at the time of application. Section 269P(3) mandates that if these criteria are met, the CEO must issue a written TCO.
The Act imposes several obligations on parties seeking a TCO. An applicant must ensure that their application meets the core criteria, which includes proving that no substitutable goods were produced in Australia. The CEO, in turn, has the responsibility to verify these criteria and, if satisfied, to issue the TCO. Additionally, the CEO must publish a notice in the Gazette inviting any interested parties to lodge submissions if they believe the TCO should not be made, as required by section 269K(1).
In the case of breaches or non-compliance with the provisions of the Customs Act 1901, various penalties and consequences may apply. While the explanatory statement does not explicitly outline penalties, it is understood that failure to comply with the Act's requirements could result in civil or criminal liabilities. These could include fines, imprisonment, or other sanctions as prescribed by relevant laws, although specific maximum penalties are not detailed within the provided text. The overall intent is to ensure that the TCO process is transparent and fair, protecting both the interests of applicants and the regulatory framework.