EXPLANATORY STATEMENT
Tariff Concession Instrument No. 0509813
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.
Golden Circle Ltd applied for a TCO in respect of certain Beverage Preparation Line on 25 July 2005.
Instrument
TCO No 0509813 was made on 30 September 2005. It declares that those certain Beverage Preparation Line 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. 0509813 is taken to have come into force on 25 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 to establish a comprehensive regulatory framework for customs and border control in Australia, aiming to ensure efficient trade and collection of duties. The Act was introduced to address the need for streamlined customs procedures and to provide a legal basis for the regulation of imports and exports. Enacted by the Parliament of Australia, the Customs Act 1901 serves to facilitate international trade while safeguarding the economic and security interests of the nation. One of the policy objectives of the Act is to provide a mechanism for tariff concessions, ensuring that Australian industries can compete effectively in the global market by offering reduced customs duties on certain imported goods. The explanatory statement indicates that the Tariff Concession Instrument No. 0509813 was introduced to provide a concession on customs duties for specific goods, in this case, certain Beverage Preparation Lines, aligning with the Act's objective of promoting fair and competitive trade practices.
Scope and Application
The Customs Act 1901, through its Part XVA, facilitates the granting of Tariff Concession Orders (TCOs) by the Chief Executive Officer of Customs (CEO). These orders apply to specific goods that are subject to lower rates of customs duty compared to the general tariff. The Act applies to any person or entity that may apply for a TCO in relation to goods not specified in section 269SJ, which lists goods ineligible for tariff concessions. The application process requires the CEO to ensure that no substitutable goods are produced in Australia at the time the application is lodged, as outlined in sections 269C and 269F. Once the application meets the core criteria, a TCO is issued, and the concessional duty rate applies retroactively to the date the application was lodged, as stated in section 269S. The TCO does not affect the rights of any person as at the date of registration, and any pre-existing liabilities or rights are preserved, ensuring that no individual is disadvantaged or incurs new liabilities due to the issuance of the TCO.
Key Provisions
The main operative sections of this legislation, specifically Tariff Concession Instrument No. 0509813, focus on the creation and implementation of Tariff Concession Orders (TCOs) under the Customs Act 1901. Section 269F allows for an application to the Chief Executive Officer of Customs (CEO) for a TCO concerning specific goods. If the application meets the core criteria outlined in section 269C, which includes ensuring that no substitutable goods were produced in Australia in the ordinary course of business on the day the application was lodged, the CEO must make a written order declaring that the goods are subject to a lower rate of customs duty. In this instance, section 269P(3) specifies that if the CEO is satisfied that the application meets the core criteria, they must issue a TCO. The TCO, once made, declares that the specified goods are subject to a prescribed item of Schedule 4 to the Customs Tariff Act 1995, resulting in a reduced rate of customs duty for those goods.
The obligations and requirements imposed by this Act on the parties it governs are primarily focused on the application process for TCOs. According to section 269K(1), the CEO must publish a notice in the Gazette inviting any person who believes there are reasons why the TCO should not be made to lodge a submission. This ensures transparency and provides an opportunity for interested parties to voice their concerns. In this particular case, no submissions were received by the CEO, indicating that no objections were raised against the application. Additionally, section 269S(1) specifies that a TCO comes into force on the day the application for the TCO is lodged, meaning that TCO No. 0509813 came into effect on 25 July 2005.
The legislation also outlines the potential consequences of breaching the provisions of the Customs Act 1901. While the explanatory statement does not specify any particular offences, penalties, or civil/criminal consequences for breach, it is implied that any non-compliance with the Act or the TCOs could lead to legal ramifications. Typically, breaches of the Customs Act may result in fines, imprisonment, or both, depending on the severity of the offence. The maximum penalties for customs-related offences can vary widely, but they can include substantial fines and imprisonment for serious violations. The specific penalties for breach would be determined in accordance with the relevant sections of the Customs Act and any applicable regulations.