EXPLANATORY STATEMENT
Tariff Concession Instrument No. 0512191
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.
Hot Shots Australia Pty Ltd applied for a TCO in respect of certain novelty tins on 15 September 2005.
Instrument
TCO No 0512191 was made on 25 November 2005. It declares that those certain novelty tins 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. 0512191 is taken to have come into force on 15 September 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. 0512191, enacted in 2005, operates under the Customs Act 1901 to facilitate tariff concessions for specific goods, addressing the need for reduced customs duties on items that are not produced domestically and thereby encouraging their importation. This instrument was introduced to provide a streamlined process for businesses to apply for and obtain tariff concessions, ensuring that they can access goods at a lower duty rate when suitable domestic alternatives do not exist. The Customs Act 1901 outlines the framework within which these concessions can be granted by the Chief Executive Officer of Customs, provided certain criteria are met. The policy objective is to support economic efficiency by lowering the cost of imported goods that have no domestic substitutes, thereby fostering competitive markets and potentially benefiting consumers through lower prices.
Scope and Application
The Tariff Concession Instrument No. 0512191, made under the Customs Act 1901, pertains to the application and implementation of Tariff Concession Orders (TCOs), which are designed to provide a reduced rate of customs duty on certain goods. This legislation applies to any person or entity that seeks to import goods that qualify for a tariff concession, provided that these goods are not specified in section 269SJ of the Act as ineligible for such concessions. The scope of the Act is national, operating under the authority of the Commonwealth, and its application extends to all industries and transactions involving the importation of goods that meet the specified criteria for tariff concessions. The Act mandates that the Chief Executive Officer of Customs must assess applications for TCOs based on whether the goods in question are substitutable by domestically produced alternatives, as defined by sections 269C and 269D of the Act. Notably, the TCO does not impose any liabilities on persons other than the Commonwealth and does not affect the rights of such persons as at the date of registration. The commencement date of the TCO aligns with the date the application was lodged, ensuring that the tariff concessions are effective from the date of application submission.
Key Provisions
The Tariff Concession Instrument No. 0512191, made under the Customs Act 1901, sets out the conditions under which certain novelty tins will benefit from a reduced rate of customs duty. According to section 269F, an application for a Tariff Concession Order (TCO) can be submitted to the Chief Executive Officer of Customs (CEO). If the application meets the core criteria outlined in section 269C, the CEO is required to issue a TCO, as stipulated in section 269P(3). This order declares that the specified goods are subject to a prescribed item of Schedule 4 to the Customs Tariff Act 1995, resulting in a duty rate of free instead of the general rate of 5%.
The obligations imposed by the Act on the CEO include ensuring that the application for a TCO does not pertain to goods specified in section 269SJ, which are ineligible for tariff concessions. The CEO must also consider whether the application meets the core criteria, particularly the condition in section 269C that no substitutable goods were produced in Australia in the ordinary course of business on the day the application was lodged. Additionally, under section 269K(1), the CEO is obligated to publish a notice in the Gazette inviting submissions from any person who believes the TCO should not be made. In this instance, no submissions were received.
Failure to comply with the requirements of the Customs Act 1901 can lead to significant consequences. Any breach of the Act may result in civil or criminal penalties, depending on the severity and intent behind the breach. The specific penalties are not detailed in the provided text but generally, under Australian law, breaches can lead to fines and, in more serious cases, imprisonment. The exact penalties would be determined by the relevant courts based on the nature and impact of the breach.