EXPLANATORY STATEMENT
Tariff Concession Instrument No. 0602949
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.
Empire Rubber Pty Ltd applied for a TCO in respect of certain laminators on 11 January 2006.
Instrument
TCO No 0602949 was made on 31 March 2006. It declares that those certain laminators 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. 0602949 is taken to have come into force on 11 January 2006.
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, enacted by the Parliament of Australia, provides the legal framework for managing and regulating the import and export of goods within Australia. To address the need for tariff flexibility and to support Australian industries by making certain imported goods more competitively priced, the Act includes provisions for the creation of Tariff Concession Orders (TCOs). These orders allow for reduced customs duties on specific imported goods under certain conditions. The explanatory statement for Tariff Concession Instrument No. 0602949 issued in 2006 outlines the process and conditions under which such tariff concessions are granted. The primary objective of this instrument is to facilitate the application for and granting of a TCO by ensuring that the application meets core criteria, particularly that no substitutable goods are produced in Australia, thus allowing for the reduction of customs duty on specified imported goods. This approach helps to support Australian businesses by reducing the cost of imported materials, thereby enhancing their competitiveness.
Scope and Application
The Tariff Concession Instrument No. 0602949 applies to specific goods, namely certain laminators, and the entities that import or deal with these goods. It falls under the Customs Act 1901, which governs customs duties in Australia. The Instrument was initiated by Empire Rubber Pty Ltd, who applied for a Tariff Concession Order (TCO) for the listed goods. The scope of the Act pertains to the conditions under which a TCO may be granted, specifically when no substitutable goods are produced in Australia in the ordinary course of business. The geographic reach of the Act is national, applying across all states and territories in Australia, and it is administered by the Chief Executive Officer of Customs. The Act provides certain exclusions, particularly regarding goods that cannot be subject to a TCO as specified in section 269SJ. The TCO, once registered, applies retroactively from the date the application was lodged, which in this case was 11 January 2006. Any rights or liabilities arising from conduct before the registration date remain unaffected, ensuring that no party is disadvantaged or incurs new liabilities as a result of the TCO.
Key Provisions
The primary sections of the Customs Act 1901 that are pertinent to Tariff Concession Orders (TCO) are sections 269F, 269C, 269B, 269D, 269E, 269P, and 269S. Section 269F allows a person to apply to the Chief Executive Officer (CEO) of Customs for a TCO. If the application is not in respect of goods specified in section 269SJ, the CEO must determine whether the application meets the core criteria as outlined in section 269C. The core criteria require that, on the day the application was lodged, no substitutable goods were produced in Australia in the ordinary course of business (sections 269B and 269C). If the CEO is satisfied that the application meets these criteria, they must make a written order declaring that the goods the subject of the TCO application are to which a prescribed item of Schedule 4 to the Customs Tariff Act 1995 applies (section 269P(3)).
Obligations imposed by the Customs Act 1901 on parties and entities governed by it include the requirement for the CEO to publish a notice in the Gazette as soon as practicable after accepting a TCO application as valid. This notice must include an invitation for any person who believes there are reasons why the TCO should not be made to lodge a submission with the CEO (subsection 269K(1)). If no submissions are received, the CEO proceeds to make the TCO. Additionally, the Act mandates that the rights of a person are not to be disadvantaged or impose liabilities in respect of anything done or omitted to be done before the date of registration of the TCO (subsection 269S(1)).
The Act does not specify any offences, penalties, or civil/criminal consequences for breaches related to the application or the making of a TCO. However, the Act does outline the process and criteria that must be adhered to when making a TCO, ensuring that the application and decision-making process is transparent and inclusive. Importers of the goods subject to a TCO are granted the benefit of applying for a refund of duty on goods imported since the day the TCO is taken to have come into force (paragraph 126(1)(r) of the Regulations). This ensures that the rights of importers are beneficially affected by the TCO.