EXPLANATORY STATEMENT
Tariff Concession Instrument No. 0605221
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.
Cadbury Schweppes Pty Ltd Richmond Vic applied for a TCO in respect of certain storage and retrieval systems on 14 March 2006.
Instrument
TCO No 0605221 was made on 20 July 2006. It declares that those certain storage and retrieval systems 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. 0605221 is taken to have come into force on 14 March 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 Tariff Concession Instrument No. 0605221, enacted under the Customs Act 1901, was introduced to address the need for tariff concessions for specific goods, thereby promoting trade and economic efficiency. This instrument was made in response to an application by Cadbury Schweppes Pty Ltd, Richmond Vic, for tariff concessions on certain storage and retrieval systems. The underlying objective of this legislation is to provide relief on customs duties for goods that are not produced domestically, thus encouraging their importation and use within Australia. The Customs Act 1901, as amended, empowers the Chief Executive Officer of Customs to make Tariff Concession Orders (TCOs) if certain conditions are met, ensuring that the concessions do not disadvantage existing domestic producers or impose new liabilities on individuals or entities. This legislative measure aligns with the broader policy objective of facilitating trade by reducing the cost burden on importers of specific goods.
Scope and Application
The Customs Act 1901, specifically Part XVA, establishes a framework for the creation of Tariff Concession Orders (TCOs) through which the Chief Executive Officer of Customs (CEO) may reduce customs duty rates on certain goods. This legislation applies to any individual or entity that can apply for a TCO, provided the goods in question do not fall under the list of excludable items specified in section 269SJ of the Act. The geographic scope of the Act is national, as it pertains to the Commonwealth of Australia. The application process involves a core criteria assessment by the CEO to ensure that no substitutable goods are produced in Australia in the ordinary course of business, which is defined under sections 269D, 269E, and 269F of the Act. Once the application meets these criteria, the CEO is mandated to issue a written TCO, which is then published in the Gazette to allow for any objections. The commencement of a TCO is effective from the date the application is lodged, and it does not retroactively affect the rights or impose liabilities on any person except the Commonwealth. Notably, this Act does not impose any new liabilities on individuals or entities and allows for potential duty refunds for importers under certain conditions.
Key Provisions
The main operative sections of the Tariff Concession Instrument No. 0605221 include Section 269F, which allows a person to apply to the Chief Executive Officer of Customs (CEO) for a Tariff Concession Order (TCO) in respect of goods, provided the goods are not specified in Section 269SJ of the Customs Act 1901 (the Act). Section 269C stipulates that a TCO application meets the core criteria if, on the day the application was lodged, no substitutable goods were produced in Australia in the ordinary course of business. Under Section 269P(3), if the CEO is satisfied that a TCO application meets the core criteria, they must make a written order declaring that the goods in question are subject to a prescribed item of Schedule 4 to the Customs Tariff Act 1995.
The Act imposes several obligations on the parties involved. The CEO is required to decide whether a TCO application meets the core criteria and, if satisfied, must make a written TCO. The CEO must also publish a notice in the Gazette inviting any person who considers there are reasons why the TCO should not be made to lodge a submission. The CEO is mandated to take into account any such submissions before making a decision on the TCO. Importers are given the opportunity to apply for a refund of duty on goods imported since the day the TCO is taken to have come into force.
Breaches of the provisions within the Act may result in various consequences. While the specific offences, penalties, or consequences are not detailed in the explanatory statement, the Act likely includes provisions for non-compliance under its general enforcement mechanisms. These could include fines, penalties, or other legal actions as prescribed by the relevant sections of the Customs Act 1901 or the Customs Tariff Act 1995. The exact penalties would depend on the nature and severity of the breach, as well as any additional regulations or guidelines established under these Acts.