EXPLANATORY STATEMENT
Tariff Concession Instrument No. 0605758
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.
Richard Karl Hill applied for a TCO in respect of certain cheese mould stack turners on 27 March 2006.
Instrument
TCO No 0605758 was made on 16 June 2006. It declares that those certain cheese mould stack turners 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. 0605758 is taken to have come into force on 27 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. 0605758 was enacted under the Customs Act 1901 to provide tariff concessions for certain goods, specifically cheese mould stack turners, to address a gap in the availability of locally produced substitutes. This instrument was introduced to facilitate the import of these goods at a reduced customs duty rate, reflecting the policy objective of ensuring that such concessions are granted when no substitutable goods are produced domestically. The instrument was made on 16 June 2006 by the Chief Executive Officer of Customs, who was satisfied that the application for tariff concession met the core criteria, as no substitutable goods were produced in Australia. This decision effectively lowered the duty rate from the general 5% to 0%, thus benefiting importers by potentially allowing them to apply for refunds of duty on goods imported since the effective date of the concession, 27 March 2006.
Scope and Application
The Tariff Concession Instrument No. 0605758 under the Customs Act 1901 applies to specific goods, in this case, certain cheese mould stack turners, and is administered by the Chief Executive Officer of Customs (CEO) who decides on the concession of customs duty rates. The Act is applicable to any person or entity seeking a tariff concession for goods imported into Australia, provided the goods do not fall under the categories specified in section 269SJ of the Act that are ineligible for such concessions. The geographic reach of this legislation is national, as it pertains to the importation of goods into Australia and is governed by the Commonwealth. The application of this Instrument is contingent upon the CEO's determination that no substitutable goods are produced in Australia in the ordinary course of business, a criterion outlined in section 269C of the Act. The commencement of this Tariff Concession Order is effective from the date the application was lodged, 27 March 2006, without retroactive application to pre-existing transactions. The Instrument does not disadvantage any person or impose new liabilities, and it allows for the potential refund of duties paid on the specified goods imported since the effective date of the concession.
Key Provisions
The Customs Act 1901, under section 269F, allows for the application of Tariff Concession Orders (TCOs) by individuals seeking lower customs duty rates for specific goods. The application process begins when a person applies to the Chief Executive Officer (CEO) of Customs, as outlined in section 269F. If the CEO determines that the application pertains to goods not listed in section 269SJ, which specifies goods ineligible for TCOs, the application is then assessed against the core criteria set out in section 269C. To meet these criteria, the application must demonstrate that, on the date it was lodged, no substitutable goods were produced in Australia in the ordinary course of business. The definitions of terms such as 'goods produced in Australia', 'ordinary course of business', and'substitutable goods' are further elaborated in sections 269D, 269E, and 269F respectively.
The obligations placed on the parties involved are primarily on the applicant and the CEO. The applicant must ensure that their application is complete and meets the core criteria, including proving that no substitutable goods were produced in Australia. The CEO is obligated to review the application, publish a notice in the Gazette inviting any objections, and make a decision on whether to grant the TCO based on the evidence provided. In this case, Richard Karl Hill applied for a TCO concerning certain cheese mould stack turners, and the CEO issued TCO No. 0605758 on 16 June 2006, declaring these goods to be subject to a 0% duty rate, which is lower than the general rate of 5%.
Failure to comply with the provisions of the Customs Act 1901 can lead to various penalties and consequences. While the explanatory statement does not detail specific penalties for breaches, the Act generally provides for both civil and criminal penalties for non-compliance with customs regulations. Civil penalties may include fines and the recovery of duties owed, while criminal penalties can result in imprisonment, reflecting the seriousness of non-compliance with customs laws. The TCO itself does not impose any liabilities on any person, ensuring that the rights of importers are beneficially affected and that the concession does not disadvantage or impose liabilities on anyone for actions taken before the TCO came into force.