EXPLANATORY STATEMENT
Tariff Concession Instrument No. 0606869
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.
Jaden Ornamental Mouldings applied for a TCO in respect of certain marquetry wood ornaments on 12 April 2006.
Instrument
TCO No 0606869 was made on 7 July 2006. It declares that those certain marquetry wood ornaments 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. 0606869 is taken to have come into force on 12 April 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 a framework under which the Chief Executive Officer of Customs can make Tariff Concession Orders (TCOs) to lower the customs duty on certain goods. The Act was enacted to address the issue of ensuring that Australian businesses and industries have access to competitively priced imported goods where no suitable Australian-made alternatives exist. This is particularly important for industries that may struggle to compete with imported goods due to the costs of production and the absence of locally produced substitutes. In line with this objective, TCO No. 0606869 was introduced on 7 July 2006 to provide a tariff concession on certain marquetry wood ornaments, recognising that no substitutable goods were produced in Australia, and thus, allowing these specific goods to benefit from a lower rate of duty. This legislative action is designed to support the competitive position of Australian businesses and the broader economy by reducing the cost of importing certain goods, thereby facilitating trade and economic activity.
Scope and Application
The Tariff Concession Instrument No. 0606869 applies to individuals or entities that have applied for and been granted a Tariff Concession Order (TCO) under section 269F of the Customs Act 1901. Specifically, this instrument pertains to the marquetry wood ornaments produced by Jaden Ornamental Mouldings, for which the instrument was issued on 7 July 2006. The geographic reach of this Act is national, as it falls under the purview of the Commonwealth, with the Customs Act 1901 governing customs duties across Australia. The Act applies to the particular goods specified in the TCO, provided they meet the criteria set out in sections 269C and 269D of the Act, which concern the production of goods in Australia and the ordinary course of business, respectively. The Act excludes goods specified in section 269SJ, which are ineligible for a TCO. The TCO can be extended or modified through subordinate instruments, but this particular TCO No. 0606869 specifies a zero duty rate for the marquetry wood ornaments starting from the date of application on 12 April 2006, as per the Customs Tariff Act 1995.
Key Provisions
The main operative sections of this Tariff Concession Order (TCO) revolve around the granting of tariff concessions on certain marquetry wood ornaments, specifically those applied for by Jaden Ornamental Mouldings. Section 269F of the Customs Act 1901 allows for the application of a TCO, while section 269C outlines the core criteria that the application must meet. Here, the Chief Executive Officer of Customs (CEO) must be satisfied that no substitutable goods were produced in Australia on the day the application was lodged. Section 269P(3) further stipulates that if these criteria are met, the CEO must issue a written order, declaring the goods eligible for the tariff concession. The TCO in question, number 0606869, specifies that these marquetry wood ornaments are subject to item 50 of Schedule 4 to the Customs Tariff Act 1995, resulting in a duty rate of free, as opposed to the general rate of 5%.
The Act imposes several obligations on both the applicant and the CEO. The applicant, Jaden Ornamental Mouldings, must submit a valid application to the CEO, ensuring that it meets the core criteria stipulated in section 269C. The CEO, upon receiving the application, is obligated to determine whether the application satisfies the core criteria and, if so, to issue a written TCO. Additionally, as per subsection 269K(1) of the Act, the CEO must publish a notice in the Gazette inviting submissions from any interested parties who may have reasons to oppose the TCO. In this case, no submissions were received, facilitating the swift approval and issuance of TCO No. 0606869.
Any breach of the provisions set forth in the Customs Act 1901 or the subsequent TCO may result in legal consequences. While the explanatory statement does not explicitly detail the offences, penalties, or civil/criminal consequences for breach, it is reasonable to infer that any non-compliance with the tariff concession regulations could lead to penalties as stipulated in the Customs Act and related regulations. For instance, section 126 of the Customs Regulations 1996 may apply, potentially involving fines or other sanctions for improper claims or fraudulent activities related to tariff concessions. The exact penalties would depend on the nature and severity of the breach, as outlined in the broader legislative framework.