EXPLANATORY STATEMENT
Tariff Concession Instrument No. 0607298
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.
Discount Plastics Vic Pty Ltd applied for a TCO in respect of certain wire benders on 21 April 2006.
Instrument
TCO No 0607298 was made on 14 July 2006. It declares that those certain wire benders 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. 0607298 is taken to have come into force on 14 July 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. 0607298 was enacted in 2006 under the Customs Act 1901 to address the need for tariff concessions for specific imported goods. This instrument, introduced by the Chief Executive Officer of Customs, allows for reduced customs duty rates on certain goods not produced domestically, thereby facilitating more competitive pricing and potentially stimulating demand for these products. The primary objective of this legislation is to provide economic benefits by making imported goods more affordable, which can subsequently encourage consumption and investment. The instrument was made following an application from Discount Plastics Vic Pty Ltd for tariff concessions on certain wire benders, where it was determined that no substitutable goods were produced in Australia. The concessions granted under this instrument do not adversely affect the rights of any person other than the Commonwealth and do not impose new liabilities on anyone.
Scope and Application
The Tariff Concession Instrument No. 0607298, made under the Customs Act 1901, applies to persons or entities seeking tariff concessions on specific goods for which they can demonstrate that no substitutable goods are produced in Australia. The instrument is particularly relevant to businesses involved in the importation of goods that are eligible for such concessions. This Act operates within the Commonwealth jurisdiction and is intended to facilitate trade by reducing the customs duty on certain goods, thereby encouraging imports and potentially reducing costs for importers. The scope of the Act is limited to goods that are not specified in section 269SJ of the Customs Act, which lists goods that are ineligible for tariff concessions. The Act's application can be extended or modified through subordinate instruments, which may provide further detail on the types of goods eligible for concessions and the specific criteria that must be met. The commencement of this particular instrument, TCO No. 0607298, is backdated to the date the application was lodged, which is 14 July 2006, ensuring that the concession applies retroactively from the application date without affecting existing rights or imposing new liabilities on persons other than the Commonwealth.
Key Provisions
The key operative sections of the Tariff Concession Instrument No. 0607298 include section 269C (3) of the Customs Act 1901, which requires the Chief Executive Officer (CEO) of Customs to make a Tariff Concession Order (TCO) if the application meets the core criteria, and section 269P(3), which mandates the CEO to declare the goods subject to the TCO application as goods to which a prescribed item of Schedule 4 to the Customs Tariff Act 1995 applies. Section 269SJ specifies the goods that cannot be subject to a TCO. This instrument declares that certain wire benders, which are subject to a 5% general rate of duty, are now subject to a 0% duty rate as per the TCO.
The obligations imposed by this Act on the parties governed by it primarily revolve around the application process for a TCO. The applicant, in this case, Discount Plastics Vic Pty Ltd, must ensure their application adheres to the criteria set out in section 269C. The CEO of Customs must then assess the application against these criteria and, if satisfied, make a TCO. Both the applicant and the CEO have obligations to ensure transparency and fairness in the process. For instance, the CEO must publish a notice in the Gazette (subsection 269K(1)) inviting submissions from any interested parties.
The legislation does not explicitly state any specific offences, penalties, or consequences for breach. However, non-compliance with the conditions of the TCO or failure to adhere to the stipulated application process could potentially lead to legal challenges or disputes. The TCO itself does not impose any liabilities on any person and does not affect the rights of a person (other than the Commonwealth) as at the date of registration so as to disadvantage that person. It should be noted that the TCO provides a refund of duty to importers of such goods from the date the TCO is taken to have come into force.