EXPLANATORY STATEMENT
Tariff Concession Instrument No. 0610368
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.
Transtar International Forwarding applied for a TCO in respect of certain display tins on 14 June 2006.
Instrument
TCO No 0610368 was made on 1 September 2006. It declares that those certain display tins 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. 0610368 is taken to have come into force on 14 June 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. 0610368, enacted in 2006, is an instrument under the Customs Act 1901 designed to provide tariff concessions for certain goods. This instrument was introduced to address the specific need for reduced customs duties on particular imported goods, in this case, display tins, where no substitutable goods are produced in Australia. The Tariff Concession Orders (TCOs) scheme under the Customs Act 1901 allows for the reduction of customs duty rates for goods specified in the order, provided certain criteria are met. The enacting body for this instrument is the Chief Executive Officer of Customs, who is responsible for deciding on applications for TCOs. The policy objective is to facilitate trade by reducing the duty burden on importers of goods where Australian-produced alternatives do not exist, thus potentially increasing the competitiveness of these imported goods in the Australian market.
Scope and Application
The Customs Act 1901, specifically under Part XVA, provides a framework for the creation of Tariff Concession Orders (TCO) by the Chief Executive Officer of Customs (CEO). The Act applies to any person or entity seeking a tariff concession for specific goods that meet the core criteria outlined in section 269C of the Act, which essentially requires that no substitutable goods are produced in Australia in the ordinary course of business. The CEO is mandated to evaluate each application and, if the criteria are met, issue a TCO that applies a lower rate of customs duty on the specified goods. This process is further clarified by definitions in sections 269D, 269E, and 269F of the Act, which detail the production of goods in Australia, the ordinary course of business, and the concept of substitutable goods, respectively. The geographic reach of this legislation is national, as it applies throughout Australia, and the instrument extends to include any goods that are the subject of a valid TCO application. The exclusions are outlined in section 269SJ of the Act, which specifies goods that cannot be subject to a TCO. The application process also involves public consultation, where the CEO must publish a notice in the Gazette inviting submissions from interested parties, although no submissions were received in response to TCO No. 0610368. The commencement of a TCO is effective from the day the application is lodged, and the rights of importers are positively affected, allowing for duty refunds on imported goods since the effective date of the TCO.
Key Provisions
The main operative sections of the Tariff Concession Instrument No. 0610368 pertain to the making of a Tariff Concession Order (TCO) under section 269F of the Customs Act 1901. Section 269F allows for applications to the Chief Executive Officer of Customs (CEO) for a TCO in respect of specific goods, subject to the criteria in sections 269C, 269B, and 269D. If the CEO determines that the application meets the core criteria, a TCO is issued, specifying a lower rate of customs duty for the goods in question. In this instance, the TCO No. 0610368, issued on 1 September 2006, applies to certain display tins, reducing the duty rate from 5% to 0% as per item 50 of Schedule 4 to the Customs Tariff Act 1995.
Under the Customs Act, the CEO has obligations to process applications for TCOs and to make a written order if the application meets the core criteria. The CEO must also publish a notice in the Gazette inviting any interested parties to submit objections to the TCO. Section 269K(1) of the Act requires that this notice be published as soon as practicable after the application is accepted as valid. If the CEO does not receive any objections, they must proceed to make the TCO. In the case of TCO No. 0610368, the CEO did not receive any submissions against the application.
The Act imposes several requirements on parties and entities it governs, including the necessity for the applicant to ensure their application complies with sections 269C and 269SJ. The CEO must then verify that no substitutable goods are being produced in Australia at the time of the application. The CEO is also obligated to consider any submissions made in response to the Gazette notice and to make a decision based on the evidence and arguments presented. The CEO must ensure the TCO does not disadvantage any person other than the Commonwealth and does not impose new liabilities on any party.
There are no specific offences outlined in the TCO itself, but breaches of the Customs Act or any related regulations can result in penalties. Offences under the Customs Act can lead to both civil and criminal penalties. Civil penalties may include financial penalties or compensation for loss or damage, while criminal penalties can include fines and imprisonment, depending on the severity of the breach. The maximum penalties are determined by the specific provision of the Act that is breached. The Customs Act generally provides for substantial fines and imprisonment terms for serious or repeated breaches, reflecting the seriousness with which the law treats non-compliance.