EXPLANATORY STATEMENT
Tariff Concession Instrument No. 0610682
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.
Henchman Products applied for a TCO in respect of certain plastic tool cases on 21 June 2006.
Instrument
TCO No 0610682 was made on 08 September 2006. It declares that those certain plastic tool cases 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. 0610682 is taken to have come into force on 21 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 Customs Act 1901 was enacted by the Parliament of Australia to facilitate the regulation of goods imported into and exported from Australia, among other things. It establishes the framework for Tariff Concession Orders (TCOs), which are used to reduce the rate of customs duty on certain imported goods. The Tariff Concession Instrument No. 0610682 was introduced to provide tariff concessions for specific goods, namely certain plastic tool cases, by lowering the customs duty rate from the general rate of 5% to free. The instrument was enacted on 8 September 2006, and it came into force on 21 June 2006, the date the application for the TCO was lodged. The instrument was created after Henchman Products applied for a TCO and the Chief Executive Officer of Customs was satisfied that no substitutable goods were produced in Australia, meeting the core criteria outlined in the Customs Act 1901. The policy objective of the Tariff Concession Instrument No. 0610682 is to provide tariff concessions for specific goods, thereby encouraging their importation into Australia and potentially benefiting importers by allowing them to apply for a refund of duty on goods imported since the day on which the TCO is taken to have come into force.
Scope and Application
The Tariff Concession Instrument No. 0610682 under the Customs Act 1901 applies to individuals or entities that have applied for tariff concession orders (TCOs) in respect of specific goods, namely certain plastic tool cases. The instrument was made by the Chief Executive Officer of Customs (CEO) following an application by Henchman Products on 21 June 2006. The TCO applies to goods that are not produced in Australia and for which no substitutable goods are produced in the ordinary course of business, thereby qualifying for a concession on customs duty. The instrument declares that the certain plastic tool cases are goods to which item 50 of Schedule 4 to the Customs Tariff Act 1995 applies, effectively making the duty on these goods free, as opposed to the general rate of 5%. The TCO came into force on the date of the application, 21 June 2006, and it does not affect the rights of any person as at the date of registration or impose any liabilities on any person. The CEO published a notice in the Gazette inviting submissions on the TCO application, but none were received, facilitating the approval of the TCO.
Key Provisions
The main operative sections of this legislation, specifically Tariff Concession Instrument No. 0610682 under the Customs Act 1901, include section 269F (subsection 269K(1)) which outlines the process for applying for a Tariff Concession Order (TCO). Section 269C details the core criteria that an application must meet, particularly ensuring that no substitutable goods were produced in Australia on the day the application was lodged. Section 269P(3) requires the Chief Executive Officer of Customs (the CEO) to issue a written order if the application meets these criteria. This order declares that the goods specified in the application are subject to the TCO, effectively reducing or eliminating the customs duty on those goods.
The obligations imposed by this Act on the parties involved, particularly Henchman Products in this instance, include submitting a detailed application to the CEO, ensuring it meets the core criteria specified in section 269C. This involves providing sufficient evidence that no substitutable goods were produced in Australia. The CEO, on receiving the application, has the obligation to publish a notice in the Gazette inviting submissions from any person who might oppose the TCO, as outlined in subsection 269K(1). Once satisfied that the application meets the criteria and no objections are received, the CEO must issue the TCO as specified in section 269P(3).
Breaches of the provisions of this Act, particularly in the context of providing false or misleading information in an application for a TCO, can lead to serious consequences. The Act does not explicitly state penalties for such breaches, but generally, under Australian law, providing false information can lead to civil or criminal penalties, including fines or imprisonment. The severity of these penalties can depend on the extent and impact of the misrepresentation. Additionally, the CEO has the authority to cancel a TCO if it is found that the conditions for its issuance were not met, which could also have financial implications for the party that submitted the application.