EXPLANATORY STATEMENT
Tariff Concession Instrument No. 0611083
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.
The Trustee for J & L McNaughton Family Trust applied for a TCO in respect of certain rodent capture containers on 30 June 2006.
Instrument
TCO No 0611083 was made on 22 September 2006. It declares that those certain rodent capture containers 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. 0611083 is taken to have come into force on 30 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. 0611083 was enacted in 2006 as a means to amend the Customs Act 1901, aiming to address specific issues related to the tariff concession orders for certain goods. This instrument was introduced to provide a lower rate of customs duty for goods that meet specific criteria, thus facilitating trade by reducing the financial burden on importers. The enactment of this instrument was overseen by the Chief Executive Officer of Customs, who is tasked with evaluating applications for tariff concessions and ensuring they align with the legislative requirements outlined in the Customs Act 1901. The overarching policy objective of this measure is to promote economic efficiency by lowering the cost of imported goods that have no substitutable equivalents produced domestically, thereby enhancing the competitiveness of Australian businesses that rely on these imports.
Scope and Application
The Customs Act 1901, specifically Part XVA, governs the scheme under which Tariff Concession Orders (TCOs) are made by the Chief Executive Officer of Customs (CEO). This legislation applies to individuals and entities who seek to import goods into Australia, aiming to reduce customs duty rates for specified goods by applying for a TCO. The scope of this legislation is national, as it applies across the Commonwealth of Australia and is implemented through the Customs Act 1901. Exclusions include goods specified in section 269SJ of the Act, which cannot be subject to a TCO, such as certain hazardous or environmentally sensitive materials. The application of this Act can be extended or restricted through subordinate instruments, such as the Customs Tariff Act 1995, which details the rates of duty applicable to various goods. The CEO must ensure that no substitutable goods are produced in Australia when making a decision on a TCO application, as outlined in sections 269C and 269D of the Act. Once a TCO is granted, it generally takes effect on the date the application was lodged, providing immediate benefits to importers who can apply for duty refunds on previously imported goods.
Key Provisions
The key operative sections of this legislation are sections 269C, 269F, and 269P(3) of the Customs Act 1901. Section 269F allows for an application to be made to the Chief Executive Officer of Customs (CEO) for a Tariff Concession Order (TCO) in respect of goods, while section 269C sets out the core criteria for the CEO to consider in making a decision on whether to grant a TCO. If the CEO determines that the core criteria are met, they must make a written order (a TCO) declaring that the goods in question are subject to a prescribed item of Schedule 4 to the Customs Tariff Act 1995 (paragraph 1). The CEO is also required to publish a notice in the Gazette inviting submissions from any person who believes there are reasons why the TCO should not be made (subsection 269K(1)).
The Act imposes several obligations and requirements on the parties involved. Firstly, an applicant must ensure that the goods in question are not specified in section 269SJ of the Act, which lists goods that cannot be subject to a TCO. If the CEO is satisfied that the application meets the core criteria, they must make a TCO declaring that the goods in question are subject to a prescribed item of Schedule 4 to the Tariff (subsection 269P(3)). The CEO must also publish a notice in the Gazette inviting submissions from any person who believes there are reasons why the TCO should not be made (subsection 269K(1)). If the CEO receives submissions, they must consider them before making a final decision.
Failure to comply with the requirements of the Customs Act 1901 may result in civil or criminal consequences. However, the Explanatory Statement does not provide information on the specific offences, penalties, or consequences for breach. It is important to note that the Tariff Concession Instrument No. 0611083 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, and they 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 (paragraph 126(1)(r) of the Regulations).
In summary, the main provisions of this legislation relate to the application for and grant of a Tariff Concession Order by the CEO of Customs. The CEO must consider the core criteria set out in section 269C of the Act when deciding whether to grant a TCO. If the CEO is satisfied that the core criteria are met, they must make a written order declaring that the goods in question are subject to a prescribed item of Schedule 4 to the Tariff. The CEO must also publish a notice in the Gazette inviting submissions from any person who believes there are reasons why the TCO should not be made. The legislation does not provide information on the specific offences, penalties, or consequences for breach, but it does state that 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.