EXPLANATORY STATEMENT
Tariff Concession Instrument No. 0613835
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.
Redback Boot Company Pty Ltd applied for a TCO in respect of certain boot and/or shoe lasts on 17 August 2006.
Instrument
TCO No 0613835 was made on 10 November 2006. It declares that those certain boot and/or shoe lasts 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. 0613835 is taken to have come into force on 17 August 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. 0613835 was enacted under the Customs Act 1901 to address the need for tariff concessions on specific goods, facilitating trade by reducing customs duties for certain imported items. The instrument was introduced to provide relief to businesses that import goods for which there are no substitutable products produced within Australia. It allows for the application of a lower rate of customs duty to these specific goods, thereby promoting economic efficiency and supporting competitive industries. The instrument was made by the Chief Executive Officer of Customs following an application by Redback Boot Company Pty Ltd for tariff concessions on certain boot and/or shoe lasts, which were granted as no substitutable goods were being produced in Australia at the time of application. The policy objective is to support Australian industries by providing necessary imported goods at a reduced duty rate, thereby balancing trade and economic interests.
The instrument was published in the Gazette, inviting any interested parties to submit objections, though none were received. It came into force on the date of the application, 17 August 2006, without affecting any pre-existing rights or imposing new liabilities on individuals or entities other than the Commonwealth. Importers of the specified goods can apply for duty refunds from the date the concession came into effect, enhancing the benefits to those engaged in the import of these goods.
Scope and Application
The Customs Act 1901, specifically under Part XVA, authorises the Chief Executive Officer (CEO) of Customs to issue Tariff Concession Orders (TCOs) which apply lower rates of customs duty on specified goods. This Act applies to any person or entity seeking to import goods into Australia, provided the goods are not listed in section 269SJ of the Act as those ineligible for tariff concessions. The geographic reach of this Act is national, affecting all states and territories within Australia. The scope of the Act is restricted by the core criteria outlined in section 269C, which requires that no substitutable goods are produced in Australia in the ordinary course of business on the day the application for the TCO is lodged. The application process also includes a mandatory publication in the Gazette, inviting submissions from interested parties, although in this instance, no submissions were received. The TCOs extend the application of the Customs Act by providing specific tariff reductions for certain goods, as exemplified by TCO No. 0613835 which applies to certain boot and/or shoe lasts, reducing their duty rate from 5% to 0%.
Key Provisions
The primary operative sections of the Customs Act 1901 (the Act) in relation to Tariff Concession Orders (TCOs) are sections 269F, 269C, 269B, 269D, 269E, 269P, and 269S. Section 269F allows a person to apply to the Chief Executive Officer of Customs (the CEO) for a TCO concerning certain goods. If the application meets the core criteria as outlined in sections 269C and 269B, the CEO must make a written order declaring that the goods are subject to a specified rate of customs duty as per the Customs Tariff Act 1995 (the Tariff). The CEO must also ensure that no substitutable goods were produced in Australia on the day the application was lodged, as defined in sections 269D and 269E.
The obligations imposed by the Act on the parties governed by it include the requirement for the CEO to make a decision on a TCO application based on the core criteria and to publish a notice in the Gazette inviting any objections. Section 269K(1) mandates the CEO to publish a notice in the Gazette as soon as practicable after accepting a TCO application as valid, inviting any person who believes the TCO should not be made to submit their reasons to the CEO. In this case, the CEO did not receive any submissions in response to this invitation.
Section 269S(1) states that a TCO is taken to have come into force on the day the application for the TCO was lodged. This means that TCO No. 0613835 is considered to have come into force on 17 August 2006, the date the application was made. The TCO does not affect the rights of any person (other than the Commonwealth) as at the date of registration in a way that would disadvantage that person or impose liabilities on them in respect of anything done or omitted to be done before the date of registration. Importers, however, will benefit from the rights conferred by this TCO, as they can apply for a refund of duty on goods imported since the TCO came into force. The TCO does not impose any liabilities on any person.
Regarding the consequences of breaching the provisions of the Act, section 269SJ lists goods that cannot be subject to a TCO. The Explanatory Statement does not detail specific offences, penalties, or civil/criminal consequences for breach, but it can be inferred that failure to comply with the Act's requirements could result in legal action. The precise penalties for non-compliance would depend on the specific breach and would likely be determined by other sections of the Customs Act or related legislation.