EXPLANATORY STATEMENT
Tariff Concession Instrument No. 0614915
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.
Tea Too Pty Ltd applied for a TCO in respect of certain mesh nylon sheets on 30 October 2006.
Instrument
TCO No 0614915 was made on 30 January 2007. It declares that those certain mesh nylon sheets 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 7.5%. 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. 0614915 is taken to have come into force on 30 October 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 to provide a comprehensive framework for the regulation of customs and excise in Australia, and was introduced to address the need for streamlined processes in international trade and duty assessments. The Tariff Concession Instrument No. 0614915, enacted in 2007, provides an additional mechanism within the Customs Act to allow for tariff concessions on specific goods, thereby facilitating trade by reducing the customs duty on particular imported items. This instrument was developed by the Chief Executive Officer of Customs under the authority granted by the Customs Act and aims to ensure that the application of tariff concessions is both fair and supportive of the economic interests of businesses and consumers. The instrument operates under a defined process where applications are assessed against specific criteria to ensure that the concessions do not undermine local production and maintain a balanced approach to trade regulation.
Scope and Application
The Tariff Concession Instrument No. 0614915, made under section 269F of the Customs Act 1901, applies to the goods specified in the instrument, namely certain mesh nylon sheets. The Act enables the Chief Executive Officer of Customs to make Tariff Concession Orders (TCOs) that provide a lower rate of customs duty on goods that are the subject of the TCO. This specific instrument was made following an application by Tea Too Pty Ltd and is effective as of the date the application was lodged, 30 October 2006. The application of this instrument is confined to the goods specified, and it does not extend to other goods unless similarly applied for and approved by the CEO. The instrument exempts the goods from the general rate of duty, which is 7.5%, and instead applies a rate of duty of free. The CEO must ensure that no substitutable goods are produced in Australia in the ordinary course of business, as defined by the Act, before approving the application. This instrument is part of the broader Customs Act 1901, which has a national jurisdictional reach across Australia. The application process for a TCO includes public consultation, although in this case, no submissions were received in response to the published notice in the Gazette. The instrument does not affect any existing rights of persons other than the Commonwealth and does not impose any new liabilities on persons.
Key Provisions
The main operative sections of the Tariff Concession Order No. 0614915 under the Customs Act 1901 (section 269F) allow for the application of a lower rate of customs duty on specific goods, provided the Chief Executive Officer (CEO) of Customs is satisfied that the application meets the core criteria. These criteria include ensuring that no substitutable goods are produced in Australia in the ordinary course of business at the time of application (section 269C). If the application is deemed valid, the CEO must issue a written order (section 269P(3)) that specifies the goods to which the lower rate of duty applies, as detailed in Schedule 4 to the Customs Tariff Act 1995.
The Act imposes several obligations on the parties involved. The CEO of Customs must ensure that the application for a tariff concession order (TCO) is valid and meets the specified criteria before making a decision. Furthermore, upon accepting a valid application, the CEO is required to publish a notice in the Gazette inviting any interested parties to submit any objections (subsection 269K(1)). In this instance, no objections were received, which facilitated the CEO's decision-making process.
In terms of offences and penalties, the Customs Act 1901 does not explicitly detail penalties for non-compliance with TCO provisions. However, general provisions within the Act likely apply, where breaches may result in civil or criminal penalties. The specifics of these penalties would depend on the nature and severity of the breach, but they could include fines or other legal actions as deemed appropriate by the relevant authorities. The Act ensures that the implementation of the TCO does not affect the rights of any person other than the Commonwealth in relation to actions taken before the TCO's registration date, thus protecting the interests of affected parties.