EXPLANATORY STATEMENT
Tariff Concession Instrument No. 0614916
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.
Hunter Douglas Limited applied for a TCO in respect of certain multiple ply polyester yarn on 30 October 2006.
Instrument
TCO No 0614916 was made on 19 January 2007. It declares that those certain multiple ply polyester yarns 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. 0614916 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, enacted by the Parliament of Australia, provides for the regulation of customs duties, including the ability to grant tariff concession orders (TCOs) through the Chief Executive Officer of Customs. The Act was introduced to streamline the process of granting tariff concessions on imported goods, ensuring that they do not have substitutable goods produced in Australia. Tariff Concession Instrument No. 0614916, made under this Act, specifically addresses the application by Hunter Douglas Limited for a TCO concerning certain multiple ply polyester yarns, which became effective from 30 October 2006. The objective of this instrument is to reduce the customs duty on these goods from 5% to free, provided that the application meets the core criteria outlined in section 269C of the Act. The instrument came into force on the same date as the application, and no submissions opposing the TCO were received, reflecting the policy objective of efficiently managing tariff concessions while considering the interests of all stakeholders.
Scope and Application
The Tariff Concession Instrument No. 0614916, established under Part XVA of the Customs Act 1901, applies to the concession of customs duty on certain multiple ply polyester yarns. This Act applies to individuals or entities that seek to import these specific goods and benefit from reduced duty rates. The legislation operates at a Commonwealth level and is applicable nationally, as it is an instrument made under federal authority. The primary exclusion stipulated in the Act pertains to goods specified in section 269SJ, which are ineligible for tariff concessions. This particular instrument was created after Hunter Douglas Limited applied for a tariff concession order, and it was effective from 30 October 2006, the date the application was lodged. The instrument does not disadvantage any person or impose liabilities on anyone in relation to actions taken before its registration, and it advantageously affects the rights of importers who can apply for a refund of duty paid on these goods since the effective date.
Key Provisions
The primary sections of the Tariff Concession Instrument No. 0614916 under the Customs Act 1901 (section 269F, 269C, 269B, and 269P(3)) establish the process for applying for and granting a Tariff Concession Order (TCO). When an application is made under section 269F, the Chief Executive Officer (CEO) of Customs must assess whether the application meets the core criteria, specifically if no substitutable goods were produced in Australia on the day the application was lodged (section 269C). If the core criteria are satisfied, the CEO must issue a TCO, as per section 269P(3), declaring that the goods in question are subject to a prescribed rate in Schedule 4 of the Customs Tariff Act 1995. In this particular case, the CEO issued TCO No. 0614916 on 19 January 2007, declaring that certain multiple ply polyester yarns would be subject to a zero rate of customs duty instead of the general rate of 5%.
The Customs Act 1901 imposes several obligations on the parties involved in the TCO process. The applicant, in this instance Hunter Douglas Limited, must submit a valid application that meets the criteria outlined in the Act. The CEO, upon receiving a valid application, must assess whether the application satisfies the core criteria (section 269C) and must publish a notice in the Gazette inviting submissions from any interested parties (subsection 269K(1)). In this case, the CEO did not receive any submissions opposing the TCO. If the application meets the criteria, the CEO must issue a written TCO, as occurred with TCO No. 0614916. Importers of the goods subject to the TCO may also apply for a refund of duties paid on imports since the TCO is deemed to have come into force on the date the application was lodged (subsection 269S(1)).
There are no specific offences or penalties outlined in the explanatory statement for the failure to comply with the provisions of the Tariff Concession Instrument No. 0614916 or the Customs Act 1901 as it relates to TCOs. However, general provisions within the Customs Act 1901 do provide for penalties for non-compliance with customs regulations, which may include fines or imprisonment for serious breaches. The Act also includes provisions for civil and administrative penalties for offences related to customs duty, which could potentially apply if there were any fraudulent claims or misrepresentations made in the TCO application process. The specific penalties would depend on the nature and severity of the breach.