EXPLANATORY STATEMENT
Tariff Concession Instrument No. 0617064
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.
Moffat Pty Ltd applied for a TCO in respect of certain dough sheeters on 11 September 2006.
Instrument
TCO No 0617064 was made on 1 December 2006. It declares that those certain dough sheeters 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. 0617064 is taken to have come into force on 11 September 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. 0617064, enacted in 2006, was introduced to provide tariff concessions for certain goods under the Customs Act 1901. This instrument was developed to address the need for tariff reductions on specific goods that are not produced in Australia, thereby ensuring competitive pricing and facilitating imports that are essential for Australian businesses. The instrument was enacted by the Chief Executive Officer of Customs, following the application by Moffat Pty Ltd for a tariff concession order (TCO) concerning certain dough sheeters. The policy objective was to enable the importation of these goods at a reduced duty rate, which would benefit importers by lowering their costs and potentially passing savings onto consumers. The instrument was published in the Gazette, inviting any interested parties to provide submissions against the TCO, although none were received. The TCO took effect from the date the application was lodged, 11 September 2006, without disadvantaging existing rights or imposing new liabilities on individuals or entities other than the Commonwealth.
Scope and Application
The Tariff Concession Instrument No. 0617064, made under the Customs Act 1901, applies to Moffat Pty Ltd, specifically in relation to certain dough sheeters that they imported. This legislation is applicable to the Commonwealth of Australia and is administered by the Chief Executive Officer of Customs. The Act facilitates the reduction or exemption of customs duties on specified goods, provided that these goods are not substitutes for products already manufactured within Australia. In this instance, the CEO determined that no substitutable goods were produced in Australia, thus meeting the core criteria for the tariff concession. The instrument reduces the duty on these particular dough sheeters from 5% to 0%, effective from the date the application was lodged, 11 September 2006. The instrument does not disadvantage any individual or entity other than the Commonwealth and does not impose any liabilities on persons other than the Commonwealth.
Key Provisions
The main operative sections of this legislation pertain to the creation and effects of Tariff Concession Orders (TCOs) under the Customs Act 1901. Section 269C stipulates that a TCO application meets the core criteria if no substitutable goods were produced in Australia on the day the application was lodged. Section 269P(3) requires the Chief Executive Officer of Customs (CEO) to make a written order if the application meets these criteria. Section 269K(1) mandates the CEO to publish a notice in the Gazette inviting submissions on the application. The TCO in question, Instrument No. 0617064, declares that certain dough sheeters are subject to a 0% duty rate instead of the general rate of 5%, effective from 11 September 2006.
The obligations imposed by this Act on the parties involved include the requirement for the CEO to assess TCO applications against the core criteria outlined in section 269C. Once a TCO application is deemed valid, the CEO must make a written order declaring the goods subject to a concessionary tariff, as per section 269P(3). The CEO must also publish a notice in the Gazette, inviting any person who may have objections to the TCO to submit their views, in accordance with section 269K(1). The entity applying for the TCO, such as Moffat Pty Ltd, must ensure that their application complies with all the legislative requirements and provide any necessary information to substantiate the claim that no substitutable goods were produced in Australia.
The Act includes provisions for potential breaches and consequences. While the explanatory statement does not explicitly list offences or penalties for non-compliance with the TCO provisions, breaches of the Customs Act 1901 in general may result in criminal or civil penalties. For instance, knowingly making a false statement in a customs document can lead to a fine of up to 10,000 penalty units or imprisonment for up to five years, or both, under section 254C. Similarly, contravening a TCO by not adhering to the declared conditions could lead to penalties for incorrect duty payments, including fines and interest on the unpaid duty. The precise penalties would depend on the specific breach and the relevant provisions of the Customs Act and associated regulations.