EXPLANATORY STATEMENT
Tariff Concession Instrument No. 0617924
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.
NSW Leather Co Pty Ltd applied for a TCO in respect of certain bovine leather on 24 October 2006.
Instrument
TCO No 0617924 was made on 12 January 2007. It declares that those certain bovine leather 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. 0617924 is taken to have come into force on 24 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 Australian Parliament, provides the legal framework for regulating the import and export of goods. Part XVA of the Act introduces a scheme that allows the Chief Executive Officer of Customs to make Tariff Concession Orders (TCOs) for specific goods, reducing their customs duty. The Tariff Concession Instrument No. 0617924, issued under this scheme, was enacted to address the specific need of NSW Leather Co Pty Ltd to lower the duty on certain bovine leather, which was set at 0% following the CEO's determination that no substitutable goods were produced in Australia. This legislative instrument aims to facilitate trade by providing tariff concessions where appropriate, ensuring that the rights of importers are protected and that no new liabilities are imposed on anyone as a result of the concession.
Scope and Application
The Customs Act 1901, as supplemented by the Tariff Concession Instrument No. 0617924, applies to any individual or entity seeking tariff concessions for specified goods imported into Australia. The Act and the associated instrument operate within the Commonwealth jurisdiction, affecting the importation of certain bovine leather as outlined in the instrument. The scope of the legislation includes the application process for tariff concessions, the criteria that applications must meet, and the conditions under which the Chief Executive Officer of Customs (CEO) can grant such concessions. Notably, the Act excludes certain goods from eligibility for tariff concessions as specified in section 269SJ of the Act. The instrument in question pertains to bovine leather and sets out the specific conditions under which a tariff concession is granted, including the application of a 0% duty rate instead of the general 5% rate. The commencement date of the tariff concession is the day the application was lodged, which in this case was 24 October 2006, and it does not retroactively affect any rights or liabilities of individuals or entities other than the Commonwealth.
Key Provisions
The main sections of the Customs Act 1901, particularly under Part XVA, allow for the creation of Tariff Concession Orders (TCOs) by the Chief Executive Officer (CEO) of Customs. A TCO can reduce the customs duty on specific goods if certain criteria are met. Specifically, section 269F allows for applications to the CEO for a TCO, while section 269C outlines the core criteria that must be satisfied, including the absence of substitutable goods produced in Australia at the time of the application. Once the CEO is satisfied that the core criteria are met, they must issue a TCO as per section 269P(3). This process was applied in the case of TCO No. 0617924 for certain bovine leather, which resulted in a duty reduction from 5% to 0%.
The obligations under the Act require applicants to ensure their goods meet the criteria for a TCO, particularly the absence of substitutable goods produced in Australia. The CEO is obligated to publish a notice in the Gazette to invite submissions from interested parties when a TCO application is accepted as valid. This ensures transparency and allows for any objections to be raised. The CEO must also decide whether the application meets the core criteria and issue a written TCO if they are satisfied.
In terms of penalties and consequences, the Act does not explicitly outline specific offences or penalties for breaches related to TCO applications. However, failure to comply with the requirements or misleading the CEO in an application could potentially lead to general legal consequences, such as administrative penalties or civil actions for misrepresentation. The primary focus of the Act is on ensuring that the criteria for tariff concessions are met fairly and transparently, rather than on imposing specific penalties for breaches.