EXPLANATORY STATEMENT
Tariff Concession Instrument No. 0619540
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.
Cadbury Schweppes Australia Pty Ltd applied for a TCO in respect of certain ultrasonic guillotine cutters on 11 December 2006.
Instrument
TCO No 0619540 was made on 09 March 2007. It declares that those certain ultrasonic guillotine cutters 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. 0619540 is taken to have come into force on 11 December 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. 0619540, made under the Customs Act 1901, was enacted in 2007 to address the need for tariff concessions on specific goods that were not being produced in Australia. The Customs Act 1901 allows for the establishment of Tariff Concession Orders (TCOs) by the Chief Executive Officer of Customs, which provide a lower rate of customs duty on goods that meet certain criteria. This instrument was introduced to ensure that Australian businesses have access to competitively priced goods, thereby encouraging economic growth and facilitating international trade. The Australian Parliament established this framework to enable the CEO to assess and approve applications for tariff concessions, as outlined in section 269F of the Act. The policy objective is to support domestic industries by reducing the customs duty on specific imported goods that are not being produced locally, thus fostering a more competitive market environment.
Scope and Application
The Tariff Concession Instrument No. 0619540 under the Customs Act 1901 applies to the concession of customs duties for certain ultrasonic guillotine cutters. The Act allows for the Chief Executive Officer of Customs to grant a Tariff Concession Order (TCO) to reduce the rate of customs duty on specific goods if certain criteria are met. In this case, the CEO made a TCO for Cadbury Schweppes Australia Pty Ltd, who applied for the concession on 11 December 2006. The TCO applies to goods specified in item 50 of Schedule 4 to the Customs Tariff Act 1995, granting them a rate of duty of free, down from the general rate of 5%. The geographic and jurisdictional reach of this Act is Commonwealth, meaning it applies nationally across Australia. The Act does not specify exclusions or exemptions for this TCO, and no liabilities or disadvantages are imposed on persons other than the Commonwealth as a result of this concession. The TCO's commencement date is the same as the date the application was lodged, which provides immediate benefits to importers who can apply for refunds of duty on goods imported since that date.
Key Provisions
The main operative sections of the Customs Act 1901, relevant to the Tariff Concession Order (TCO) No. 0619540, are sections 269C, 269F, 269P, and 269S. Section 269F allows a person to apply to the Chief Executive Officer of Customs (CEO) for a TCO in respect of goods, provided these goods are not specified in section 269SJ. If the application meets the core criteria, as outlined in section 269C, the CEO must make a written order (TCO), as stated in section 269P(3). The TCO is effective from the day the application was lodged, according to section 269S(1).
Under the Act, the CEO has specific obligations when handling TCO applications. Firstly, the CEO must ensure that the application is not for goods specified in section 269SJ, which are ineligible for TCOs. Secondly, the CEO must assess whether the application meets the core criteria set out in section 269C, which requires that no substitutable goods were produced in Australia on the day the application was lodged. This involves verifying that the goods are not produced domestically and determining that they do not have substitutable goods that could be used in their place. If these criteria are met, the CEO must then issue a written TCO.
Furthermore, section 269K(1) imposes an obligation on the CEO to publish a notice in the Gazette, inviting submissions from any person who believes there are reasons why the TCO should not be made. In the case of TCO No. 0619540, the CEO did not receive any submissions. This step is crucial for transparency and allowing interested parties to voice their concerns.
In terms of consequences for non-compliance or breaches, the Act does not explicitly detail specific offences or penalties related to TCOs. However, general provisions within the Customs Act and associated regulations may apply. For instance, non-compliance with customs duties or incorrect classification of goods can result in financial penalties or other enforcement actions. The penalties for breaches can vary, but they can include fines and, in severe cases, criminal charges. The specifics would depend on the nature and severity of the breach, as well as any additional relevant legislation or regulations.