EXPLANATORY STATEMENT
Tariff Concession Instrument No. 0619783
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.
P & N Beverages Australia Pty Limited applied for a TCO in respect of certain soft drink blenders and carbonators on 18 December 2006.
Instrument
TCO No 0619783 was made on 09 March 2007. It declares that those certain soft drink blenders and carbonators 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. 0619783 is taken to have come into force on 18 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. 0619783 was enacted in 2007 under the Customs Act 1901. This legislation was introduced to address the need for a streamlined process to reduce customs duty on certain imported goods, thereby facilitating trade and benefiting businesses that rely on importing specific equipment. The Customs Act 1901, particularly Part XVA, empowers the Chief Executive Officer of Customs to make Tariff Concession Orders (TCOs), which apply a lower rate of customs duty to specified goods. The policy objective of this Act is to support Australian businesses by reducing the cost of importing necessary equipment, as long as no substitutable goods are produced domestically.
The enacting body for this instrument is the Chief Executive Officer of Customs, who assessed the application by P & N Beverages Australia Pty Limited for tariff concessions on certain soft drink blenders and carbonators. Following the assessment, the CEO determined that no substitutable goods were produced in Australia, satisfying the core criteria for the TCO. Consequently, the CEO issued Instrument TCO No. 0619783, which applies a duty rate of free on these goods, effective from 18 December 2006. The process involved publishing a notice in the Gazette to invite submissions, though none were received, allowing the TCO to proceed without opposition.
Scope and Application
The Customs Act 1901 applies to individuals and entities seeking tariff concessions on imported goods, specifically those who apply for Tariff Concession Orders (TCOs) through the Chief Executive Officer (CEO) of Customs. The Act outlines a process by which a person can apply for a TCO in respect of goods, provided those goods are not specified in section 269SJ of the Act as ineligible for concession. The CEO must assess whether the application meets the core criteria, notably that no substitutable goods were produced in Australia at the time of application, as defined in sections 269C, 269D, 269E, and 269F. Once the CEO determines the application meets the criteria, a TCO is issued, granting a lower rate of duty on the specified goods as outlined in the Customs Tariff Act 1995. This legislation is of national reach, impacting all importers of goods in Australia.
Subordinate instruments may further extend or restrict the application of the Act by detailing specific procedures or additional criteria for TCOs. For example, regulations under the Customs Act may specify the format and content of TCO applications or establish timelines for CEO responses. The Act does not disadvantage existing rights of persons other than the Commonwealth, ensuring that no retroactive liabilities are imposed, though it does benefit importers by potentially allowing refunds of duty for goods imported since the TCO's effective date. The TCOs do not impose any liabilities on any person other than the Commonwealth, as outlined in subsection 269S(1) of the Act.
Key Provisions
The Tariff Concession Instrument No. 0619783, under the Customs Act 1901, specifically Section 269F, establishes the legal framework for the creation of Tariff Concession Orders (TCOs). When an entity such as P & N Beverages Australia Pty Limited applies for a TCO, the Chief Executive Officer of Customs (CEO) evaluates the application against the core criteria outlined in Section 269C of the Act. If the CEO is satisfied that the application meets the criteria, they must make a written order, or TCO, which in this case, applies to certain soft drink blenders and carbonators, granting them a duty-free status under item 50 of Schedule 4 to the Customs Tariff Act 1995.
The obligations imposed by the Act on the parties involved include the necessity for the CEO to publish a notice in the Gazette as soon as practicable after accepting a TCO application as valid, pursuant to Subsection 269K(1) of the Act. This notice invites any person who might oppose the making of the TCO to lodge a submission with the CEO. In this instance, no submissions were received, allowing the CEO to proceed with the order. The Act also mandates that a TCO is deemed to have come into force on the day the application was lodged, as stipulated in Subsection 269S(1) of the Act, thus, TCO No. 0619783 is effective from 18 December 2006.
The Act ensures that the TCO does not adversely affect the rights of any person other than the Commonwealth, as per Subsection 269S(3) of the Act. This means that the TCO does not disadvantage any person or impose any liabilities on them for actions taken before the TCO's effective date. Instead, it benefits importers by allowing them to apply for a refund of duty on goods imported since the TCO's effective date, as outlined in paragraph 126(1)(r) of the Regulations.
There are no specific offences or penalties outlined in the explanatory statement for breaches related to the TCO. However, any breaches of the Customs Act 1901 or the associated regulations could lead to civil or criminal consequences. The penalties for such breaches can vary significantly, depending on the severity of the offence, and may include substantial fines or imprisonment. It is crucial for parties involved to adhere to the requirements and obligations set forth in the Act to avoid any legal repercussions.