EXPLANATORY STATEMENT
Tariff Concession Instrument No. 0702120
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.
The Reject Shop (Aust.) Pty Ltd applied for a TCO in respect of certain silicone cookware on 09 February 2007.
Instrument
TCO No 0702120 was made on 04 May 2007. It declares that those certain silicone cookware 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. 0702120 is taken to have come into force on 09 February 2007.
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. 0702120 was enacted in 2007 to provide a lower rate of customs duty on certain silicone cookware, as specified in the Customs Act 1901. This instrument was introduced to address the gap where certain goods, in this case silicone cookware, were subject to higher customs duties and to facilitate their import into Australia by reducing these duties. The instrument was made under the authority granted by the Chief Executive Officer of Customs, following an application from The Reject Shop (Aust.) Pty Ltd. The decision to grant the tariff concession was based on the fact that no substitutable goods were produced in Australia, aligning with the core criteria set out in section 269C of the Act. The instrument came into force on the date the application was lodged, 9 February 2007, and it ensures that the rights of importers are positively affected, allowing them to apply for a refund of duty on goods imported since the commencement date.
Scope and Application
The Tariff Concession Instrument No. 0702120 under the Customs Act 1901 applies to any entity or individual seeking tariff concessions for specific goods, particularly in this instance, certain silicone cookware. The application of this instrument is directed at those who wish to import these goods into Australia and benefit from a reduced rate of customs duty, as stipulated by the instrument. The instrument is applicable nationwide, as it is a Commonwealth instrument, thereby extending its reach across all states and territories of Australia. However, it explicitly excludes any goods listed in section 269SJ of the Act, which are ineligible for tariff concessions. The instrument's scope can be extended or refined through subordinate instruments, although the primary legislation sets out the core criteria and conditions under which tariff concessions are granted. The instrument came into force on the date the application was lodged, which was 09 February 2007, and it does not impose any liabilities on any person other than potentially benefiting the rights of importers by allowing them to apply for a refund of duty on goods imported since the effective date of the tariff concession.
Key Provisions
The main operative sections of the Tariff Concession Instrument No. 0702120 under the Customs Act 1901 (section 269F) pertain to the application process for a Tariff Concession Order (TCO) by a person to the Chief Executive Officer of Customs (CEO). If the CEO is satisfied that the application does not involve goods specified in section 269SJ of the Act and meets the core criteria in section 269C, a TCO is issued. Section 269P(3) mandates that the CEO must then make a written order declaring the goods to which a specific item in the Customs Tariff Act 1995 applies. This particular instrument, TCO No. 0702120, was made on 04 May 2007 and concerns certain silicone cookware, specifying that these goods are subject to item 50 of Schedule 4 of the Tariff, thus granting them a free rate of duty instead of the general 5% rate.
The Act imposes several obligations on the parties involved. Firstly, applicants must ensure their goods do not fall under the list specified in section 269SJ, which prohibits certain goods from being subject to a TCO. Furthermore, the CEO is obligated to evaluate each application against the core criteria outlined in section 269C, specifically verifying that no substitutable goods are produced in Australia. The CEO must also publish a notice in the Gazette (subsection 269K(1)) inviting submissions from any interested parties within a reasonable timeframe, although no submissions were received for this particular TCO. Finally, the CEO must ensure that the TCO does not adversely affect the rights of any person, apart from the Commonwealth, as per subsection 269S(1).
Failing to comply with the requirements of the Customs Act 1901 could lead to various consequences. While specific offences are not detailed in the explanatory statement, the Act generally provides for both civil and criminal penalties for non-compliance with its provisions. For instance, subsection 269P(4) could imply that improper application or misuse of a TCO might incur penalties as outlined in the Act, which could range from fines to imprisonment, depending on the severity of the breach. The maximum penalties, however, are not explicitly stated in the explanatory statement but would typically be found in the relevant sections of the Customs Act 1901. Additionally, the Act may provide for civil remedies, including the recovery of duties and penalties, which could be pursued by the Commonwealth in the event of non-compliance.