EXPLANATORY STATEMENT
Tariff Concession Instrument No. 0703106
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.
3M Australia Pty Ltd applied for a TCO in respect of certain fastening nonwoven tapes on 27 February 2007.
Instrument
TCO No 0703106 was made on 18 May 2007. It declares that those certain fastening nonwoven tapes 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. 0703106 is taken to have come into force on 27 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 Customs Act 1901, enacted by the Australian Parliament, facilitates the implementation of Tariff Concession Orders (TCOs) to provide relief on customs duties for certain goods. The Act, through Part XVA, empowers the Chief Executive Officer of Customs to grant these concessions when specific criteria are met, particularly when no substitutable goods are produced in Australia. This legislative framework aims to support Australian businesses by reducing the cost of importing goods that are not domestically produced, thus encouraging trade and economic activity. Instrument No. 0703106, made under this Act on 18 May 2007, exemplifies the application of these provisions by granting a tariff concession for certain fastening nonwoven tapes, thereby setting their duty rate to free from the general rate of 5%. The policy objective is to enhance the competitiveness of Australian businesses by reducing import costs for goods not produced locally.
Scope and Application
The Customs Act 1901, as supplemented by Tariff Concession Instrument No. 0703106, pertains to the application and concession of customs duty rates on specific goods. This Act applies to individuals or entities seeking to import certain goods into Australia and the Chief Executive Officer of Customs, who has the authority to grant tariff concession orders (TCOs). The Act specifically targets the importation of fastening nonwoven tapes, which are declared to be subject to a zero rate of customs duty as per this TCO. This concession is applicable from the date the TCO application was lodged, which in this case is 27 February 2007, and no earlier. The geographical scope of this legislation is national, as it applies to all imports into Australia. The Act does not specify any exclusions or exemptions other than the goods listed in section 269SJ of the Act, which are ineligible for a TCO. The instrument may extend its application through subordinate instruments, such as regulations or further tariff concession orders, but in this instance, no additional instruments are noted to affect the scope of this particular TCO.
Key Provisions
The key operative sections of this legislation focus on the process and criteria for making a Tariff Concession Order (TCO) under the Customs Act 1901. Section 269F outlines the procedure for applying for a TCO, while section 269C specifies the core criteria that must be met for the CEO to consider the application. Section 269P(3) details the action the CEO must take if the application meets these criteria, which includes making a written order (a TCO) specifying the goods and the prescribed item of the Customs Tariff Act 1995 that applies to these goods.
The obligations imposed by this Act on the parties it governs primarily revolve around the application process for a TCO. An applicant must ensure that their application complies with the criteria set out in section 269C, which includes proving that no substitutable goods are produced in Australia. The CEO, in turn, has the responsibility to evaluate the application against these criteria and, if satisfied, to make a written order as specified in section 269P(3). The CEO is also required to publish a notice in the Gazette (subsection 269K(1)) to invite any interested parties to submit any objections to the TCO, although in this case, no submissions were received.
In terms of consequences for breach, the Act does not explicitly outline specific offences or penalties for failing to comply with the provisions of the TCO or the application process. However, the implications of not adhering to the stipulated criteria or processes could potentially lead to the TCO not being granted or, in the case of fraudulent applications, could result in legal actions for misrepresentation or other civil consequences. The maximum penalties for such actions are not explicitly stated in the provided text but would typically fall under the broader administrative and legal frameworks governing the Customs Act 1901 and related legislation.