EXPLANATORY STATEMENT
Tariff Concession Instrument No. 0712301
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.
Road Gear Australasia Pty Ltd applied for a TCO in respect of certain car seat cover sets on 30 July 2007.
Instrument
TCO No 0712301 was made on 08 October 2007. It declares that those certain car seat cover sets 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 7.5%. 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. 0712301 is taken to have come into force on 30 July 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 Parliament of Australia, provides a framework for the administration of customs duties and includes provisions for the creation of Tariff Concession Orders (TCOs) through Part XVA. This legislative mechanism allows for the application of reduced or waived customs duties on specified goods under certain conditions, aiming to support Australian industry and consumers by making imported goods more affordable. The Tariff Concession Instrument No. 0712301, made in 2007, is an example of this process where a TCO was issued to Road Gear Australasia Pty Ltd for certain car seat cover sets, resulting in a reduction of customs duty from 7.5% to free. This instrument was introduced to address the gap where certain imported goods could benefit from tariff concessions if no substitutable goods were produced in Australia, thus fostering competition and potentially lowering consumer prices. The policy objective underpinning these concessions is to facilitate the import of goods that are not domestically produced, thereby enhancing market access and economic efficiency.
Scope and Application
The Customs Act 1901 applies to the application for Tariff Concession Orders (TCOs) concerning specific goods, allowing for a lower rate of customs duty. This application process is governed by the Chief Executive Officer of Customs (CEO), who must assess whether the application meets the core criteria, specifically whether no substitutable goods were produced in Australia in the ordinary course of business at the time of application. If the CEO is satisfied that the application meets these criteria, a written order is made, declaring that the goods in question are subject to a specified item of Schedule 4 to the Customs Tariff Act 1995. The application process includes an invitation for public submissions, although in the case of Tariff Concession Instrument No. 0712301, no submissions were received. The TCO does not affect existing rights or impose liabilities on anyone except the Commonwealth, and it benefits importers by potentially allowing them to apply for a refund of duty on goods imported since the TCO came into force.
Key Provisions
The key provisions of Tariff Concession Instrument No. 0712301 under the Customs Act 1901 (sections 269C, 269F, 269P, and 269S) allow for the application and granting of Tariff Concession Orders (TCO) to lower the rate of customs duty on certain goods. Section 269F of the Act enables a person to apply to the Chief Executive Officer of Customs (CEO) for a TCO for specific goods, provided they do not fall under the restricted category outlined in section 269SJ. The CEO must then assess whether the application meets the core criteria, which are defined in section 269C as requiring no substitutable goods to be produced in Australia in the ordinary course of business at the time of application. If satisfied, the CEO must issue a written TCO as per section 269P(3), applying a prescribed item from Schedule 4 to the Customs Tariff Act 1995.
The obligations imposed by the Act on the parties involved include the requirement for the CEO to publish a notice in the Gazette (subsection 269K(1)) inviting submissions from any interested party regarding the TCO application. The CEO must consider any submissions received and make a decision based on the core criteria. In this instance, no submissions were received, allowing the CEO to proceed with the TCO. The Act also mandates that the TCO does not affect the rights of any person other than the Commonwealth and does not impose liabilities on any person (subsection 269S(1)).
In terms of penalties and consequences, the Customs Act 1901 does not explicitly detail specific offences, penalties, or civil/criminal consequences for breaches related to the granting of TCOs. However, general provisions within the Act regarding customs duty and tariff regulations may apply to any breaches. Typically, non-compliance with customs regulations could result in penalties such as fines, seizure of goods, and potential criminal charges depending on the severity and intent of the breach. The exact penalties would depend on the specific circumstances of the case and other relevant legislation.