EXPLANATORY STATEMENT
Tariff Concession Instrument No. 0712630
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.
Vinidex Pty Limited applied for a TCO in respect of certain rigid plastic pipe cutters on 07 August 2007.
Instrument
TCO No 0712630 was made on 12 October 2007. It declares that those certain rigid plastic pipe 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. 0712630 is taken to have come into force on 07 August 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 regulation of customs and excise duties. Part XVA of the Act allows for the creation of Tariff Concession Orders (TCOs) by the Chief Executive Officer of Customs, which offer lower rates of customs duty on specified goods. This mechanism was introduced to address the problem of ensuring that Australian industries remain competitive by reducing tariffs on goods for which no suitable domestic substitutes are produced. The policy objective is to encourage the production and import of goods that are not domestically produced, thus supporting economic growth and consumer benefit. The explanatory statement outlines the process and criteria for TCO applications, including the requirement that no substitutable goods are produced in Australia. It also details the commencement and effects of such orders, ensuring that they do not disadvantage existing rights or impose new liabilities on individuals or entities other than the Commonwealth.
Scope and Application
The Tariff Concession Instrument No. 0712630 is a legislative tool under the Customs Act 1901 that applies to specific goods, in this case, certain rigid plastic pipe cutters, to which a Tariff Concession Order (TCO) is granted. This instrument applies to Vinidex Pty Limited, the entity that applied for the concession, and to any other entity importing similar goods. The scope of the Act extends to the geographic jurisdiction of Australia, impacting import duties on the specified goods throughout the country. The Act ensures that no substitutable goods were produced in Australia when the application was made, allowing for the concession to be granted. Notably, the Act does not impose any liabilities or disadvantage any person other than the Commonwealth, and it does not affect rights as they stood on the date of the application registration. The commencement of this TCO is deemed to be on the date of the application, 07 August 2007, with the actual order coming into force on 12 October 2007, providing a free rate of duty on the specified goods as opposed to the general rate of 5%.
Key Provisions
The Customs Act 1901, specifically under Part XVA, facilitates the creation of Tariff Concession Orders (TCOs) through which lower rates of customs duty are applied to specified goods. The CEO of Customs is responsible for making these orders. Section 269F allows an application to be made for a TCO concerning certain goods. To be considered, the goods must not be those listed in section 269SJ, which are ineligible for tariff concessions. If the application meets the criteria, the CEO is required to make an order under section 269C, provided that on the day the application was lodged, no substitutable goods were produced in Australia in the ordinary course of business. The terms 'substitutable goods', 'ordinary course of business', and 'goods produced in Australia' are defined in sections 269D, 269E, and 269F of the Act, respectively.
The obligations imposed by the Act on parties applying for a TCO include ensuring the goods in question meet the eligibility criteria as outlined in section 269C. Once an application is accepted as valid, the CEO must publish a notice in the Gazette inviting submissions from any person who believes the TCO should not proceed. This is stipulated in subsection 269K(1) of the Act. In the case of TCO No. 0712630, the CEO published such a notice but did not receive any submissions. The TCO is considered effective from the date the application was lodged, as per subsection 269S(1) of the Act. This means that for TCO No. 0712630, the effective date was 7 August 2007. Importantly, the TCO does not retroactively disadvantage any person, nor does it impose new liabilities on anyone for actions taken before the registration date.
In terms of consequences, if any party breaches the provisions of the Customs Act 1901 concerning the TCOs, they may face penalties. Although the specific penalties for breaches are not detailed in the provided text, the Act generally allows for both civil and criminal penalties for non-compliance. These penalties could include fines or imprisonment, depending on the severity of the breach and the discretion of the court. The specific penalties are usually outlined in the relevant regulations or other legislative instruments that accompany the primary Act.