EXPLANATORY STATEMENT
Tariff Concession Instrument No. 0714649
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.
Vadals Butcher Supplies Pty Ltd applied for a TCO in respect of certain meat mincers and or mixers on 07 September 2007.
Instrument
TCO No 0714649 was made on 16 November 2007. It declares that those certain meat mincers and or mixers 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. 0714649 is taken to have come into force on 07 September 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 was enacted to establish a framework for the administration of customs duties and related matters, including the ability to provide tariff concessions. The Tariff Concession Instrument No. 0714649 was introduced to address the problem of ensuring that certain goods, in this case meat mincers and mixers, that are imported and do not have locally produced alternatives are subject to a lower rate of customs duty. This instrument was made under the authority of the Customs Act 1901 by the Chief Executive Officer of Customs, in accordance with section 269F, and aims to meet the core criteria specified in section 269C. The policy objective is to facilitate the import of goods that are not produced in Australia, thereby potentially lowering costs for businesses and consumers and encouraging trade. The instrument became effective from the date the application was lodged, 7 September 2007, and does not impose any new liabilities on any person.
Scope and Application
The Tariff Concession Instrument No. 0714649 under the Customs Act 1901 applies specifically to certain meat mincers and mixers, as submitted by Vadals Butcher Supplies Pty Ltd on 07 September 2007. This legislation pertains to the reduction of customs duty rates for these specified goods, as determined by the Chief Executive Officer of Customs (CEO). The application of this Instrument is contingent upon the absence of substitutable goods produced in Australia, which are defined as goods that can be used for the same purpose as the imported goods. The geographic and jurisdictional reach of this Act is national, affecting importers and the Commonwealth across Australia. The application of the Tariff Concession Order (TCO) does not disadvantage any person other than the Commonwealth and does not impose liabilities for actions taken prior to the TCO’s registration. The TCO, which came into effect on 07 September 2007, allows for a refund of duty on imports of the specified goods since that date, providing a clear benefit to importers.
Key Provisions
The main operative sections of the Customs Act 1901 relevant to this Tariff Concession Order (TCO) are sections 269C, 269F, 269P, and 269S. Section 269F allows a person to apply to the Chief Executive Officer (CEO) of Customs for a TCO. If the CEO determines that the application meets the core criteria specified in section 269C, the CEO must make a TCO (section 269P). The TCO declares that the goods in question are subject to a lower rate of customs duty, as specified in the relevant schedule of the Customs Tariff Act 1995 (section 269P(3)). Under section 269S, the TCO comes into force on the date the application is lodged.
The Customs Act 1901 imposes several obligations on the parties involved. The applicant must submit an application to the CEO, ensuring that it pertains to goods not specified in section 269SJ, which lists goods that cannot be subject to a TCO. The CEO must review the application to determine if it meets the core criteria, specifically ensuring no substitutable goods are produced in Australia (section 269C). If the criteria are met, the CEO must publish a notice in the Gazette inviting submissions from any interested parties and make a written TCO order (sections 269K and 269P). The CEO must also ensure that the TCO does not disadvantage any person other than the Commonwealth or impose any liabilities on such persons in respect of actions taken before the TCO's registration (section 269S).
Breaching the conditions set out by the Customs Act 1901, or failing to comply with the obligations of the TCO, can result in various civil and criminal consequences. While the specific penalties for breaching the TCO are not detailed in the explanatory statement, penalties for breaches of the Customs Act generally include fines and imprisonment. For example, section 260 of the Customs Act provides that a person who contravenes the Act may be liable to a penalty of up to 10,000 penalty units or imprisonment for five years, or both, for serious offences. Civil penalties may also apply, such as fines for under-declaration of goods or failure to pay the correct duty. However, the explanatory statement does not provide specific maximum penalties for breaches directly related to the TCO in question.