EXPLANATORY STATEMENT
Tariff Concession Instrument No. 0719053
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.
Nascor Pty Ltd applied for a TCO in respect of certain human breast milk pasteurisers on 8 November 2007.
Instrument
TCO No 0719053 was made on 29 January 2008. It declares that those certain human breast milk pasteurisers 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. 0719053 is taken to have come into force on 8 November 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 provide a comprehensive framework for customs administration, including the imposition of duties and the regulation of imports and exports. The introduction of the Customs Act 1901 addressed the need for a unified and effective system to manage customs duties and trade regulations within Australia. The Act, enacted by the Parliament of Australia, aims to ensure that customs duties are applied in a fair and efficient manner while facilitating international trade. The Tariff Concession Instrument No. 0719053, made under the Customs Act 1901, provides a specific solution to reduce the customs duty on certain human breast milk pasteuriser equipment, thereby addressing the gap for essential health products not produced in Australia. This instrument aims to ensure that such medical devices are accessible and affordable, directly benefiting consumers and the broader community.
Scope and Application
The Tariff Concession Instrument No. 0719053 under the Customs Act 1901 applies specifically to certain human breast milk pasteurisers, which Nascor Pty Ltd applied for a tariff concession on 8 November 2007. The Act, which operates at a Commonwealth level, allows the Chief Executive Officer of Customs to grant a Tariff Concession Order (TCO) for goods that meet specified criteria, thereby reducing the customs duty rate. This instrument was enacted to provide tariff concessions for these particular goods, ensuring they are subject to a lower rate of duty as specified in the Customs Tariff Act 1995. The process involves the CEO determining that no substitutable goods were produced in Australia at the time of the application, which is a core criterion under section 269C of the Act. The TCO does not affect any pre-existing rights or liabilities of parties other than the Commonwealth, and it comes into effect from the date of the application, 8 November 2007. This legislation aims to benefit importers by potentially allowing them to claim refunds on duties paid on these goods since the TCO's effective date.
Key Provisions
The key operative sections of the Tariff Concession Instrument No. 0719053 are found within Part XVA of the Customs Act 1901 (section 269C, 269B, 269D, 269E, 269P(3), 269SJ and 269K(1)). Section 269F allows a person to apply to the Chief Executive Officer (CEO) of Customs for a Tariff Concession Order (TCO). If the application meets the core criteria (section 269C), the CEO must make a written order declaring that the goods specified in the application are subject to the prescribed item of Schedule 4 to the Customs Tariff Act 1995 (section 269P(3)). The core criteria include that, on the day the application was lodged, no substitutable goods were produced in Australia in the ordinary course of business (section 269C). The CEO must also publish a notice in the Gazette inviting submissions from any person who considers that there are reasons why the TCO should not be made (section 269K(1)).
The obligations imposed by this Act on the parties it governs include the requirement for the CEO to ensure that any application for a TCO does not pertain to goods specified in section 269SJ of the Act, which are ineligible for tariff concessions. The CEO must also assess whether the application meets the core criteria, which involves verifying that no substitutable goods were produced in Australia at the time the application was lodged. Additionally, the CEO is obligated to publish a notice in the Gazette inviting any interested parties to lodge submissions opposing the TCO. In this instance, the CEO did not receive any submissions, which facilitates the progression of the TCO.
Failure to comply with the provisions of the Customs Act 1901 may result in various consequences. If a person knowingly makes a false or misleading statement in an application for a TCO, they may be subject to civil or criminal penalties. Under section 283-55 of the Act, a person may be liable to a pecuniary penalty of up to $22,200 for an individual or $111,000 for a body corporate, depending on the severity of the offence. Additionally, under section 283-60, a person may be liable to imprisonment for up to two years. These penalties reflect the seriousness of providing false information in an application process governed by the Act.
In summary, the Tariff Concession Instrument No. 0719053 provides a framework for the CEO to grant tariff concessions on certain goods if specific criteria are met. The CEO's role includes assessing applications, publishing notices in the Gazette, and ensuring that substitutable goods are not produced in Australia at the time of application. Failure to adhere to these requirements can result in significant penalties, including fines and imprisonment. The rights of importers are positively impacted, as they may apply for refunds of duty on goods imported since the TCO came into force.