EXPLANATORY STATEMENT
Tariff Concession Instrument No. 0719070
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.
Coman Textiles Pty Ltd applied for a TCO in respect of certain quilted bedspread fabric on 09 November 2007.
Instrument
TCO No 0719070 was made on 30 January 2008. It declares that those certain quilted bedspread fabric 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 10%. 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. 0719070 is taken to have come into force on 09 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, enacted by the Australian Parliament, establishes a framework for the application and administration of customs duties and other charges. The Act, particularly through Part XVA, introduced a scheme for Tariff Concession Orders (TCOs) to provide relief on customs duties for specific goods under certain conditions. The policy objective is to promote trade and economic efficiency by reducing the cost of imported goods that do not have domestic substitutes. This instrument, known as Tariff Concession Instrument No. 0719070, was created to address a specific application from Coman Textiles Pty Ltd for a tariff concession on certain quilted bedspread fabric. The Chief Executive Officer of Customs determined that no substitutable goods were produced in Australia, thereby meeting the core criteria for the concession. The instrument came into force on the date the application was lodged, 09 November 2007, and allows for the duty on the specified goods to be set at zero, effectively providing a tariff concession from the general rate of 10%. The process followed the statutory requirement for public consultation, although no objections were received.
Scope and Application
The Tariff Concession Instrument No. 0719070 pertains to the Customs Act 1901, specifically addressing Tariff Concession Orders (TCOs) that can be made by the Chief Executive Officer of Customs (the CEO). This instrument applies to any person who may apply for a TCO in respect of certain goods, provided that these goods are not specified in section 269SJ of the Act, which lists goods that cannot be subject to a TCO. The application must meet the core criteria outlined in section 269C of the Act, which involves the absence of substitutable goods produced in Australia at the time of application. This Act has a Commonwealth jurisdictional reach, extending its application across Australia and affecting entities and persons involved in the importation of goods subject to TCOs. The application of the Act is further refined through subordinate instruments, such as the Customs Tariff Act 1995, which specifies the prescribed items under which certain goods fall. Notably, the TCO does not affect the rights of persons other than the Commonwealth and does not impose any liabilities on any person. The commencement of the TCO is effective from the date of the application, as outlined in section 269S(1) of the Act.
Key Provisions
The primary operative sections of this legislation include section 269F, which allows for an application to be made to the Chief Executive Officer (CEO) of Customs for a Tariff Concession Order (TCO) in respect of goods, and section 269C, which stipulates that a TCO application meets the core criteria if no substitutable goods were produced in Australia on the day the application was lodged. Section 269P(3) mandates that if the CEO is satisfied that an application meets the core criteria, a written TCO must be made, declaring the goods to which a prescribed item of Schedule 4 to the Customs Tariff Act 1995 applies.
The Act imposes specific obligations on applicants, requiring them to ensure that their application complies with the core criteria outlined in section 269C. Additionally, the CEO is obligated to publish a notice in the Gazette as soon as practicable after accepting a TCO application as valid, inviting any person who believes the TCO should not be made to lodge a submission with the CEO. This process ensures transparency and allows for public input before a TCO is made. Furthermore, the CEO must ensure that the TCO does not adversely affect the rights of any person, other than the Commonwealth, as at the date of registration.
Any failure to comply with the requirements of the Act may result in legal consequences. While the explanatory statement does not detail specific offences or penalties, it is implicit that breaches of the Act, such as submitting an invalid application or failing to follow the prescribed procedures, could result in civil or administrative penalties. Additionally, the CEO’s failure to properly assess applications and make orders in accordance with the Act could lead to judicial review or other legal actions. The maximum penalties for such breaches would depend on the specific provisions of the Customs Act 1901 and any related legislation.