EXPLANATORY STATEMENT
Tariff Concession Instrument No. 0719504
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.
Healthy Snacks Pty Ltd applied for a TCO in respect of certain confectionery bar forming system on 19 November 2007.
Instrument
TCO No 0719504 was made on 29 January 2008. It declares that those certain confectionery bar forming system 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. 0719504 is taken to have come into force on 19 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 Tariff Concession Instrument No. 0719504, enacted in 2008, is a legislative instrument made under the Customs Act 1901. It was introduced to address the need for tariff concessions on specific goods, in this case, certain confectionery bar forming systems. The instrument was made to facilitate the application by Healthy Snacks Pty Ltd, allowing for these goods to be subject to a lower rate of customs duty, in this instance, making it duty-free, provided no substitutable goods were produced in Australia. The policy objective of the Customs Act 1901, under which this instrument was made, is to streamline the application process for tariff concessions and to ensure that such concessions are granted fairly and without imposing liabilities on individuals or entities. The instrument was created following the standard procedure of application, review by the Chief Executive Officer of Customs, and subsequent publication in the Gazette with no objections received.
Scope and Application
The Tariff Concession Instrument No. 0719504 under the Customs Act 1901 applies to the confectionery bar forming system, granting tariff concessions to certain goods that are imported into Australia. This legislation pertains specifically to goods that are not substitutable and are not produced in Australia in the ordinary course of business, as defined by the Act. The instrument extends to any entity or person involved in the importation of these specified goods, thereby ensuring they benefit from a reduced customs duty rate. The geographic reach of this legislation is national, applying across Australia under the Commonwealth jurisdiction, as governed by the Customs Act 1901. The legislation does not specify any exclusions, exemptions, or thresholds beyond the criteria outlined in the Act itself. Any further elaboration or restriction on the application of this Act is left to the discretion of subordinate instruments issued by the Chief Executive Officer of Customs, as per the legislative framework.
Key Provisions
The main operative sections of this legislation, particularly section 269F of the Customs Act 1901, establish the framework for applying for Tariff Concession Orders (TCOs) through the Chief Executive Officer of Customs (the CEO). Section 269C outlines the core criteria that must be satisfied for an application to be considered. This includes ensuring that, on the date the application was lodged, no substitutable goods were produced in Australia in the ordinary course of business. If these criteria are met, the CEO is obligated to make a written order (TCO) under section 269P(3) that specifies the lower rate of customs duty applicable to the goods in question. The TCO also includes a reference to the relevant item in Schedule 4 of the Customs Tariff Act 1995, which outlines the new duty rate.
Under this Act, the CEO bears the responsibility of determining whether an application for a TCO meets the core criteria. This involves verifying that no substitutable goods were produced in Australia in the ordinary course of business as of the application date, as per section 269C. The CEO must also publish a notice in the Gazette, inviting any interested parties to submit objections to the proposed TCO, as stipulated in section 269K(1). If no objections are received, the CEO proceeds to make the TCO, declaring the specified goods eligible for the lower duty rate. Additionally, the Act ensures that the rights of persons other than the Commonwealth are not adversely affected by the TCO, and it does not impose any new liabilities on these parties.
Breach of the provisions outlined in the Customs Act 1901 could result in significant legal consequences. Although specific offences, penalties, or consequences are not detailed in this particular explanatory statement, it is implied that any misuse or circumvention of the TCO provisions could lead to enforcement actions by the relevant authorities. The Act likely incorporates general provisions for penalties under the broader Customs Act framework, which could include fines and imprisonment for serious violations. The exact penalties would depend on the nature and severity of the breach, but they could potentially include substantial financial penalties and/or imprisonment terms as outlined in other sections of the Customs Act.
Overall, the legislation is designed to streamline the process for obtaining tariff concessions while ensuring that the rights of all parties are protected. The obligations on the CEO and applicants are clear, and the potential consequences for non-compliance underscore the importance of adhering to the stipulated procedures.