EXPLANATORY STATEMENT
Tariff Concession Instrument No. 0802155
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.
Bissell Australia Pty Ltd applied for a TCO in respect of certain floor cleaners on 7 February 2008.
Instrument
TCO No 0802155 was made on 11 April 2008. It declares that those certain floor cleaners 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. 0802155 is taken to have come into force on 7 February 2008.
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. 0802155, enacted in 2008, is a measure under the Customs Act 1901 to address the issue of granting tariff concessions for specific goods. This instrument was introduced to provide relief on customs duties for certain floor cleaners, as applied for by Bissell Australia Pty Ltd, ensuring that these goods are subject to a reduced or free rate of duty. The enacting body responsible for this instrument is the Chief Executive Officer of Customs, who must assess applications against the criteria set out in the Customs Act 1901 to determine the eligibility of goods for tariff concessions. The policy objective is to facilitate the import of goods that are not produced domestically, thereby benefiting importers and potentially encouraging competition and consumer choice. The instrument was published in the Gazette to allow for public submissions, though none were received in this instance. It is effective from the date the application was lodged, providing a seamless transition for affected parties.
Scope and Application
The Customs Act 1901 applies to any person or entity importing goods into Australia, particularly under the scheme for Tariff Concession Orders (TCOs) outlined in Part XVA of the Act. The Act allows the Chief Executive Officer of Customs (CEO) to grant TCOs that provide a lower rate of customs duty on specific goods, provided the application meets core criteria such as the absence of substitutable goods produced in Australia. The application process includes an opportunity for public submission before a TCO is issued, ensuring transparency and stakeholder engagement. The TCOs have a jurisdictional reach across the Commonwealth, impacting all importers of the specified goods. However, the Act explicitly excludes certain goods from being subject to TCOs, as defined in section 269SJ. Additionally, the TCOs do not affect the rights of any person as at the date of registration, nor do they impose liabilities for actions taken prior to the registration date. This legislative framework ensures that the application and benefits of TCOs are clearly defined and communicated to all relevant parties.
Key Provisions
The primary operative sections of this legislation, specifically Tariff Concession Instrument No. 0802155, are sections 269C, 269P, and 269S of the Customs Act 1901 (the Act). Section 269C outlines the core criteria that a Tariff Concession Order (TCO) application must meet, including the requirement that no substitutable goods are produced in Australia on the day the application is lodged. Section 269P mandates that if the Chief Executive Officer of Customs (CEO) is satisfied that the application meets these core criteria, they must issue a written order, i.e., a TCO, declaring the specified goods to which the order applies. Section 269S specifies the effective date of the TCO, which is the date the application was lodged.
The Act imposes certain obligations and requirements on the parties it governs. For instance, an applicant such as Bissell Australia Pty Ltd must ensure their application for a TCO is valid and meets the core criteria as stipulated in section 269C. The CEO, on the other hand, is required to make a written order if the application satisfies the core criteria under section 269P. Furthermore, under subsection 269K(1) of the Act, the CEO must publish a notice in the Gazette inviting submissions from any person who believes the TCO should not be made. This ensures transparency and provides an opportunity for stakeholders to voice their concerns.
The Act also delineates potential consequences for breaches of its provisions. While the explanatory statement does not explicitly mention penalties, the Customs Act 1901, in general, provides for both civil and criminal penalties for non-compliance. Civil penalties can include fines and other monetary penalties, while criminal penalties can include imprisonment, reflecting the seriousness with which the Act treats breaches. However, the specific maximum penalties would need to be referred to under the broader Customs Act 1901, as detailed provisions are not outlined in this explanatory statement.