EXPLANATORY STATEMENT
Tariff Concession Instrument No. 0813301
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.
Mattel Pty Ltd applied for a TCO in respect of certain infant vibrating seating on 18 June 2008.
Instrument
TCO No 0813301 was made on 22 August 2008. It declares that those certain infant vibrating seating 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. 0813301 is taken to have come into force on 18 June 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 Customs Act 1901, enacted by the Parliament of Australia, serves as the foundational legislation governing customs duties and related matters within Australia. A specific feature of this Act is the ability to establish Tariff Concession Orders (TCOs) through Part XVA, which provides for a lower rate of customs duty on goods specified in such orders. This mechanism was introduced to address the gap in providing relief to importers who seek to bring in goods for which there are no Australian-made equivalents, thereby supporting trade and economic efficiency. The Tariff Concession Instrument No. 0813301, issued on 22 August 2008, is a practical application of this provision. In this instance, Mattel Pty Ltd successfully applied for a TCO concerning certain infant vibrating seating, resulting in a concession that reduced the general duty rate from 5% to free, effective from 18 June 2008. This legislative instrument aims to ensure that the rights of importers are positively impacted without imposing any new liabilities or disadvantaging any person other than the Commonwealth.
Scope and Application
The Customs Act 1901, as amended, provides for the making of Tariff Concession Orders (TCO) by the Chief Executive Officer of Customs. This Act applies to any individual or entity that imports goods into Australia and seeks to benefit from reduced customs duty rates under a TCO. The scope of the Act encompasses all goods that are subject to the Customs Tariff and which are not specifically excluded under section 269SJ of the Act. The application of the Act is national, applying throughout the Commonwealth of Australia, and it does not distinguish between states, territories, or specific industries. The Act includes provisions for exclusions, particularly those goods listed in section 269SJ that are ineligible for tariff concessions. The application of the Act can be extended or restricted through subordinate instruments such as regulations, which provide further detail on the administration and enforcement of the tariff concession scheme. The explanatory statement for Instrument No. 0813301 illustrates the process by which a TCO is made, including the requirement for the CEO to be satisfied that no substitutable goods are produced in Australia and the obligation to publish notices in the Gazette inviting submissions from interested parties.
Key Provisions
The Tariff Concession Instrument No. 0813301 under the Customs Act 1901 introduces tariff concessions for certain infant vibrating seating. According to section 269P(3) of the Act, if the Chief Executive Officer (CEO) of Customs is satisfied that an application for a Tariff Concession Order (TCO) meets the core criteria, the CEO must make a written order declaring that the specified goods are subject to a prescribed tariff item. In this case, the CEO made TCO No. 0813301, which specifies that certain infant vibrating seating are subject to item 50 of Schedule 4 of the Customs Tariff Act 1995, with a duty rate of free instead of the general 5% rate. This effectively grants a tariff concession on these goods.
The obligations imposed by the Act on the parties involved are primarily on the applicant and the CEO. The applicant must submit a valid TCO application under section 269F, ensuring that the goods in question do not fall under the prohibitions specified in section 269SJ. The CEO, upon receiving a valid application, must determine whether it meets the core criteria set out in sections 269B and 269C. If the criteria are met, the CEO is required to make a TCO, as stipulated in section 269P(3). Additionally, under subsection 269K(1), the CEO must publish a notice in the Gazette inviting submissions from any interested parties regarding the application. In this instance, no submissions were received.
Regarding consequences for non-compliance, the Act does not explicitly outline specific offences or penalties for breaches related to TCO applications. However, the general principles of the Customs Act 1901 and associated regulations would apply. For example, any misrepresentation or fraudulent activity in the application process could potentially lead to civil or criminal penalties under other sections of the Act. The TCO itself does not impose any liabilities on persons other than the Commonwealth and does not affect the rights of individuals as at the date of registration, ensuring that no one is disadvantaged or subjected to liabilities for actions taken before the TCO's effective date.