EXPLANATORY STATEMENT
Tariff Concession Instrument No. 0826747
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.
Ross Hanna Australia Pty Ltd applied for a TCO in respect of certain polypropylene netting on 15 August 2008.
Instrument
TCO No 0826747 was made on 14 November 2008. It declares that those certain polypropylene netting 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. 0826747 is taken to have come into force on 15 August 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. 0826747 was enacted in 2009 as a measure to address the need for tariff concessions on specific goods entering Australia under the Customs Act 1901. This legislation, originating from the Parliament of Australia, was introduced to facilitate lower customs duty rates for certain goods, thereby encouraging their import by reducing financial barriers. This initiative was aimed at ensuring that Australian businesses and consumers could access necessary goods more affordably, which aligns with the overarching policy objective of fostering economic efficiency and accessibility within the Australian market. The instrument, made by the Chief Executive Officer of Customs, specifies that the general rate of duty on the particular polypropylene netting falls from 5% to free, contingent on the absence of substitutable goods produced in Australia.
Scope and Application
The Tariff Concession Instrument No. 0826747 is part of the Customs Act 1901, which allows the Chief Executive Officer of Customs to grant Tariff Concession Orders (TCOs) for specific goods, thereby applying a lower rate of customs duty. This instrument applies to individuals or entities that have applied for and been granted a TCO, such as Ross Hanna Australia Pty Ltd, which applied for a concession on certain polypropylene netting. The application process is governed by the criteria set out in sections 269C, 269D, and 269E of the Act, which ensure that the goods in question are not substitutable by Australian-made products and are not specified in section 269SJ as ineligible for a TCO. The instrument's jurisdictional reach is national, affecting all importers of the specified goods within Australia. There are no exclusions or exemptions mentioned within the scope of this particular TCO, and it does not disadvantage or impose liabilities on any person other than the Commonwealth. The TCO comes into effect on the date the application was lodged, as stipulated in subsection 269S(1) of the Act.
Key Provisions
The Customs Act 1901 (the Act) establishes a framework under which Tariff Concession Orders (TCOs) can be issued by the Chief Executive Officer of Customs (CEO) (section 269F). This process allows for a lower rate of customs duty on goods that are the subject of a TCO. A person may apply to the CEO for a TCO in respect of goods, and if the CEO is satisfied that the application is not for goods specified in section 269SJ, the CEO must determine whether the application meets the core criteria set out in section 269C. The core criteria require that on the day the application was lodged, no substitutable goods were produced in Australia in the ordinary course of business. If these criteria are met, the CEO must issue a TCO.
The Act imposes specific obligations on the CEO in relation to TCOs. Once a TCO application is accepted as valid, the CEO must publish a notice in the Gazette, inviting any person who believes there are reasons why the TCO should not be made to submit their views (subsection 269K(1)). In this case, the CEO did not receive any submissions. Additionally, a TCO is considered to have come into force on the day the application for the TCO was lodged (subsection 269S(1)). The rights of importers will be beneficially affected, allowing them to apply for a refund of duty on goods imported since the day the TCO is taken to have come into force (paragraph 126(1)(r) of the Regulations).
The Act does not impose any liabilities on any person other than the Commonwealth. Any rights or liabilities of persons other than the Commonwealth as at the date of registration of the TCO are not affected in a way that disadvantages them or imposes liabilities for actions taken before the registration date. In terms of consequences for non-compliance or breaches, the Act does not specify any particular offences, penalties, or civil/criminal consequences for failing to comply with the provisions regarding TCOs. However, the imposition of a tariff concession without meeting the necessary criteria could potentially lead to legal challenges or reviews by the relevant authorities.