EXPLANATORY STATEMENT
Tariff Concession Instrument No. 0828244
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.
Abey Australia Pty Ltd applied for a TCO in respect of certain ceramic soap dispensers on 27 August 2008.
Instrument
TCO No 0828244 was made on 07 November 2008. It declares that those certain ceramic soap dispensers 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. 0828244 is taken to have come into force on 27 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 Customs Act 1901 was enacted by the Australian Parliament to provide for the regulation of customs and excise duties, among other things. It was introduced to address the need for a comprehensive legislative framework governing the importation and exportation of goods, as well as the collection of duties and taxes. The Act serves to facilitate international trade while ensuring that appropriate revenue is collected for the Commonwealth. One of its key components is the scheme under which Tariff Concession Orders (TCOs) can be made by the Chief Executive Officer of Customs, aimed at providing tariff relief for certain goods. This mechanism allows for the reduction or exemption of customs duties on specified goods, provided that certain criteria are met. In this context, TCO No. 0828244 was introduced to provide a tariff concession for certain ceramic soap dispensers, which were deemed not to have substitutable goods produced in Australia, thereby meeting the core criteria for concession.
Scope and Application
The Tariff Concession Instrument No. 0828244, made under the Customs Act 1901, applies to specific goods identified in an application submitted to the Chief Executive Officer of Customs. The instrument is targeted at entities, such as importers or manufacturers, seeking a lower rate of customs duty on certain goods by way of a Tariff Concession Order (TCO). It specifically applies to ceramic soap dispensers as designated in the instrument, and the application of such concessions is contingent upon the absence of substitutable goods produced in Australia. The instrument has a national jurisdictional reach, as it operates under the authority of the Commonwealth and is designed to facilitate trade by reducing customs duties on eligible imported goods. Exclusions under the Act include goods specified in section 269SJ, which are ineligible for TCOs. The application of the TCO may be extended or modified through subordinate instruments, which can provide further clarification or criteria for eligibility.
Key Provisions
The Customs Act 1901 (the Act) includes provisions that allow for the establishment of Tariff Concession Orders (TCOs) through Part XVA. Section 269F of the Act allows for an application to be made to the Chief Executive Officer of Customs (CEO) for a TCO in respect of goods. If the application is not for goods specified in section 269SJ, which are ineligible for a TCO, the CEO must determine whether the application meets the core criteria (s 269C). This is assessed based on whether, on the day the application was lodged, there were no substitutable goods produced in Australia in the ordinary course of business (s 269D and s 269E). Once the CEO is satisfied that the core criteria are met, they must make a written order (s 269P(3)) that specifies the prescribed item of Schedule 4 to the Customs Tariff Act 1995 that applies to the goods in question.
The Act imposes specific obligations on the CEO, including the requirement to publish a notice in the Gazette inviting submissions from any person who believes that a TCO should not be made (s 269K(1)). If no submissions are received, the CEO proceeds to make the order. The obligations on the applicant, Abey Australia Pty Ltd in this instance, are to ensure their application meets the core criteria and to provide any necessary information to the CEO. The TCO is deemed to have come into force on the day the application was lodged (s 269S(1)).
Failure to comply with the requirements of the Act may result in consequences for the parties involved. The Act does not specify any offences or penalties for breaches related to TCOs, but general contraventions of the Customs Act may attract civil or criminal penalties depending on the nature and severity of the breach. It is important for all parties to adhere to the provisions of the Act to avoid any potential legal repercussions.