EXPLANATORY STATEMENT
Tariff Concession Instrument No. 0828473
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.
Hills Industries Limited applied for a TCO in respect of certain plastic step ladders on 28 August 2008.
Instrument
TCO No 0828473 was made on 07 November 2008. It declares that those certain plastic step ladders 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. 0828473 is taken to have come into force on 28 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, enacted by the Parliament of Australia, provides the legislative framework for the administration of customs duties in Australia. This Act establishes a system through which Tariff Concession Orders (TCOs) can be issued by the Chief Executive Officer of Customs. The primary purpose of the Act is to facilitate trade by allowing for reduced customs duties on specific goods, which is particularly beneficial for importers. TCOs are issued when it is determined that no substitutable goods are produced in Australia, thereby ensuring that local industries are not unduly harmed by the concession. The Tariff Concession Instrument No. 0828473 was introduced to provide tariff concessions for certain plastic step ladders, which were granted a duty-free status effective from the date of application, 28 August 2008. This instrument was made to ensure that the application process met the core criteria set out in the Act, and no objections were raised during the consultation period.
Scope and Application
The Customs Act 1901, specifically Part XVA, provides the framework for the issuance of Tariff Concession Orders (TCOs) by the Chief Executive Officer of Customs, which can result in lower rates of customs duty for certain goods. The application for a TCO can be made by any person provided the goods in question are not those specified in section 269SJ of the Act that are ineligible for such concessions. The Act mandates that for an application to be considered, it must meet core criteria, notably that no substitutable goods are produced in Australia in the ordinary course of business. The TCO process involves publishing a notice in the Gazette to allow for public submissions, although in this instance, no submissions were received. Once a TCO is issued, it applies retroactively to the date the application was lodged, with no adverse impact on the rights of non-Commonwealth persons as of the registration date. The TCO in question, No. 0828473, pertains to certain plastic step ladders, reducing the duty rate to free from the general rate of 5%, and it came into effect on 28 August 2008.
Key Provisions
The primary operative sections of the Customs Act 1901, as applied through Tariff Concession Instrument No. 0828473, include sections 269F, 269C, and 269P. Section 269F allows a person to apply to the Chief Executive Officer of Customs (CEO) for a Tariff Concession Order (TCO) in respect of goods, provided the goods are not specified in section 269SJ. Section 269C stipulates that a TCO application meets the core criteria if no substitutable goods were produced in Australia in the ordinary course of business on the day the application was lodged. If the CEO is satisfied that the application meets these criteria, section 269P(3) requires the CEO to issue a written TCO.
The Act imposes certain obligations on the parties involved. Specifically, section 269K(1) mandates the CEO to publish a notice in the Gazette, inviting any interested parties to submit reasons why a TCO should not be made. In this case, no submissions were received, indicating that the CEO proceeded with the order without opposition. Furthermore, under subsection 269S(1), a TCO is deemed to come into effect on the day the application for the TCO was lodged, which in this instance was 28 August 2008.
The Tariff Concession Instrument No. 0828473 imposes no disadvantages or liabilities on any person other than the Commonwealth, as clarified under the Act. Specifically, the rights of importers are beneficially affected, as they can apply for a refund of duty on goods imported since the day the TCO is taken to have come into force. The TCO does not impose any liabilities on any person, ensuring that there are no adverse impacts on third parties.
In terms of consequences for breaches, the explanatory statement does not specify any offences, penalties, or civil or criminal consequences for non-compliance with the TCO. However, the Act and the associated regulations do provide for general enforcement mechanisms, which could include fines or other penalties for non-compliance with customs-related laws. Given the specific nature of TCOs, any breach would likely be addressed under the broader customs legislation, but the maximum penalties would depend on the specifics of the breach and applicable regulations.