EXPLANATORY STATEMENT
Tariff Concession Instrument No. 0829202
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.
Anasazi Trading Pty Ltd applied for a TCO in respect of certain household articles on 03 September 2008.
Instrument
TCO No 0829202 was made on 28 November 2008. It declares that those certain household articles 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. 0829202 is taken to have come into force on 03 September 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, introduces a scheme that allows for the reduction of customs duties on certain goods through the issuance of Tariff Concession Orders (TCOs) by the Chief Executive Officer of Customs. This legislation was enacted to address the problem of high customs duties on goods that are not produced domestically and for which there are no suitable substitutes. By providing for TCOs, the Act aims to make imported goods more affordable, thereby encouraging trade and benefiting consumers. The instrument, Tariff Concession Instrument No. 0829202, made on 28 November 2008, was introduced following an application by Anasazi Trading Pty Ltd for tariff concessions on specific household articles. The instrument declares that these articles are subject to a free duty rate, down from the general rate of 5%, as no substitutable goods were produced in Australia at the time of the application. The policy objective behind this specific TCO is to facilitate the import of these household articles by reducing their customs duty to zero, thus promoting economic efficiency and consumer welfare.
Scope and Application
The Tariff Concession Instrument No. 0829202, issued under the Customs Act 1901, applies to Anasazi Trading Pty Ltd and specifically concerns certain household articles that are subject to a Tariff Concession Order (TCO). The Act allows the Chief Executive Officer of Customs to make TCOs that provide for a lower rate of customs duty on specified goods, provided the application meets the core criteria outlined in the Act. These criteria include the absence of substitutable goods produced in Australia in the ordinary course of business. This Instrument was made on 28 November 2008, following Anasazi Trading Pty Ltd's application on 03 September 2008, and it came into force on the same day as the application was lodged. The Instrument declares that the household articles are subject to a free rate of duty, as no substitutable goods were being produced in Australia on the application date. This TCO does not affect any existing rights or impose new liabilities on persons other than the Commonwealth, and it benefits importers by potentially allowing them to apply for duty refunds on goods imported since the TCO's effective date.
Key Provisions
The main operative sections of the Customs Act 1901 in this context are sections 269C, 269F, 269P, and 269S (paragraphs 1 and 2). Section 269F allows for an application to be made to the Chief Executive Officer (CEO) of Customs for a Tariff Concession Order (TCO) concerning specific goods. If the application is valid, and the CEO is satisfied that the goods meet the core criteria set out in section 269C, they must make a TCO, as described in section 269P(3). The TCO, once made, is deemed to have come into force on the date the application was lodged, according to section 269S(1). In this case, the TCO No. 0829202 was made on 28 November 2008, effective from 3 September 2008, the date the application was submitted by Anasazi Trading Pty Ltd.
The Act imposes certain obligations and requirements on the parties involved. Firstly, the applicant, in this case Anasazi Trading Pty Ltd, must ensure their application for a TCO is valid and meets the criteria outlined in section 269C. The CEO, upon receiving a valid application, must then determine if the goods are substitutable and if no such goods are produced in Australia. If the CEO is satisfied with the application, they must issue a TCO as per section 269P(3). Additionally, the CEO must publish a notice in the Gazette inviting submissions from any person who may have reasons why the TCO should not be made, as per section 269K(1). The CEO must consider any submissions received before finalising the TCO.
There are no specific offences, penalties, or consequences outlined in the explanatory statement for breach of the Customs Act 1901 in the context of a TCO application. However, it is important to note that the Act and its associated regulations govern the process and consequences of applying for and receiving a TCO. Any breach of these regulations or failure to comply with the requirements of the Act could potentially result in civil or criminal penalties. These penalties may include fines, imprisonment, or other consequences as prescribed by law. The maximum penalties would depend on the specific breach and the relevant provisions of the Customs Act 1901 or other related legislation.