EXPLANATORY STATEMENT
Tariff Concession Instrument No. 0833625
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.
The Reject Shop applied for a TCO in respect of certain hob covers on 01 October 2008.
Instrument
TCO No 0833625 was made on 12 December 2008. It declares that those certain hob covers 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. 0833625 is taken to have come into force on 01 October 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 Order No. 0833625 was enacted under the Customs Act 1901 to address a gap in the tariff structure for specific goods, in this case, certain hob covers. This legislation was introduced to provide a concessional rate of customs duty for these goods, which would otherwise attract a standard rate of 5%. The enacting body for this instrument was the Chief Executive Officer of Customs, who, upon reviewing the application by The Reject Shop, found that the application met the core criteria as outlined in the Act. Specifically, the CEO was satisfied that no substitutable goods were produced in Australia, thereby justifying the tariff concession. The primary policy objective was to potentially stimulate economic activity by lowering the cost of importing these goods, thus encouraging their availability and use in the Australian market.
The order came into effect on the date of the application, 01 October 2008, and did not adversely affect any pre-existing rights or impose new liabilities on individuals or entities other than the Commonwealth. Importers of the affected goods can benefit from this order by applying for a refund of duties paid on imports since the effective date of the order, as per the relevant regulations. The CEO's decision was made without any objections from the public, as no submissions were received in response to the published notice in the Gazette.
Scope and Application
The Customs Act 1901 applies to any person or entity seeking to import goods into Australia and to the goods themselves, with a specific focus on those seeking tariff concessions under the Act. The Act’s jurisdiction extends across the Commonwealth of Australia, with the application of tariff concessions applicable to all states and territories. The act applies to imports of goods that are not specified in section 269SJ of the Act, which lists goods that are ineligible for tariff concessions. The legislation enables the Chief Executive Officer of Customs to make Tariff Concession Orders (TCOs) if certain criteria are met, including the absence of substitutable goods produced in Australia. The TCOs are specified in subordinate instruments, such as TCO No. 0833625, which sets out the particulars of the concession and its application to specific goods, in this case, certain hob covers. The application of these concessions is retrospective to the date the TCO application was lodged and does not affect the rights of any person as at the date of registration in a way that would disadvantage them or impose liabilities in respect of actions taken before the registration date.
Key Provisions
The Customs Act 1901 (the Act) enables the Chief Executive Officer of Customs (the CEO) to issue Tariff Concession Orders (TCOs) which apply lower rates of customs duty to specified goods (sections 269F, 269P(3)). For a TCO to be issued, an applicant must lodge an application with the CEO, and the CEO must determine whether it meets the core criteria (section 269C). A TCO application meets the core criteria if, on the day the application was lodged, no substitutable goods were produced in Australia in the ordinary course of business (section 269C). In this case, the TCO No. 0833625, issued on 12 December 2008, declares that certain hob covers are subject to a zero duty rate, as the CEO determined that no substitutable goods were produced in Australia (section 269C). The CEO must also publish a notice in the Gazette inviting any person to submit objections if they consider there are reasons why the TCO should not be made (subsection 269K(1)). In this instance, no submissions were received by the CEO (subsection 269K(1)).
The Act imposes specific obligations on the CEO in relation to TCOs. The CEO must determine whether an application for a TCO meets the core criteria, which involves confirming that no substitutable goods were produced in Australia on the day the application was lodged (section 269C). If the CEO is satisfied that the application meets the core criteria, the CEO must make a written order declaring that the goods are subject to a TCO (section 269P(3)). Additionally, the CEO must publish a notice in the Gazette as soon as practicable after accepting a TCO application as valid, inviting submissions from any person who believes the TCO should not be made (subsection 269K(1)). If no submissions are received, the CEO proceeds with issuing the TCO (subsection 269K(1)).
Under the Customs Act 1901, breaches of the provisions concerning TCOs may lead to civil or criminal consequences. However, the specific offences, penalties, or consequences for non-compliance are not detailed within the text provided. The Act includes provisions for penalties and enforcement mechanisms, but these are not explicitly outlined in the context of TCOs within the given extract. Therefore, it is essential to refer to the full Act and related regulations for a comprehensive understanding of the penalties for breaches.