EXPLANATORY STATEMENT
Tariff Concession Instrument No. 0844051
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.
Nestle Australia applied for a TCO in respect of certain fluid bed thermoglide toaster on 16 December 2008.
Instrument
TCO No 0844051 was made on 13 March 2009. It declares that those certain fluid bed thermoglide toaster 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. 0844051 is taken to have come into force on 16 December 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 Australian Parliament, provides a framework for the administration of customs duties and includes a mechanism for granting tariff concessions through Tariff Concession Orders (TCOs). These orders allow for a reduced rate of customs duty on specified goods, provided certain criteria are met, such as the absence of substitutable goods produced in Australia. The objective of the Act, particularly in relation to TCOs, is to facilitate trade by reducing the cost of imported goods, thereby supporting economic efficiency and competitiveness. The explanatory statement for Tariff Concession Instrument No. 0844051 outlines the process followed by the Chief Executive Officer of Customs in approving a TCO for a specific type of fluid bed thermoglide toaster, confirming that no substitutable goods were produced in Australia, and setting the duty rate at free, effective from the date the application was lodged. This instrument ensures that the rights of importers are protected, and no new liabilities are imposed under the Act.
Scope and Application
The Customs Act 1901, specifically Part XVA, provides a framework through which Tariff Concession Orders (TCOs) can be issued by the Chief Executive Officer of Customs. This Act applies to any person or entity that seeks to apply for a TCO in respect of goods, particularly those who wish to benefit from a lower rate of customs duty. The Act is a Commonwealth instrument, thus it applies across the nation. The application process requires that the goods for which a concession is sought do not have substitutable goods produced in Australia in the ordinary course of business. Furthermore, certain goods, as specified in section 269SJ, are ineligible for a TCO. The scope of the Act can be extended through subordinate instruments, which might provide further definitions or procedural guidelines. For example, the Explanatory Statement for Tariff Concession Instrument No. 0844051 illustrates the application of these principles in practice. The TCO, once issued, comes into force on the date of application lodging and does not retroactively affect any rights or liabilities of persons other than the Commonwealth.
Key Provisions
The primary operative sections of this legislation (sections 269C, 269P, and 269S) concern the making of Tariff Concession Orders (TCOs) by the Chief Executive Officer (CEO) of Customs. Section 269C sets the core criteria that must be satisfied for a TCO to be made, primarily that no substitutable goods were produced in Australia on the day the application was lodged. Section 269P(3) requires the CEO to make a written TCO if the application meets the core criteria, and section 269S specifies the effective date of the TCO, which is the day the application was lodged.
These sections impose several obligations on the parties involved. The CEO must ensure that any TCO application meets the core criteria outlined in section 269C and must make a written order if those criteria are met. The applicant must provide sufficient information to satisfy the CEO that the application meets these criteria. Additionally, the CEO must publish a notice in the Gazette inviting any interested party to submit reasons why the TCO should not be made, as outlined in section 269K(1).
There are no explicit offences, penalties, or consequences for breach detailed in this legislation. However, the failure to comply with the obligations imposed by the Act, such as not meeting the core criteria for a TCO application or not publishing the required notice in the Gazette, could lead to legal challenges or administrative actions by aggrieved parties. It should be noted that while the Act does not specify penalties, breaches of other provisions of the Customs Act 1901 or related regulations could result in civil or criminal penalties as outlined in those respective laws.