EXPLANATORY STATEMENT
Tariff Concession Instrument No. 0902344
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.
Jennmar Australia Pty Ltd applied for a TCO in respect of certain extender nuts on 23 January 2009.
Instrument
TCO No 0902344 was made on 9 July 2009. It declares that those certain extender nuts 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. 0902344 is taken to have come into force on 23 January 2009.
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 to facilitate the administration of customs duties and related matters, and was designed to provide a framework for the regulation of imports and exports in Australia. The Act was introduced to address the need for a structured and comprehensive legislative scheme to govern customs operations, ensuring compliance and revenue collection while also promoting efficient trade practices. The Tariff Concession Instrument No. 0902344, made under the Customs Act, was introduced by the Chief Executive Officer of Customs as part of the scheme to allow for tariff concessions on certain goods. The policy objective is to provide relief from customs duty for goods where no substitutable goods are produced in Australia, thereby encouraging trade and potentially lowering costs for importers of these specified goods. The instrument was developed following an application by Jennmar Australia Pty Ltd for tariff concessions on certain extender nuts, which were granted after it was determined that no substitutable goods were produced in Australia.
Scope and Application
The Tariff Concession Instrument No. 0902344, made under Part XVA of the Customs Act 1901, applies to any person or entity that seeks to import goods that are the subject of a Tariff Concession Order (TCO) issued by the Chief Executive Officer of Customs (CEO). The Act specifically targets goods for which a TCO has been applied and approved, providing these goods with a lower rate of customs duty compared to the general rate specified in the Customs Tariff Act 1995. The TCO in question pertains to certain extender nuts and is effective from the date the application was lodged, 23 January 2009. The geographic reach of this legislation is national, applying across Australia, as it involves the application of federal customs duties and tariff concessions. The Act excludes goods specified in section 269SJ, which are those goods that cannot be subject to a TCO. The CEO must ensure that no substitutable goods were produced in Australia in the ordinary course of business for the TCO to be granted, as outlined in sections 269C, 269D, and 269E of the Act. The application process includes an opportunity for public consultation, although in this case, no submissions were received. The TCO does not impose any liabilities on persons other than the Commonwealth and does not affect any existing rights as of the date of registration.
Key Provisions
The Tariff Concession Instrument No. 0902344, issued under the Customs Act 1901, provides for a concession on customs duty for specific goods. Section 269F of the Act allows an application to the Chief Executive Officer of Customs (CEO) for a Tariff Concession Order (TCO) in respect of goods. The CEO must assess the application against the core criteria specified in section 269C of the Act, which includes ensuring that no substitutable goods were produced in Australia on the date of application, as defined in sections 269D and 269E. If the application meets these criteria, the CEO must issue a TCO, as outlined in subsection 269P(3). In this instance, the CEO issued TCO No. 0902344 on 9 July 2009, declaring that certain extender nuts are subject to a lower duty rate of free, as opposed to the general rate of 5%, due to the absence of substitutable goods produced in Australia.
The Act imposes several obligations on both the applicant and the CEO. The applicant must ensure that their TCO application is valid and meets the core criteria specified in the Act. The CEO, on the other hand, has the duty to assess the application against these criteria and, if satisfied, to issue a TCO. Additionally, the CEO is required to publish a notice in the Gazette inviting any interested parties to submit objections if they believe the TCO should not be granted. Section 269K(1) of the Act mandates this publication to ensure transparency and allow for any potential objections to be considered before the TCO is issued.
Failure to comply with the requirements set out in the Customs Act 1901 may result in various consequences. While the explanatory statement does not detail specific offences or penalties, it is implied that any breach of the Act's provisions could lead to legal action. The Act provides for both civil and criminal penalties for non-compliance, although the exact penalties are not specified in this particular explanatory statement. Typically, breaches could result in fines or other sanctions as determined by the relevant authorities.
In summary, the Tariff Concession Instrument No. 0902344 under the Customs Act 1901 facilitates the concession of customs duty for specific goods, provided the application meets the criteria set out in the Act. The CEO has the responsibility to assess applications and issue TCOs accordingly, while applicants must ensure their applications are valid. Non-compliance with the Act could result in legal consequences, although the specific penalties are not outlined in this explanatory statement.