EXPLANATORY STATEMENT
Tariff Concession Instrument No. 0902883
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.
McPhersons Consumer Products applied for a TCO in respect of certain nail brushes on 29 January 2009.
Instrument
TCO No 0902883 was made on 24 April 2009. It declares that those certain nail brushes 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. 0902883 is taken to have come into force on 29 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, enacted by the Parliament of Australia, establishes a framework for the administration of customs and excise duties. One of its provisions allows for Tariff Concession Orders (TCOs), which provide relief from customs duty on certain goods. The Tariff Concession Instrument No. 0902883 was introduced to address the specific need for tariff concessions for certain nail brushes, as applied for by McPhersons Consumer Products on 29 January 2009. The instrument was made on 24 April 2009, declaring that these nail brushes are subject to item 50 of Schedule 4 to the Tariff, thereby reducing the duty rate from 5% to free. The policy objective, as outlined in the Act, is to facilitate the import of goods that are not produced in Australia, thus benefiting importers by potentially allowing them to claim refunds of duty paid on imports before the effective date of the concession.
Scope and Application
The Tariff Concession Instrument No. 0902883 made under the Customs Act 1901 applies to specific goods, in this case certain nail brushes, as identified in an application by McPhersons Consumer Products on 29 January 2009. The Act facilitates the granting of Tariff Concession Orders (TCOs) by the Chief Executive Officer of Customs (CEO) when the goods in question are not substitutable by Australian-produced goods. The TCO mechanism is part of a broader scheme outlined in Part XVA of the Customs Act 1901, which aims to provide tariff relief on goods under specific conditions. The geographic reach of this Act is national, as it operates within the framework of Commonwealth law, but it applies specifically to the customs duties outlined in the Customs Tariff Act 1995.
Section 269SJ of the Customs Act 1901 sets out certain goods that cannot be the subject of a TCO, while section 269C establishes the core criteria that an application must meet, which in this case was satisfied by the CEO's determination that no substitutable goods were produced in Australia. The application process involves the CEO making a written order once satisfied with the criteria, which then reduces the customs duty on the specified goods to free, as declared in TCO No. 0902883. The instrument came into force on the date of the application, 29 January 2009, and does not impose any liabilities on persons other than the Commonwealth, effectively benefiting importers by allowing them to apply for duty refunds on goods imported since that date.
Key Provisions
The Tariff Concession Instrument No. 0902883 (TCO) under the Customs Act 1901 (section 269P(3)) provides a mechanism for granting tariff concessions on certain goods. Specifically, this TCO applies to certain nail brushes, declaring them as goods to which item 50 of Schedule 4 to the Customs Tariff Act 1995 applies, effectively reducing the duty rate from 5% to free. This provision aims to facilitate the importation of these goods by removing the customs duty charge. The TCO was made on 24 April 2009, following an application by McPhersons Consumer Products on 29 January 2009. The decision to grant the concession was based on the Chief Executive Officer of Customs being satisfied that no substitutable goods were produced in Australia at the time the application was lodged.
Under the Customs Act 1901, the process for granting a TCO involves several obligations. The CEO must first determine that the application does not pertain to goods specified in section 269SJ, which excludes certain goods from eligibility for a TCO. Then, the CEO must verify that the application meets the core criteria outlined in section 269C, which requires that no substitutable goods were produced in Australia in the ordinary course of business on the day the application was lodged. This involves understanding the definitions of terms such as 'goods produced in Australia' (section 269D), 'ordinary course of business' (section 269E), and'substitutable goods' (section 269B). Once these criteria are met, the CEO is mandated to make a written order, constituting the TCO. In this case, the CEO was satisfied that the application met these requirements, leading to the issuance of TCO No. 0902883.
The Act also imposes obligations on the CEO to ensure transparency and provide opportunities for stakeholder input. Pursuant to subsection 269K(1), the CEO must publish a notice in the Gazette as soon as practicable after accepting the TCO application as valid. This notice includes an invitation for any person who believes there are reasons why the TCO should not be made to lodge a submission with the CEO. In the case of TCO No. 0902883, no submissions were received in response to this invitation, which means the process proceeded without any objections.
The Customs Act 1901 also stipulates the potential consequences for breaches related to TCOs. While the explanatory statement does not detail specific offences under this TCO, general provisions within the Act and associated regulations could apply. For instance, if any party fails to comply with the terms of the TCO or engages in fraudulent activities to benefit from the concession, they could face penalties. These penalties could include fines, imprisonment, or both, depending on the severity of the breach and the specific provisions of the Act and any relevant regulations. The maximum penalties would be in line with those stipulated in the Customs Act 1901 and the Customs Tariff Act 1995.