EXPLANATORY STATEMENT
Tariff Concession Instrument No. 0906869
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 can covers on 27 February 2009.
Instrument
TCO No 0906869 was made on 22 May 2009. It declares that those certain can 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. 0906869 is taken to have come into force on 27 February 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 Tariff Concession Instrument No. 0906869, enacted under the Customs Act 1901, addresses the need for tariff concessions for specific goods, ensuring that Australian consumers and businesses have access to competitively priced products. This instrument was introduced to provide relief to businesses by reducing or eliminating customs duty on certain goods, thereby supporting the economic efficiency and competitiveness of Australian industries. The instrument was made by the Chief Executive Officer of Customs following an application by McPhersons Consumer Products for tariff concessions on certain can covers. The CEO was satisfied that no substitutable goods were produced in Australia, meeting the core criteria under section 269C of the Act. The policy objective is to promote fair trade practices and support the economic interests of Australian businesses by reducing the cost of imported goods through tariff concessions where appropriate.
Scope and Application
The Tariff Concession Instrument No. 0906869 pertains to the Customs Act 1901 and specifically addresses the application of Tariff Concession Orders (TCOs) for certain goods. This legislation applies to entities or individuals who seek a reduction in customs duty on goods by applying for a TCO. The Act is administered at the Commonwealth level, thereby having national jurisdiction. The instrument specifies that the application of this legislation is contingent upon the absence of substitutable goods produced in Australia, as outlined in section 269C of the Act, ensuring that the concession is only granted when it is beneficial to the economy by avoiding the duplication of production within the country. Notably, the legislation explicitly excludes certain goods from eligibility for TCOs, as detailed in section 269SJ of the Act. The scope of this Act can be further extended or clarified through subordinate instruments, such as regulations or further orders made by the CEO under the authority provided by the Customs Act 1901. The commencement date for this specific TCO is 27 February 2009, aligning with the date of application by McPhersons Consumer Products, and the TCO itself is effective from the same date, offering no retrospective application to previous transactions.
Key Provisions
The main operative sections of this legislation, specifically sections 269C, 269F, 269K, and 269S, establish the framework for Tariff Concession Orders (TCOs) under the Customs Act 1901. Section 269F permits a person to apply to the Chief Executive Officer of Customs (CEO) for a TCO in respect of goods. If the CEO is satisfied that the application meets the core criteria (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, the CEO must make a written order (section 269P(3)). This order declares that the goods in question are to which a prescribed item of Schedule 4 to the Customs Tariff Act 1995 applies, effectively lowering the customs duty rate for those goods.
The Act imposes specific obligations on applicants and the CEO. Applicants must ensure that their application for a TCO meets the core criteria, particularly that no substitutable goods are produced in Australia. The CEO is required to assess the validity of the application against these criteria and make a decision within a specified timeframe. Additionally, under section 269K, the CEO must publish a notice in the Gazette inviting submissions from any person who believes the TCO should not be made, although in this case, no such submissions were received.
The Act also outlines potential consequences for non-compliance. While the explanatory statement does not detail specific offences or penalties, breaches of the Customs Act 1901 generally may result in civil or criminal penalties, including fines and imprisonment, depending on the nature and severity of the breach. The absence of specific penalties in this context suggests that the primary focus is on ensuring that the process for granting TCOs is transparent and fair, with an emphasis on compliance through due diligence rather than punitive measures. The Tariff Concession Instrument No. 0906869 itself does not introduce new penalties but operates within the existing legal framework for customs duties and tariffs.