EXPLANATORY STATEMENT
Tariff Concession Instrument No. 0914074
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.
Fba Imports applied for a TCO in respect of certain plastic shoe boxes on 28 April 2009.
Instrument
TCO No 0914074 was made on 17 July 2009. It declares that those certain plastic shoe boxes 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. 0914074 is taken to have come into force on 28 April 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 Commonwealth Parliament, established a framework under which Tariff Concession Orders (TCOs) can be issued to reduce the customs duty on certain goods. The primary objective of this legislation is to facilitate the importation of goods by providing tariff concessions, thereby supporting economic activities that may rely on the availability of specific imported items not produced domestically. Specifically, TCOs apply when there are no substitutable goods produced in Australia, ensuring that businesses are not unfairly disadvantaged by higher import duties. This legislative measure aims to promote fair competition and the efficient operation of the market by allowing for tariff reductions under specified conditions. The Tariff Concession Instrument No. 0914074, made under this Act, exemplifies the process by which the Chief Executive Officer of Customs can grant such concessions, as demonstrated in the case of certain plastic shoe boxes, where the duty rate was reduced from 5% to free.
Scope and Application
The Tariff Concession Instrument No. 0914074 pertains to the Customs Act 1901, specifically under its Part XVA which governs the creation of Tariff Concession Orders (TCOs) by the Chief Executive Officer of Customs (CEO). This legislation applies to any individual or entity seeking a tariff concession for specific goods imported into Australia, provided the goods are not specified in section 269SJ of the Act, which lists those goods that cannot be subject to a TCO. The application must meet the core criteria outlined in section 269C, which is contingent on no substitutable goods being produced in Australia in the ordinary course of business at the time of application. This instrument extends to the entire Commonwealth of Australia and is not restricted to specific states or territories. The commencement date for this particular TCO, No. 0914074, is 28 April 2009, the day the application was lodged. It is worth noting that this TCO does not disadvantage or impose liabilities on any person other than the Commonwealth, and it allows for the refund of duty on goods imported since the effective date of the concession.
Key Provisions
The primary sections of the Customs Act 1901 (the Act) relevant to the Tariff Concession Instrument No. 0914074 are sections 269C, 269F, 269K, 269P, and 269S (subsection 269S(1) is particularly pertinent). Section 269F allows for the application of Tariff Concession Orders (TCOs) by any person, while section 269C outlines the core criteria that must be satisfied for the application to proceed, namely that no substitutable goods were produced in Australia at the time the application was lodged. Section 269P(3) mandates that if the CEO is satisfied with the application, a written TCO must be issued. Section 269K(1) requires the CEO to publish a notice in the Gazette inviting submissions from any interested parties regarding the TCO application. Lastly, section 269S(1) specifies that a TCO comes into force on the date the application is lodged.
The Act imposes several obligations on the Chief Executive Officer of Customs (the CEO) and applicants for a TCO. The CEO must, upon receiving a valid application, determine whether the application meets the core criteria as outlined in section 269C. If satisfied, the CEO must publish a notice in the Gazette inviting submissions from any interested parties (subsection 269K(1)), and if no submissions are received, the CEO must issue a written TCO (subsection 269P(3)). The CEO must also ensure that the TCO does not adversely affect the rights of any person as at the date of registration, and that it does not impose any liabilities on any person (subsection 269S(1)). The applicant, on the other hand, must ensure that their application is in accordance with the Act and that it satisfies the core criteria for a TCO.
The Act does not explicitly outline offences, penalties, or civil/criminal consequences for breach of the provisions regarding TCOs. However, any failure by the CEO to adhere to the statutory requirements could potentially be subject to judicial review or other legal remedies available under administrative law. Additionally, if the TCO imposes liabilities or disadvantages any person contrary to the provisions of section 269S, the aggrieved party may seek redress through the courts. There are no stated maximum penalties within the Act for breaches related to TCOs, but the consequences of non-compliance could include the invalidity of the TCO, financial repercussions for any imposed liabilities, and potential reputational damage.
In summary, the Tariff Concession Instrument No. 0914074, made under the Customs Act 1901, establishes a framework for the application and issuance of Tariff Concession Orders (TCOs) by the Chief Executive Officer of Customs (the CEO). The CEO must ensure that applications meet the core criteria and publish notices inviting submissions from interested parties. The TCO in question, which came into force on 28 April 2009, applies a zero rate of duty on certain plastic shoe boxes, benefiting importers who may now apply for a refund of duty. While the Act does not explicitly outline penalties for breaches, non-compliance could result in legal challenges and potential financial liabilities.