EXPLANATORY STATEMENT
Tariff Concession Instrument No. 0914079
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.
The Reject Shop applied for a TCO in respect of certain car seat and footwell protectors on 28 April 2009.
Instrument
TCO No 0914079 was made on 17 July 2009. It declares that those certain car seat and footwell protectors 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 7.5%. 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. 0914079 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 Tariff Concession Instrument No. 0914079, enacted in 2009, is a legislative instrument under the Customs Act 1901 designed to address the problem of ensuring that Australian consumers have access to affordable goods by allowing tariff concessions on certain imported products. This instrument was enacted by the Chief Executive Officer of Customs, following a valid application by The Reject Shop for tariff concessions on specific car seat and footwell protectors. The core objective of this instrument is to provide tariff relief on goods for which no substitutable goods are produced in Australia, thereby facilitating a reduction in the cost of these goods for consumers. The instrument came into force on the date the application was lodged, 28 April 2009, and it ensures that the rights of importers are protected without imposing any new liabilities.
Scope and Application
The Customs Act 1901, through its Part XVA, facilitates the creation of Tariff Concession Orders (TCOs) by the Chief Executive Officer of Customs. This legislative provision applies to any person or entity seeking to import specific goods that are not already being produced in Australia in the ordinary course of business. The TCO mechanism provides for a lower rate of customs duty on goods that meet the core criteria, ensuring that the importation of these goods does not displace local production. The scope of the Act is limited by exclusions set out in section 269SJ, which specifies goods that cannot be subject to a TCO. Additionally, the Act’s application extends to the entire Commonwealth of Australia, governing the importation of goods across all states and territories. The Act may also be further refined or expanded through subordinate instruments, allowing for the detailed specification of goods eligible for tariff concessions and the procedures for applying and processing TCOs. The explanatory statement provided for Tariff Concession Instrument No. 0914079 exemplifies the application of this legislative framework, detailing a specific instance where the CEO granted a TCO for car seat and footwell protectors, reducing their duty from 7.5% to free.
Key Provisions
The main operative sections of the Tariff Concession Order No. 0914079 under the Customs Act 1901 (section 269F) allow for the application of a lower rate of customs duty on specified goods, in this case certain car seat and footwell protectors. If the Chief Executive Officer (CEO) of Customs is satisfied that the application for a Tariff Concession Order (TCO) meets the core criteria, as outlined in section 269C, the CEO must make a written order declaring that the goods in question are subject to the prescribed tariff concession. In this instance, the CEO made TCO No. 0914079 on 17 July 2009, declaring that the specified car seat and footwell protectors are subject to item 50 of Schedule 4 of the Customs Tariff Act 1995, with a duty rate of free, as opposed to the general rate of 7.5%.
The obligations imposed by the Act on the parties involved are primarily on the CEO of Customs. Upon receiving an application for a TCO, the CEO must determine if the application meets the core criteria, which includes verifying that no substitutable goods were produced in Australia on the date the application was lodged. This involves understanding the definitions of "goods produced in Australia" (section 269D), "ordinary course of business" (section 269E), and "substitutable goods" (section 269F). If the CEO is satisfied that the application meets these criteria, they are required to make a written TCO. Additionally, as per subsection 269K(1), the CEO must publish a notice in the Gazette inviting submissions from any interested parties regarding the application.
For breaches of the provisions outlined in the Customs Act 1901, various offences and penalties may apply. However, the specific penalties are not detailed in the Explanatory Statement provided. Typically, breaches of customs regulations can lead to both civil and criminal penalties. Civil penalties can include fines, and in some cases, the seizure of goods. Criminal penalties might include imprisonment, depending on the severity of the offence and the discretion of the court. The maximum penalties for specific breaches would be detailed in other sections of the Customs Act 1901 or in related regulations. The TCO itself does not impose any liabilities on any person, and it does not affect the rights of persons other than the Commonwealth in a way that disadvantages them or imposes liabilities for actions taken before the TCO came into force.