EXPLANATORY STATEMENT
Tariff Concession Instrument No. 0916019
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.
Ricky Richards Sales applied for a TCO in respect of certain polyester mesh on 12 May 2009.
Instrument
TCO No 0916019 was made on 31 July 2009. It declares that those certain polyester mesh 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. 0916019 is taken to have come into force on 12 May 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. 0916019, enacted in 2009, was introduced under the Customs Act 1901 to address the need for tariff concessions on specific imported goods, in this case, certain polyester mesh. The instrument was designed to provide a lower rate of customs duty on these goods by the Chief Executive Officer of Customs (CEO) when it was determined that no substitutable goods were produced in Australia. This measure aimed to benefit importers by reducing their duty liabilities and potentially allowing for duty refunds on goods imported since the TCO's effective date. The enacting body, the Parliament of Australia, intended this legislation to foster fair trade practices and support Australian businesses by ensuring that imported goods do not undercut locally produced alternatives.
Scope and Application
The Customs Act 1901, specifically under Part XVA, establishes a framework for the Chief Executive Officer of Customs (CEO) to issue Tariff Concession Orders (TCO) which provide for a lower rate of customs duty on certain goods. A TCO can be applied for by any person in respect of goods, provided they do not fall under the exclusions specified in section 269SJ of the Act. The CEO assesses whether the application meets the core criteria outlined in section 269C, which necessitates that no substitutable goods are produced in Australia in the ordinary course of business. If the criteria are satisfied, the CEO must issue a written TCO. For instance, TCO No. 0916019 applies to certain polyester mesh, reducing the duty rate from 5% to free, effective from the date the application was lodged. The CEO is mandated to publish a notice in the Gazette inviting submissions regarding the TCO application, although in this case, no submissions were received. The TCO does not adversely affect any person's rights as at the date of registration, and it does not impose any new liabilities.
Key Provisions
The Tariff Concession Instrument No. 0916019, under the Customs Act 1901, pertains to the granting of tariff concessions on certain goods. Specifically, section 269F (1) of the Act allows for applications for Tariff Concession Orders (TCOs) to be made to the Chief Executive Officer (CEO) of Customs. If the application is deemed valid, the CEO must make a written order (section 269P (3)) that declares the goods subject to a lower rate of customs duty. In this case, the instrument (section 269S (1)) was made on 31 July 2009 and is taken to have come into force on 12 May 2009, the date on which the application was lodged.
The obligations imposed on the parties by the Act are primarily directed towards the CEO of Customs. Upon receiving a valid TCO application, the CEO must ensure that the application meets the core criteria (section 269C) and, if satisfied, must proceed to make a TCO (section 269P (3)). The CEO must also publish a notice in the Gazette (subsection 269K (1)) inviting any interested parties to lodge submissions if they believe the TCO should not be made. Additionally, the TCO must be registered without affecting the rights of any person as at the date of registration (subsection 269S (2)), ensuring that it does not disadvantage any person or impose liabilities on anyone in respect of actions taken before the registration date.
The Act does not explicitly outline specific offences or penalties for breaches of the TCO provisions, but breaches of the Customs Act 1901 generally carry potential civil and criminal consequences. For example, under section 269V of the Act, if an entity knowingly provides false or misleading information in an application for a TCO, they may face penalties. The maximum penalties for such breaches can be substantial, including fines and imprisonment, depending on the severity and intent of the offence. The specifics of these penalties are detailed in other sections of the Customs Act 1901 and related legislation.