EXPLANATORY STATEMENT
Tariff Concession Instrument No. 0919828
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.
Mundigo Pty Ltd applied for a TCO in respect of certain mixing and distribution system pig food on 11 June 2009.
Instrument
TCO No 0919828 was made on 04 September 2009. It declares that those certain mixing and distribution system pig food 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. 0919828 is taken to have come into force on 11 June 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, provides a framework for the regulation of customs and excise duties. Specifically, Part XVA of the Act introduces the scheme for Tariff Concession Orders (TCOs), which allow the Chief Executive Officer of Customs to apply a lower rate of customs duty on certain goods. This was introduced to address the problem of ensuring that goods which are not produced domestically in an ordinary course of business receive appropriate tariff concessions, thus encouraging their importation. The explanatory statement outlines the process for applying for a TCO, including the requirement that no substitutable goods be produced in Australia. In the case of Mundigo Pty Ltd's application for a TCO concerning certain mixing and distribution system pig food, the CEO was satisfied that the application met the criteria, leading to the issuance of TCO No. 0919828 on 4 September 2009, which effectively grants a free rate of duty on these goods. The policy objective here is to support industries that cannot produce certain goods domestically, thereby promoting economic efficiency and consumer benefit.
Scope and Application
The Customs Act 1901 provides a framework through which Tariff Concession Orders (TCOs) can be made, allowing for lower rates of customs duty on specified goods. This legislation applies to any person or entity that seeks to import goods and benefit from reduced tariff rates under a TCO. The scope of the Act is broad, encompassing various industries and types of goods that might be subject to tariff concessions, provided they meet the criteria stipulated under sections 269C and 269D. The geographic reach of this legislation is national, as it is administered under the Commonwealth. However, the Act excludes certain goods as specified in section 269SJ, which cannot be subject to a TCO. The Act also allows for the extension or restriction of its application through subordinate instruments, such as the Customs Tariff Act 1995, which further defines the tariff items applicable to goods under a TCO. The application process involves an assessment by the Chief Executive Officer of Customs, who must ensure that no substitutable goods are produced in Australia before granting a concession.
Key Provisions
The Tariff Concession Instrument No. 0919828 under the Customs Act 1901 (sections 269C, 269F, 269P) applies to certain mixing and distribution system pig food. Specifically, section 269F of the Act allows for an application to the Chief Executive Officer of Customs (CEO) for a Tariff Concession Order (TCO) if certain criteria are met. A TCO, as outlined in section 269P, applies a lower rate of customs duty to goods that meet the core criteria specified in section 269C, which includes the condition that no substitutable goods were produced in Australia on the day the application was lodged.
The obligations imposed by the Act on the parties involved are primarily procedural. For instance, under section 269K(1), the CEO must publish a notice in the Gazette inviting submissions from any person who believes the TCO should not be made. This was done for TCO No. 0919828, though no submissions were received. The CEO is also required to determine whether the application meets the core criteria specified in section 269C, which was satisfied in this case, leading to the issuance of the TCO.
Breaching the provisions of the Customs Act 1901, including the requirements for making a TCO, may result in various penalties or consequences. For instance, if a TCO is made incorrectly or without proper justification, it could lead to legal challenges or administrative reviews. Additionally, while the explanatory statement does not explicitly mention penalties, general provisions within the Act and associated regulations could impose fines or other sanctions for non-compliance with customs regulations. The maximum penalties would depend on the specific breach and the relevant sections of the Act or Regulations being contravened.