EXPLANATORY STATEMENT
Tariff Concession Instrument No. 0922447
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.
McPherson's Consumer Products applied for a TCO in respect of certain chopping board on 30 June 2009.
Instrument
TCO No 0922447 was made on 18 September 2009. It declares that those certain chopping board 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. 0922447 is taken to have come into force on 30 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 was enacted to provide a comprehensive framework for the regulation of customs and excise in Australia. The Act was introduced to address the need for a structured approach to the administration of customs duties, excise, and other charges, as well as to facilitate trade and ensure revenue collection. The Customs Act 1901 is administered by the Parliament of Australia and aims to streamline the process of customs duty collection while also protecting domestic industries by regulating the import and export of goods. One of the mechanisms introduced by the Act is the Tariff Concession Orders (TCOs) scheme, which allows for the reduction or exemption of customs duties on certain goods under specific conditions. This scheme was designed to support Australian industries by reducing the cost of imported raw materials or components, thus making locally produced goods more competitive.
Scope and Application
The Tariff Concession Instrument No. 0922447 applies to certain chopping boards, specifically those for which McPherson's Consumer Products applied for a tariff concession order under section 269F of the Customs Act 1901. The instrument applies to the goods specified in the application, which in this instance are certain chopping boards, and it is administered by the Chief Executive Officer of Customs. The instrument grants a lower rate of customs duty for these goods, aligning with item 50 of Schedule 4 to the Customs Tariff Act 1995. The concession applies on a Commonwealth level, meaning it has jurisdiction across Australia, and it is effective from the date the application was lodged, in this case, 30 June 2009. The instrument does not affect the rights of any person other than the Commonwealth and does not impose any liabilities on any person, ensuring that importers can benefit from the tariff concession for goods imported since the effective date.
Key Provisions
The main operative sections of this legislation, Tariff Concession Instrument No. 0922447, provide for the making of a Tariff Concession Order (TCO) that allows for a concession on customs duty for certain goods. Section 269F of the Customs Act 1901 allows 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, as set out in section 269C, a TCO is to be made declaring the goods to which a specified item of Schedule 4 to the Customs Tariff Act 1995 applies (section 269P(3)). In this case, the TCO No. 0922447 declares that certain chopping boards are goods to which item 50 of Schedule 4 to the Tariff applies, with the rate of duty for these goods being free, as opposed to the general rate of 5%.
The obligations and requirements imposed by the Customs Act 1901 on the parties it governs are primarily concerned with the application and assessment process for a TCO. When an application is made under section 269F, the CEO must first ensure that the goods are not specified in section 269SJ, which sets out goods that cannot be subject to a TCO. If the CEO is satisfied that the application meets the core criteria, as outlined in section 269C, the CEO must then make a written order (a TCO) declaring the goods to which a prescribed item of Schedule 4 to the Tariff applies (section 269P(3)). As part of this process, the CEO must also publish a notice in the Gazette inviting submissions from any person who believes there are reasons why the TCO should not be made (subsection 269K(1)).
Failure to comply with the requirements of the Customs Act 1901 may result in various consequences. While the explanatory statement does not detail specific offences or penalties, breaches of the Customs Act 1901 in general can result in civil or criminal penalties. Under the Customs Act 1901, civil penalties may include fines, and in some cases, criminal penalties may apply, including imprisonment. The maximum penalties will depend on the specific breach and the severity of the offence. For example, subsection 256D(4) of the Customs Act 1901 provides for a maximum penalty of 10,000 penalty units for making a false or misleading statement in connection with a duty concession. It is essential for parties subject to the Act to adhere to its provisions to avoid any potential penalties or consequences.