EXPLANATORY STATEMENT
Tariff Concession Instrument No. 0922449
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 sink and or bath plugs on 30 June 2009.
Instrument
TCO No 0922449 was made on 18 September 2009. It declares that those certain sink and or bath plugs 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 the 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. 0922449 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 Tariff Concession Instrument No. 0922449 was enacted in 2009 under the Customs Act 1901 to address the gap in tariff concessions for certain imported goods. This legislation was introduced to provide tariff relief for specific goods, in this case, certain sink and bath plugs, by allowing for a lower rate of customs duty or even a waiver of duty altogether. The Customs Act 1901, managed by the Australian Parliament, enables the Chief Executive Officer of Customs to make Tariff Concession Orders (TCOs) when certain criteria are met, such as when no substitutable goods are produced in Australia. The policy objective is to facilitate the import of goods that are not domestically produced, thereby potentially lowering costs for consumers and businesses that rely on these imports. The Tariff Concession Instrument No. 0922449 was designed to benefit importers by eliminating or reducing customs duty on specified goods, effective from the date the application was lodged.
Scope and Application
The Customs Act 1901, specifically under Part XVA, governs the process for making Tariff Concession Orders (TCOs) which allow for a lower rate of customs duty on certain goods. The Act applies to persons or entities seeking to import goods eligible for tariff concessions, with the Chief Executive Officer of Customs (the CEO) responsible for determining whether an application for a TCO meets the core criteria. The legislation mandates that a TCO can only be applied to goods not specified in section 269SJ, which lists goods ineligible for such concessions, and requires that on the application date, no substitutable goods were produced in Australia in the ordinary course of business. The geographic reach of this legislation is national, applying across all jurisdictions within Australia. The instrument, TCO No. 0922449, declared that certain sink and bath plugs were subject to a zero rate of duty, effective from the date of application, 30 June 2009, provided no substitutable goods were being produced in Australia. The CEO must also publish a notice in the Gazette inviting submissions on the TCO application, although in this case, no submissions were received. The TCO does not retroactively affect any rights or impose liabilities on persons other than the Commonwealth, and importantly, importers can apply for a refund of duty paid on such goods since the effective date of the TCO.
Key Provisions
The main operative sections of the Tariff Concession Instrument No. 0922449 under the Customs Act 1901 (section 269C, 269B, and 269P(3)) establish the conditions under which the Chief Executive Officer of Customs (CEO) can grant a Tariff Concession Order (TCO). If the CEO is satisfied that an application for a TCO meets the core criteria, which includes that no substitutable goods were produced in Australia on the day the application was lodged, the CEO must make a written order declaring that the goods in question are subject to a prescribed item of Schedule 4 to the Customs Tariff Act 1995 (section 269P(3)). This instrument specifically relates to certain sink and bath plugs, applying a zero rate of duty instead of the general rate of 5%.
The obligations imposed by the Act on the parties involved primarily focus on the CEO of Customs. When an application for a TCO is received, the CEO must determine if it meets the core criteria outlined in section 269C of the Act. This involves verifying that no substitutable goods were produced in Australia on the day the application was lodged, which is defined by sections 269D and 269E of the Act. Additionally, the CEO must publish a notice in the Gazette inviting any person who might have objections to the TCO to submit their views (subsection 269K(1)). If no objections are received, the CEO can proceed to issue the TCO.
In terms of consequences for breach, the Act does not explicitly detail specific offences or penalties for non-compliance with the TCO provisions. However, general legal principles apply, where non-compliance with statutory requirements can lead to civil or criminal penalties, depending on the nature and severity of the breach. For instance, providing false information in an application might be considered fraudulent and could attract criminal penalties under other relevant legislation, such as the Crimes Act 1914. Similarly, failure to comply with the duty refund provisions under paragraph 126(1)(r) of the Regulations could result in civil penalties for the importer.
In summary, the Tariff Concession Instrument No. 0922449 provides a mechanism for reducing the customs duty on certain sink and bath plugs to zero, provided the CEO determines that no substitutable goods are produced in Australia. The CEO's role involves assessing applications against the core criteria and publishing notices for objections. While the Act does not specify penalties for non-compliance, general legal principles and other applicable legislation would address any breaches.