EXPLANATORY STATEMENT
Tariff Concession Instrument No. 0923930
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 fridge pins on 08 July 2009.
Instrument
TCO No 0923930 was made on 25 September 2009. It declares that those certain fridge pins 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. 0923930 is taken to have come into force on 08 July 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 Commonwealth Parliament, provides a framework for the administration of customs duties and the regulation of goods entering Australia. One of the mechanisms within this framework is the Tariff Concession Order (TCO), which allows for the reduction or exemption of customs duty on specific goods. The Tariff Concession Instrument No. 0923930, introduced on 25 September 2009, addresses the issue of granting tariff concessions to ensure that Australian businesses have access to competitively priced inputs necessary for their operations. The instrument was made in response to an application by McPherson's Consumer Products for a TCO on certain fridge pins, which was accepted by the Chief Executive Officer of Customs (CEO) after determining that no substitutable goods were produced in Australia at the time of application. This decision aligns with the policy objective of facilitating smoother trade operations by reducing the cost burden on businesses for essential goods.
Scope and Application
The Tariff Concession Instrument No. 0923930, issued under the Customs Act 1901, applies to any entity that has made an application for a Tariff Concession Order (TCO) in respect of specific goods, in this case, certain fridge pins. The application was lodged by McPherson's Consumer Products on 08 July 2009, and the instrument was issued on 25 September 2009. The application process involves the Chief Executive Officer of Customs (CEO) assessing whether the goods are substitutable by any goods produced in Australia in the ordinary course of business. If the CEO determines that no such goods are produced domestically, a TCO is issued, granting the applicant a concession on the customs duty rate, in this instance, reducing it from 5% to free. This instrument operates nationally and does not disadvantage any person by affecting their rights as they stood on the date of the application. The TCO provides importers with the benefit of applying for a refund of duty on the goods imported since the TCO came into force on 08 July 2009, without imposing any liabilities on any person.
Key Provisions
The main operative sections of the Customs Act 1901, as applied in Tariff Concession Instrument No. 0923930, pertain to the making of Tariff Concession Orders (TCOs) by the Chief Executive Officer of Customs (section 269F). An application for a TCO can be made by any person in respect of goods, provided the goods are not specified in section 269SJ, which lists those goods that cannot be subject to a TCO (section 269C). The CEO must determine if the application meets the core criteria, specifically, whether no substitutable goods were produced in Australia in the ordinary course of business on the day the application was lodged (section 269P(3)). If the CEO is satisfied that the application meets these criteria, they must make a written order (section 269P(3)).
The obligations and requirements imposed by the Act on parties or entities it governs include the necessity for the CEO to consider applications for TCOs and to 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)). Additionally, the Act requires that the TCO does not affect the rights of a person, other than the Commonwealth, in a manner that would disadvantage them or impose liabilities for actions taken before the TCO's effective date (subsection 269S(1)). Importers of goods affected by the TCO can apply for a refund of duty on goods imported since the TCO is taken to have come into force.
There are no specific offences, penalties, or civil/criminal consequences outlined in the explanatory statement for the breach of any provisions in this particular Tariff Concession Instrument. However, the general framework of the Customs Act 1901 provides for potential penalties for breaches related to customs duties and regulations. These may include fines and imprisonment for serious or repeated breaches. The specific penalties would depend on the nature and severity of the breach and would be in accordance with the relevant sections of the Customs Act 1901 and associated regulations.