EXPLANATORY STATEMENT
Tariff Concession Instrument No. 0924092
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.
E D Oates Pty Ltd applied for a TCO in respect of certain polyvinyl alcohol chamois cloth on 08 July 2009.
Instrument
TCO No 0924092 was made on 25 September 2009. It declares that those certain polyvinyl alcohol chamois cloth 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. 0924092 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 was enacted to provide a comprehensive framework for the administration of customs and excise in Australia, and it includes provisions for tariff concession orders (TCOs). The Tariff Concession Instrument No. 0924092, made under this Act, addresses the problem of ensuring that goods eligible for tariff concessions are not subject to competition from locally produced goods. The instrument was introduced to provide a mechanism through which businesses can apply for a tariff concession when no substitutable goods are produced in Australia, thereby promoting the importation of specific goods that are essential for certain uses. The instrument was enacted by the Chief Executive Officer of Customs, acting under the authority conferred by the Customs Act 1901. The policy objective of this instrument is to facilitate the importation of goods that are not produced domestically, thereby supporting industries that rely on imported materials and promoting competitive pricing for consumers.
Scope and Application
The Tariff Concession Instrument No. 0924092 applies to the concessions made under the Customs Act 1901 concerning the customs duty on specific goods. The legislation pertains to any person or entity applying for a Tariff Concession Order (TCO) in respect of goods, with the primary focus being on the goods themselves, specifically certain polyvinyl alcohol chamois cloth. The Act applies nationally within Australia, as it falls under the jurisdiction of the Commonwealth. The TCO does not disadvantage any person other than the Commonwealth and does not impose any liabilities on persons for actions taken prior to the TCO's registration. The Act allows for the extension or restriction of its application through subordinate instruments, facilitating the dynamic management of customs duties based on evolving market conditions and trade relationships. The process for determining eligibility for a TCO involves rigorous criteria, including the absence of substitutable goods produced in Australia, ensuring that the concessions are granted in a manner that supports fair trade practices and economic efficiency.
Key Provisions
The main operative sections of this Tariff Concession Instrument are sections 269C, 269F, 269P, and 269S. Section 269F allows a person to apply to the Chief Executive Officer of Customs (CEO) for a Tariff Concession Order (TCO) in respect of goods. If the CEO is satisfied that the application meets the core criteria set out in section 269C, they must make a written order, which is the TCO (section 269P). Section 269S specifies that the TCO comes into force on the day the application was lodged.
The obligations and requirements imposed by the Act on the parties it governs include the process for applying for a TCO and the conditions under which the CEO must grant such an order. The CEO must ensure that no substitutable goods were produced in Australia on the day the application was lodged (section 269C). Furthermore, the CEO must publish a notice in the Gazette inviting any interested parties to submit their views on the application (subsection 269K(1)). This process ensures transparency and allows for any objections to be considered before the TCO is granted.
Under this Act, breaches or non-compliance with the provisions for obtaining a TCO could lead to civil or criminal consequences. However, the specific offences, penalties, or consequences are not detailed in the explanatory statement provided. Generally, under Australian law, failure to comply with customs regulations can result in penalties, including fines and, in some cases, imprisonment. The maximum penalties would depend on the nature and severity of the breach, as well as other relevant laws and regulations.
The Tariff Concession Instrument No. 0924092 specifically addresses the application by E D Oates Pty Ltd for a TCO concerning certain polyvinyl alcohol chamois cloth. The CEO was satisfied that no substitutable goods were produced in Australia, and thus, the TCO was made, declaring that these goods are subject to a lower rate of customs duty. This concession benefits importers by reducing the duty rate from the general 5% to free, effective from the date the application was lodged, 08 July 2009. The rights of persons other than the Commonwealth are not adversely affected, and no new liabilities are imposed on anyone as a result of this TCO.