EXPLANATORY STATEMENT
Tariff Concession Instrument No. 0925633
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.
Import Ants Pty Ltd applied for a TCO in respect of certain sample and or collection albums on 20 July 2009.
Instrument
TCO No 0925633 was made on 02 October 2009. It declares that those certain sample and or collection albums 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. 0925633 is taken to have come into force on 20 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 Australian Parliament, establishes the framework for the imposition and collection of customs duties and provides mechanisms for tariff concession orders. The Act was designed to streamline the process for granting tariff concessions, ensuring that specific goods can benefit from reduced customs duties, thus supporting trade and economic efficiency. In 2009, Tariff Concession Order No. 0925633 was introduced to address the specific needs of Import Ants Pty Ltd, which applied for a tariff concession on certain sample and collection albums. This order was made to ensure that these goods could be imported without incurring the general rate of duty, thereby facilitating their availability and affordability in the Australian market. The policy objective was to support the import of goods that are not produced in Australia and thus to enhance market access and consumer choice.
Scope and Application
The Customs Act 1901, through its Tariff Concession Orders (TCO) scheme, allows for the reduction of customs duty on specified goods when certain criteria are met. This scheme applies to individuals and entities seeking to import goods into Australia and is administered by the Chief Executive Officer of Customs (CEO). For an application to be considered, it must not pertain to goods that are ineligible under section 269SJ of the Act and must meet the core criteria outlined in section 269C, specifically that no substitutable goods are produced in Australia at the time of application. This instrument, TCO No. 0925633, applies to certain sample and collection albums, which are now subject to a free rate of duty as per item 50 of Schedule 4 to the Customs Tariff Act 1995, effective from the date of application on 20 July 2009. This TCO does not retroactively affect any rights or impose liabilities on individuals or entities other than the Commonwealth, and no submissions were received in opposition to the TCO.
Key Provisions
The key operative sections of the Tariff Concession Instrument No. 0925633 under the Customs Act 1901 (section 269C) require the Chief Executive Officer (CEO) of Customs to make a Tariff Concession Order (TCO) if certain conditions are met. Specifically, section 269C mandates that a TCO application meets the core criteria if no substitutable goods were produced in Australia in the ordinary course of business on the day the application was lodged (section 269P(3)). The CEO must make a written order declaring that the goods subject to the TCO application are goods to which a prescribed item of Schedule 4 to the Customs Tariff Act 1995 applies. In this instance, TCO No. 0925633 specifies that certain sample and/or collection albums are goods to which item 50 of Schedule 4 applies, resulting in a duty rate of free, down from the general rate of 5%.
The obligations imposed by the Act on parties include the requirement for the CEO to consider applications for TCOs and to make a decision based on whether the core criteria are met. This involves ensuring that no substitutable goods were produced in Australia in the ordinary course of business on the date the application was lodged. If the CEO is satisfied that the application meets these criteria, a TCO must be made. Additionally, section 269K(1) obligates the CEO to publish a notice in the Gazette inviting submissions from any interested parties. In this case, no submissions were received.
Furthermore, the Act stipulates that a TCO comes into force on the day the application for the TCO was lodged (subsection 269S(1)). For TCO No. 0925633, this date is 20 July 2009. The TCO does not affect the rights of a person as at the date of registration in a way that would disadvantage that person or impose liabilities on them for actions taken before the date of registration. However, it does allow for the rights of importers to be beneficially affected, enabling them to apply for a refund of duty on goods imported since the TCO came into force (paragraph 126(1)(r) of the Regulations).
In terms of consequences for breach, the Act does not specify any criminal offences or penalties related to the failure to comply with the requirements for TCOs. However, any failure by the CEO to adhere to the statutory requirements for making a TCO could potentially lead to legal challenges or administrative consequences. Furthermore, any misuse or fraudulent claims regarding the application of a TCO could result in civil or criminal penalties under other relevant laws, though these are not detailed in the Act itself. The primary enforcement mechanism is the review and compliance oversight by the relevant authorities.