EXPLANATORY STATEMENT
Tariff Concession Instrument No. 0927669
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.
Multigate Medical Products applied for a TCO in respect of certain protective sterile field sheets on 31 July 2009.
Instrument
TCO No 0927669 was made on 16 October 2009. It declares that those certain protective sterile field sheets 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. 0927669 is taken to have come into force on 31 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, addresses the need for a streamlined process to provide tariff concessions on certain goods. This Act facilitates the reduction or exemption of customs duty on specific goods through the issuance of Tariff Concession Orders (TCOs) by the Chief Executive Officer of Customs. The policy objective is to promote economic efficiency by reducing the cost of imported goods that do not have domestic substitutes, thereby supporting Australian industries and consumers. In 2009, the Act was utilised to address a specific application from Multigate Medical Products for tariff concessions on certain protective sterile field sheets, leading to Tariff Concession Instrument No. 0927669. This instrument was enacted to provide a tariff concession on these goods, setting their duty rate at free, thereby benefiting importers by potentially allowing them to apply for duty refunds on goods imported since the effective date of the concession.
Scope and Application
The Tariff Concession Instrument No. 0927669 applies to certain protective sterile field sheets, specifically those for which Multigate Medical Products applied for a tariff concession order under section 269F of the Customs Act 1901. The application was lodged on 31 July 2009, and the instrument was made on 16 October 2009 by the Chief Executive Officer of Customs. This instrument effectively alters the customs duty rate for these specific goods from the general rate of 5% to a duty-free rate as specified in item 50 of Schedule 4 to the Customs Tariff Act 1995. The instrument does not apply to any goods specified in section 269SJ of the Customs Act 1901, which are ineligible for tariff concessions. The instrument is applicable nationally across Australia and its territories as it is an instrument under the Customs Act 1901, a Commonwealth Act. The instrument came into force on the date the application was lodged, 31 July 2009, and does not impose any liabilities on any person nor does it affect the rights of any person as at the date of registration.
Key Provisions
The main sections of this legislation, specifically Tariff Concession Order No. 0927669 under the Customs Act 1901, address the process and conditions for granting tariff concessions for specific goods. Section 269F outlines the procedure for applying for a Tariff Concession Order (TCO), while section 269C stipulates the core criteria that an application must meet for approval, primarily that no substitutable goods are produced in Australia at the time of the application. Section 269P(3) mandates that if these criteria are satisfied, the Chief Executive Officer of Customs (CEO) must issue a TCO.
The Act imposes several obligations on parties involved with TCOs. Firstly, the CEO must decide whether an application meets the core criteria as defined in section 269C. If the criteria are met, the CEO is required to make a written TCO as per section 269P(3). Additionally, under section 269K(1), the CEO must publish a notice in the Gazette inviting submissions from any interested parties who believe the TCO should not proceed. There were no submissions in response to the notice for TCO No. 0927669.
In terms of legal consequences, the Customs Act 1901 does not explicitly detail offences or penalties for breaches related to TCOs. However, any failure to comply with the statutory requirements for TCO applications or the conditions set forth in the TCO itself could potentially lead to disputes or litigation. The legal framework does not specify particular civil or criminal penalties for non-compliance with TCOs, but breaches may result in administrative actions, including the revocation of the concession or other regulatory measures. The rights of importers and the general public are protected, ensuring that the TCO does not impose liabilities on any person for actions taken before the TCO's effective date, as stated in the explanatory statement.