EXPLANATORY STATEMENT
Tariff Concession Instrument No. 0929597
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.
HMA Fabrics applied for a TCO in respect of certain poly viscose yarn on 12 August 2009.
Instrument
TCO No 0929597 was made on 30 October 2009. It declares that those certain poly viscose yarn 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. 0929597 is taken to have come into force on 12 August 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, provides a framework for the regulation of customs duties and the administration of the Australian Customs Service. Among its provisions, Part XVA of the Act allows for the establishment of Tariff Concession Orders (TCOs) by the Chief Executive Officer of Customs. These orders enable a lower rate of customs duty to be applied to specific goods, provided certain criteria are met. The Tariff Concession Instrument No. 0929597 was introduced to address the need for tariff concessions for certain poly viscose yarn imported by HMA Fabrics, ensuring that the application of customs duties aligns with the broader policy objectives of promoting fair trade and economic efficiency. The instrument was made following a formal application process and public consultation, resulting in a concession that lowered the duty rate from 5% to free for the specified goods. This approach not only benefits importers by reducing their duty obligations but also ensures that no existing rights or liabilities are adversely affected by the new tariff arrangement.
Scope and Application
The Tariff Concession Instrument No. 0929597, under the Customs Act 1901, applies to specific goods as determined by the Chief Executive Officer of Customs (CEO) and pertains to those who are seeking tariff concessions on imported goods. The Act allows for the application of lower rates of customs duty on goods subject to a Tariff Concession Order (TCO). It is pertinent to individuals or entities that have lodged an application for a TCO and are seeking tariff concessions, provided the goods are not specified in section 269SJ of the Act, which outlines goods that cannot be subject to a TCO. The scope of the Act is national as it operates under the Commonwealth of Australia and is not limited to specific states, territories, or local jurisdictions. The Act extends its application through subordinate instruments, specifically the Customs Tariff Act 1995, which details the applicable tariffs and duty rates for goods. The application of this legislation is triggered when an entity such as HMA Fabrics applies for a TCO, and the CEO determines that the goods in question do not have substitutable equivalents produced in Australia. There are no stated exclusions, exemptions, or thresholds in the explanatory statement provided, though the application process inherently excludes goods listed in section 269SJ of the Customs Act 1901.
Key Provisions
The main operative sections of this legislation are sections 269C, 269F, 269K, 269P, and 269S of the Customs Act 1901. Section 269F allows a person to apply to the Chief Executive Officer (CEO) of Customs for a Tariff Concession Order (TCO). Section 269C requires the CEO to assess whether the application meets the core criteria, which is the case if no substitutable goods were produced in Australia in the ordinary course of business on the day the application was lodged. If the application meets the core criteria, the CEO must make a written order (a TCO) under section 269P(3), declaring the goods to which the order applies. Section 269K mandates the CEO to publish a notice in the Gazette inviting submissions from any interested parties, while section 269S specifies that a TCO is to be taken to have come into force on the day on which the application for the TCO was lodged.
The obligations imposed by this Act on the parties it governs are primarily directed at the CEO of Customs. The CEO is required to evaluate each TCO application to ensure it meets the core criteria and to publish a notice in the Gazette inviting any relevant submissions. The CEO must make a written order if the application meets the criteria, specifying the goods to which the TCO applies. Additionally, importers of the goods subject to a TCO may apply for a refund of duty on goods imported since the day the TCO is taken to have come into force under paragraph 126(1)(r) of the Regulations.
There are no specific offences, penalties, or civil/criminal consequences outlined in this particular legislation for breach of its provisions. However, failure to comply with the requirements for applying for a TCO or making an application that does not meet the core criteria could potentially lead to administrative or legal challenges. Importers who fail to apply for a refund of duty under the specified regulations might not receive the benefits intended by the TCO. The legislation ensures that the rights of persons other than the Commonwealth are not disadvantaged by the TCO, and it does not impose any new liabilities on any person.