EXPLANATORY STATEMENT
Tariff Concession Instrument No. 0933955
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.
McPhersons Consumer Products applied for a TCO in respect of certain household sets on 11 September 2009.
Instrument
TCO No 0933955 was made on 27 November 2009. It declares that those certain household sets 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. 0933955 is taken to have come into force on 11 September 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 Tariff Concession Instrument No. 0933955, enacted under the Customs Act 1901, addresses the issue of providing tariff concessions on specific imported goods by allowing for lower rates of customs duty. The Customs Act 1901 establishes a framework under which Tariff Concession Orders (TCOs) can be made by the Chief Executive Officer of Customs, and this particular instrument was created to cater to an application by McPhersons Consumer Products for tariff concessions on certain household sets. The policy objective, as outlined in the Act, is to ensure that no substitutable goods are produced in Australia at the time of application, which in this case, was satisfied by the CEO, leading to the approval of the TCO. This instrument was introduced by the Commonwealth Parliament and aims to facilitate trade by providing tariff relief where appropriate, benefiting importers by potentially reducing their duty costs on the specified goods.
Scope and Application
The Tariff Concession Order No. 0933955 under the Customs Act 1901 applies to the goods specified in the application submitted by McPhersons Consumer Products, which were declared tariff-free for certain household sets. This Act applies to entities or individuals involved in the importation of these specific goods, and its jurisdiction extends across Australia as it is a Commonwealth Act. The primary exclusion from this concession is any goods listed in section 269SJ of the Act, which cannot be subject to a Tariff Concession Order. This legislative instrument extends its application through the subordinate instrument of Schedule 4 to the Customs Tariff Act 1995, which details the prescribed rates of duty applicable to the goods in question. The scope of the concession is further defined by the conditions set out in sections 269C, 269D, and 269E of the Customs Act 1901, which ensure that the goods in question are not substitutable by any produced in Australia and meet the criteria for tariff concession.
Key Provisions
The main operative sections of the Tariff Concession Instrument No. 0933955 under the Customs Act 1901 (sections 269C, 269P(3), and 269S) establish the criteria for a Tariff Concession Order (TCO). Specifically, section 269C outlines the core criteria for a TCO, which must be met for the Chief Executive Officer (CEO) of Customs to consider an application. If the CEO is satisfied that the application meets these criteria, section 269P(3) mandates the CEO to make a written order (the TCO), specifying the applicable prescribed item from Schedule 4 of the Customs Tariff Act 1995. Section 269S specifies that the TCO comes into force on the day the application is lodged, which in this case was 11 September 2009.
The obligations imposed by the Act on the parties involved include the requirement for the CEO to consider applications for TCOs and to make a written order if the application meets the core criteria. Section 269K(1) of the Act mandates the CEO to publish a notice in the Gazette inviting submissions from interested parties if they believe there are reasons why the TCO should not be made. The CEO must then review these submissions before making a decision. In this instance, no submissions were received in response to the published notice. Additionally, section 269S(1) ensures that the rights of any person, other than the Commonwealth, will not be adversely affected by the TCO in respect of anything done or omitted before the TCO comes into force.
The Act does not explicitly outline specific offences, penalties, or consequences for breach in relation to the issuance of TCOs. However, any breaches of the Customs Act 1901 or the Customs Tariff Act 1995 in general may attract penalties. For example, section 235 of the Customs Act 1901 provides for civil and criminal penalties for various breaches, including the imposition of fines and imprisonment. The maximum penalties can vary depending on the nature and severity of the breach but could include substantial fines and/or imprisonment for serious or repeat offences.