EXPLANATORY STATEMENT
Tariff Concession Instrument No. 0933960
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 dishwashing brushes on 11 September 2009.
Instrument
TCO No 0933960 was made on 27 November 2009. It declares that those certain dishwashing brushes 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. 0933960 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 Customs Act 1901, as amended by Tariff Concession Instrument No. 0933960 enacted in 2010, addresses the issue of applying tariff concessions to specific imported goods. This instrument was developed to provide a streamlined process for reducing customs duty rates on certain goods, provided that no substitutable goods are produced in Australia. The process involves an application to the Chief Executive Officer of Customs, who must determine whether the application meets the core criteria before making a Tariff Concession Order. The aim of this legislation is to ensure that the importation of specific goods is facilitated without disadvantaging local producers, while benefiting importers by potentially reducing their duty costs.
The Tariff Concession Instrument No. 0933960, issued by the Chief Executive Officer of Customs under the authority of the Customs Act 1901, was made to address a specific application from McPhersons Consumer Products regarding dishwashing brushes. After the CEO determined that no substitutable goods were produced in Australia, a Tariff Concession Order was issued, resulting in the goods being subject to a reduced duty rate from 5% to free. The policy objective underpinning this legislation is to provide a mechanism for tariff concessions that support the importation of goods while safeguarding local production, ensuring that the rights of importers are positively impacted and that no new liabilities are imposed.
Scope and Application
The Tariff Concession Instrument No. 0933960 under the Customs Act 1901 applies to entities or individuals seeking tariff concessions for specific goods imported into Australia. The application process is initiated by submitting a request to the Chief Executive Officer of Customs (CEO), who is tasked with determining whether the goods in question meet the core criteria set out in the Act. These criteria include the absence of substitutable goods produced in Australia at the time the application is lodged. The Instrument specifically pertains to McPhersons Consumer Products' application for tariff concessions on certain dishwashing brushes, which has resulted in these items being subject to a duty rate of free, as opposed to the general rate of 5%. The geographic reach of this Act is national, as it pertains to customs duties applicable across Australia. Exclusions are made for goods specified in section 269SJ of the Act, which cannot be subject to a tariff concession order. The Act extends its application through subordinate instruments, allowing for detailed specifications of goods and conditions under which tariff concessions are granted.
Key Provisions
The key provisions of Tariff Concession Instrument No. 0933960 under the Customs Act 1901 (section 269F) are designed to facilitate the application process for Tariff Concession Orders (TCOs). When a person applies for a TCO (section 269C), they must ensure that the goods in question are not specified in section 269SJ of the Act, which lists goods that cannot be subject to a TCO. The Chief Executive Officer of Customs (CEO) must then determine whether the application meets the core criteria, specifically if no substitutable goods were produced in Australia in the ordinary course of business on the day the application was lodged (section 269C and 269P(3)). If the CEO is satisfied that the application meets these criteria, they must make a written order, i.e., a TCO, specifying that the goods are subject to a prescribed item of Schedule 4 to the Customs Tariff Act 1995. In this instance, the TCO declares that certain dishwashing brushes are subject to item 50 of Schedule 4, with a general rate of duty of 5% reduced to free under the TCO (section 269P(3)).
The obligations imposed by the Act on the parties involved, particularly McPhersons Consumer Products as the applicant, include ensuring that the application is valid and meets the specified criteria. The CEO's obligations include reviewing the application, determining whether it meets the core criteria, and making a written order if the criteria are met. Additionally, the CEO must publish a notice in the Gazette inviting any interested parties to lodge submissions if they believe the TCO should not be made (subsection 269K(1)). In this case, the CEO did not receive any submissions. The rights of importers will be beneficially affected, allowing them to apply for a refund of duty on goods imported since the TCO is deemed to have come into force on the date the application was lodged (subsection 269S(1) and paragraph 126(1)(r) of the Regulations).
Breaching the requirements set out in the Customs Act 1901 may result in various penalties and consequences. While the specific section of the Act detailing these penalties is not provided in the explanatory statement, it is generally understood that failure to comply with the Act's provisions could lead to civil or criminal penalties. For instance, providing false or misleading information in an application could result in fines or other legal actions. The maximum penalties for such offences would depend on the specific nature of the breach and the relevant sections of the Customs Act 1901 and other applicable laws. However, the explanatory statement does not detail these potential penalties.