EXPLANATORY STATEMENT
Tariff Concession Instrument No. 0939366
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 plastic clips on 20 October 2009.
Instrument
TCO No 0939366 was made on 08 January 2010. It declares that those certain plastic clips 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. One submission requesting revocation to the TCO application was received from Kwik Lok.
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. 0939366 is taken to have come into force on 20 October 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 was enacted by the Australian Parliament and is the foundational statute governing the regulation of customs and border control in Australia. The Act provides the legislative framework for the imposition of customs duty on imported goods and includes provisions for tariff concession orders (TCOs) to encourage economic activity and reduce the cost of imported goods. In particular, the Customs Act 1901 allows for the application of lower rates of customs duty on specified goods through the issuance of TCOs by the Chief Executive Officer of Customs, subject to certain criteria being met. The Act aims to support Australian businesses by reducing the cost of imported goods, thus promoting economic growth and competitiveness. The Tariff Concession Instrument No. 0939366, issued under the Customs Act 1901, is an example of this mechanism in action, providing tariff concessions on certain plastic clips and thereby reducing the duty payable on these goods from the standard rate to free.
Scope and Application
The Tariff Concession Instrument No. 0939366, pursuant to the Customs Act 1901, applies to the specific category of plastic clips that are subject to the instrument. It is directed at entities and individuals involved in the importation and production of these goods within Australia. The act provides for a lower rate of customs duty on these goods, contingent upon meeting the criteria set out in the Act, including the absence of substitutable goods produced in Australia. The geographic reach of this legislation is national, applying across all states and territories of Australia. There are specific exclusions, such as goods listed in section 269SJ of the Act, which are ineligible for tariff concessions. The instrument also allows for the potential revocation of tariff concessions based on submissions received by the Chief Executive Officer of Customs. The commencement of the tariff concession is effective from the date the application was lodged, 20 October 2009, and does not affect any pre-existing rights or liabilities of parties other than the Commonwealth.
Key Provisions
The main operative sections of the Tariff Concession Instrument No. 0939366, issued under the Customs Act 1901, include sections 269C, 269F, and 269P(3) (paragraphs 1-2). These sections outline the process for applying for a Tariff Concession Order (TCO) and the criteria that must be met for the Chief Executive Officer of Customs (CEO) to grant such an order. Specifically, Section 269F allows a person to apply for a TCO in respect of goods, while Section 269C stipulates that the application meets the core criteria if, on the day the application was lodged, no substitutable goods were produced in Australia in the ordinary course of business. Section 269P(3) then requires the CEO to make a written order (a TCO) if satisfied that the application meets the core criteria.
In accordance with the Customs Act, the obligations and requirements imposed by this Act on the parties or entities it governs are primarily centred around the application and approval process for TCOs. Under Section 269K(1), the CEO must publish a notice in the Gazette as soon as practicable after accepting a TCO application as valid, inviting any person who considers that there are reasons why the TCO should not be made to lodge a submission with the CEO. This ensures that the process is transparent and allows for objections to be raised. Additionally, the CEO is required to decide whether the application meets the core criteria, as outlined in Section 269C.
The Act also outlines potential consequences for breaches. While the Explanatory Statement does not specify any particular offences, penalties, or civil/criminal consequences for breach, the general provisions of the Customs Act 1901 would apply. These typically include financial penalties for non-compliance, with the maximum penalties varying depending on the severity of the offence. The Act also provides for the imposition of civil and criminal penalties for more serious breaches, including potential imprisonment.
In summary, the Tariff Concession Instrument No. 0939366 sets out a clear process for applying for and granting TCOs under the Customs Act 1901, with obligations and requirements designed to ensure a fair and transparent process. While the specific penalties for breach are not detailed in the Explanatory Statement, the broader provisions of the Customs Act provide for potential financial, civil, and criminal penalties for non-compliance.