EXPLANATORY STATEMENT
Tariff Concession Instrument No. 0939368
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 plastic scoops on 20 October 2009.
Instrument
TCO No 0939368 was made on 04 January 2010. It declares that those certain plastic scoops 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. 0939368 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 Tariff Concession Instrument No. 0939368, enacted in 2010, is a legislative measure under the Customs Act 1901. This legislation was introduced to address the need for tariff concessions on specific goods, allowing for a lower rate of customs duty to be applied. The instrument was made by the Chief Executive Officer of Customs, as authorised under the Act, in response to an application by McPhersons Consumer Products for tariff concessions on certain plastic scoops. The instrument aims to facilitate trade by reducing the cost burden on importers of these goods, aligning with the policy objectives of the Customs Act 1901 to streamline and support the import process. The instrument was published in the Gazette, inviting any interested parties to lodge submissions, though none were received. The tariff concession became effective from the date of the application, providing immediate benefit to importers by allowing them to apply for a refund of duty on goods imported since that date.
Scope and Application
The Tariff Concession Instrument No. 0939368 under the Customs Act 1901 applies to the specific goods, namely certain plastic scoops, as applied for by McPhersons Consumer Products. This Act governs the application and issuance of Tariff Concession Orders (TCOs) by the Chief Executive Officer of Customs, which allow for a lower rate of customs duty on goods that meet certain criteria. The instrument specifically addresses the eligibility of the goods for tariff concessions and their classification under item 50 of Schedule 4 to the Customs Tariff Act 1995. The legislation ensures that these particular plastic scoops, previously subject to a 5% duty, now qualify for a duty-free status.
The scope of this legislation is national, operating within the framework of Australian federal law. It applies to any person or entity seeking a tariff concession for specified goods not produced in Australia in the ordinary course of business. The Act ensures that the concessions do not disadvantage any person or impose liabilities on them for actions taken prior to the issuance of the TCO. The Act does not include exclusions for specific types of goods beyond those already outlined in section 269SJ of the Customs Act 1901. The commencement of the TCO aligns with the date the application was lodged, ensuring a seamless transition to the new duty rates from that date.
Key Provisions
The Tariff Concession Instrument No. 0939368 under the Customs Act 1901 sets out specific provisions that govern the application and approval process for Tariff Concession Orders (TCOs) (section 269F). The main operative sections of this legislation, such as sections 269C and 269B, establish the criteria for what constitutes a substitutable good and how the ordinary course of business is defined. Specifically, section 269C requires that for a TCO application to meet the core criteria, no substitutable goods must be produced in Australia on the day the application was lodged. Section 269B clarifies that goods produced in Australia, the ordinary course of business, and substitutable goods are all defined in sections 269D, 269E, and 269F respectively. If the Chief Executive Officer of Customs (CEO) is satisfied that these criteria are met, they must make a written order declaring that the goods in question are subject to a lower rate of duty as specified in Schedule 4 of the Customs Tariff Act 1995.
The Act imposes specific obligations and requirements on both the applicant and the CEO. For instance, the applicant must ensure that their application is not in respect of goods specified in section 269SJ of the Act, which lists goods that cannot be subject to a TCO. The CEO, on the other hand, has the responsibility to verify that the application meets the core criteria as per section 269C. If the CEO decides that the application satisfies these criteria, they must proceed to make a TCO. Additionally, as per section 269K, the CEO is required to publish a notice in the Gazette inviting submissions from any person who may have reasons to oppose the TCO. Although no submissions were received in this case, the requirement to publish and invite submissions is a critical part of the process.
In terms of consequences for breach, the Customs Act 1901 does not explicitly state offences or penalties for failing to comply with the requirements of a TCO. However, the failure to adhere to the established procedures could lead to disputes and potential legal challenges regarding the validity of the TCO. The Act ensures that the rights of importers are beneficially affected and that no liabilities are imposed on any person in respect of actions taken before the TCO came into force. This provision helps protect individuals and businesses from any retroactive liabilities stemming from the implementation of the TCO.