EXPLANATORY STATEMENT
Tariff Concession Instrument No. 0940617
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.
The Reject Shop Limited applied for a TCO in respect of certain non woven scourers on 28 October 2009.
Instrument
TCO No 0940617 was made on 15 January 2010. It declares that those certain non woven scourers 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. 0940617 is taken to have come into force on 28 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. 0940617, enacted in 2010, was introduced to address the issue of providing tariff concessions on certain goods that were not being produced domestically. The Customs Act 1901, under which this instrument was made, allows the Chief Executive Officer of Customs to issue Tariff Concession Orders (TCOs) that can result in a lower rate of customs duty for specific goods. This legislation was enacted by the Parliament of Australia, aiming to facilitate trade by reducing the duty burden on imported goods where there is no domestic production of substitutable goods. The instrument specifically applied to certain non-woven scourers, which were granted a duty-free status under item 50 of Schedule 4 to the Customs Tariff Act 1995, effective from the date the application was lodged. The process involved ensuring no objections were received during the consultation period, which, in this case, did not happen, thereby allowing the concession to proceed without any adverse submissions.
Scope and Application
The Tariff Concession Instrument No. 0940617, made under Part XVA of the Customs Act 1901, applies specifically to certain non woven scourers that The Reject Shop Limited applied for tariff concession on 28 October 2009. This legislation is designed to provide a lower rate of customs duty on specified goods when the Chief Executive Officer of Customs is satisfied that no substitutable goods were produced in Australia in the ordinary course of business. The instrument was enacted to declare that these non woven scourers are goods to which a prescribed item of Schedule 4 to the Customs Tariff Act 1995 applies, thereby making the rate of duty free. The application of this Act is confined to the goods mentioned in the application and does not affect the rights of any person other than the Commonwealth, ensuring no disadvantage or new liabilities are imposed on individuals or entities. The commencement of this tariff concession order is deemed to have occurred on the date of the application, 28 October 2009, and allows importers to apply for a refund of duty on goods imported since that date.
Key Provisions
The Tariff Concession Instrument No. 0940617 under the Customs Act 1901 (sections 269C, 269F, 269P) provides a framework for the application and implementation of Tariff Concession Orders (TCOs). According to section 269F, an application for a TCO can be submitted to the Chief Executive Officer of Customs (CEO) by any person. If the CEO determines that the application pertains to goods not listed in section 269SJ, which are ineligible for TCOs, the CEO will then assess whether the application meets the core criteria outlined in section 269C. This assessment hinges on whether any substitutable goods are produced in Australia in the ordinary course of business on the day the application was lodged. If no such goods are found, the CEO is required to issue a written order, a TCO, declaring that the specified goods are subject to a prescribed item of Schedule 4 of the Customs Tariff Act 1995.
The obligations imposed by the Act on the parties involved are straightforward yet crucial. The CEO must ensure that the application complies with the specified criteria, including the assessment of whether substitutable goods are produced in Australia. Additionally, the CEO is mandated to publish a notice in the Gazette (section 269K) inviting submissions from any interested parties who may have reasons why the TCO should not be granted. In this instance, the CEO did not receive any submissions. Furthermore, the Act stipulates that the TCO does not affect any pre-existing rights or liabilities of persons other than the Commonwealth, ensuring that the rights of importers are positively affected, as they can apply for a refund of duty on goods imported since the TCO came into effect (Regulations, paragraph 126(1)(r)).
The Act also outlines the consequences for non-compliance with the provisions of the TCO. While the specific offences and penalties are not detailed within the explanatory statement, the Act generally imposes severe penalties for breaches of customs regulations. These may include fines and imprisonment, with the exact penalties varying according to the nature and severity of the offence. The potential for significant financial and criminal penalties underscores the importance of adhering to the conditions and requirements set forth in the TCOs and the Customs Act 1901.