EXPLANATORY STATEMENT
Tariff Concession Instrument No. 0942109
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.
Renz Masterbind applied for a TCO in respect of certain book binding wire on 9 November 2009.
Instrument
TCO No 0942109 was made on 22 January 2010. It declares that those certain book binding wire 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. 0942109 is taken to have come into force on 9 November 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. 0942109, made under the Customs Act 1901, was introduced to address the need for reducing the customs duty on specific goods, in this case certain book binding wire, by providing a tariff concession. This legislative instrument was enacted in 2010 in response to an application by Renz Masterbind, who sought a tariff concession for the goods in question. The Australian Government, through the Chief Executive Officer of Customs, is the enacting body responsible for determining whether an application for a tariff concession meets the core criteria. The policy objective is to facilitate the import of goods that cannot be substituted by domestic production, thereby promoting trade and benefiting importers by potentially allowing them to claim a refund of duty paid on these goods prior to the concession's implementation.
Scope and Application
The Tariff Concession Instrument No. 0942109 is a legislative instrument made under Part XVA of the Customs Act 1901, which provides a framework for the Chief Executive Officer of Customs to grant Tariff Concession Orders (TCOs) that apply lower rates of customs duty to certain goods. The Act applies to any person or entity seeking to import goods into Australia that qualify for a tariff concession. The scope of the legislation is national, as it operates within the Commonwealth jurisdiction and impacts importers throughout Australia. The Act excludes certain goods from eligibility for a TCO, as specified in section 269SJ of the Customs Act 1901. The application process for a TCO requires that the applicant satisfies core criteria, including the absence of substitutable goods produced in Australia on the date the application is lodged, as defined in sections 269C and 269D of the Act. The Act allows for the extension or restriction of its application through subordinate instruments, such as the Customs Tariff Act 1995, which provides the schedule of duty rates applicable to goods under a TCO. The TCO itself has a retrospective effect from the date of the application, as per subsection 269S(1) of the Customs Act 1901, and does not disadvantage any person or impose liabilities on them for actions taken prior to the TCO's registration.
Key Provisions
The main operative sections of this legislation pertain to the making of Tariff Concession Orders (TCOs) under section 269F of the Customs Act 1901 (referred to as the Act). Section 269F allows for an application to be made to the Chief Executive Officer (CEO) of Customs for a TCO in respect of specified goods. If the CEO determines that the application meets the core criteria, a TCO is issued. Section 269C outlines the core criteria, which include the requirement that no substitutable goods were produced in Australia in the ordinary course of business on the day the application was lodged. The TCO process involves the CEO making a written order, as described in section 269P(3), specifying that the goods in question are subject to a prescribed item of Schedule 4 to the Customs Tariff Act 1995.
The Act imposes certain obligations on the parties involved in the TCO process. Firstly, applicants must ensure that their TCO applications are valid and meet the core criteria, as specified in section 269C. The CEO of Customs has the responsibility of reviewing applications and determining whether they meet the core criteria. Once a TCO is issued, the CEO must also publish a notice in the Gazette, inviting any interested parties to submit objections or submissions regarding the TCO, as required by section 269K(1). The CEO must consider any submissions received before making a final decision on the TCO.
In terms of potential consequences for breach, the Act does not explicitly detail offences, penalties, or civil/criminal consequences for non-compliance with the TCO provisions. However, it is important to note that the Act and related regulations provide for general enforcement mechanisms that may apply in cases of non-compliance. For instance, section 201 of the Act authorises the CEO to take action against persons who contravene the Act or regulations, which could include pursuing civil or criminal penalties as appropriate. Additionally, section 126 of the Customs (Prohibited Imports) Regulations 1977 provides for the imposition of penalties, including fines, for breaches of the Customs Act and related regulations.