EXPLANATORY STATEMENT
Tariff Concession Instrument No. 0944767
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 bag on 25 November 2009.
Instrument
TCO No 0944767 was made on 26 February 2010. It declares that those certain plastic bag 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. 0944767 is taken to have come into force on 25 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 Order No. 0944767, made under the Customs Act 1901, was enacted to address the need for concessional tariff rates for certain goods. This legislative instrument was introduced to provide relief from customs duty for specific goods where no substitutable goods are produced in Australia, aligning with the broader objective of promoting economic efficiency and competitiveness. The Customs Act 1901, as amended, facilitates the creation of Tariff Concession Orders (TCOs) by the Chief Executive Officer of Customs, upon meeting certain criteria. This particular TCO was issued following an application by McPhersons Consumer Products on 25 November 2009, concerning certain plastic bags. The concession reduces the duty on these goods from the general rate of 5% to free, effective from the date of the application. This measure aims to benefit importers by potentially entitling them to duty refunds for goods imported since the TCO's effective date.
Scope and Application
The Customs Act 1901, specifically through Part XVA, facilitates the granting of Tariff Concession Orders (TCO) by the Chief Executive Officer of Customs. This legislative instrument applies to any person or entity that seeks to apply for a tariff concession on goods not specified in section 269SJ of the Act. The application process mandates that no substitutable goods are produced in Australia in the ordinary course of business on the date the application is lodged, as outlined in section 269C. The scope of the Act is national, applying across all states and territories of Australia, and it encompasses any goods that meet the criteria for a tariff concession. Exclusions apply to goods specified in section 269SJ, which cannot be subject to a TCO. The application of this Act can be extended or restricted through subordinate instruments, which provide further detail and operational guidance on the application process and eligibility criteria for tariff concessions.
Key Provisions
The primary sections of Tariff Concession Instrument No. 0944767 (TCO No. 0944767) under the Customs Act 1901 (section 269F) and the Customs Tariff Act 1995 establish a scheme for tariff concessions, where specific goods may be subject to a lower rate of customs duty. This particular TCO applies to certain plastic bags and declares them to be subject to item 50 of Schedule 4 of the Tariff, resulting in a free rate of duty rather than the general 5% rate. The TCO was made on 26 February 2010, and it is deemed to have come into effect on 25 November 2009, the date the application was lodged (section 269S).
The obligations imposed by this Act on the parties it governs include the requirement for the Chief Executive Officer of Customs (CEO) to determine whether an application for a Tariff Concession Order (TCO) meets the core criteria, specifically whether no substitutable goods were produced in Australia in the ordinary course of business on the day the application was lodged (section 269C). Additionally, section 269K(1) mandates the CEO to publish a notice in the Gazette inviting submissions if the application is accepted as valid. In this case, no submissions were received, indicating that the application was unopposed.
Failure to comply with the provisions of the Customs Act 1901 and the Customs Tariff Act 1995 can lead to legal consequences. Although specific offences and penalties are not detailed in the explanatory statement, breaches of customs laws typically result in civil or criminal penalties. For instance, knowingly or recklessly making a false statement or representation in an application for a TCO can lead to fines or imprisonment, as stipulated in section 269Q of the Customs Act 1901. The maximum penalties can include substantial fines and imprisonment terms, depending on the severity of the breach. It is also important to note that the TCO does not affect the rights of any person other than the Commonwealth in respect of actions taken before the date of registration, nor does it impose any liabilities on any person.