EXPLANATORY STATEMENT
Tariff Concession Instrument No. 0944779
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 pom poms on 25 November 2009.
Instrument
TCO No 0944779 was made on 05 February 2010. It declares that those certain pom poms 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. 0944779 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 Instrument No. 0944779, made under the Customs Act 1901, was enacted in 2010 to address the need for tariff concessions on specific goods, in this case, certain pom poms. This instrument was introduced to ensure that the goods in question benefit from a lower rate of customs duty when they do not have substitutable goods produced in Australia. The Tariff Concession Orders (TCOs) are made by the Chief Executive Officer of Customs (CEO) if an application meets the core criteria as stipulated in the Act. McPhersons Consumer Products applied for the concession on certain pom poms, which was granted after the CEO determined that no substitutable goods were produced in Australia. This concession makes the importation of these pom poms duty-free, thereby benefiting the rights of importers who can now apply for a refund of duty on goods imported since the effective date of the concession. The enactment of this instrument aligns with the policy objective of the Customs Act 1901 to facilitate trade by providing tariff concessions where appropriate.
Scope and Application
The Tariff Concession Instrument No. 0944779 under the Customs Act 1901 applies to entities and individuals seeking tariff concessions on certain goods, specifically in this case, certain pom poms. The Act allows the Chief Executive Officer of Customs to grant a Tariff Concession Order (TCO) if the application meets specified criteria, such as the absence of substitutable goods produced in Australia. The geographic reach of this legislation is national, as it operates under the Commonwealth's authority. The Act excludes goods specified in section 269SJ, which cannot be subject to a TCO. The application process requires the CEO to publish a notice in the Gazette inviting submissions, although in this instance, no submissions were received. The TCO does not retroactively affect any pre-existing rights or impose new liabilities on persons other than the Commonwealth. The TCO instrument extends its application through subordinate instruments, ensuring compliance with the Customs Tariff Act 1995 and associated regulations.
Key Provisions
The Tariff Concession Order (TCO) No. 0944779 under the Customs Act 1901 (section 269F) allows for a lower rate of customs duty on certain specified goods, in this case certain pom poms. This order was made by the Chief Executive Officer of Customs (CEO) on 5 February 2010 in response to an application by McPhersons Consumer Products on 25 November 2009. The TCO applies item 50 of Schedule 4 to the Customs Tariff Act 1995, which sets the rate of duty for these goods as free, as opposed to the general rate of 5% (section 269P(3)). The TCO came into force on the date the application was lodged, 25 November 2009 (subsection 269S(1)). The CEO must ensure that no substitutable goods were produced in Australia on the day the application was lodged (section 269C), and the CEO must publish a notice in the Gazette inviting submissions if any person believes the TCO should not be made (subsection 269K(1)). In this instance, no submissions were received.
The obligations imposed by this Act on the parties involved are primarily on the CEO. The CEO must assess whether the application for a TCO meets the core criteria, particularly that no substitutable goods were produced in Australia on the application date (section 269C). Additionally, the CEO is required to publish a notice in the Gazette inviting any interested parties to lodge submissions if they believe the TCO should not proceed (subsection 269K(1)). McPhersons Consumer Products, as the applicant, must ensure that their application provides all necessary information and that it meets the criteria outlined in the Act. Importers, on the other hand, benefit from the TCO by being able to apply for a refund of duty on goods imported since the TCO came into force (paragraph 126(1)(r) of the Regulations).
Failure to comply with the requirements of the Customs Act 1901 or the provisions of a TCO can result in various consequences. For example, any person who contravenes the Act may be subject to civil or criminal penalties. However, the specific offences, penalties, or consequences for breach are not detailed in the explanatory statement for TCO No. 0944779. Generally, under the Customs Act 1901, contraventions can lead to penalties that include fines and, in some cases, imprisonment, depending on the severity of the offence. It is important to consult the relevant sections of the Act and any subsidiary legislation for detailed information on penalties and enforcement mechanisms.