EXPLANATORY STATEMENT
Tariff Concession Instrument No. 0950589
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.
Cadbury Pty Ltd applied for a TCO in respect of certain chocolate refiner machines on 31 December 2009.
Instrument
TCO No 0950589 was made on 26 March 2010. It declares that those certain chocolate refiner machines 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. 0950589 is taken to have come into force on 31 December 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. 0950589 was enacted under the Customs Act 1901 to address the need for a streamlined process to grant tariff concessions on specific imported goods. This legislation allows the Chief Executive Officer of Customs to make Tariff Concession Orders (TCOs) that reduce or eliminate customs duty on particular goods, provided certain criteria are met. The purpose of this instrument is to facilitate the import of goods that are not produced domestically or are not substitutable by Australian-made alternatives, thereby promoting fair trade practices and potentially lowering costs for businesses that rely on importing these goods. The instrument was introduced by the Parliament of Australia, with the policy objective of supporting economic efficiency and competitiveness by reducing the cost of imported goods that have no local substitutes. This measure is particularly beneficial to businesses such as Cadbury Pty Ltd, which applied for and received a tariff concession on certain chocolate refiner machines, allowing for duty-free importation of these specific items.
Scope and Application
The Tariff Concession Instrument No. 0950589 applies to the specific category of chocolate refiner machines, which were the subject of an application for a Tariff Concession Order (TCO) by Cadbury Pty Ltd. This instrument is part of the Customs Act 1901, administered by the Chief Executive Officer of Customs (CEO) who determines whether an application for a TCO meets the prescribed core criteria. The primary focus of the Act is to provide relief on customs duties for goods that are not produced in Australia and for which there are no substitutable goods available domestically. The instrument grants a concession by setting the duty rate for the specified chocolate refiner machines to zero, down from the general rate of 5%. This relief is geographically applicable throughout Australia, as the Customs Act 1901 operates under a national framework. The application of the TCO is contingent on the CEO's determination that the goods in question meet the criteria established by the Act, and no submissions were received opposing the concession. The commencement date of the TCO aligns with the date the application was lodged, ensuring that the rights of third parties are not adversely affected by the concession.
Key Provisions
The Customs Act 1901, specifically Part XVA, enables the Chief Executive Officer (CEO) of Customs to issue Tariff Concession Orders (TCOs) which apply lower rates of customs duty to certain goods. Section 269F of the Act allows any person to apply to the CEO for a TCO concerning goods, provided the goods are not specified in section 269SJ, which lists those goods that cannot be subject to a TCO. The CEO must assess whether the application meets the core criteria outlined in section 269C, which requires that no substitutable goods were produced in Australia in the ordinary course of business on the date the application was lodged. Substitutable goods, as defined in section 269D, are those that can be produced in Australia and serve the same use or design as the goods in question.
The CEO has the obligation to make a written order if the application meets the core criteria. This order, a Tariff Concession Order, declares that the goods in question are subject to a specified lower rate of duty as outlined in Schedule 4 to the Customs Tariff Act 1995. For instance, TCO No. 0950589, made on 26 March 2010, applied to certain chocolate refiner machines, setting their duty rate to free, whereas the general rate would have been 5%. Additionally, under subsection 269K(1) of the Act, the CEO must publish a notice in the Gazette inviting submissions against the TCO application. In the case of TCO No. 0950589, no submissions were received.
Failure to comply with the provisions of the Customs Act 1901 concerning Tariff Concession Orders can lead to legal consequences. Breaches of the Act may result in civil or criminal penalties. However, the specific penalties for non-compliance are not detailed in the provided text. Generally, penalties for breaches of customs regulations can include fines and, in severe cases, imprisonment. The exact penalties depend on the nature and severity of the breach, as well as any applicable regulations or subsequent legislation.