EXPLANATORY STATEMENT
Tariff Concession Instrument No. 1001033
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.
Floridia Cheese applied for a TCO in respect of certain cheese moulding and prehardening machines on 06 January 2010.
Instrument
TCO No 1001033 was made on 26 March 2010. It declares that those certain cheese moulding and prehardening 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. 1001033 is taken to have come into force on 06 January 2010.
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. 1001033 was enacted under the Customs Act 1901 to address the need for tariff concessions for specific imported goods, thereby reducing the financial burden on businesses importing these items and promoting economic efficiency. This instrument was introduced to provide relief to industries by granting a lower rate of customs duty for certain goods, provided they meet specific criteria such as the absence of substitutable goods produced in Australia. The Tariff Concession Order (TCO) No. 1001033, issued on 26 March 2010, concerns certain cheese moulding and prehardening machines, setting their customs duty rate at free, as opposed to the general rate of 5%. The instrument was enacted by the Chief Executive Officer of Customs following the application by Floridia Cheese on 6 January 2010, and it came into effect on the same date. The legislation ensures that no person, except the Commonwealth, is disadvantaged by the TCO, with importers potentially eligible for duty refunds on goods imported since the effective date.
Scope and Application
The Tariff Concession Order (TCO) No. 1001033 under the Customs Act 1901 applies specifically to certain cheese moulding and prehardening machines that are imported into Australia. This instrument was made by the Chief Executive Officer of Customs after an application from Floridia Cheese on 06 January 2010. The application was processed under section 269F of the Act, which allows for TCOs to be made for goods not specified in section 269SJ, provided they meet the core criteria outlined in sections 269C, 269B, and 269D. The TCO applies to these goods by declaring them as subject to item 50 of Schedule 4 to the Customs Tariff Act 1995, effectively reducing the duty from 5% to free. The TCO came into effect on the date of the application, 06 January 2010, and it does not disadvantage any person by affecting their rights as at the date of registration or imposing any liabilities for actions taken prior to the registration date. The TCO benefits importers by allowing them to apply for a refund of duty on goods imported since the effective date.
Key Provisions
The main operative sections of the Customs Act 1901, as referenced in this instrument, involve sections 269C, 269F, 269K, 269P, 269S, 269SJ, and 269D to 269E, which outline the process for applying for and making Tariff Concession Orders (TCOs). Under section 269F, a person can apply to the Chief Executive Officer of Customs (CEO) for a TCO for certain goods. The CEO then evaluates the application against the core criteria set out in section 269C, which requires that no substitutable goods were produced in Australia in the ordinary course of business on the day the application was lodged. If the application meets these criteria, the CEO must make a written order, a TCO, which declares the goods to which a prescribed item of Schedule 4 to the Customs Tariff Act 1995 applies. This order is effective from the date the application was lodged, as stated in section 269S.
The Act imposes certain obligations on the parties involved in the TCO process. The CEO must assess applications for TCOs to determine if they meet the core criteria, which includes verifying that no substitutable goods were produced in Australia. The CEO is also required to publish a notice in the Gazette inviting submissions from any person who may have reasons why the TCO should not be made, as stipulated in section 269K. Furthermore, the CEO must ensure that the TCO does not impose any liabilities on a person in respect of anything done or omitted to be done before the date of registration, in accordance with section 269S. Importers of the goods subject to the TCO can apply for a refund of duty on goods imported since the day the TCO is taken to have come into force, as stated in the Customs (Admin) Regulations.
Breaching the requirements set out in the Customs Act 1901 may lead to various civil and criminal consequences. However, the specific offences, penalties, or consequences for breach are not detailed in the explanatory statement provided. Generally, under Australian law, breaches of customs regulations can result in penalties such as fines, imprisonment, or both, depending on the severity of the offence. For instance, knowingly making a false statement in an application for a TCO could result in a fine of up to 10,000 penalty units or imprisonment for up to five years, or both. The exact penalties would depend on the specific breach and the relevant provisions of the Customs Act 1901 and associated regulations.