EXPLANATORY STATEMENT
Tariff Concession Instrument No. 1008751
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 film on 18 February 2010.
Instrument
TCO No 1008751 was made on 23 April 2010. It declares that those certain film 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. 1008751 is taken to have come into force on 18 February 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. 1008751, enacted under the Customs Act 1901, addresses the need for tariff concessions on specific goods that are not produced in Australia. The instrument, issued by the Chief Executive Officer of Customs, was introduced to alleviate the financial burden on importers by granting tariff concessions for certain film products, following an application by McPhersons Consumer Products on 18 February 2010. The instrument came into effect on the same date, ensuring that importers of these goods could apply for a refund of duty from the application date. This initiative was enacted by the relevant authority to support the policy objective of reducing import costs and facilitating trade for specified goods not locally produced.
Scope and Application
The Tariff Concession Instrument No. 1008751, made under the Customs Act 1901, applies to the specific category of film products submitted by Mcphersons Consumer Products on 18 February 2010. This legislation facilitates the reduction of customs duty for these goods by declaring them eligible for a concession under item 50 of Schedule 4 to the Customs Tariff Act 1995. The application of this concession is contingent upon the Chief Executive Officer of Customs determining that no substitutable goods are produced in Australia, thereby satisfying the core criteria set out in the Customs Act. This instrument impacts the duty rates, transitioning the general rate of 5% to a duty-free status for the specified film products. The application is confined to the goods for which the concession was applied and does not extend to any other goods or entities, nor does it impose any liabilities on individuals or entities other than the Commonwealth. The commencement date of the concession aligns with the date of application, 18 February 2010, ensuring that the rights of importers are protected and they may apply for duty refunds from this date onwards.
Key Provisions
The main operative sections of this legislation pertain to the process and criteria for granting Tariff Concession Orders (TCOs) under the Customs Act 1901. Section 269F allows a person to apply to the Chief Executive Officer of Customs (CEO) for a TCO in respect of certain goods. Section 269C specifies that a TCO application meets the core criteria if, on the day the application was lodged, no substitutable goods were produced in Australia in the ordinary course of business. This is defined in sections 269D and 269E, and 'substitutable goods' is defined in section 269D. If the CEO is satisfied that the application meets the core criteria, they must make a written order, a TCO, declaring that the goods are subject to a prescribed item of Schedule 4 to the Customs Tariff Act 1995, as per section 269P(3).
The Act imposes specific obligations on the CEO when handling TCO applications. Upon receiving a valid application, the CEO must publish a notice in the Gazette inviting submissions from any person who believes there are reasons why the TCO should not be made, as per subsection 269K(1). If no submissions are received, the CEO must proceed with the application. The CEO is also required to determine whether the application meets the core criteria by assessing whether no substitutable goods were produced in Australia on the day the application was lodged. If these criteria are met, the CEO must make a TCO.
The legislation also outlines the consequences of breaching the requirements. Although the explanatory statement does not explicitly detail specific offences or penalties for breaches related to the TCO process, general provisions within the Customs Act 1901 and associated regulations would likely apply. These could include civil or criminal penalties for incorrect declarations, failure to comply with orders, or other non-compliance with customs duties and regulations. The penalties could range from fines to potential imprisonment, depending on the nature and severity of the breach.
The commencement date of the TCO is crucial, as it is taken to be the day the application was lodged, as per subsection 269S(1). For TCO No. 1008751, this date is 18 February 2010. The TCO does not affect the rights of any person as at the date of registration to disadvantage that person or impose liabilities in respect of anything done or omitted before the date of registration. Instead, the rights of importers will be beneficially affected, allowing them to apply for a refund of duty on goods imported since the TCO came into force, as per paragraph 126(1)(r) of the Regulations.