EXPLANATORY STATEMENT
Tariff Concession Instrument No. 1011292
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.
Bubba Blue applied for a TCO in respect of certain baby blankets on 04 March 2010.
Instrument
TCO No 1011292 was made on 14 May 2010. It declares that those certain baby blankets 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. 1011292 is taken to have come into force on 04 March 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. 1011292, enacted in 2010, addresses a specific issue under the Customs Act 1901 by providing for tariff concessions on certain baby blankets. The Customs Act 1901, enacted by the Australian Parliament, provides a framework for imposing and collecting customs duty. Part XVA of the Act outlines the process for making Tariff Concession Orders (TCOs), which allow for reduced customs duty on specified goods. The policy objective of this legislation is to offer tariff concessions where appropriate, facilitating trade and potentially benefiting importers by reducing the duty payable on certain goods. In this instance, the instrument was made following an application by Bubba Blue for tariff concessions on baby blankets, which was granted by the Chief Executive Officer of Customs after determining that no substitutable goods were produced in Australia. This instrument aims to provide tariff relief without disadvantaging existing rights or imposing new liabilities.
Scope and Application
The Tariff Concession Order No. 1011292 under the Customs Act 1901 applies to specific baby blankets for which Bubba Blue submitted an application to the Chief Executive Officer of Customs. This instrument is designed to provide tariff concessions by lowering the customs duty on these particular goods from the standard rate to free. The Act applies to goods that are not substitutable by any goods produced in Australia in the ordinary course of business, as stipulated under section 269C. The geographic reach of this Act is national, as it operates under the Commonwealth jurisdiction and is applicable across Australia. The instrument does not disadvantage any person, including businesses and importers, as it only affects rights and duties prospectively from the date of registration, which is 4 March 2010. The CEO is mandated to ensure no substitutable goods were being produced in Australia at the time of the application and did not receive any submissions opposing the concession, allowing the order to proceed without impediment.
Key Provisions
The main operative sections of the Customs Act 1901, as outlined in the explanatory statement, include section 269F, which allows for the application of a Tariff Concession Order (TCO) by a person to the Chief Executive Officer (CEO) of Customs. Section 269C specifies the core criteria that an application must meet, such as the absence of substitutable goods produced in Australia on the date of application, as defined by sections 269D and 269E. If the CEO determines that the application meets these criteria, section 269P(3) mandates the creation of a written TCO order. In this case, TCO No. 1011292 applies to certain baby blankets, declaring them as subject to item 50 of Schedule 4 to the Customs Tariff Act 1995, thereby granting them a zero duty rate.
The obligations imposed by the Act on parties and entities governed by it include the requirement for the CEO to assess applications against the core criteria set forth in section 269C. The CEO must also publish a notice in the Gazette inviting submissions if a TCO application is deemed valid, as required by subsection 269K(1). The TCO itself, once made, does not affect any existing rights of persons other than the Commonwealth, nor does it impose any liabilities on such persons prior to the TCO's effective date. Importers benefit from the ability to apply for a refund of duty on goods imported since the TCO's effective date, as per paragraph 126(1)(r) of the Regulations.
In terms of breaches and consequences, the explanatory statement does not explicitly detail offences, penalties, or civil/criminal consequences for non-compliance with the TCO or the Act. However, the absence of such information suggests that the primary focus is on the procedural correctness and benefits of the TCO rather than punitive measures. It is implied that compliance with the Act and its provisions is crucial to avoid any potential legal ramifications, although the specific penalties for non-compliance are not stated in the provided text.