EXPLANATORY STATEMENT
Tariff Concession Instrument No. 1019462
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.
McPherson's Consumer Products applied for a TCO in respect of certain acrylic powder on 29 April 2010.
Instrument
TCO No 1019462 was made on 26 July 2010. It declares that those certain acrylic powder 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. 1019462 is taken to have come into force on 29 April 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 Customs Act 1901 was enacted to regulate customs and excise matters, including the imposition of customs duties on imported goods. It was introduced to address the need for a comprehensive framework governing customs and border protection in Australia. The Act was enacted by the Parliament of Australia and provides the legal basis for the administration of customs and excise duties, as well as the regulation of the import and export of goods. The Tariff Concession Instrument No. 1019462, made under the Customs Act 1901, aims to provide tariff concessions for certain goods, reducing the customs duty on specified items. This particular instrument, made on 26 July 2010, grants a tariff concession for certain acrylic powder, reducing the duty from the general rate of 5% to free. The instrument was introduced in response to an application by McPherson's Consumer Products, and no objections were received during the consultation period. The policy objective of this legislation is to provide tariff relief for goods that are not produced domestically, thereby supporting industry and consumers by reducing the cost of imported goods.
Scope and Application
The Tariff Concession Instrument No. 1019462 pertains to the Customs Act 1901, under which Tariff Concession Orders (TCOs) can be issued by the Chief Executive Officer of Customs. The Act applies to individuals and entities seeking to import goods that are subject to a TCO, with the primary focus on the industries involved in the importation and production of specific goods. The Act ensures that if the CEO determines an application for a TCO meets the core criteria—that is, if no substitutable goods are produced in Australia—a TCO will be issued, effectively lowering the customs duty rate on the specified goods. The geographic reach of this legislation is national, as it pertains to the importation of goods into Australia. It is important to note that the Act does not cover goods specified in section 269SJ, which lists those goods that cannot be subject to a TCO. The application of the Act may also be extended or restricted through subordinate instruments, which may provide further detail on the criteria and processes involved.
Key Provisions
The main operative sections of this legislation focus on the creation and effect of Tariff Concession Orders (TCOs) under Part XVA of the Customs Act 1901 (the Act). Specifically, section 269F allows a person to apply to the Chief Executive Officer of Customs (the CEO) for a TCO in respect of goods. If the CEO is satisfied that the application does not pertain to goods specified in section 269SJ, which outlines goods that cannot be subject to a TCO, the CEO must assess whether the application meets the core criteria set out in section 269C. This assessment hinges on whether, on the day the application was lodged, no substitutable goods were produced in Australia in the ordinary course of business (section 269C). If these conditions are met, the CEO must issue a written order, a TCO, specifying that the goods in question are subject to a prescribed item in Schedule 4 of the Customs Tariff Act 1995 (section 269P(3)).
The obligations and requirements imposed by the Act on the parties involved primarily concern the application and approval process for TCOs. The applicant, such as McPherson's Consumer Products in this case, must ensure that their application complies with the provisions of the Act, particularly those outlined in sections 269F and 269SJ. The CEO, on the other hand, is obliged to review the application to determine if it meets the core criteria and to make a decision based on this assessment. Additionally, the CEO must publish a notice in the Gazette inviting submissions from any interested parties once a TCO application is accepted as valid (subsection 269K(1)). This process aims to ensure transparency and provide an opportunity for stakeholders to voice any objections before the TCO is issued.
In terms of penalties and consequences for breach, the Customs Act 1901 does not explicitly outline specific offences, penalties, or consequences for non-compliance with the TCO provisions. However, the general legal framework in Australia provides that any breaches of legislation can result in civil or criminal penalties, depending on the nature and severity of the breach. For example, civil penalties may include fines, while criminal penalties could involve imprisonment. The exact penalties would be determined by the courts based on the specific circumstances of the breach, and the maximum penalties would be governed by the applicable laws at the time of the offence. It is important for applicants and the CEO to adhere to the statutory requirements to avoid any potential legal repercussions.