EXPLANATORY STATEMENT
Tariff Concession Instrument No. 1025687
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 tableware and or kitchenware on 08 June 2010.
Instrument
TCO No 1025687 was made on 06 September 2010. It declares that those certain tableware and or kitchenware 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. 1025687 is taken to have come into force on 08 June 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, enacted by the Parliament of Australia, facilitates the imposition of tariffs on imported goods, among other customs-related duties. This Act aims to regulate the import and export of goods within Australia, ensuring compliance with tariff obligations and fostering economic stability. One of its key mechanisms is the Tariff Concession Order (TCO) scheme, which allows for reduced customs duty rates on specified goods under certain conditions. The Explanatory Statement for Tariff Concession Instrument No. 1025687 details the process by which McPhersons Consumer Products successfully applied for and received a TCO for certain tableware and kitchenware, reducing their duty rate from 5% to free. The Chief Executive Officer of Customs (CEO) was satisfied that no substitutable goods were produced in Australia, thereby meeting the core criteria for a TCO under section 269C of the Act. The policy objective here is to support Australian businesses by reducing the duty burden on specific imported goods, thereby promoting competitive pricing and market accessibility for consumers.
Scope and Application
The Tariff Concession Instrument No. 1025687 under the Customs Act 1901 applies to specific tableware and kitchenware items that were the subject of an application by McPhersons Consumer Products. The Act allows for the Chief Executive Officer of Customs to make Tariff Concession Orders (TCOs) which result in a lower rate of customs duty for the specified goods. This Act is applicable at the Commonwealth level and pertains to any goods that meet the criteria outlined in the Act, particularly those that are not specified in section 269SJ as ineligible for TCOs. The application process for a TCO requires that the goods in question have no substitutable goods produced in Australia at the time of the application, as defined by sections 269C, 269D, and 269E of the Act. The scope of the Act is further extended through subordinate instruments, which can specify additional criteria or details related to TCOs. The Act ensures that its application does not disadvantage any person or impose liabilities on anyone for actions taken before the TCO was registered, while providing benefits such as duty refunds to importers of the specified goods.
Key Provisions
The main operative sections of this legislation pertain to the process of making Tariff Concession Orders (TCOs) under the Customs Act 1901. Section 269F allows for applications to the Chief Executive Officer of Customs (CEO) for a TCO, while section 269C outlines the core criteria that must be met for an application to be valid. This includes the condition in section 269P(3) that a TCO can only be made if no substitutable goods are produced in Australia. Once these criteria are satisfied, the CEO must issue a written order (a TCO) as stated in section 269P(3). In this case, McPhersons Consumer Products successfully applied for a TCO concerning certain tableware and kitchenware, which was subsequently granted as TCO No. 1025687 on 06 September 2010.
The Act imposes specific obligations and requirements on both the CEO and applicants for a TCO. For the CEO, these include ensuring that the application meets the core criteria set out in section 269C, which necessitates that no substitutable goods are produced in Australia at the time of application. This determination must be made in accordance with the definitions provided in sections 269D and 269E. Additionally, the CEO must publish a notice in the Gazette inviting submissions from interested parties once an application is accepted as valid, as stipulated in subsection 269K(1). McPhersons Consumer Products, as the applicant, must ensure that their application provides sufficient evidence that no substitutable goods are produced in Australia and that the goods in question meet the criteria outlined in the Act.
Any breaches of the Act's provisions related to the application and issuance of TCOs may result in civil or criminal consequences. Although specific penalties are not detailed in the text, it is implied that failure to comply with the statutory requirements could lead to legal action. For instance, if the CEO issues a TCO without meeting the criteria in section 269C, this could result in the order being contested in court, potentially leading to the revocation of the TCO. Similarly, if McPhersons Consumer Products submits a fraudulent application, they could face legal repercussions, including fines or other penalties as determined by the relevant authorities. The consequences underscore the importance of adhering to the statutory requirements to avoid legal disputes or sanctions.