EXPLANATORY STATEMENT
Tariff Concession Instrument No. 1032317
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.
Star Fasteners applied for a TCO in respect of certain chipboard screws on 15 July 2010.
Instrument
TCO No 1032317 was made on 06 October 2010. It declares that those certain chipboard screws 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. 1032317 is taken to have come into force on 15 July 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. 1032317 was enacted in 2010 under the Customs Act 1901. This legislation was introduced to address the need for tariff concessions on specific goods where there is no domestic production of substitutable items. The Customs Act 1901 provides a framework for the Chief Executive Officer of Customs to grant Tariff Concession Orders (TCOs) to applicants, thereby reducing the customs duty on the specified goods. The objective of this legislative measure is to ensure that Australian importers are not disadvantaged when importing goods where no suitable Australian-made alternatives exist, thereby promoting fair trade practices and encouraging the import of goods where domestic production is not viable. The instrument was published in the Gazette, inviting public submissions, though none were received, and it came into effect on the date the application was lodged, 15 July 2010. This TCO ensures that importers of the specified chipboard screws can benefit from a duty-free rate, effective from the date of application.
Scope and Application
The Tariff Concession Order No. 1032317, as specified in the Customs Act 1901, applies to certain chipboard screws, providing a lower rate of customs duty as per item 50 of Schedule 4 to the Customs Tariff Act 1995. This concession is available to applicants who meet the core criteria outlined in the Act, specifically when no substitutable goods are produced in Australia in the ordinary course of business. The order was implemented on the date the application was lodged, 15 July 2010, and the tariff rate for these goods has been set at free, down from the general rate of 5%. The order is limited to the goods specified in the application, and no submissions opposing the concession were received from other parties, thereby solidifying its implementation. The legislation ensures that the rights of importers are positively impacted, allowing them to apply for duty refunds on imports made since the order's effective date.
Key Provisions
The key operative sections of this legislation include section 269F, which allows a person to apply to the Chief Executive Officer of Customs (CEO) for a Tariff Concession Order (TCO) in respect of goods. If the CEO is satisfied that the application is valid and meets the core criteria outlined in section 269C, they must make a written order declaring that the goods are subject to a concession. Section 269P(3) further stipulates that if the CEO is satisfied that the application meets these criteria, they must issue a TCO. This particular TCO No. 1032317 was made on 6 October 2010, declaring that certain chipboard screws are subject to the concession.
The Act imposes several obligations and requirements on the parties involved. Firstly, the CEO must ensure that any TCO application is not in respect of goods specified in section 269SJ, which lists those goods that cannot be subject to a TCO. If the CEO is satisfied that the application meets the core criteria, they must make the TCO. In this case, Star Fasteners applied for the TCO, and the CEO confirmed that no substitutable goods were produced in Australia, thus satisfying the criteria. Furthermore, as per subsection 269K(1), the CEO must publish a notice in the Gazette inviting any interested parties to lodge a submission if they believe the TCO should not be made. In this instance, no submissions were received.
The legislation also outlines the consequences for breach, though specific offences, penalties, or civil/criminal consequences are not detailed in this particular TCO. Generally, under the Customs Act 1901, breaches of the Act or associated regulations could lead to penalties such as fines or imprisonment, depending on the severity of the offence. For instance, subsection 269S(1) states that a TCO is effective from the date the application was lodged, and it does not disadvantage any person or impose liabilities for actions taken before the registration date. The rights of importers are positively affected as they can apply for a refund of duty on goods imported since the TCO came into force. This TCO does not impose any liabilities on any person, ensuring compliance without punitive measures against individuals or entities.