EXPLANATORY STATEMENT
Tariff Concession Instrument No. 1110595
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.
Esko (Australia) Pty Ltd applied for a TCO in respect of certain ice cream cone handling lines on 29 March 2011.
Instrument
TCO No 1110595 was made on 15 June 2011. It declares that those certain ice cream cone handling lines 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. 1110595 is taken to have come into force on 29 March 2011.
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 Australian Parliament, serves to regulate the importation and exportation of goods, including the imposition of customs duties. In particular, Part XVA of the Act introduces a scheme that allows the Chief Executive Officer of Customs to make Tariff Concession Orders (TCOs) that provide for a lower rate of customs duty on specified goods. This scheme was introduced to address the problem of high customs duties on imported goods that do not have locally produced alternatives, thus encouraging competition and reducing costs for businesses and consumers. Tariff Concession Instrument No. 1110595 was made under this scheme, following an application by Esko (Australia) Pty Ltd for a TCO on certain ice cream cone handling lines, resulting in a reduction of duty from the general rate of 5% to free. The policy objective is to facilitate the import of goods that are not produced domestically by providing tariff relief, thereby supporting industry and potentially lowering consumer prices.
Scope and Application
The Customs Act 1901, as amended by Tariff Concession Instrument No. 1110595, facilitates the concession of tariff rates for specific goods, applicable across the Commonwealth of Australia. This instrument pertains to applications submitted by individuals or entities seeking a Tariff Concession Order (TCO) for goods, provided that these goods are not specified in section 269SJ of the Act, which lists goods that cannot be subject to a TCO. The primary condition for a TCO is outlined in section 269C, which stipulates that no substitutable goods must be produced in Australia in the ordinary course of business on the day the application is lodged. The scope of this legislation extends to any person or entity applying for tariff concessions on imported goods, thereby affecting the customs duty rates for the specified items. The application of this instrument is geographically comprehensive, applying across all states and territories within Australia. However, it does not impose any liabilities on persons other than the Commonwealth and does not affect pre-existing rights of any person as at the date of registration. The instrument is enforced through subordinate legislation, allowing for further detailed regulation and administration of tariff concessions under the Customs Act.
Key Provisions
The main provisions of Tariff Concession Instrument No. 1110595 under the Customs Act 1901 (the Act) establish a mechanism for the Chief Executive Officer of Customs (the CEO) to grant tariff concessions on certain goods. According to section 269F, a person can apply to the 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 sections 269C and 269P(3), the CEO must make a TCO declaring that the specified goods are subject to a prescribed rate of duty, which in this case is free of charge. The goods in question, certain ice cream cone handling lines, are subject to item 50 of Schedule 4 to the Customs Tariff Act 1995.
The Act imposes certain obligations on the parties involved. Under section 269K(1), the CEO must publish a notice in the Gazette as soon as practicable after accepting a TCO application as valid, inviting any person who may object to the concession to lodge a submission with the CEO. In this case, the CEO did not receive any submissions. Additionally, section 269S(1) specifies that a TCO is effective from the date the application is lodged, which for TCO No. 1110595 was 29 March 2011. The TCO does not affect the rights of any person adversely or impose liabilities on any person for actions taken before the date of registration, except for the Commonwealth.
The Act also outlines potential consequences for breaches. Although the specific offences, penalties, or civil/criminal consequences for breaching the provisions of the TCO are not detailed in the explanatory statement, the Customs Act 1901 generally includes provisions for penalties and enforcement mechanisms. Typically, breaches of customs regulations can lead to financial penalties, confiscation of goods, and potential criminal charges, depending on the nature and severity of the breach. The exact penalties would be determined by the relevant sections of the Customs Act 1901 and any related regulations.