EXPLANATORY STATEMENT
Tariff Concession Instrument No. 1114754
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 retractable pet leash bag sets on 11 May 2011.
Instrument
TCO No 1114754 was made on 25 July 2011. It declares that those certain retractable pet leash bags sets 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. 1114754 is taken to have come into force on 11 May 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 Parliament of Australia, provides a framework for administering customs duties and other import charges. Part XVA of the Act introduces a scheme under which Tariff Concession Orders (TCOs) can be made by the Chief Executive Officer of Customs. The primary aim of this legislation is to offer relief from customs duty on certain goods, provided they meet specific criteria, thereby supporting economic efficiency and competitiveness. The Explanatory Statement for Tariff Concession Instrument No. 1114754 elucidates the process of issuing a TCO, highlighting the application requirements and the conditions under which the CEO must grant the concession. In this particular case, McPherson's Consumer Products successfully applied for a TCO on retractable pet leash bag sets, resulting in a reduction of duty from 5% to free. This legislative instrument ensures that the rights of all parties, except the Commonwealth, are preserved and that no new liabilities are imposed.
Scope and Application
The Tariff Concession Instrument No. 1114754 is an instrument under Part XVA of the Customs Act 1901, which provides for the making of Tariff Concession Orders (TCOs) by the Chief Executive Officer of Customs. This particular TCO applies to certain retractable pet leash bag sets, which are now subject to a free rate of duty as opposed to the general rate of 5%, following an application by McPherson's Consumer Products. The Act applies to any person or entity seeking to import the specified goods into Australia, with the CEO having the authority to grant concessions if specific criteria are met, such as the absence of substitutable goods produced in Australia. The geographic reach of this Act is national, as it pertains to the importation of goods into Australia. The TCO does not apply to goods specified in section 269SJ of the Act, which cannot be subject to a TCO. The TCO came into effect on 11 May 2011, the date the application was lodged, and benefits importers by potentially allowing them to claim refunds of duty paid on imports of these goods since that date. The Act allows for the extension and restriction of its application through subordinate instruments, although this specific TCO does not impose any new liabilities.
Key Provisions
The primary sections of the Customs Act 1901 that are pertinent to the Tariff Concession Order No. 1114754 include sections 269C, 269F, 269P, and 269SJ (sections 269C, 269F, 269P, 269SJ). Section 269F allows for an application to the Chief Executive Officer (CEO) of Customs for a Tariff Concession Order (TCO) in respect of specific goods. If the application is not for goods listed in section 269SJ, which are excluded from TCOs, the CEO must determine if the application meets the core criteria as outlined in section 269C. If satisfied, the CEO must issue a written TCO. Section 269P(3) further specifies that the TCO must declare that the goods are subject to a prescribed item of Schedule 4 to the Customs Tariff Act 1995.
Under this legislation, the CEO has specific obligations when processing a TCO application. The CEO must first ensure that the application is valid and not for goods excluded by section 269SJ. If valid, the CEO must assess whether the core criteria in section 269C are met, which involves confirming that no substitutable goods are produced in Australia. Once these criteria are met, the CEO must issue a TCO in writing. Additionally, under section 269K(1), the CEO is required to publish a notice in the Gazette inviting submissions from any interested parties. This process ensures transparency and allows for any objections to be considered before the TCO is made.
Breaching the provisions of the Customs Act 1901 can lead to various civil and criminal consequences. While the specific offences and penalties are not detailed in this context, general contraventions of the Act can result in fines and imprisonment. The maximum penalties will depend on the severity of the breach and the specific provisions of the Customs Act and associated regulations. It is important to adhere strictly to the legislative requirements to avoid these penalties.
In summary, Tariff Concession Order No. 1114754 was made under the Customs Act 1901 to provide a tariff concession on certain retractable pet leash bag sets, with the duty rate reduced from 5% to free. The CEO's role involves assessing applications, ensuring compliance with the core criteria, and publishing notices for public submissions. The TCO, which came into force on 11 May 2011, benefits importers by allowing them to apply for duty refunds and does not impose any new liabilities. Non-compliance with the Act's provisions can lead to significant penalties, underscoring the importance of adhering to the legislative framework.