EXPLANATORY STATEMENT
Tariff Concession Instrument No. 1121643
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.
Cormack Packaging applied for a TCO in respect of certain compact slide actuation moulds on 30 June 2011.
Instrument
TCO No 1121643 was made on 19 September 2011. It declares that those certain compact slide actuation moulds 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. 1121643 is taken to have come into force on 30 June 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 was enacted by the Australian Parliament and provides the framework for customs duties and related matters. The act includes provisions for tariff concession orders (TCOs), which can reduce customs duty rates on specified goods. The Tariff Concession Instrument No. 1121643 was introduced in 2011 to address the need for tariff concessions on certain compact slide actuation moulds. This instrument was made under the authority of the Chief Executive Officer of Customs and was designed to provide relief from customs duty for these goods if no substitutable goods were being produced in Australia. The policy objective of this instrument is to support the importation of goods that cannot be produced domestically, thereby benefiting importers by reducing their duty costs and potentially enhancing competitiveness in the relevant market.
Scope and Application
The Customs Act 1901, specifically under Part XVA, outlines the legislative framework for Tariff Concession Orders (TCOs) that can be issued by the Chief Executive Officer of Customs (CEO). These orders allow for a lower rate of customs duty on goods that are subject to a TCO. The Act applies to any person who may apply to the CEO for a TCO in respect of goods, provided the goods are not specified in section 269SJ of the Act which lists goods that cannot be subject to a TCO. The CEO assesses the application against the core criteria set out in section 269C of the Act, which require that no substitutable goods were produced in Australia in the ordinary course of business on the day the application was lodged. The CEO must then make a written order if satisfied that the application meets these criteria. The application of TCOs is national in scope, as the Customs Act 1901 is a Commonwealth Act, applying across Australia. The Tariff Concession Instrument No. 1121643, issued on 19 September 2011, exemplifies the process, where certain compact slide actuation moulds were granted a concession, reducing the duty rate from 5% to free. This TCO came into effect on 30 June 2011, the date of the application, and does not disadvantage any person or impose liabilities for actions prior to its registration.
Key Provisions
The main operative sections of the Tariff Concession Instrument No. 1121643 under the Customs Act 1901 (the Act) include sections 269C, 269B, 269E, 269D, 269F, 269P, and 269SJ. These sections outline the process for applying for and granting Tariff Concession Orders (TCOs), which provide lower rates of customs duty on specified goods. Section 269F allows for an application to the Chief Executive Officer of Customs (the CEO) for a TCO. If the application does not pertain to goods specified in section 269SJ, the CEO must determine if it meets the core criteria under section 269C, which requires that no substitutable goods were produced in Australia in the ordinary course of business on the day the application was lodged. If these criteria are met, the CEO must issue a written order (a TCO) under section 269P(3) that specifies the applicable tariff concession.
The obligations imposed by the Act on the parties it governs include the requirement for applicants to ensure that their applications are valid and do not pertain to goods listed in section 269SJ. The CEO is obligated to review applications, determine if they meet the core criteria, and, if satisfied, issue a TCO. Additionally, the CEO must publish a notice in the Gazette inviting submissions from any person who believes there are reasons why the TCO should not be made, as stipulated in section 269K(1). In the case of TCO No. 1121643, the CEO did not receive any submissions. The TCO is taken to have come into force on the date the application was lodged, as per section 269S(1).
Any breaches of the Act's provisions or the terms of a TCO may have legal consequences. However, the explanatory statement does not detail specific offences, penalties, or civil/criminal consequences for breach. It is important to refer to the relevant sections of the Customs Act 1901 and the Customs Regulations 1996 for detailed information on penalties and enforcement mechanisms. The statement does clarify that the TCO does not affect the rights of any person as at the date of registration and does not impose any liabilities on any person.