EXPLANATORY STATEMENT
Tariff Concession Instrument No. 1129230
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 hot plate liners on 26 August 2011.
Instrument
TCO No 1129230 was made on 14 November 2011. It declares that those certain hot plate liners 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. 1129230 is taken to have come into force on 26 August 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, establishes a framework for Tariff Concession Orders (TCOs) aimed at providing tariff relief for certain goods. These concessions are intended to benefit Australian consumers and businesses by reducing the customs duty on specified goods. A TCO may be applied for by any person under section 269F of the Act, provided the goods do not fall under the restrictions outlined in section 269SJ. The Chief Executive Officer of Customs (CEO) is responsible for assessing whether the application meets the core criteria set forth in sections 269C, 269D, and 269E of the Act, particularly focusing on the absence of substitutable goods produced in Australia. Once the CEO determines that a TCO application satisfies these criteria, they must issue a written order declaring the goods to which a prescribed tariff item applies, as per section 269P(3). In the case of McPherson's Consumer Products, a TCO was issued for certain hot plate liners on 14 November 2011, reducing the duty rate from 5% to free, effective from 26 August 2011. The CEO also published a notice in the Gazette inviting submissions against the TCO, although no objections were received. The issuance of the TCO ensures that the rights of importers are positively affected, enabling them to apply for duty refunds on goods imported since the effective date of the TCO.
Scope and Application
The Tariff Concession Instrument No. 1129230 applies to goods specified in the instrument, namely certain hot plate liners, and is issued under the Customs Act 1901, which is a Commonwealth Act. This legislation applies to any entity or individual involved in the import or export of goods affected by this Instrument, particularly those who might benefit from the tariff concession. The geographic reach of this Act extends to all of Australia as it pertains to the administration of customs duties at the national level. The application of this Instrument is limited to the specific goods mentioned, and it does not extend to goods that are specified in section 269SJ of the Customs Act 1901, which cannot be subject to a Tariff Concession Order. The Act allows for further specification and regulation through subordinate instruments, such as the Customs Tariff Act 1995, which provides the schedule of tariff items that the Instrument references. The commencement of this Instrument is backdated to the date of the application for the Tariff Concession Order, which was lodged on 26 August 2011.
Key Provisions
The main operative sections of the Customs Act 1901 relevant to Tariff Concession Orders (TCOs) include sections 269C, 269F, 269K, and 269P. Section 269F allows for an application to be made to the Chief Executive Officer of Customs (CEO) for a TCO in respect of goods. Section 269C outlines the core criteria that must be met for the CEO to consider a TCO application, specifically that no substitutable goods are produced in Australia in the ordinary course of business on the day the application was lodged. Section 269K mandates the CEO to publish a notice in the Gazette inviting submissions on the application as soon as practicable after accepting it as valid, while Section 269P requires the CEO to make a written order if satisfied that the application meets the core criteria.
The Act imposes certain obligations on the CEO and applicants for a TCO. The CEO must assess whether the application meets the core criteria set out in section 269C and ensure that the application is not in respect of goods specified in section 269SJ, which cannot be subject to a TCO. The CEO is also required to publish a notice in the Gazette inviting submissions from any person who may have an interest in the application being made or not. For applicants, the primary obligation is to submit a valid application that meets the criteria outlined in section 269C and to provide all necessary information to satisfy the CEO that the application is appropriate.
The Act does not explicitly detail offences, penalties, or civil/criminal consequences for breach concerning TCO applications. However, it is implied that any non-compliance with the provisions of the Customs Act 1901 or the associated regulations may lead to enforcement actions as per other relevant sections of the Act. The CEO has the authority to investigate and take necessary actions against any breaches, which could potentially include the imposition of fines, legal proceedings, or other penalties as prescribed by the Act. It is important for all parties involved to adhere strictly to the requirements set forth to avoid any adverse consequences.