EXPLANATORY STATEMENT
Tariff Concession Instrument No. 1133648
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.
Greatorex Textile Induistries applied for a TCO in respect of certain twine on 04 October 2011.
Instrument
TCO No 1133648 was made on 04 January 2012. It declares that those certain twine 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. 1133648 is taken to have come into force on 04 October 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 to provide a framework for the regulation of customs and excise duties, among other things. The Act was introduced to address the need for a systematic approach to the administration of customs and excise, ensuring efficient and fair trade practices. Tariff Concession Orders (TCOs) under Part XVA of the Customs Act 1901 allow the Chief Executive Officer of Customs to apply a lower rate of customs duty on specified goods, provided certain criteria are met. Specifically, if no substitutable goods are produced in Australia in the ordinary course of business, an application for a TCO may be granted. This legislative instrument, Tariff Concession Instrument No. 1133648, was introduced to facilitate the application process for Greatorex Textile Industries regarding certain twine, ensuring they receive the appropriate tariff concession in line with the Customs Tariff Act 1995.
Scope and Application
The Tariff Concession Instrument No. 1133648 under the Customs Act 1901 provides for tariff concessions on certain twine, applicable to the goods specified in the instrument. This legislation applies to any person or entity that imports or deals with the specified twine, facilitating their access to reduced customs duty rates. The scope of the Act extends to the Commonwealth jurisdiction, meaning it applies nationally across Australia. It is pertinent to note that the Act does not apply to goods listed in section 269SJ of the Customs Act 1901, which are explicitly excluded from tariff concessions. The application process involves an assessment by the Chief Executive Officer of Customs to ensure that no substitutable goods are produced in Australia at the time of application, as outlined in section 269C of the Act. The concession takes effect from the date the application is lodged, as specified in subsection 269S(1) of the Act, ensuring that the rights of importers are protected from any retrospective disadvantages. Subordinate instruments may further extend or refine the application of this Act, thereby providing a comprehensive regulatory framework for tariff concessions.
Key Provisions
The Customs Act 1901, under Part XVA, facilitates the creation of Tariff Concession Orders (TCOs) by the Chief Executive Officer of Customs (CEO) (sections 269F and 269C). A TCO reduces the customs duty rate for specific goods, provided the application meets the core criteria. For instance, if the CEO is satisfied that no substitutable goods are produced in Australia on the date the application is lodged, a TCO may be issued (section 269C). The specific definitions of 'substitutable goods', 'goods produced in Australia', and 'ordinary course of business' are provided in sections 269D, 269E, and 269P(3). In the case of Greatorex Textile Industries, a TCO was issued on 04 January 2012 for certain twine, as no substitutable goods were produced in Australia, reducing the duty rate to zero (section 269P(3)).
The obligations imposed by the Act on the CEO include accepting valid TCO applications, determining whether the application meets the core criteria, and making a written order if the criteria are met (section 269F). The CEO must also publish a notice in the Gazette inviting submissions from any person who might object to the TCO (subsection 269K(1)). The CEO must consider these submissions before making a final decision on the TCO. Additionally, the Act ensures that a TCO does not affect the rights of any person, other than the Commonwealth, as at the date of registration (subsection 269S(1)).
Failure to comply with the requirements of the Act may result in certain consequences. Although specific offences and penalties are not detailed in the explanatory statement, the general legal framework suggests that breaches of customs regulations can lead to civil or criminal penalties. These may include fines or imprisonment, depending on the nature and severity of the breach. For instance, section 126 of the Regulations provides for the possibility of a refund of duty for importers under certain conditions, indicating a structured process for handling compliance and potential breaches.
In summary, the Customs Act 1901, through Part XVA, allows for the creation of TCOs to reduce customs duty rates for specific goods, provided the core criteria are met. The CEO has the responsibility to process applications, consider objections, and issue TCOs accordingly. While specific penalties for non-compliance are not detailed, the broader legal context implies potential civil or criminal consequences for breaches of customs regulations.