EXPLANATORY STATEMENT
Tariff Concession Instrument No. 1133856
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.
B Box for Kids Pty Ltd applied for a TCO in respect of certain nappy caddies on 30 September 2011.
Instrument
TCO No 1133856 was made on 19 December 2011. It declares that those certain nappy caddies 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. 1133856 is taken to have come into force on 30 September 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 Tariff Concession Instrument No. 1133856, enacted under the Customs Act 1901, aims to provide tariff concessions for specific goods, thereby addressing the need for reduced customs duties on certain imported items. This instrument was introduced to facilitate the import of goods by lowering the customs duty rate, provided that no substitutable goods are produced in Australia. The Customs Act 1901, enacted by the Australian Parliament, established a framework for the creation of Tariff Concession Orders (TCOs) by the Chief Executive Officer of Customs, which can be applied for by interested parties. The policy objective of this legislation is to encourage the importation of goods by making them more affordable through reduced tariff rates, provided certain conditions are met, thereby potentially stimulating trade and economic activity.
Scope and Application
The Customs Act 1901, specifically under Part XVA, governs the issuance of Tariff Concession Orders (TCOs) by the Chief Executive Officer of Customs (CEO). This legislation applies to individuals or entities seeking lower customs duty rates for specific goods by applying for a TCO. The application process requires that the goods in question are not listed in section 269SJ of the Act and meet the core criteria outlined in sections 269C, 269D, and 269E. If the CEO determines that no substitutable goods are produced in Australia, a TCO may be issued, resulting in a reduction of the customs duty rate for the specified goods. The application must be made in writing, and the CEO is required to publish a notice in the Gazette inviting any interested parties to submit objections, although no submissions were received for TCO No. 1133856. The TCO does not retroactively affect the rights of any party other than the Commonwealth and does not impose any new liabilities. Instead, it allows importers to apply for duty refunds on goods imported since the effective date of the TCO.
Key Provisions
The key operative sections of this legislation are sections 269C, 269F, 269P, and 269SJ of the Customs Act 1901 (the Act). Section 269F allows a person to apply to the Chief Executive Officer of Customs (the CEO) for a Tariff Concession Order (TCO) in respect of goods. Section 269C specifies 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 269P(3) mandates 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) applies. Section 269SJ specifies the goods that cannot be subject to a TCO.
The Act imposes several obligations and requirements on the parties it governs. The CEO must determine whether a TCO application meets the core criteria as outlined in section 269C. If the CEO is satisfied that the application meets these criteria and is not in respect of goods specified in section 269SJ, the CEO must make a TCO. The CEO must also publish a notice in the Gazette inviting submissions from any person who considers that there are reasons why the TCO should not be made, as per subsection 269K(1) of the Act. Importers, upon application, can receive a refund of duty on goods imported since the day on which the TCO is taken to have come into force, under paragraph 126(1)(r) of the Regulations.
The legislation does not explicitly outline specific offences, penalties, or civil/criminal consequences for breaches. However, the general legal framework under which the Customs Act 1901 operates would apply to any breaches. This could include penalties for non-compliance with customs regulations, which can range from fines to imprisonment, depending on the severity of the breach and the specific provisions of the Act and related regulations. The exact penalties would be determined by the courts in the event of a breach.