EXPLANATORY STATEMENT
Tariff Concession Instrument No. 0410860
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.
Tymhour Pty Ltd applied for a TCO in respect of certain violin or viola bows carry cases on 15 October 2004.
Instrument
TCO No 0410860 was made on 4 January 2005. It declares that those certain violin or viola bows carry cases are goods to which item 50A 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 0%.
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.0410860 is taken to have come into force on 15 October 2004.
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 to regulate and facilitate the movement of goods across Australia's borders. The introduction of Tariff Concession Orders (TCOs) through Part XVA of the Act addresses the problem of ensuring that Australian consumers have access to goods that are not produced domestically, while also promoting international trade and competition. The Parliament of Australia established this scheme to provide a mechanism for lowering customs duty rates on certain imported goods, thereby reducing the cost burden on consumers and supporting economic efficiency. The objective is to ensure that imports are accessible and affordable, while also fostering an environment conducive to trade.
The Tariff Concession Instrument No. 0410860, made on 4 January 2005, exemplifies this legislative intent by applying to certain violin or viola bows carry cases. This instrument was created in response to an application by Tymhour Pty Ltd, after it was determined that no substitutable goods were being produced in Australia. The Customs Act mandates that if the Chief Executive Officer of Customs is satisfied that the application meets the core criteria, a TCO must be issued, resulting in a reduction of the general duty rate from 5% to 0%. This instrument came into force on the date of application, 15 October 2004, without imposing any liabilities or disadvantaging any parties.
Scope and Application
The Customs Act 1901, through Part XVA, facilitates the creation of Tariff Concession Orders (TCOs) which are issued by the Chief Executive Officer of Customs (CEO). These orders apply to specific goods, providing them with a lower rate of customs duty than that which is generally applicable. The Act allows individuals or entities to apply for a TCO, provided the goods in question are not specified in section 269SJ, which lists goods that cannot be subject to a TCO. For an application to meet the core criteria, it must be established that no substitutable goods are produced in Australia in the ordinary course of business. Once these criteria are met, the CEO is required to issue a TCO, specifying the prescribed item of Schedule 4 to the Customs Tariff Act 1995 applicable to the goods in question. The instrument's jurisdictional reach is national, applying across Australia, and it does not disadvantage existing rights or impose liabilities on individuals or entities for actions taken prior to the registration of the TCO. There are no exclusions or exemptions stated within the text, and the scope of the application is defined strictly by the conditions laid out in the Act.
Key Provisions
The primary operative sections of this legislation concern the establishment of Tariff Concession Orders (TCOs) under Part XVA of the Customs Act 1901. Specifically, section 269F allows for an application to the Chief Executive Officer of Customs (CEO) for a TCO. Section 269C stipulates that a TCO application meets the core criteria if no substitutable goods are produced in Australia in the ordinary course of business on the date the application is lodged. The CEO is required to make a written order (the TCO) if satisfied that the application meets these criteria, as per section 269P(3). This particular TCO No. 0410860, made on 4 January 2005, applies to certain violin or viola bows carry cases and specifies that these goods are subject to item 50A of Schedule 4 of the Customs Tariff Act 1995, resulting in a duty rate of 0% instead of the general rate of 5%.
The obligations imposed by this Act on the parties involved are primarily centred on the application and assessment processes for TCOs. The applicant must ensure that their application is lodged with sufficient evidence to meet the core criteria outlined in the Act. The CEO has the obligation to assess the application, publish a notice in the Gazette inviting submissions, and decide whether to make the TCO. In this case, Tymhour Pty Ltd fulfilled their obligation by applying for the TCO on 15 October 2004, and the CEO fulfilled their obligation by making the order on 4 January 2005 after confirming that no substitutable goods were produced in Australia. The Act also mandates that the TCO comes into force on the date the application is lodged, which was 15 October 2004 for TCO No. 0410860.
Regarding the consequences of breaching the provisions of this Act, it is essential to note that the Act does not explicitly outline criminal penalties for non-compliance. However, the application and assessment processes for TCOs are strictly regulated. Failure to provide accurate information or meet the criteria could result in the CEO's refusal to make a TCO. Additionally, while the Act does not impose liabilities on any person, any misrepresentation or fraud in the application process could potentially lead to civil or criminal consequences under other provisions of the Customs Act 1901 or related legislation. The specific penalties for such breaches would depend on the nature and severity of the offence, but they could include fines or imprisonment as determined by the courts.