EXPLANATORY STATEMENT
Tariff Concession Instrument No.0502713
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.
Brosnan Golf applied for a TCO in respect of certain golf club sets on 1 March 2005.
Instrument
TCO No 0502713 was made on 30 May 2005. It declares that those certain golf club sets 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. 0502713 is taken to have come into force on 1 March 2005.
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. 0502713 was enacted in 2005 to provide tariff concessions under the Customs Act 1901, specifically to address the need for lower rates of customs duty on certain imported goods that are not produced in Australia. The Customs Act 1901 allows the Chief Executive Officer (CEO) of Customs to grant Tariff Concession Orders (TCOs) for goods that meet specific criteria, such as the absence of substitutable goods being produced in Australia. Brosnan Golf applied for a TCO for certain golf club sets, and following the CEO's satisfaction that the application met the core criteria, the TCO was issued, effectively granting these goods a duty-free status. This legislative action aims to facilitate the importation of these goods without imposing additional costs on importers, thus enhancing their rights to seek refunds on duties already paid.
Scope and Application
The Tariff Concession Instrument No. 0502713, made under the Customs Act 1901, applies specifically to certain golf club sets that Brosnan Golf applied for tariff concessions on, effective from 1 March 2005. This instrument was issued by the Chief Executive Officer of Customs, following an application from Brosnan Golf, who sought a reduction in customs duty on these particular goods. The instrument is designed to lower the duty rate from the general 5% to free, provided that no substitutable goods were produced in Australia on the date the application was lodged, in accordance with the core criteria set out in section 269C of the Act. The instrument’s scope is limited to the specified golf club sets and does not affect any rights or liabilities of persons other than the Commonwealth as of the date of registration. Importers of the affected goods will be able to apply for a refund of duty paid on imports since the effective date of the concession.
Key Provisions
The Tariff Concession Instrument No. 0502713, issued under the Customs Act 1901, provides a detailed framework for the concession of customs duty on certain goods. Section 269F of the Act allows for the application of a Tariff Concession Order (TCO) by a person to the Chief Executive Officer (CEO) of Customs, who may grant such an order if it meets the core criteria outlined in section 269C. This section stipulates that a TCO application is valid if, on the date of its lodgement, no substitutable goods were produced in Australia in the ordinary course of business. Substitutable goods, as defined by section 269D, are those produced in Australia that could be used in place of the goods specified in the TCO application.
The obligations under the Act require the CEO to evaluate whether the application for a TCO meets the core criteria. If satisfied, the CEO must issue a written TCO, specifying the goods to which the concession applies, as per section 269P(3). The CEO is also mandated to publish a notice in the Gazette inviting any interested parties to submit objections to the TCO, as stipulated in subsection 269K(1). In this instance, no objections were received. The TCO comes into force on the date of the application lodgement, as per subsection 269S(1), which in this case was 1 March 2005.
Failure to comply with the requirements of the Customs Act 1901 may result in various consequences. Section 276 of the Act outlines potential penalties for breaches, which can include fines and imprisonment. The specific penalties for each offence vary, with some carrying a maximum penalty of up to 12 months imprisonment or a fine of up to 10,000 penalty units, as determined by the severity of the breach. The Act also provides for civil remedies, including the recovery of any unpaid duty or the imposition of additional charges for incorrect declarations.