EXPLANATORY STATEMENT
Tariff Concession Instrument No. 0516378
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.
Super Cheap Auto Pty Ltd applied for a TCO in respect of certain portable carports on 23 November 2005.
Instrument
TCO No 0516378 was made on 30 January 2006. It declares that the certain portable carports is a good 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. 0516378 is taken to have come into force on 23 November 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 Customs Act 1901, enacted by the Parliament of Australia, establishes a framework for the administration of customs duties and provides mechanisms for tariff concessions through the creation of Tariff Concession Orders (TCOs). This legislative instrument was introduced to address the need for a streamlined process to provide duty relief on certain imported goods, facilitating trade by reducing the cost of importing specific items. The policy objective is to encourage the importation of goods that are not produced domestically, thus benefiting consumers and businesses by potentially lowering prices and increasing availability. TCO No. 0516378, issued on 30 January 2006, is a specific instance where the Chief Executive Officer of Customs granted a concession to reduce the duty on certain portable carports from the general rate of 5% to free, following an application by Super Cheap Auto Pty Ltd. This concession was made after determining that no substitutable goods were produced in Australia, aligning with the core criteria outlined in the Act. The TCO was effective from the date of the application on 23 November 2005, and no submissions were received against the concession during the consultation period.
Scope and Application
The Customs Act 1901, specifically under Part XVA, provides a framework for Tariff Concession Orders (TCOs) which can be made by the Chief Executive Officer of Customs (CEO) to reduce customs duty rates on certain goods. An application for a TCO can be submitted by any person, provided the goods are not those specified in section 269SJ of the Act, which lists goods ineligible for tariff concessions. The CEO evaluates the application against core criteria set out in section 269C, ensuring that no substitutable goods are produced in Australia in the ordinary course of business, as defined in sections 269D and 269E. If these conditions are met, a TCO is issued, applying a specified lower duty rate on the goods. The TCO applies nationally across Australia, impacting importers by potentially allowing them to claim refunds on duties paid on the specified goods since the effective date of the TCO. Importantly, the TCO does not retroactively affect rights or impose liabilities on any person other than the Commonwealth for actions taken prior to its registration.
Key Provisions
The main operative sections of this legislation revolve around the ability to apply for a Tariff Concession Order (TCO) under section 269F (1) of the Customs Act 1901. This section provides that a person can apply to the Chief Executive Officer of Customs (CEO) for a TCO in respect of goods. The CEO is required to consider whether the application meets the core criteria set out in section 269C. This involves determining whether no substitutable goods were produced in Australia in the ordinary course of business on the day the application was lodged, as defined in section 269D and 269E respectively. If the application meets these criteria, the CEO must make a TCO as per section 269P(3), which specifies the prescribed item of Schedule 4 to the Customs Tariff Act 1995 that applies to the goods.
The obligations imposed by the Customs Act 1901 on the parties or entities it governs include the requirement for applicants to ensure that their applications for a TCO are valid and meet the specified criteria. The CEO, on receiving an application, must publish a notice in the Gazette inviting submissions from any person who believes the TCO should not be made, as per subsection 269K(1). The CEO must also decide whether the application meets the core criteria under section 269C and, if satisfied, make a TCO accordingly. The Act further mandates that the rights of persons are not adversely affected by the TCO, ensuring that it does not impose liabilities on anyone for actions taken before the TCO's effective date.
Should there be a breach of the provisions under the Customs Act 1901, there are potential consequences. The Act does not explicitly state offences, penalties, or civil/criminal consequences for breaches of the TCO provisions. However, it is implicit that non-compliance with the requirements for applying for and making a TCO, or failure to adhere to the conditions of the TCO, could result in legal actions. The exact penalties for such breaches would typically be determined in the context of other relevant laws and regulations, such as the Crimes Act 1914 or specific administrative penalties outlined in the Customs Act 1901. The severity of penalties would depend on the nature and extent of the breach, with potential outcomes ranging from fines to more severe criminal sanctions in cases of deliberate non-compliance.