EXPLANATORY STATEMENT
Tariff Concession Instrument No. 0516800
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.
Quebec Nominees Pty Ltd applied for a TCO in respect of certain game sets on 14 December 2005.
Instrument
TCO No 0516800 was made on 03 March 2006. It declares that those certain game 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. 0516800 is taken to have come into force on 14 December 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. 0516800, enacted in 2006, is a legislative instrument under the Customs Act 1901. It was introduced to address the need for tariff concessions on specific imported goods, allowing for a lower rate of customs duty for those goods that meet certain criteria. The instrument was made by the Chief Executive Officer of Customs in response to an application by Quebec Nominees Pty Ltd for tariff concessions on certain game sets. The policy objective behind this legislation is to support the importation of goods that are not produced domestically, thereby encouraging trade and potentially lowering costs for consumers.
The instrument operates by providing a concession on the customs duty applicable to the specified game sets, with the rate of duty being reduced from the general rate of 5% to free. The instrument came into effect on 14 December 2005, the date the application was lodged, and it does not affect the rights of any person as at the date of registration, nor does it impose any liabilities. Importers of the affected goods will benefit from the tariff concession, and they may apply for a refund of duty paid on those goods since the effective date of the concession. The instrument was published in the Gazette, inviting submissions, but none were received.
Scope and Application
The Tariff Concession Instrument No. 0516800 under the Customs Act 1901 applies to the specific case of Quebec Nominees Pty Ltd, which sought a tariff concession order (TCO) for certain game sets. This instrument, issued by the Chief Executive Officer of Customs (CEO), pertains to goods that are subject to a reduced rate of customs duty as stipulated by a TCO. The application for a TCO must meet the core criteria set out in section 269C of the Act, which requires that on the day the application was lodged, no substitutable goods were produced in Australia in the ordinary course of business. The CEO, after ensuring that the application does not concern goods specified in section 269SJ, which are ineligible for a TCO, must decide whether the application meets these criteria. Once satisfied, the CEO is obligated to issue a written order, declaring the goods to which a prescribed item of Schedule 4 to the Customs Tariff Act 1995 applies. The instrument has a national jurisdictional reach, applying throughout Australia and is effective from the date the TCO application was lodged. The rights of importers will be beneficially affected as they may apply for a refund of duty on goods imported since the effective date of the TCO, without any additional liabilities imposed on any person.
Key Provisions
The primary sections of the Tariff Concession Instrument No. 0516800 (subsection 269C) determine the conditions under which an application for a Tariff Concession Order (TCO) may be approved by the Chief Executive Officer of Customs (CEO). A TCO application will be deemed to meet the core criteria if, on the date the application was submitted, no goods that could replace the ones in question were being produced in Australia in the ordinary course of business (subsection 269C). This definition is further elaborated in sections 269D (goods produced in Australia), 269E (ordinary course of business), and 269P(3) (substitutable goods).
Entities applying for a TCO, such as Quebec Nominees Pty Ltd in this instance, must ensure their applications are lodged in accordance with the stipulated conditions. The CEO is obligated to make a written order if satisfied that the application meets the core criteria and is not in respect of goods specified in section 269SJ, which outlines those goods that cannot be subject to a TCO. Furthermore, as per subsection 269K(1), the CEO must publish a notice in the Gazette inviting any interested parties to lodge submissions if they believe the TCO should not be made. In this case, no submissions were received.
Breaching the requirements outlined in the Customs Act 1901 or the Tariff Concession Instrument could lead to various legal consequences. While the specific penalties are not detailed in the text, general breaches of customs legislation can result in fines and other penalties. For instance, knowingly making a false statement or representation in relation to customs duty can attract significant fines under the Customs Act. Additionally, failure to comply with TCO requirements could potentially lead to civil or administrative penalties, depending on the specifics of the breach and the relevant provisions of the Customs Act and associated regulations.