EXPLANATORY STATEMENT
Tariff Concession Instrument No. 0602272
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.
Multilift Commercial Pty Ltd applied for a TCO in respect of certain stair chair lifts on 16 January 2006.
Instrument
TCO No 0602272 was made on 10 April 2006. It declares that those certain stair chair lifts 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. 0602272 is taken to have come into force on 16 January 2006.
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 facilitate international trade by regulating the movement of goods across Australian borders, including the imposition and collection of customs duties. Specifically, Tariff Concession Instrument No. 0602272 was introduced to address the issue of high customs duties on certain imported goods, in this case, stair chair lifts, which could potentially disadvantage Australian consumers and businesses by increasing the cost of these goods. The instrument was made under the authority of the Customs Act and was introduced by the Chief Executive Officer of Customs in response to an application by Multilift Commercial Pty Ltd. The policy objective of this instrument was to reduce the financial burden on consumers and businesses by providing a tariff concession on the specified goods, thereby facilitating more affordable access to these products.
Scope and Application
The Customs Act 1901, specifically under Part XVA, facilitates the making of Tariff Concession Orders (TCOs) by the Chief Executive Officer of Customs. This legislation applies to individuals and entities that wish to apply for a TCO for goods that are not listed in section 269SJ of the Act, which excludes certain goods from tariff concession eligibility. The Act allows for reduced or no customs duty on goods specified in a TCO, provided that the application meets the core criteria, which includes the absence of substitutable goods produced in Australia in the ordinary course of business. The scope of this legislation extends to the national level, as it is an instrument of the Commonwealth of Australia, and it does not disadvantage any person other than the Commonwealth by affecting their rights as they stood at the date of registration. The TCO does not impose liabilities on any person, although it does allow for the beneficial effect of refunding duty to importers for goods imported since the TCO came into force. The application of this Act may be further defined or restricted through subordinate instruments.
Key Provisions
The main operative sections of the Tariff Concession Instrument No. 0602272 (F2006L01153) under the Customs Act 1901 include section 269C, which sets out the core criteria that a Tariff Concession Order (TCO) application must meet. Specifically, for the CEO to consider making a TCO, it must be established that no substitutable goods are produced in Australia at the time of the application (section 269C). Additionally, section 269P(3) requires the CEO to make a written order if the application meets the core criteria. This written order, the TCO, specifies the goods that qualify for a reduced rate of customs duty. In this case, TCO No. 0602272 was made for certain stair chair lifts, declaring them as goods eligible for a concession under item 50 of Schedule 4 to the Tariff.
The Act imposes several obligations and requirements on the parties involved. Firstly, any person seeking a TCO must submit an application to the CEO (section 269F). The CEO must then assess whether the application meets the core criteria, particularly whether substitutable goods are produced in Australia (section 269C). If the application is valid, the CEO must make a written TCO (section 269P(3)). The CEO is also required to publish a notice in the Gazette inviting submissions from any interested parties who may have reasons why the TCO should not be made (subsection 269K(1)). In this instance, no submissions were received, leading to the issuance of the TCO.
The Act sets out specific consequences for breaches of its provisions. However, in the context of this TCO, there are no explicit offences, penalties, or consequences outlined for failing to comply with the terms of the TCO itself. Nevertheless, any misuse of the concession or non-compliance with other related customs regulations could potentially lead to penalties under other sections of the Customs Act 1901 or the Customs Tariff Act 1995. For instance, if an entity were found to have falsely claimed tariff concessions, they could face significant penalties, including fines and potential imprisonment, under broader customs laws.