EXPLANATORY STATEMENT
Tariff Concession Instrument No. 0602851
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.
Bells Amusements Pty Ltd applied for a TCO in respect of certain fairground amusement rides on 20 January 2006.
Instrument
TCO No 0602851 was made on 31 March 2006. It declares that those certain fairground amusement rides 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 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. 0602851 is taken to have come into force on 20 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 Tariff Concession Instrument No. 0602851, enacted under the Customs Act 1901, aims to provide tariff concessions for specific goods by reducing the rate of customs duty applicable to them. This legislation was introduced to address the need for facilitating the import of goods where no substitutable products are produced domestically, thereby encouraging trade and potentially lowering costs for businesses and consumers. The instrument was enacted by the Chief Executive Officer of Customs, following an application from Bells Amusements Pty Ltd for tariff concessions on certain fairground amusement rides. The policy objective of this instrument is to ensure that the application of tariff concessions does not disadvantage any party and that it promotes equitable trade practices by providing a mechanism for duty refunds on eligible goods imported since the effective date of the concession.
The Tariff Concession Order (TCO) No. 0602851 specifies that certain fairground amusement rides are subject to a zero percent duty rate, effective from 20 January 2006, the date the application was lodged. This order was made after determining that no substitutable goods were being produced in Australia, aligning with the core criteria set out in section 269C of the Customs Act 1901. The instrument ensures that the rights of importers are protected and can benefit from duty refunds, while also ensuring that no liabilities are imposed on any party prior to the registration of the TCO. The CEO published a notice inviting submissions on the TCO application but did not receive any objections, facilitating the smooth implementation of the tariff concession.
Scope and Application
The Tariff Concession Instrument No. 0602851 under the Customs Act 1901 applies specifically to goods that are subject to a Tariff Concession Order (TCO) as requested by an applicant such as Bells Amusements Pty Ltd. This legislation allows for the reduction or elimination of customs duty on particular goods, in this case, certain fairground amusement rides, provided the goods are not being produced in Australia in the ordinary course of business. The instrument came into force on the date of the application, 20 January 2006, and affects the rights of importers by allowing them to apply for a refund of duty paid on these goods since that date. Importantly, the TCO does not disadvantage any person by imposing liabilities for actions taken prior to its registration, nor does it affect the rights of persons other than the Commonwealth. The application of this TCO is governed by the specific criteria outlined in the Customs Act 1901, and the CEO of Customs must ensure that the application meets the core criteria before issuing a TCO.
Key Provisions
The Customs Act 1901 allows for the creation of Tariff Concession Orders (TCOs) to reduce customs duty rates on certain goods, as outlined in section 269F. To qualify for a TCO, the goods in question must not be substitutable by any goods produced in Australia in the ordinary course of business, as per section 269C. The definitions of "goods produced in Australia," "ordinary course of business," and "substitutable goods" are provided in sections 269D, 269E, and 269B, respectively. If the Chief Executive Officer of Customs (CEO) is satisfied that the application meets these criteria, a written order is made under section 269P(3), declaring the goods to which a prescribed item of Schedule 4 to the Customs Tariff Act 1995 applies.
Entities such as Bells Amusements Pty Ltd, which applied for a TCO for certain fairground amusement rides on 20 January 2006, must ensure that their applications meet the core criteria to be successful. In this case, TCO No. 0602851, made on 31 March 2006, declared that the rides are subject to a 0% duty rate, down from the general rate of 5%. The CEO must also publish a notice in the Gazette inviting submissions on the proposed TCO, as per subsection 269K(1). In the case of TCO No. 0602851, no submissions were received in response to this invitation.
The obligations imposed by the Customs Act 1901 on parties governed by the TCO include ensuring that the goods in question are not substitutable by any Australian-made goods produced in the ordinary course of business. Importers benefit from the TCO as they can apply for a refund of duty on goods imported since the date the TCO is taken to have come into force, as per paragraph 126(1)(r) of the Regulations. The TCO does not affect the rights of any person (other than the Commonwealth) as at the date of registration or impose any liabilities on any person.
Failure to comply with the requirements of the Customs Act 1901 and the associated TCO could result in civil or criminal consequences. While the specific penalties are not detailed in the provided text, breaches of customs regulations can lead to fines or imprisonment. The exact penalties would depend on the nature and severity of the breach.