EXPLANATORY STATEMENT
Tariff Concession Instrument No. 0609665
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.
Macquarie Leisure Operations Ltd applied for a TCO in respect of certain swimming pool wave generators on 5 June 2006.
Instrument
TCO No 0609665 was made on 25 August 2006. It declares that those certain swimming pool wave generators 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. 0609665 is taken to have come into force on 5 June 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, enacted by the Parliament of Australia, provides a framework under which the Chief Executive Officer of Customs can make Tariff Concession Orders (TCOs) to lower customs duty rates on certain goods. This Act was introduced to address the need for a streamlined process to adjust customs duties in response to specific economic conditions or to foster particular industries by reducing the cost of imported goods. The explanatory statement outlines Tariff Concession Instrument No. 0609665, which was issued on 25 August 2006, in response to an application from Macquarie Leisure Operations Ltd for a TCO on certain swimming pool wave generators. The instrument was made following the CEO’s satisfaction that no substitutable goods were produced in Australia, thus meeting the core criteria stipulated in the Act. As a result, the duty rate on these swimming pool wave generators was reduced from 5% to 0%. The policy objective of this concession is to potentially stimulate the market for these goods by making them more affordable, thereby encouraging their import and use.
Scope and Application
The Customs Act 1901 applies to individuals and entities engaged in the importation of goods into Australia, providing a framework for the imposition and concession of customs duties. Specifically, Part XVA of the Act enables the Chief Executive Officer of Customs to issue Tariff Concession Orders (TCOs) that lower the rate of customs duty on certain goods. The application process for a TCO is outlined in section 269F of the Act, where an applicant must satisfy the CEO that the goods in question do not fall under the exclusions specified in section 269SJ and meet the core criteria detailed in sections 269C, 269D, 269E, and 269P. The application process involves a notice to the public via the Gazette, inviting objections to the TCO, although in the case of TCO No. 0609665, no submissions were received. The TCO applies nationally and is effective from the date the application is lodged, as per subsection 269S(1) of the Act. Macquarie Leisure Operations Ltd successfully applied for a TCO on swimming pool wave generators, resulting in a duty rate reduction from 5% to 0%, effective from 5 June 2006.
Key Provisions
The main operative sections of this legislation, specifically Tariff Concession Instrument No. 0609665, provide a framework for the creation of Tariff Concession Orders (TCOs) under the Customs Act 1901. Section 269F allows an individual to apply to the Chief Executive Officer (CEO) of Customs for a TCO in relation to certain goods, provided those goods do not fall under the restricted list specified in section 269SJ. If the CEO determines that the application meets the core criteria, as outlined in sections 269C, 269B, and 269P, they must issue a written TCO. This particular TCO, number 0609665, pertains to certain swimming pool wave generators, as specified in item 50 of Schedule 4 to the Customs Tariff Act 1995, and sets the duty rate for these goods at 0% instead of the usual 5%.
The Act imposes several obligations and requirements on the parties involved. The CEO of Customs is required to assess whether an application for a TCO meets the core criteria, which includes ensuring that no substitutable goods are produced in Australia in the ordinary course of business. If the application meets these criteria, the CEO must make the TCO. Additionally, as per subsection 269K(1), the CEO must publish a notice in the Gazette after accepting a valid TCO application, inviting any interested party to lodge a submission if they believe the TCO should not proceed. In this case, no submissions were received. Furthermore, the TCO does not adversely affect the rights of any person except the Commonwealth and does not impose any liabilities on any person in relation to actions taken before the TCO's registration date.
Regarding breaches of this legislation, the Customs Act 1901 does not explicitly detail offences, penalties, or consequences for failing to comply with the provisions of a TCO. However, it is essential to note that non-compliance with customs regulations generally can lead to various penalties. These penalties may include fines, imprisonment, or both, depending on the severity and nature of the offence. For instance, under the Customs Act, penalties for offences related to customs duties can include fines up to 10,000 penalty units or imprisonment for up to five years, or both, for individuals, and higher penalties for bodies corporate. The specific consequences would depend on the nature and extent of the breach, as well as any additional relevant laws or regulations that may apply.