EXPLANATORY STATEMENT
Tariff Concession Instrument No. 0612694
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.
Thinking Ergonomix Pty Ltd applied for a TCO in respect of certain stepless height table adjusters on 31 July 2006.
Instrument
TCO No 0612694 was made on 20 October 2006. It declares that those certain stepless height table adjusters 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. 0612694 is taken to have come into force on 31 July 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. 0612694 was enacted in 2006 as a part of the Customs Act 1901, aiming to address the issue of providing tariff concessions for certain goods that are not produced in Australia, thus ensuring a fair competitive environment for imported goods. This instrument was created under the authority of the Chief Executive Officer of Customs, who has the power to make Tariff Concession Orders (TCOs) that result in a lower rate of customs duty for specified goods. In this particular case, the instrument was introduced in response to an application by Ergonomix Pty Ltd for tariff concessions on certain stepless height table adjusters, which were not produced in Australia at the time. The primary objective was to ensure that the application of the TCO did not disadvantage any person, other than the Commonwealth, and it was designed to benefit importers by potentially allowing them to apply for a refund of duty on goods imported since the effective date of the concession.
Scope and Application
The Customs Act 1901 applies to entities and individuals involved in the import and export of goods in Australia. Specifically, Tariff Concession Orders (TCOs) under Part XVA of the Act, such as TCO No. 0612694, pertain to the application of lower rates of customs duty on certain goods. The Act mandates that a TCO may only be issued if no substitutable goods are produced in Australia in the ordinary course of business, as defined by the Act. The geographic reach of this legislation is national, applying across all states and territories within Australia. Exclusions from TCO eligibility are outlined in section 269SJ, which specifies certain goods that cannot be subject to a TCO. The application process requires a formal submission to the Chief Executive Officer of Customs, with opportunities for public consultation as per section 269K(1). The application for TCO No. 0612694 was lodged by Thinking Ergonomix Pty Ltd on 31 July 2006, and the order came into force on the same date. The order, effective from the date of application, provides tariff concessions for specific stepless height table adjusters, reducing their duty rate to free from the general rate of 5%.
Key Provisions
The Customs Act 1901, as outlined in sections 269C, 269B, and 269P(3), provides a framework for the creation of Tariff Concession Orders (TCOs) by the Chief Executive Officer of Customs (CEO). When a person applies for a TCO, the CEO must ensure that the goods in question are not listed in section 269SJ, which specifies goods ineligible for TCOs. If the application does not involve these restricted goods and meets the core criteria stipulated in section 269C, the CEO must issue a written TCO. This TCO specifies a lower rate of customs duty, as per a prescribed item in Schedule 4 to the Customs Tariff Act 1995, for the goods in question. In this case, the TCO No. 0612694, made on 20 October 2006, declared that certain stepless height table adjusters would have a duty rate of free, down from the general rate of 5%.
The obligations under the Customs Act 1901 require the CEO to consider applications for TCOs and ensure that they comply with the statutory criteria. The CEO must also publish a notice in the Gazette, inviting submissions from any interested parties who may have reasons to oppose the TCO. This process ensures transparency and allows for stakeholder input. In the case of TCO No. 0612694, the CEO did not receive any submissions opposing the TCO.
Any breach of the requirements set forth in the Customs Act 1901 may result in legal consequences. However, the Explanatory Statement does not detail specific offences, penalties, or civil/criminal consequences for non-compliance with the TCO provisions. The Act and associated regulations would need to be consulted to determine the penalties for non-compliance. It is clear, though, that the TCO does not disadvantage any person or impose liabilities for actions taken before its registration, ensuring that rights are preserved for those affected by the concession.