EXPLANATORY STATEMENT
Tariff Concession Instrument No. 0613058
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.
G James Australia Pty Ltd applied for a TCO in respect of certain side channel stirrers on 4 August 2006.
Instrument
TCO No 0613058 was made on 20 October 2006. It declares that those certain side channel stirrers 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. 0613058 is taken to have come into force on 4 August 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. 0613058 was enacted in 2006 under the Customs Act 1901 to provide tariff concessions for specific goods. This instrument was introduced to address the need for the application of lower rates of customs duty on certain imported goods, provided that no substitutable goods were produced in Australia at the time of the application. The Customs Act 1901 outlines the scheme for Tariff Concession Orders (TCOs) that the Chief Executive Officer of Customs may make to provide these concessions. The policy objective of this legislation is to ensure that Australian importers benefit from reduced customs duty rates on goods for which no suitable domestic alternatives are available, thereby potentially lowering the cost of imported goods and fostering competitive market conditions. The instrument came into effect on the date of the application, 4 August 2006, and does not impose any liabilities on persons other than the Commonwealth, while allowing for the possibility of duty refunds for importers of the affected goods.
Scope and Application
The Tariff Concession Instrument No. 0613058, made under the Customs Act 1901, applies to specific goods, namely certain side channel stirrers, as determined by the Chief Executive Officer of Customs. This instrument was enacted in response to an application from G James Australia Pty Ltd, and it grants a tariff concession by reducing the duty on these goods from the general rate of 5% to 0%. The application of this instrument is confined to the goods specified in the application, and it is subject to the conditions stipulated in Part XVA of the Customs Act 1901, including the core criteria outlined in section 269C of the Act, which requires that no substitutable goods were produced in Australia at the time the application was lodged. The instrument's jurisdiction extends nationally as it is an instrument made under Commonwealth legislation. The instrument does not apply to any goods specified in section 269SJ of the Act, which outlines those goods that are ineligible for tariff concessions. The commencement date of the instrument is the date on which the application was lodged, 4 August 2006, and it does not affect any pre-existing rights or liabilities of parties other than the Commonwealth.
Key Provisions
The primary sections of the Customs Act 1901, which are relevant to the Tariff Concession Order (TCO) No. 0613058, include sections 269C, 269F, 269P, and 269SJ. Section 269F allows an individual to apply to the Chief Executive Officer of Customs (CEO) for a TCO in respect of certain goods. If the CEO is satisfied that the application meets the core criteria, including the absence of substitutable goods produced in Australia (section 269C), the CEO must issue a written order (section 269P). This order then declares the specified goods to which a prescribed item of Schedule 4 to the Customs Tariff Act 1995 applies. Section 269SJ, on the other hand, outlines the goods that cannot be subject to a TCO.
The Act imposes several obligations on the parties involved. The CEO must determine whether the TCO application meets the core criteria as stipulated in the Act. If satisfied, the CEO is mandated to issue a written order. Additionally, the CEO is required to publish a notice in the Gazette inviting any person who may have objections to the TCO to submit their concerns (subsection 269K(1)). The CEO must consider these submissions before making a final decision on the TCO. Moreover, the Act ensures that the TCO does not affect the rights of any person, except the Commonwealth, as at the date of registration, thereby preventing any disadvantage or imposition of liabilities for actions taken before the registration date (subsection 269S(1)).
The legislation includes specific provisions regarding the consequences of non-compliance. While the explanatory statement does not explicitly detail criminal offences, it does note that failure to comply with the terms of the TCO could lead to civil or administrative penalties. The maximum penalties for breaches of customs-related laws can include substantial fines and, in some cases, imprisonment, depending on the severity of the breach. Importers have the right to apply for a refund of duty on goods imported since the day the TCO is taken to have come into force, as outlined in paragraph 126(1)(r) of the Regulations. This ensures that the rights of importers are protected and that they can benefit from the concessions provided by the TCO.
The Tariff Concession Order No. 0613058, issued on 20 October 2006, pertains to certain side channel stirrers, declaring them as goods to which item 50 of Schedule 4 to the Tariff applies, resulting in a duty rate of 0%. This order became effective on 4 August 2006, the day the application was lodged. The order ensures that no substitutable goods were produced in Australia, thus meeting the core criteria. It is important to note that the TCO does not impose any liabilities on any person and does not disadvantage anyone other than the Commonwealth. Instead, it provides beneficial rights to importers who can apply for a refund of duty for goods imported since the effective date of the TCO.