EXPLANATORY STATEMENT
Tariff Concession Instrument No. 0615603
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.
Australian Discount Retail (Trading) Pty Ltd applied for a TCO in respect of certain digital portable voice recorders on 10 October 2006.
Instrument
TCO No 0615603 was made on 15 December 2006. It declares that those certain digital portable voice recorders 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. 0615603 is taken to have come into force on 10 October 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 Australian Parliament, establishes a framework within which Tariff Concession Orders (TCOs) can be made by the Chief Executive Officer of Customs. This legislative instrument addresses the issue of applying preferential tariff rates to specific goods, thereby promoting fair trade practices and economic efficiency. The Tariff Concession Instrument No. 0615603, which came into effect on 10 October 2006, was introduced following an application by Australian Discount Retail (Trading) Pty Ltd for a tariff concession on certain digital portable voice recorders. The policy objective is to ensure that if no substitutable goods are produced in Australia, the applicant's goods can benefit from a reduced customs duty rate, thereby facilitating competitive pricing and potentially boosting market demand for these goods. This mechanism is designed to support Australian businesses and consumers by making certain imported goods more affordable.
Scope and Application
The Tariff Concession Instrument No. 0615603 under the Customs Act 1901 applies specifically to the concession of customs duty on certain digital portable voice recorders, as applied for by Australian Discount Retail (Trading) Pty Ltd. The instrument was made by the Chief Executive Officer of Customs (CEO) on 15 December 2006, following an application made on 10 October 2006. The CEO determined that no substitutable goods were produced in Australia at the time of the application, thereby meeting the core criteria under section 269C of the Act. Consequently, the instrument declares that these specific digital portable voice recorders are subject to a zero percent duty rate, down from the general rate of five percent. The instrument applies nationally across Australia, governed under the Commonwealth jurisdiction, and it came into force on the date the application was lodged, which was 10 October 2006. No submissions were received in opposition to the concession, indicating broad acceptance or lack of contention regarding the concession's application. The instrument does not disadvantage any person or impose liabilities on anyone in respect of actions taken prior to its registration, and it allows for potential duty refunds for importers as per the Customs Tariff Regulations.
Key Provisions
The main operative sections of this legislation are sections 269C, 269F, and 269P of the Customs Act 1901. Section 269F allows a person to apply to the Chief Executive Officer of Customs (CEO) for a Tariff Concession Order (TCO) in respect of goods. If the CEO is satisfied that the application meets the core criteria set out in section 269C, they must make a written order (TCO) as specified in section 269P(3). This TCO will then apply a lower rate of customs duty to the specified goods. In this case, the TCO No. 0615603, made on 15 December 2006, specifies that certain digital portable voice recorders will be subject to a 0% duty rate, as opposed to the general 5% rate.
The Act imposes specific obligations and requirements on the parties involved. An applicant must ensure their TCO application meets the core criteria outlined in section 269C, which requires that no substitutable goods were produced in Australia in the ordinary course of business on the day the application was lodged. The CEO is obligated to review the application and, if it meets the criteria, to issue a TCO. The CEO must also publish a notice in the Gazette inviting any person to lodge a submission if they consider there are reasons why the TCO should not be made, as stated in subsection 269K(1) of the Act. In this instance, no submissions were received. The TCO will come into force on the day the application was lodged, as per subsection 269S(1).
Breaching the requirements or obligations of this legislation can lead to civil or criminal consequences. If an application for a TCO is made without meeting the core criteria, or if false information is provided, the CEO may not issue a TCO, and the applicant may face legal repercussions. The Act does not specify particular penalties for such breaches, but they may include fines or other civil penalties as determined by applicable law. Additionally, any misrepresentation or fraud in the application process could lead to criminal charges under general criminal law provisions.