EXPLANATORY STATEMENT
Tariff Concession Instrument No. 0616811
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.
Nilfisk Pty Ltd applied for a TCO in respect of certain sweepers and/or cleaners and/or scrubbers on 6 September 2006.
Instrument
TCO No 0616811 was made on 24 November 2006. It declares that those certain sweepers and/or cleaners and/or scrubbers 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. 0616811 is taken to have come into force on 6 September 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. 0616811, enacted in 2006, addresses the need to provide tariff concessions on certain goods, specifically sweepers, cleaners, and scrubbers, to facilitate trade and economic efficiency. The Customs Act 1901 establishes a framework for the Chief Executive Officer of Customs to make Tariff Concession Orders (TCOs) that lower customs duty rates on specified goods, provided certain criteria are met. Nilfisk Pty Ltd applied for a TCO on these items, which was subsequently approved by the CEO as no substitutable goods were produced in Australia at the time of application. Consequently, the TCO reduced the duty rate from the general 5% to 0%, effective from the date the application was lodged, which is 6 September 2006. This legislative action by the Commonwealth Parliament aims to promote fair trade practices by ensuring that Australian importers are not disadvantaged and can benefit from reduced duty rates on specified imported goods.
Scope and Application
The Tariff Concession Instrument No. 0616811, made under section 269F of the Customs Act 1901, applies to any individual or entity that has applied for a Tariff Concession Order (TCO) for specific goods, in this case certain sweepers, cleaners, and scrubbers, which have been declared eligible for a concessional rate of customs duty. The Act operates on a Commonwealth level, providing a scheme for the Chief Executive Officer of Customs to issue TCOs that apply a lower rate of customs duty to goods that meet certain criteria, such as the absence of substitutable goods produced in Australia. The instrument excludes goods specified in section 269SJ of the Act, which are ineligible for tariff concessions. The instrument also extends its application through the Customs Tariff Act 1995, which specifies the prescribed duty rates in its Schedule 4. The TCO does not disadvantage any person by affecting their rights as at the date of registration, nor does it impose liabilities on persons other than the Commonwealth for actions taken prior to the TCO's effective date.
Key Provisions
The main operative sections of Tariff Concession Instrument No. 0616811, made under the Customs Act 1901, establish the conditions under which a Tariff Concession Order (TCO) can be issued by the Chief Executive Officer of Customs (CEO). Section 269F of the Act allows for an application to be made by any person seeking a TCO for specific goods (s. 269F). If the CEO determines that the goods are not prohibited by section 269SJ, they must assess whether the 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 (s. 269C). If these criteria are met, the CEO must issue a written TCO, specifying the goods and the applicable rate of customs duty (s. 269P(3)).
The Act imposes several obligations and requirements on the parties involved. The CEO must ensure that the application is valid and not in respect of goods listed in section 269SJ (s. 269F). Once an application is accepted, the CEO is required to publish a notice in the Gazette, inviting any interested parties to submit objections or submissions against the TCO (s. 269K(1)). In this case, the CEO did not receive any submissions against the application (Explanatory Statement). The TCO itself sets out the specific goods subject to the concession and the applicable rate of duty, which in this instance is 0% for certain sweepers, cleaners, and scrubbers (Instrument TCO No. 0616811).
The Customs Act 1901 does not explicitly state specific offences, penalties, or consequences for breaches related to the issuance or non-compliance with a TCO. However, general provisions within the Customs Act may apply. For instance, any breaches of the Act or regulations could result in civil or criminal penalties, including fines and imprisonment, depending on the severity of the offence. The maximum penalties for breaches of customs-related laws can be significant, reflecting the importance of compliance with customs regulations. The specifics of penalties would be determined by the courts based on the particulars of the case and applicable laws at the time of the breach.